Economy

SEOUL, Nov. 7 (UPI) — After the inauguration of the Donald Trump in January, the South Korean government and its corporations were pressed to invest hundreds of billions of dollars in the United States to avoid high tariffs.

Observers expressed concern Friday that such large-scale overseas investments could end up harming Asia’s fourth-largest economy, which heavily depends on the manufacturing industry.

Late last month, Seoul agreed to invest $200 billion in cash and $150 billion in shipbuilding and other industrial projects in the United States over the coming years, with an annual ceiling of $20 billion.

In return, Washington would reduce tariffs on Korean exports to 15% from 25%, honoring the terms agreed upon in late July. Trump also vowed to provide propulsion technology to help the key U.S. ally in East Asia build a nuclear-powered submarine.

The deal coincided with Trump’s visit to Korea to meet his counterpart, President Lee Jae Myung, on the sidelines of the Asia-Pacific Economic Cooperation Summit.

“Beginning next year, our annual investments in the United States are expected to double compared to 2025. When corporate funds move abroad, companies will have less capacity to invest at home,” Sogang University economics Professor Hur Jung told UPI.

“The problem is that it appears to become a long-term trend, which is feared to lead to the hollowing out of Korea’s manufacturing sector. The government is required to put forth great efforts to address this,” he said.

Hur recommended the country to prioritize traditional industries, such as semiconductors and automobiles, rather than concentrate on artificial intelligence-based innovations, which have been the main focus of the incumbent Seoul administration.

Other analysts note that the worries go beyond the $350 billion investment plan, as many Korean corporations have announced major spending initiatives in the United States to avoid high tariffs.

For example, Korea’s state-backed companies and private enterprises promised up to $150 billion in investments in the United States in August, when Lee had his first summit with Trump.

Back then, Hyundai Motor Group unveiled a plan to funnel $26 billion in the United States until 2028, while Hanwha Group committed $5 billion to expand its shipyard in Philadelphia, which the Korean conglomerate acquired late last year.

Korean Air also plans to purchase 103 aircraft from Boeing by the end of the 2030s, which is expected to total $36.2 billion in value.

“Korea Inc. invested $106 billion in domestic facilities last year. And its companies are now ready to spend $150 billion in the United States alone after a single meeting between the two countries’ political leaders in August. Does it make sense?” economic commentator Kim Kyeong-joon, formerly vice chairman at Deloitte Consulting Korea, asked rhetorically in a phone interview.

“Our foreign exchange reserves stand at just over $400 billion, and we are preparing to pour more than that amount into a single foreign market. Such an approach could weaken our ability to invest domestically, weighing heavily on the manufacturing-based economy,” he said.

According to the Organization for Economic Cooperation and Development, manufacturing accounts for 27% of South Korea’s gross domestic product, which is almost double the average among other member countries.

Against this backdrop, the Ministry of Trade, Industry and Resources is set to establish a forum involving related researchers and businesses to deal with the expected crisis. The Bank of Korea also warned of the gravity of the situation in an August report.

“As in past crises, our corporations, the government and households need to share a sense of urgency and work together to overhaul the country’s aging economic structure,” the central bank said at the time.

However, critics take issue with the complacency of top policymakers like Kim Yong-beom, chief presidential secretary for policy in the current administration, who downplayed fears about the hollowing out of the domestic manufacturing sector.

“Such assessments may be premature because many partner firms and key operations, including research and development centers, still remain based in Korea,” Kim told a conference in early September.

Shareholders approved the pay package with as much as 75 percent support on Thursday.

Tesla CEO Elon Musk has scored a resounding victory as shareholders have approved a pay package of as much as $878bn over the next decade, endorsing his vision of morphing the electric vehicle (EV) maker into an AI and robotics juggernaut.

Shares of Tesla rose more than 3 percent in after-hours trading after the shareholders voted on Thursday. The proposal was approved with more than 75 percent support.

Musk took to the stage in Austin, Texas, along with dancing robots. “What we are about to embark upon is not merely a new chapter of the future of Tesla, but a whole new book,” he said. “This really is going to be quite the story.”

He added: “Other shareholder meetings are like snooze fests, but ours are bangers. I mean, look at this. This is sick.”

Shareholders also re-elected three directors on Tesla’s board and voted in favour of a replacement pay plan for Musk’s services because a legal challenge has held up a previous package.

The vote, analysts have said, is a positive for Tesla’s stock, whose valuation hangs on Musk’s vision of making vehicles drive themselves, expanding robotaxis across the United States and selling humanoid robots, even though his far-right political rhetoric has hurt the Tesla brand this year.

A win for Musk was widely expected as the billionaire was allowed to exercise the full voting rights of his roughly 15 percent stake after the carmaker moved to Texas from Delaware, where a legal challenge has held up a previous pay rise.

The approval comes even after opposition from some major investors, including Norway’s sovereign wealth fund.

Tesla’s board had said Musk could quit if the pay package was not approved.

The vote will also allay investor concerns that Musk’s focus has been diluted with his work in politics as well as in running his other companies, including rocket maker SpaceX and artificial intelligence startup xAI.

The board and many investors who lent their endorsement have said the nearly $1 trillion package benefits shareholders in the longer run, as Musk must ensure Tesla achieves a series of milestones to get paid.

Goals for Musk over the next decade include the company delivering 20 million vehicles, having one million robotaxis in operation, selling one million robots and earning as much as $400bn in core profit. But in order for him to get paid, Tesla’s stock value has to rise in tandem, first to $2 trillion from the current $1.5 trillion, and all the way to $8.5 trillion.

Under the new plan, Musk could earn as much as $878bn in Tesla stock over 10 years. Musk would be given as much as $1 trillion in stock but would have to make some payments back to Tesla.

The DOJ argued that the federal judge did not have the authority to make the decision.

A United States judge in Texas has approved the Department of Justice’s request to dismiss a criminal case against Boeing despite his objections to the decision.

On Thursday, Judge Reed O’Connor of the US District Court in Fort Worth dismissed the case, which will allow the plane maker to avoid prosecution over charges related to two deadly 737 MAX crashes: the 2018 Lion Air crash in Indonesia and the 2019 Ethiopian Airlines crash.

O’Connor said he disagreed with the Justice Department’s argument that ending the case served the public interest, noting that he lacked the authority to overrule it.

The government argued Boeing has improved, and the Federal Aviation Administration (FAA) is providing enhanced oversight. Boeing and the government argued O’Connor had no choice but to dismiss the case.

He said the deal with the aerospace giant “fails to secure the necessary accountability to ensure the safety of the flying public”.

In September, O’Connor held a three-hour hearing to consider objections to the deal, questioning the government’s decision to drop a requirement that Boeing face oversight from an independent monitor for three years and instead hire a compliance consultant.

O’Connor said the government’s position is “Boeing committed crimes sufficient to justify prosecution, failed to remedy its fraudulent behaviour on its own during the [deferred prosecution agreement], which justified a guilty plea and the imposition of an independent monitor, but now Boeing will remedy that dangerous culture by retaining a consultant of its own choosing”.

The DOJ first criminally charged Boeing for the crashes in January 2021, but also agreed to deferred prosecution in the case.

The plane maker was charged with one count of conspiracy to defraud the US. Courts found that Boeing deceived the FAA about what is called the manoeuvring characteristics augmentation system, which affects flight control systems on the aircraft.

“Boeing’s employees chose the path of profit over candor by concealing material information from the FAA concerning the operation of its 737 Max airplane and engaging in an effort to cover up their deception,” acting Assistant Attorney General David P Burns of the DOJ’s criminal division said in a statement at the time.

O’Connor said in 2023 that “Boeing’s crime may properly be considered the deadliest corporate crime in US history”.

Under the non-prosecution deal, Boeing agreed to pay an additional $444.5m into a crash victims’ fund to be divided evenly per victim of the two fatal 737 MAX crashes, on top of a new $243.6m fine and more than $455m to strengthen the company’s compliance, safety, and quality programmes.

On Wall Street, Boeing’s stock was up by 0.2 percent as of 11am in New York (16:00 GMT).

A months-long siege on the Malian capital, Bamako, by the armed al-Qaeda affiliate group, Jama’at Nusrat al-Islam wal-Muslimin (JNIM), has brought the city to breaking point, causing desperation among residents and, according to analysts, placing increasing pressure on the military government to negotiate with the group – something it has refused to do before now.

JNIM’s members have created an effective economic and fuel blockade by sealing off major highways used by tankers to transport fuel from neighbouring Senegal and the Ivory Coast to the landlocked Sahel country since September.

While JNIM has long laid siege to towns in other parts of the country, this is the first time it has used the tactic on the capital city.

The scale of the blockade, and the immense effect it has had on the city, is a sign of JNIM’s growing hold over Mali and a step towards the group’s stated aim of government change in Mali, Beverly Ochieng, Sahel analyst with intelligence firm Control Risks, told Al Jazeera.

For weeks, most of Bamako’s residents have been unable to buy any fuel for cars or motorcycles as supplies have dried up, bringing the normally bustling capital to a standstill. Many have had to wait in long fuel queues. Last week, the United States and the United Kingdom both advised their citizens to leave Mali and evacuated non-essential diplomatic staff.

Other Western nations have also advised their citizens to leave the country. Schools across Mali have closed and will remain shut until November 9 as staff struggle to commute. Power cuts have intensified.

Here’s what we know about the armed group responsible and why it appears to have Mali in a chokehold:

What is JNIM?

JNIM is the Sahel affiliate of al-Qaeda and the most active armed group in the region, according to conflict monitor ACLED. The group was formed in 2017 as a merger between groups that were formerly active against French and Malian forces that were first deployed during an armed rebellion in northern Mali in 2012. They include Algeria-based al-Qaeda in the Maghreb (AQIM) and three Malian armed groups – Ansar Dine, Al-Murabitun and Katiba Macina.

JNIM’s main aim is to capture and control territory and to expel Western influences in its region of control. Some analysts suggest that JNIM may be seeking to control major capitals and, ultimately, to govern the country as a whole.

It is unclear how many fighters the group has. The Washington Post has reported estimates of about 6,000, citing regional and western officials.

However, Ulf Laessing, Sahel analyst at the German think tank, Konrad Adenauer Stiftung (KAS), said JNIM most likely does not yet have the military capacity to capture large, urban territories that are well protected by soldiers. He also said the group would struggle to appeal to urban populations who may not hold the same grievances against the government as some rural communities.

While JNIM’s primary base is Mali, KAS revealed in a report that the group has Algerian roots via its members of the Algeria-based al-Qaeda in the Maghreb (AQIM).

The group is led by Iyad Ag-Ghali, a Malian and ethnic Tuareg from Mali’s northern Kidal region who founded Ansar Dine in 2012. That group’s stated aim was to impose its interpretation of Islamic law across Mali.

Ghali had previously led Tuareg uprisings against the Malian government, which is traditionally dominated by the majority Bambara ethnic group, in the early 1990s, demanding the creation of a sovereign country called Azawad.

However, he reformed his image by acting as a negotiator between the government and the rebels. In 2008, he was posted as a Malian diplomat to Saudi Arabia under the government of Malian President Amadou Toumani Toure. When another rebellion began in 2012, however, Ghali sought a leadership role with the rebels but was rebuffed, leading him to create Ansar Dine.

According to the US Department of National Intelligence (DNI), Ghali has stated that JNIM’s strategy is to expand its presence across West Africa and to put down government forces and rival armed groups, such as the Mali-based Islamic State Sahel, through guerrilla-style attacks and the use of improvised explosive devices (IEDs).

Simultaneously, it attempts to engage with local communities by providing them with material resources. Strict dress codes and bans on music are common in JNIM-controlled areas.

JNIM also destroys infrastructure, such as schools, communication towers and bridges, to weaken the government off the battlefield.

An overall death toll is unclear, but the group has killed thousands of people since 2017. Human rights groups accuse it of attacking civilians, especially people perceived to be assisting government forces. JNIM activity in Mali caused 207 deaths between January and April this year, according to ACLED data.

How has JNIM laid siege to Bamako?

JNIM began blocking oil tankers carrying fuel to Bamako in September.

That came after the military government in Bamako banned small-scale fuel sales in all rural areas – except at official service stations – from July 1. Usually, in these areas, traders can buy fuel in jerry cans, which they often resell later.

The move to ban this was aimed at crippling JNIM’s operations in its areas of control by limiting its supply lines and, thus, its ability to move around.

At the few places where fuel is still available in Bamako, prices soared last week by more than 400 percent, from $25 to $130 per litre ($6.25-$32.50 per gallon). Prices of transportation, food and other commodities have risen due to the crisis, and power cuts have been frequent.

Some car owners have simply abandoned their vehicles in front of petrol stations, with the military government threatening on Wednesday to impound them to ease traffic and reduce security risks.

A convoy of 300 fuel tankers reached Bamako on October 7, and another one with “dozens” of vehicles arrived on October 30, according to a government statement. Other attempts to truck in more fuel have met obstacles, however, as JNIM members ambush military-escorted convoys on highways and shoot at or kidnap soldiers and civilians.

Even as supplies in Bamako dry up, there are reports of JNIM setting fire to about 200 fuel tankers in southern and western Mali. Videos circulating on Malian social media channels show rows of oil tankers burning on a highway.

What is JNIM trying to achieve with this blockade?

Laessing of KAS said the group is probably hoping to leverage discontent with the government in the already troubled West African nation to put pressure on the military government to negotiate a power-sharing deal of sorts.

“They want to basically make people as angry as possible,” he said. “They could [be trying] to provoke protests which could bring down the current government and bring in a new one that’s more favourable towards them.”

Ochieng of Control Risks noted that, in its recent statements, JNIM has explicitly called for government change. While the previous civilian government of President Ibrahim Boubacar Keita (2013-2020) had negotiated with JNIM, the present government of Colonel Assimi Goita will likely keep up its military response, Ochieng said.

Frustration at the situation is growing in Bamako, with residents calling for the government to act.

Speaking to Al Jazeera, driver Omar Sidibe said the military leaders ought to find out the reasons for the shortage and act on them. “It’s up to the government to play a full role and take action [and] uncover the real reason for this shortage.”

Which parts of Mali is the JNIM active in?

In Mali, the group operates in rural areas of northern, central and western Mali, where there is a reduced government presence and high discontent with the authorities among local communities.

In the areas it controls, JNIM presents itself as an alternative to the government, which it calls “puppets of the West”, in order to recruit fighters from several ethnic minorities which have long held grievances over their perceived marginalisation by the government, including the Tuareg, Arab, Fulani, and Songhai groups. Researchers note the group also has some members from the majority Bambara group.

In central Mali, the group seized Lere town last November and captured the town of Farabougou in August this year. Both are small towns, but Farabougou is close to Wagadou Forest, a known hiding place of JNIM.

JNIM’s hold on major towns is weaker because of the stronger government presence in larger areas. It therefore more commonly blockades major towns or cities by destroying roads and bridges leading to them. Currently, the western cities of Nioro and gold-rich Kayes are cut off. The group is also besieging the major cities of Timbuktu and Gao, as well as Menaka and Boni towns, located in the north and northeast.

How is JNIM funded?

For revenue, the group oversees artisanal gold mines, forcefully taxes community members, smuggles weapons and kidnaps foreigners for ransom, according to the US DNI. Kayes region, whose capital, Kayes, is under siege, is a major gold hub, accounting for 80 percent of Mali’s gold production, according to conflict monitoring group Critical Threats.

The Global Initiative Against Transnational Organised Crime (Gi-Toc) also reports cattle rustling schemes, estimating that JNIM made 91,400 euros ($104,000) in livestock sales of cattle between 2017 and 2019. Cattle looted in Mali are sold cheaply in communities on the border with Ghana and the Ivory Coast, through a complex chain of intermediaries.

In which other countries is JNIM active?

JNIM expanded into Burkina Faso in 2017 by linking up with Burkina-Faso-based armed group Ansarul-Islam, which pledged allegiance to the Malian group. Ansarul-Islam was formed in 2016 by Ibrahim Dicko, who had close ties with Amadou Koufa, JNIM’s deputy head since 2017.

In Burkina Faso, JNIM uses similar tactics of recruiting from marginalised ethnic groups. The country has rapidly become a JNIM hotspot, with the group operating – or holding territory – in 11 of 13 Burkina Faso regions outside of capital Ouagadougou. There were 512 reported casualties as a result of JNIM violence in the country between January and April this year. It is not known how many have died as a result of violence by the armed group in total.

Since 2022, JNIM has laid siege to the major northern Burkinabe city of Djibo, with authorities forced to airlift in supplies. In a notable attack in May 2025, JNIM fighters overran a military base in the town, killing approximately 200 soldiers. It killed a further 60 in Solle, about 48km (30 miles) west of Djibo.

In October 2025, the group temporarily took control of Sabce town, also located in the north of Burkina Faso, killing 11 police officers in the process, according to the International Crisis Group.

In a September report, Human Rights Watch said JNIM and a second armed group – Islamic State Sahel, which is linked to ISIL (ISIS) – massacred civilians in Burkina Faso between May and September, including a civilian convoy trying to transport humanitarian aid into the besieged northern town of Gorom Gorom.

Meanwhile, JNIM is also moving southwards, towards other West African nations with access to the sea. It launched an offensive on Kafolo town, in northern Ivory Coast, in 2020.

JNIM members embedded in national parks on the border regions with Burkina Faso have been launching sporadic attacks in northern Togo and the Benin Republic since 2022.

In October this year, it recorded its first attack on the Benin-Nigeria border, where one Nigerian policeman was killed. The area is not well-policed because the two countries have no established military cooperation, analyst Ochieng said.

“This area is also quite a commercially viable region; there are mining and other developments taking place there … it is likely to be one that [JNIM] will try to establish a foothold,” she added.

Why are countries struggling to fend off JNIM?

When Mali leader General Assimi Goita led soldiers to seize power in a 2020 coup, military leaders promised to defeat the armed group, as well as a host of others that had been on the rise in the country. Military leaders subsequently seizing power from civilian governments in Burkina Faso (2022) and in Niger (2023) have made the same promises.

However, Mali and its neighbours have struggled to hold JNIM at bay, with ACLED data noting the number of JNIM attacks increasing notably since 2020.

In 2022, Mali’s military government ended cooperation with 4,000-strong French forces deployed in 2013 to battle armed groups which had emerged at the time, as well as separatist Tuaregs in the north. The last group of French forces exited the country in August 2022.

Mali also terminated contracts with a 10,000-man UN peacekeeping force stationed in the country in 2023.

Bamako is now working with Russian fighters – initially 1,500 from the Wagner Mercenary Group, but since June, from the Kremlin-controlled Africa Corps – estimated to be about 1,000 in number.

Russian officials are, to a lesser extent, also present in Burkina Faso and Niger, which have formed the Alliance of Sahel States (AES) with Mali.

Results in Mali have been mixed. Wagner supported the Malian military in seizing swaths of land in the northern Kidal region from Tuareg rebels.

But the Russians also suffered ambushes. In July 2024, a contingent of Wagner and Malian troops was ambushed by rebels in Tinzaouaten, close to the Algerian border. Between 20 and 80 Russians and 25 to 40 Malians were killed, according to varying reports. Researchers noted it was Wagner’s worst defeat since it had deployed to West Africa.

In all, Wagner did not record much success in targeting armed groups like JNIM, analyst Laessing told Al Jazeera.

Alongside Malian forces, the Russians have also been accused by rights groups of committing gross human rights violations against rural communities in northern Mali perceived to be supportive of armed groups.

Could the Russian Africa Corps fighters end the siege on Bamako?

Laessing said the fuel crisis is pressuring Mali to divert military resources and personnel to protect fuel tankers, keeping them from consolidating territory won back from armed groups and further endangering the country.

He added that the crisis will be a test for Russian Africa Corp fighters, who have not proven as ready as Wagner fighters to take battle risks. A video circulating on Russian social media purports to show Africa Corps members providing air support to fuel tanker convoys. It has not been verified by Al Jazeera.

“If they can come in and allow the fuel to flow into Bamako, then the Russians will be seen as heroes,” Laessing said – at least by locals.

Laessing added that the governments of Mali and Burkina Faso, in the medium to long term, might eventually have to negotiate with JNIM to find a way to end the crisis.

While Goita’s government has not attempted to hold talks with the group in the past, in early October, it greenlit talks led by local leaders, according to conflict monitoring group Critical Threats – although it is unclear exactly how the government gave its approval.

Agreements between the group and local leaders have reportedly already been signed in several towns across Segou, Mopti and Timbuktu regions, in which the group agrees to end its siege in return for the communities agreeing to JNIM rules, taxes, and noncooperation with the military.

The agency made the announcement as it confronts staffing shortages caused by air traffic controllers who are working unpaid.

The United States Federal Aviation Administration (FAA) will reduce air traffic by 10 percent across 40 “high-volume” markets beginning Friday morning to maintain safety during the ongoing government shutdown, it has said.

The agency made the announcement on Wednesday as it confronts staffing shortages caused by air traffic controllers, who are working unpaid, with some calling out of work during the shutdown, resulting in delays across the country.

FAA Administrator Bryan Bedford said the agency is not going to wait for a problem to act, saying the shutdown is causing staffing pressures and “we can’t ignore it”.

Bedford and Transportation Secretary Sean Duffy said they will meet later Wednesday with airline leaders to figure out how to safely implement the reduction.

Widespread delays

The shutdown, now in its 36th day, has forced 13,000 air traffic controllers and 50,000 Transportation Security Administration officers to work without pay. This has worsened staff shortages, caused widespread flight delays and extended lines at airport security screening.

The move is aimed at taking pressure off air traffic controllers. The FAA also warned that it could add more flight restrictions after Friday if further air traffic issues emerge.

Duffy had warned on Tuesday that if the federal government shutdown continued another week, it could lead to “mass chaos” and force him to close some of the national airspace to air traffic, a drastic move that could upend American aviation.

Airlines have repeatedly urged an end to the shutdown, citing aviation safety risks.

Shares of major airlines, including United Airlines and American Airlines, were down about 1 percent in extended trading.

An airline industry group estimated that more than 3.2 million passengers have been affected by flight delays or cancellations due to rising air traffic controller absences since the shutdown began on October 1. Airlines have been raising concerns with lawmakers about the impact on operations.

Airlines said the shutdown has not significantly affected their business, but have warned bookings could drop if it drags on. More than 2,100 flights were delayed on Wednesday.

On Tuesday, FAA’s Bedford said that 20 percent to 40 percent of controllers at the agency’s 30 largest airports were failing to show up for work.

The federal government has mostly closed as Republicans and Democrats are locked in a standoff in Congress over a funding bill. Democrats have insisted they would not approve a plan that does not extend health insurance subsidies, while Republicans have rejected that.

There have already been numerous flight delays as the FAA slows down or stops traffic when it is short of controllers.

United States Transportation Secretary Sean Duffy has said that there could be chaos in the skies next week if the government shutdown drags on and air traffic controllers miss a second paycheck.

Duffy made his comments on Tuesday as the US government shutdown dragged into its 35th day, matching the shutdown in US President Donald Trump’s first term as president and which was the longest at the time.

There have already been numerous delays at airports across the country — sometimes hours long — because the Federal Aviation Administration slows down or stops traffic temporarily anytime it is short on controllers. Last weekend saw some of the worst staff shortages, and on Sunday, flights at Newark Liberty International Airport in New Jersey were delayed for several hours.

Duffy and the head of the air traffic controllers union have both warned that the situation will only get worse the longer the shutdown continues and the financial pressure continues to grow on people who are forced to work without pay. FAA employees already missed one paycheck on October 28. Their next payday is scheduled for next Tuesday.

“Many of the controllers said, ‘A lot of us can navigate missing one paycheck. Not everybody, but a lot of us can. None of us can manage missing two paychecks,’” Duffy said. “So if you bring us to a week from today, Democrats, you will see mass chaos. You will see mass flight delays. You’ll see mass cancellations, and you may see us close certain parts of the airspace, because we just cannot manage it, because we don’t have air traffic controllers.”

Most of the flight disruptions so far during the shutdown have been isolated and temporary. But if delays become more widespread and start to ripple throughout the system, the pressure will mount on US Congress to reach an agreement to end the shutdown.

Normally, airlines strive to have at least 80 percent of their flights depart and arrive within 15 minutes of when they are scheduled. Aviation analytics firm Cirium said that since the shutdown began on October 1, the total number of delays overall has not fallen significantly below that goal because most of the disruptions so far have been no worse than what happens when a major thunderstorm moves across an airport.

But on Sunday, only about 56 percent of Newark’s departures were on time, and the Orlando airport reported that only about 70 percent of its flights were on time, according to Cirium.

As of midday Tuesday, there have been 1,932 flight delays reported across the US, according to www.FlightAware.com. That is lower than what is typical, although the FAA did say that flights in Phoenix were being delayed on Tuesday morning because of staffing shortages. Strong winds are also causing delays at the Newark and LaGuardia airports on Tuesday.

Starbucks has announced it will sell the majority stake in its Chinese business for $4bn to a Hong Kong-based private equity firm after years of losing market share to local competitors in China.

Starbucks announced the sale on Monday, which will see the firm Boyu Capital take a 60 percent stake in its Chinese retail operations through a joint venture.

Boyu Capital has offices in Shanghai, Beijing and Singapore, and its cofounders include Alvin Jiang, the grandson of former Chinese President Jiang Zemin, according to the Reuters news agency.

The US coffee giant will retain a 40 percent interest in its China operations while maintaining its ownership of the company’s brand and intellectual property, the company said.

The deal marks a “new chapter” in Starbucks’s 26-year-long history in China, the company said in a statement.

It will also give Starbucks a much-needed injection of funding and logistical support as it tries to expand its business deeper into China, according to Jason Yu, the Shanghai-based managing director of CTR Market Research.

Starbucks has 8,000 locations across China, but it aspires to open as many as 20,000 through its joint venture, the company said in a statement.

“Starbucks used to be a pioneer in coffee in China, where it was probably the first coffee chain in many cities, but this is no longer the case as the local competition already outpaced Starbucks in their expansion,” Yu told Al Jazeera.

Top competitors include homegrown Luckin Coffee, which has more than 26,000 locations worldwide, mostly in China.

Starbucks has historically been concentrated in first- and second-tier cities like Shanghai, Beijing and Shenzhen while Luckin has expanded into much smaller cities.

Luckin has also built a reputation around offering customers much cheaper drinks than Starbucks through its loyalty programme and in-app discounts.

A small Americano coffee at Starbucks costs 30 yuan ($4.21), but at Luckin, the same drink retails on average for about 10 yuan ($1.40), according to Yu.

Olivia Plotnick, founder of the Shanghai-based social marketing company Wai Social, told Al Jazeera that Starbucks has been unable to keep up with competitive pricing and consumer preferences.

“Between domestic players such as Luckin and later Cotti Coffee undercutting Starbucks on price, footprint and flavour fuelled by tech, wider beverage competition from the rise of milk tea brands and delivery platform wars, Starbucks have lost their once very competitive edge,” Plotnick said. By “delivery platform wars”, Plotnick referred to the cutthroat competition between apps for delivery services that drives down prices of goods like coffee.

Starbucks’s joint venture with Boyu Capital will offer the company more capital for investment but also help with logistics, infrastructure and managing commercial property as it opens more storefronts in regional cities, Yu said.

The company is following a familiar playbook used by other international brands in China, he said.

In 2016, after a major food safety scandal, KFC and Pizza Hut owner Yum Brands sold a stake in their China business to the China-based Primavera Capital and an affiliate of the e-commerce giant Alibaba Group, according to Reuters. The China business was later spun off into an independent entity.

In 2017, McDonald’s sold off a majority stake in its China, Hong Kong and Macau businesses to the Chinese state-backed conglomerate CITIC and the private equity group Carlyle Capital although it later bought back some of its business, according to CNBC.

After the deal with CITIC, McDonald’s doubled its outlets in China to 5,500 as of late 2023, CNBC said, and aims to open 10,000 restaurants by 2028.

The announcement comes less than week after Amazon laid off 14,000 people.

OpenAI has signed a new deal valued at $38bn with Amazon that will allow the artificial intelligence giant to run AI workloads across Amazon Web Services (AWS) cloud infrastructure.

The seven-year deal announced on Monday is the first big AI push for the e-commerce giant after a restructuring last week.

The new deal will give the ChatGPT maker access to thousands of Nvidia graphics processors to train and run its artificial intelligence models.

Experts say this does not mean that it will allow OpenAI to train its model on websites hosted by AWS – which includes the websites of The New York Times, Reddit and United Airlines.

“Running OpenAI training inside AWS doesn’t change their ability to scrape content from AWS-hosted websites [which they could already do for anything publicly readable]. This is strictly speaking about the economics of rent vs buy for GPU [graphics processing unit] capacity,” Joshua McKenty, CEO of the AI detection company PolyguardAI, told Al Jazeera.

The deal is also a major vote of confidence for the e-commerce giant’s cloud unit, AWS, which some investors feared had fallen behind rivals Microsoft and Google in the artificial intelligence (AI) race. Those fears were somewhat eased by the strong growth the business reported in the September quarter.

OpenAI will begin using AWS immediately, with all planned capacity set to come online by the end of 2026 and room to expand further in 2027 and beyond.

Amazon plans to roll out hundreds of thousands of chips, including Nvidia’s GB200 and GB300 AI accelerators, in data clusters built to power ChatGPT’s responses and train OpenAI’s next wave of models, the companies said.

Amazon already offers OpenAI models on Amazon Bedrock, which offers multiple AI models for businesses using AWS.

OpenAI’s sweeping restructuring last week moved it further away from its non-profit roots and also removed Microsoft’s first right to refusal to supply services in the new arrangement.

Image hurdles

Amazon’s announcement about an investment in AI comes only days after the company laid off 14,000 people despite CEO Andy Jassy’s comment in an earnings call on Thursday saying the layoffs were not driven by AI.

“The announcement that we made a few days ago was not really financially driven, and it’s not even really AI-driven, not right now at least,” Jassy said.

OpenAI CEO Sam Altman has said the startup is committed to spending $1.4 trillion to develop 30 gigawatts of computing resources – enough to roughly power 25 million United States homes.

“Scaling frontier AI requires massive, reliable compute,” said Altman. “Our partnership with AWS strengthens the broad compute ecosystem that will power this next era and bring advanced AI to everyone.”

This comes amid growing concerns about the sheer amount of energy demand that AI data centres need to operate. The Lawrence Berkeley National Laboratory estimates that AI data centres will use up to 12 percent of US electricity by 2028.

An AP/NORC poll from October found that 41 percent of Americans are extremely concerned about AI’s impact on the environment, while another 30 percent say they are somewhat concerned as the industry increases its data centre footprint around the US.

Signs of a bubble

Surging valuations of AI companies and their massive spending commitments, which total more than $1 trillion for OpenAI, have raised fears that the AI boom may be turning into a bubble.

OpenAI has already tapped Alphabet’s Google to supply it with cloud services, as Reuters reported in June. It also reportedly struck a deal to buy $300bn in computing power for about five years.

While OpenAI’s relationship with Microsoft, which the two forged in 2019, has helped push Microsoft to the top spot among its Big Tech peers in the AI race, both companies have been making moves recently to reduce reliance on each other.

Neither OpenAI nor Amazon were immediately available for comment.

On Wall Street, Amazon’s stock is surging on the news of the new deal. As of 11:15am in New York (16:15 GMT), it is up by 4.7 percent.

Relations nosedived in 2018 after Canada arrested a senior Huawei executive and have remained rocky ever since.

The leaders of China and Canada have taken a step towards mending the long-fractured ties between their countries with a meeting in South Korea during the Asia-Pacific Economic Summit.

Chinese President Xi Jinping and Canadian Prime Minister Mark Carney met on Friday and called for improving ties in a pragmatic and constructive manner, according to both sides.

“The leaders agreed that their meeting marked a turning point in the bilateral relationship,” a Canadian statement said.

Xi was quoted as saying that relations are showing signs of recovery, thanks to the joint efforts of both sides.

“We are willing to work together with Canada to take this meeting as an opportunity to promote the return of bilateral relations to a healthy, stable and sustainable track as soon as possible,” Xi said, according to an official report distributed by China’s state media.

Carney, who became prime minister in March, accepted an invitation from Xi to visit China, the Canadian statement said, without specifying any date.

Carney also later told reporters he was “very pleased” with the outcome.

“We now have a turning point in the relationship, a turning point that creates opportunities for Canadian families, for Canadian businesses and Canadian workers, and also creates a path to address current issues,” he said.

“The meeting signals a change in tone and an openness to relations at the highest levels, but this is not a return to strategic partnership,” said Vina Nadjibulla, vice president of the Asia Pacific Foundation of Canada. “Canada needs to proceed with caution because there’s nothing to suggest the Chinese Communist Party’s actions have changed since the prime minister named China as a foreign security threat.”

She said Carney should keep talking with Chinese leaders but stay mindful of China’s threats to Canada’s security interests, including its efforts to play a greater role in Arctic affairs.

Shaky relations

Relations took a nosedive in late 2018 after Canadian authorities arrested a senior executive of Chinese tech giant Huawei as part of its extradition agreement with the United States. China then arrested two Canadian citizens and charged them with espionage.

Ties did not improve much even after the 2021 release of the two Canadians, Michael Kovrig and Michael Spavor, and the Chinese executive, Meng Wanzhou, who is the daughter of Huawei’s founder.

More recently, relations have been shaken by Canada’s decision to levy a 100 percent tariff on electric vehicles (EVs) from China in 2024 and a 25 percent tariff on steel and aluminium. China retaliated with its own steep tariffs on canola, seafood and pork, and has offered to remove some of those import taxes if Canada drops the EV tariff.

Canada made the move last in tandem with the US.

The Canadian statement said that both leaders directed their officials to move quickly to resolve trade issues and irritants and discussed solutions for specific products such as EVs, canola and seafood.

Xi called for expanding “pragmatic” cooperation in areas such as the economy, trade and energy. Both Canada and China have been hit by tariffs imposed by US President Donald Trump.

The attempt at rapprochement comes as Carney looks to diversify Canada’s trade away from the US and as Trump says he plans to raise tariffs on imports of Canadian goods by an extra 10 percent. Canada’s free trade agreement with the US is up for review.

Earlier on Friday, Carney told a business event that the world of rules-based liberalised trade and investment had passed, adding that Canada aimed to double its non-US exports over the next decade.

Nadjibulla said China should not be viewed as the solution to Canada’s issues with the US, however.

“We should not diversify away from the US and go deeper into China,” she said. “Canada’s overdependence on both the US and China has been shown to be a vulnerability we cannot afford.”

Advocates say new rules let Education Department to politically punish groups working on immigration, transgender care.

The United States Department of Education has finalised new rules that could bar nonprofits deemed to have undertaken work with a “substantial illegal purpose” from a special student loan forgiveness programme.

Those rules, finalised on Thursday, appear to single out certain organisations that do work in areas that President Donald Trump politically opposes, including immigration advocacy and transgender rights.

Under the new rules, set to take effect in July 2026, the education secretary has the power to exclude groups if they engage in activities like the “chemical castration” of children, using a politically charged term for gender-affirming healthcare, including puberty-delaying medication.

It also allows the education secretary to bar groups accused of supporting undocumented immigration or “terrorist” organisations.

The Trump administration has said its decisions “will not be made based on the political views or policy preferences of the organization”.

But advocates fear the move is the administration’s latest effort to target left-leaning and liberal organisations.

Trump has already threatened to crack down on several liberal nonprofits, which the White House has broadly accused of being part of “domestic terror networks”.

Thursday’s rules concern the Public Service Loan Forgiveness programme, created by an act of Congress in 2007.

In an effort to direct more graduates into public service jobs, the programme promises to cancel federal student loans for government employees and many nonprofit workers after they have made 10 years of payments.

Workers in the public sector, including teachers, medical professionals, firefighters, social service professionals and lawyers, are among those who can benefit.

In a statement, the Trump administration defended the updated rules, calling them a necessary bulwark to protect taxpayer funds.

The programme “was meant to support Americans who dedicate their careers to public service – not to subsidize organizations that violate the law, whether by harboring illegal immigrants or performing prohibited medical procedures that attempt to transition children away from their biological sex”, said Education Undersecretary Nicholas Kent.

Critics, however, have denounced the administration for using false claims of “terrorism” or criminal behaviour to silence opposing views and restrict civil liberties.

Michael Lukens, executive director of the Amica Center for Immigrant Rights, said the new rules weaponised loan forgiveness.

Lukens explained that many of the lawyers, social workers and paralegals who work at his organisation handle cases to stop deportations and other immigration litigation.

They count on public service loan forgiveness to take jobs that pay significantly less than the private sector, he said.

“All of a sudden, that’s going away,” Lukens told The Associated Press news agency. “The younger generation, I hope, will be able to wait this out for the next couple of years to see if it gets better, but if it doesn’t, we’re going to see a lot of people leave the field to go and work in a for-profit space.”

Organisations have raised concerns over the education secretary’s broad power to determine if a group should be barred. Short of a legal finding, the secretary can decide based on a “preponderance of the evidence” whether an employer is in violation.

The National Council of Nonprofits was among the associations criticising the change.

It said the rules would allow future administrations from any political party to change eligibility rules “based on their own priorities or ideology”.

New York City, United States – Sitting in a room of hundreds of Jewish New Yorkers, Zohran Mamdani received cheers and applause at the Erev Rosh Hashanah service of progressive Brooklyn synagogue Kolot Chayeinu on a Monday evening last month.

This was one of the Democratic mayoral nominee’s recent appearances at synagogues and events over the Jewish High Holy Days, and a visible step towards navigating a politically charged line: increasingly engaging the largest concentration of Jewish people in any metropolitan area in the United States, and holding firmly anti-Zionist views before the general election on November 4.

Historically, Mamdani has held a strong stance on the Israeli–Palestinian conflict, even founding a chapter of Students for Justice in Palestine during his undergraduate days at Bowdoin College. A little more than a decade later, as Mamdani’s name began to gain recognition, his longstanding unapologetically pro-Palestinian stance became a rallying force behind his platform as well as a point of criticism from opponents.

Mamdani received endorsements and canvassing support from progressive Jewish organisations like Bend the Arc, Jewish Voice for Peace (JVP) Action and Jews for Racial and Economic Justice (JFREJ), organisations that have each confronted Israel’s role in the war in Gaza through statements on their websites.

Simultaneously, he has sustained attacks from far-right activists, Jewish Democrats on Capitol Hill and Zionist activist groups for his firm support for the Boycott, Divestment and Sanctions (BDS) movement and refusal to call Israel a Jewish state.

But despite mixed responses, the polls are clear: Mamdani is leading among Jewish voters overall in a multiway race.

‘No group is a monolith’

In July, a publicly released research poll by Zenith Research found that Mamdani led with a 17-point lead among Jews and by Jewish subgroups. In the scenario of Mayor Eric Adams dropping from the race, Mamdani still dominated, 43-33.

“Me being Jewish, I understand that there are many cleavages within the Jewish community,” said Adam Carlson, founding partner of Zenith Research. “As a pollster, one of my big things is that no group is a monolith, and if you have a large enough sample size, you can break it out and glean some nuances … what we found was a better-than-expected result for Mamdani among Jewish voters in New York City.”

Beth Miller, political director of the political advocacy organisation Jewish Voice for Peace (JVP) Action and a member of Kolot Chayeinu, shared what it was like to witness a fraction of this support at the Erev Rosh Hashanah that Mamdani attended last month.

“He was basically swarmed at the end because people were so excited that he was there,” said Miller. “And that’s not because he’s a celebrity, it’s because people are excited about what we can all build together if he becomes mayor.”

JVP Action, a day-one endorser of Mamdani, represents one organisation among a growing group of Jewish supporters for Mamdani, like JFREJ, a group that has played a part in spearheading canvassing efforts among the diverse Jewish communities of NYC.

JFREJ’s electoral arm, The Jewish Vote, has supported Mamdani since he was first running for state assembly in 2020. Since then, JFREJ members and Mamdani have worked, canvassed and protested together.

Alicia Singham Goodwin, political director of JFREJ, has personally been arrested at protests alongside Mamdani.

“That’s the kind of thing that gives me faith in his commitments,” Goodwin told Al Jazeera regarding the arrests. “He’s willing to take on big risks for the things that matter.”

JFREJ has played a large role in spreading Mamdani’s message by knocking on doors and phone banking Jewish voters.

“We care about what our neighbours are worried about, excited and hopeful for — what they need for their families, and we’re ready to meet them there with our analysis of how the city needs to move to get to affordable housing, universal childcare, or to combat the real rise in anti-Semitism and hate violence,” said Goodwin. “We believe that Zohran is the strongest candidate for that, as well as for all the other issues we talk about.”

Courting the Jewish vote

While there is no doubt that the canvassing army of 50,000 volunteers has served Mamdani well, the mayoral hopeful has also been strategic in his pursuit of the Jewish vote.

“He has definitely modulated his rhetoric and has made a concerted effort to reach out to liberal congregations,” said Val Vinokur, professor of literary studies and director of the minor in Jewish culture at The New School. “This has made him more palatable to some progressive Zionists, much to the outrage of his anti-Zionist supporters.”

One example of Mamdani’s subdued rhetoric includes his response to continued backlash over the phrase “globalise the intifada”.

The phrase, used by pro-Palestinian activists, sparked tension between Mamdani and parts of the Jewish community. To some, it represents a call for solidarity with Palestinian resistance, while others view it as anti-Semitic and violent.

Mamdani resisted rejecting the phrase before the June election, but The New York Times reported that since then, he said he would “discourage” its use.

On the second anniversary of the Gaza war, Mamdani posted a four-paragraph statement on X where he acknowledged the atrocities of Hamas’s attack, and then called Israel’s response genocide and ended on a note of commitment to human rights.

“It got s*** on from all sides,” said Carlson. “He made nobody happy, which in my mind, is kinda the correct way to go about it … Sometimes, pleasing nobody is the job of the mayor, and I think he’s learning that now. It’s like a microcosm of what he’s about to face as mayor, assuming he wins. Sometimes, you have to piss off everybody a little bit for compromises.”

Anti-Zionism and anti-Semitism

As Carlson’s Zenith Research poll reflected, the NYC Jewish community has a wide diversity of opinion about politics and positions on Israel and Palestine. The community most clearly differentiates along lines of age, and secular versus conservative practice, but as Jewish support for Mamdani increases, it is evident that these divides are not always so distinct.

“While it’s true that there are major trends that younger American Jews are more progressive and sympathetic to Palestinians, it’s also true that for as long as Zionism has existed, there have been anti-Zionist Jews,” said Miller. “I learned a lot from elders who were in their 70s, 80s and 90s who have been anti-Zionist since Israel was created because they never felt that what they wanted or needed was an ethnostate to represent them.”

Alternatively, Zionist groups like Betar worldwide are troubled by these trends within the Jewish community of New York.

“It’s heartbreaking to see members of the Jewish community support Zohran Mamdani, who openly opposes Zionism — the national liberation movement of the Jewish people,” said Oren Magnezy, spokesperson of Betar worldwide.

Jonathan Boyarin, American anthropologist and Mann professor of modern Jewish studies at Cornell University, wondered whether anti-Zionism has done much to help Palestinians, but distinguished the line that Mamdani is walking.

“It’s been said that there are two kinds of people who confuse anti-Zionism and anti-Semitism: Zionists and anti-Semites. I don’t think Zohran Mamdani belongs in either of those categories,” said Boyarin.

‘New political moment’

Ultimately, experts like Vinokur predict Mamdani will win, barring a scenario in which Republican nominee Curtis Sliwa drops out. Regardless, Vinokur expects Mamdani to secure the Jewish vote.

“He will win the Jewish vote despite and not because of his anti-Zionist background,” said Vinokur. “Younger Jewish voters are overwhelmingly liberal, have been galvanised by the dynamism of his campaign, and ultimately want to make the city a more livable, affordable, and equitable place.”

Mamdani’s message and campaign were celebrated at the JFREJ annual gala fundraiser, the Mazals. NYC Comptroller Brad Lander and Mamdani were honoured together during a night filled with music, ritual and tradition with more than 1,000 attendees.

“I would say it was probably the largest single gathering of Jews for Zohran,” said Goodwin. “They cement this new political moment that we’re in, where people like JFREJ members, movements like ours, are not fringe or aspirational, but we are popular among a majority of New Yorkers.”

The United States Federal Reserve has cut its benchmark interest rate by 25 basis points to 3.75 – 4.00 percent, amid signs of a slowing labour market and continued pressure on consumer prices.

The cut, announced on Wednesday, marks the US central bank’s second rate cut this year.

“Job gains have slowed this year, and the unemployment rate has edged up but remained low through August; more recent indicators are consistent with these developments. Inflation has moved up since earlier in the year and remains somewhat elevated,” the Fed said in a statement.

“Uncertainty about the economic outlook remains elevated.”

The cuts were largely in line with expectations. Earlier on Wednesday, CME Fed Watch — which tracks the likelihood of rate cuts — said there was a 97.8 percent probability of rate cuts.

After the September cut, economists had largely been expecting two additional rate cuts for the rest of this year. Goldman Sachs, Citigroup, HSBC, and Morgan Stanley, among others, forecast one more 25-basis-point reduction by year’s end following Wednesday’s cut. Bank of America Global Research is the only major firm that is not anticipating another 25-basis-point cut in 2025.

“The Fed has a challenging line to walk; lower interest rates to support labour markets and growth, or raise them to tamp down inflation. For now, they are taking a cautious approach tilted a bit towards the growth concerns,” Michael Klein, professor of international economic affairs at The Fletcher School at Tufts University in Massachusetts, told Al Jazeera.

Despite forecasts, Federal reserve chairman Jerome Powell isn’t necessarily inevitable.

“We haven’t made a decision about December,” Powell told reporters in a press conference.

“We remain well-positioned to respond in a timely way to potential economic developments.”

Government shutdown implications

The cuts come as economic data becomes increasingly scarce amid the ongoing government shutdown, now in its 29th day as of Wednesday, making it the second-longest in US history, behind the 35-day shutdown during the first presidency of Donald Trump in late 2018 and early 2019.

Because of the shutdown, the Department of Labor did not release the September jobs report, which was scheduled for October 3. The only major government economic data released this month was the Consumer Price Index (CPI), which tracks the cost of goods and services and is a key measure of inflation. The CPI rose 0.3 percent in September on a month-over-month basis to an inflation rate of 3 percent.

That data was released because the Social Security Administration required it to calculate cost-of-living adjustments for 2026. As a result, Social Security beneficiaries will receive a 2.8 percent increase in payments compared to 2025.

The shutdown, however, could have a bigger impact on next month’s central bank decision as the Labor Department is currently unable to compile the data needed for its November reports.

However, amid the limited government data, private trackers are showing a slowdown.

“We are not going to be able to have the detailed feel of things, but I think if there were a significant or material change in the economy one way or another, I think we would pick that up,” Powell said.

Consumer confidence lags

Consumer confidence fell to a six-month low, according to The Conference Board’s report that was released on Tuesday.

The data showed that lower-income earners – those making less than $75,000 a year – are less confident about the economy as fears of job scarcity loom. This comes only days after several large corporations announced waves of layoffs.

On Wednesday, Paramount cut 2,000 people from its workforce. On Tuesday, Amazon cut 14,000 corporate jobs. Last week, big box retailer Target cut 1,800 jobs. This, as furloughs and layoffs weigh on government workers. The US government is the nation’s largest employer.

Those making more than $200,000 annually remain fairly confident and are leading consumer spending that is keeping the economy afloat, according to The Conference Board.

Pressures both on consumer spending and the labour market are largely driven by tariffs weighing on consumers and businesses.

US markets are ticking up on the rate cut. The Nasdaq is up 0.5, the S&P 500 is up 0.1, and the Dow Jones Industrial Average is up by 0.26 as of 2pm in New York (18:00 GMT).

Gyeongju, South Korea – As US President Donald Trump and Chinese leader Xi Jinping prepare to meet for the first time since 2019, Washington and Beijing appear poised to reach a deal to lower the temperature of their fierce rivalry.

But while Trump and Xi are widely expected to de-escalate US-China tensions in South Korea on Thursday, expectations are modest for how far any agreement will go to resolve the myriad points of contention between the world’s two largest economies.

Many details of the expected deal that have been flagged in advance relate to avoiding future escalation, rather than rolling back the trade war that Trump launched during his first term and has dramatically expanded since returning to office this year.

Some of the proposed measures involve issues that have only arisen within the last few weeks, including China’s plan to impose strict export controls on rare earths from December 1.

Whatever Trump and Xi agree to on the sidelines of the Asia-Pacific Economic Cooperation (APEC) summit in Gyeongju, there is little doubt that Washington and Beijing will continue to butt heads as they jockey for influence in a rapidly shifting international order, according to analysts.

“I have modest expectations for this meeting,” said Deborah Elms, head of trade policy at the Hinrich Foundation in Singapore.

“I think, no matter what happens this week, we haven’t seen the end of economic tensions, tariff threats, export controls and restrictions, and the use of unusual levers like digital rules,” Elms told Al Jazeera.

Contours of a deal

While the exact parameters of any deal are still to be determined by Trump and Xi, the contours of an agreement have emerged in recent days.

US Secretary of the Treasury Scott Bessent said in media interviews this week that he expected China to defer its restrictions on rare earths and that Trump’s threatened 100 percent tariff on Chinese goods was “effectively off the table”.

Bessent said he also anticipated that the Chinese side would agree to increase purchases of US-grown soya beans, enhance cooperation with the US to halt the flow of chemicals used to manufacture fentanyl, and sign off on a finalised TikTok deal.

While heading off a further spiralling in US-China ties, a deal along these lines would leave intact a wide array of tariffs, sanctions and export controls that hinder trade and business between the sides.

Since Washington and Beijing reached a partial truce in their tit-for-tat tariff salvoes in May, the average US duty on Chinese goods has stood at more than 55 percent, while China’s average levy on US products has hovered at about 32 percent.

Washington has blacklisted hundreds of Chinese firms deemed to pose national security risks, and prohibited the export of advanced chips and key manufacturing equipment related to AI.

China has, in turn, added dozens of US companies to its “unreliable entity” list, launched antitrust investigations into Nvidia and Qualcomm, and restricted exports of more than a dozen rare earths and metallic elements, including gallium and dysprosium.

US-China trade has declined sharply since Trump re-entered the White House.

China’s exports to the US fell 27 percent in September, the sixth straight month of decline, even as outbound shipments rose overall amid expanding trade with Southeast Asia, Latin America, Europe and Africa.

China’s imports of US goods declined 16 percent, continuing a downward trend since April.

“The structural contradictions between China and the United States have not been resolved,” said Wang Wen, dean of the Chongyang Institute for Financial Studies at Renmin University of China in Beijing, predicting continuing friction and “even worse” relations between the superpowers in the future.

“Most importantly, China’s strength is increasing and will surpass that of the United States in the future,” Wang told Al Jazeera.

‘De-escalation unlikely’

Shan Guo, a partner with Shanghai-based Hutong Research, said he expects the “bulk” of the deal between Trump and Xi to be about avoiding escalation. “A fundamental de-escalation is unlikely given the political environment in the US,” Guo told Al Jazeera.

But with the US having no alternative to Chinese rare earths and minerals in the near-term, Washington and Beijing could put aside their differences for longer than past trade truces, Guo said.

“This means reduced downside risks in US-China relations for at least a year, or perhaps even longer,” he said.

Dennis Wilder, a professor at Georgetown University who worked on China at the CIA and the White House’s National Security Council, said that while he is optimistic the summit will produce “positive tactical results”, it will not mark the end of the trade war.

“A comprehensive trade deal is still not available,” Wilder told Al Jazeera.

“Bessent and his Chinese counterpart will continue negotiating in hopes of a more lasting agreement if and when President Trump visits China next year.”

Trump and Xi’s go-to language on the US-China relationship itself points to the gulf between the sides.

While Trump often complains about the US being “ripped off” by China, Xi has repeatedly called for their relations to be defined by “mutual respect” and “win-win cooperation”.

“The United States should treat China in a way that China considers respectful,” said Wang of Renmin University.

“They have to respect China, and if they don’t, then the United States will receive an equal response until they become able to respect others,” he added.

More air traffic controllers are calling in sick, often to work another job to pay for groceries and medicines.

United States air traffic controllers will miss their paycheques because of the ongoing government shutdown, raising concerns that mounting financial stress could take a toll on the already understaffed employees who guide thousands of flights each day.

Paycheques were due on Tuesday.

Flight delays are becoming more common across the country as more controllers call out sick because the Federal Aviation Administration (FAA) was already so short on controllers before the shutdown.

Transportation Secretary Sean Duffy and National Air Traffic Controllers Association President Nick Daniels have continued to emphasise the pressure that controllers are feeling. They say the problems are likely to only get worse the longer the shutdown continues.

Not only are controllers worrying about how to pay for their mortgages and groceries, but Daniels said some of them are also grappling with how to pay for the medicine needed to keep their children alive.

Duffy said he heard from one controller who had to tell his daughter she couldn’t join the travelling volleyball team she had earned a spot on because he couldn’t afford the cost during the shutdown.

“Air traffic controllers have to have 100 percent of focus 100 percent of the time,” Daniels said Tuesday at a news conference alongside Duffy at LaGuardia Airport in New York City. “And I’m watching air traffic controllers going to work. I’m getting the stories. They’re worried about paying for medicine for their daughter. I got a message from a controller that said, ‘I’m running out of money. And if she doesn’t get the medicine she needs, she dies. That’s the end.’”

The FAA restricts the number of flights landing and taking off at an airport anytime there is a shortage of controllers to ensure safety. Most of the time, that has meant delays — sometimes hours long — at airports like New Jersey’s Newark Liberty International Airport or Burbank Airport in California. But over the weekend, Los Angeles International Airport actually had to stop all flights for nearly two hours.

Controllers are planning to assemble outside at least 17 airports nationwide on Tuesday to hand out leaflets urging an end to the shutdown as soon as possible.

Money worries

The number of controllers calling in sick has increased during the shutdown – both because of their frustration with the situation and because controllers need the time off to work second jobs instead of continuing to work six days a week, as many of them routinely do. Duffy has said that controllers could be fired if they abuse their sick time, but the vast majority of them have continued to show up for work every day.

Air traffic controller Joe Segretto, who works at a regional radar facility that directs planes in and out of airports in the New York area, said morale is suffering as controllers worry more about money.

“The pressure is real,” Segretto said. “We have people trying to keep these planes safe. We have trainees — who are trying to learn a new job that is very fast-paced, very stressful, very complex — now having to worry about how they’re going to pay bills.”

Duffy said the shutdown is also making it harder for the government to reduce the longstanding shortage of about 3,000 controllers. He said that some students have dropped out of the air traffic controller academy in Oklahoma City, and younger controllers who are still training to do the job might abandon the career because they can’t afford to go without pay.

“This shutdown is making it harder for me to accomplish those goals,” Duffy said.

The longer the 27-day shutdown continues, the more pressure will continue to build on the US Congress to reach an agreement to reopen the government. During the 35-day shutdown in President Donald Trump’s first term, the disruptions to flights across the country contributed to the end of that disruption. But so far, Democrats and Republicans have shown little sign of reaching a deal to fund the government.

The deal removes a major constraint on raising capital for OpenAI, the maker of ChatGPT, and values the firm at $500bn.

Microsoft and OpenAI have reached a deal to allow the ChatGPT maker to restructure itself into a public-benefit corporation, valuing OpenAI at $500bn and giving it more freedom in its business operations.

The deal, unveiled on Tuesday, removes a major constraint on raising capital for OpenAI that has existed since 2019.

At the time, it had signed an agreement with Microsoft that gave the tech giant rights over much of OpenAI’s work in exchange for costly cloud computing services needed to carry it out. As its ChatGPT service exploded in popularity, those limitations had become a notable source of tension between the two companies.

Microsoft will still hold a stake of about $135bn, or 27 percent, in OpenAI Group PBC, which will be controlled by the OpenAI Foundation, a nonprofit, the companies said.

Microsoft, based in Redmond, Washington in the United States, has invested $13.8bn in OpenAI, with Tuesday’s deal implying that the firm had generated a return of nearly 10 times its investment.

Shares of Microsoft rose 2.5 percent, sending its market value above $4 trillion again.

The deal keeps the two firms intertwined until at least 2032, with a massive cloud computing contract and with Microsoft retaining some rights to OpenAI products and artificial intelligence (AI) models until then – even if OpenAI reaches artificial general intelligence (AGI), the point at which AI systems can match a well-educated human adult.

Simplified corporate structure

With more than 700 million weekly users as of September, ChatGPT has exploded in popularity to become the face of AI for many consumers after OpenAI’s founding as a nonprofit AI safety group.

As the company grew, the Microsoft deal constrained OpenAI’s ability to raise funds from outside investors and secure computing contracts as the crush of ChatGPT users and its research into new models caused its computing needs to skyrocket.

“OpenAI has completed its recapitalization, simplifying its corporate structure,” Bret Taylor, the OpenAI Foundation’s board chair, said in a blog post. “The nonprofit remains in control of the for-profit, and now has a direct path to major resources before AGI arrives.”

Microsoft’s previous 2019 agreement had many provisions that rested on when OpenAI reached that point, and the new deal requires an independent panel to verify OpenAI’s claims it has reached AGI.

“OpenAI still faces ongoing scrutiny around transparency, data usage, and safety oversight. But overall, this structure should provide a clearer path forward for innovation and accountability,” said Adam Sarhan, CEO of 50 Park Investments.

Gil Luria, head of technology research at DA Davidson, said the deal “resolves the longstanding issue of OpenAI being organized as a not-for-profit [organisation] and settles the ownership rights of the technology vis-a-vis Microsoft. The new structure should provide more clarity on OpenAI’s investment path, thus facilitating further fundraising.”

Microsoft also said that it has secured a deal with OpenAI where the ChatGPT maker will purchase $250bn of Microsoft Azure cloud computing services. In exchange, Microsoft will no longer have a right of first refusal to provide computing services to OpenAI.

Microsoft also said that it will not have any rights to hardware produced by OpenAI. In March, OpenAI bought longtime Apple design chief Jony Ive’s startup io Products in a $6.5bn deal.

Officials signal that trade deal is close as Trump and Xi prepare to meet for the first time since 2019.

Kuala Lumpur, Malaysia – The United States and China have hailed the outcome of trade talks in Malaysia, raising expectations that Donald Trump and Xi Jinping will seal a deal to de-escalate their trade war at their first meeting since 2019.

US and Chinese officials on Sunday said the sides had made significant progress towards a deal as they wrapped a weekend of negotiations on the sidelines of the ASEAN summit in Kuala Lumpur.

Trump and Xi are set to meet on Thursday on the sidelines of the APEC summit in Gyeongju, South Korea, marking their first face-to-face talks since the US president returned to the White House and embarked on a radical shake-up of global trade.

US Secretary of the Treasury Scott Bessent told reporters in Kuala Lumpur that the sides had come up with a “framework” for Trump and Xi to discuss in South Korea.

Bessent said in a subsequent interview with NBC News that he expected the sides to reach a deal that would defer China’s threatened export controls on rare earths and avoid a 100 percent tariff that Trump has threatened to impose on Chinese goods.

Bessent also said in an interview with ABC News that Beijing had agreed to make “substantial” purchases of US agricultural products, which the treasury secretary said would make US soya bean farmers “feel very good”.

Chinese Vice Premier He Lifeng, Beijing’s top trade negotiator, said the sides had reached “a basic consensus” on “arrangements to address each side’s concerns”.

He said they agreed to “finalise specific details” and “proceed with domestic approval processes”, according to a readout from China’s Ministry of Commerce.

Asian stock markets surged on Monday on hopes of easing US-China tensions.

Japan’s Nikkei 225 and South Korea’s KOSPI both hit record highs, with the benchmark indexes up about 2.1 percent and 2.3 percent, respectively, shortly after midday, local time.

Hong Kong’s Hang Seng also saw strong gains, rising about 0.85 percent.

After attending the ASEAN summit, Trump on Monday departed for Japan, where he will meet newly sworn-in Japanese Prime Minister Sanae Takaichi.

The US president is scheduled to then travel on to South Korea on Wednesday.

While Trump has imposed significant tariffs on almost all US trade partners, he has threatened to hit China with higher levies than anywhere else.

Countries have been anxiously anticipating a breakthrough in the tensions, hoping Washington and Beijing can avoid a full-blown trade war that could do catastrophic damage to the global economy.

In a major escalation in US-China tensions earlier this month, Beijing announced that it would require companies everywhere to acquire a licence to export rare-earth magnets and some semiconductor materials that contain even trace amounts of minerals sourced from China or are produced using Chinese technology.

The proposed rules, which are set to take effect on December 1, have raised fears of substantial disruption to global supply chains.

Rare earths, a group of 17 minerals including holmium, cerium and dysprosium, are critical to the manufacture of countless high-tech products, including smartphones, electric cars and fighter jets.

Trump responded to Beijing’s move by threatening to impose a 100 percent tariff on Chinese goods from November 1.

Analysts have cast the tit-for-tat moves as efforts by the Chinese and US sides to gain leverage in their negotiations ahead of the Trump-Xi summit.

US president says Ontario government’s anti-tariff ad featuring Ronald Reagan needed to be taken down ‘immediately’.

Donald Trump has announced an additional 10-percent tariff on Canada, as the United States president continues to slam his country’s northern neighbour over a contentious anti-tariff advertisement featuring former President Ronald Reagan.

In a social media post on Saturday, Trump said the ad “was to be taken down, IMMEDIATELY, but [Canada] let it run last night during the World Series, knowing that it was a FRAUD”.

“Because of their serious misrepresentation of the facts, and hostile act, I am increasing the Tariff on Canada by 10% over and above what they are paying now,” he said.

The advertisement, produced by the Canadian province of Ontario, features a 1980s speech by Reagan in which the former Republican leader had warned against the ramifications that high tariffs on foreign imports could have on the US economy.

The US government suspended trade talks with Canada this week over the ad, accusing the Ontario provincial government of misrepresenting Reagan’s position and seeking to influence a looming US Supreme Court ruling on Trump’s tariffs policy.

On Friday, Ontario Premier Doug Ford announced that, after consulting with Canadian Prime Minister Mark Carney, the province would “pause its US advertising campaign effective Monday so that trade talks can resume”.

“Our intention was always to initiate a conversation about the kind of economy that Americans want to build and the impact of tariffs on workers and businesses. We’ve achieved our goal, having reached US audiences at the highest levels,” Ford wrote on X.

“I’ve directed my team to keep putting our message in front of Americans over the weekend so that we can air our commercial during the first two World Series games.”

The Canadian government did not immediately comment on Trump’s announcement of additional tariffs on Saturday.

It is unclear whether the ad will run during the second World Series game between the Toronto Blue Jays and the Los Angeles Dodgers, which is set for 8pm local time in Toronto on Saturday (00:00 GMT Sunday).

Since taking office in January, Trump has unveiled sweeping tariffs against a number of countries including Canada, straining relations with the US’s longtime ally.

More to come…

If the United States federal government shutdown continues, millions of low-income Americans could lose access to a monthly benefit that pays for food.

About 42 million people receive money through the Supplemental Nutrition Assistance Program (SNAP), sometimes called food stamps. The Department of Agriculture told states in an October 10 letter that if the shutdown continues, the programme would run out of money to pay for benefits in November.

President Donald Trump’s Republican administration is blaming the Democrats with Agriculture Secretary Brooke Rollins repeating a false healthcare talking point on October 16 on X: “Democrats are putting free health care for illegal aliens and their political agenda ahead of food security for American families. Shameful.”

The government shutdown stems from disagreements between Democrats – who want Congress, as part of approving federal funding, to extend expiring enhanced subsidies for the Affordable Care Act (ACA), through which uninsured Americans can buy health insurance – and Republicans, who want to extend federal funding first before negotiating over whether or how to extend the ACA subsidies.

SNAP is a federal programme operated by state agencies. Participants receive an average individual monthly benefit of about $190 or $356 per household. Recipients may use the benefits to buy fruit, vegetables, meat, dairy products, bread and other foods. The majority of SNAP households live in poverty.

Lawmakers and social media users have made several statements about SNAP with varying degrees of accuracy about the shutdown and the Republican tax and spending law that Trump signed in July. Here’s a closer look:

Social media posts say food stamps will disappear on November 1

Many social media posts have said food stamps are going away as soon as November 1.

“Let that sink in – just in time for the cold season and the month of giving thanks,” one Instagram post said.

That could happen for millions of people. But it might not happen for all of them, and it could happen throughout the month of November because the monthly date when people receive their benefits varies by state.

The Trump administration could use SNAP’s contingency fund to pay for nearly two-thirds of a full month of benefits, or it could transfer other Agriculture Department funds, according to the Center on Budget and Policy Priorities, a liberal think tank. The administration has said it has found funding to continue the Women, Infants and Children programme, another food programme for low-income families.

According to an Agriculture Department funding lapse plan, SNAP “shall continue operations during a lapse in appropriations, subject to the availability of funding”.

An Agriculture Department letter told states to hold off on steps that would lead to people receiving their November benefits. Federal regulations require that reductions be made in a way that higher-income recipients lose more benefits than the lowest-income recipients.

We asked administration officials for more detail but received no response to our questions.

Many state officials – including in Illinois, New York, North Carolina, Texas and Wisconsin – said that if the shutdown continues, participants might not or will not receive benefits in November. A spokesperson for the Florida Department of Children and Families told PolitiFact that if the shutdown continues into November, benefits will not be issued.

California Governor Gavin Newsom said on Wednesday that he will deploy the National Guard and California Volunteers, a state agency, to support food banks and provide $80m in state money.

“Empty cupboards and stomachs are not abstract outcomes,” Wisconsin Governor Tony Evers told Rollins in a Wednesday letter. “They are the very real and near consequences of the dysfunction in Washington. These are also consequences you can prevent today.”

Meanwhile, food banks across the country have taken a hit from other Trump administration policies. ProPublica reported on October 3 that earlier in the year, the administration cut $500m in deliveries through the Emergency Food Assistance Program, which provides food to state distribution agencies.

So what have key lawmakers said on this issue and how true are their claims?

‘We are not cutting’ SNAP

– Mike Johnson, speaker of the US House of Representatives, on the TV programme Face the Nation on May 25

This is false.

Johnson spoke after the House passed a Republican-backed bill known at the time as the One Big Beautiful Bill, which included many of Trump’s policy priorities.

The Congressional Budget Office (CBO), the nonpartisan number-crunching arm of Congress, estimated in May that 3.2 million fewer people per month on average would receive SNAP benefits over the next nine years based on the bill’s changes to work requirements and restrictions on states’ ability to waive the work requirements in areas with high unemployment.

A more recent August CBO analysis estimated the changes would reduce participation in SNAP by roughly 2.4 million people.

‘Nearly 25 cents of every $1 spent via SNAP goes to farmers and ranchers’

– Wisconsin state Representative Francesca Hong in a June 12 X post

This is true.

In a series of X posts, Hong said it wouldn’t be only families receiving food aid that would be hurt by the legislation.

A chart published this year by the Agriculture Department’s Economic Research Service showed that in 2023, farm establishments made 24.3 cents of every dollar spent on food at home, including at grocery stores and supermarkets.

‘About 20 percent of households with veterans rely upon’ SNAP

– House Democratic leader Hakeem Jeffries at a May 8 news conference

This is mostly false.

An April 2 study found that 8 percent of veterans rely on SNAP benefits. No state had a share higher than 14 percent. Studies with data from a few years earlier showed rates from 4.9 percent to 6.6 percent.

Louis Jacobson, Staff Writer Loreben Tuquero and Milwaukee Journal Sentinel reporter Madeline Heim contributed to this article.

South Africa, Nigeria, Mozambique, Burkina Faso removed from Financial Action Task Force’s financial crimes list.

A global money-laundering watchdog has taken South Africa, Nigeria, Mozambique and Burkina Faso off its “grey list” of countries subjected to increased monitoring.

The Financial Action Task Force’s (FATF), a financial crimes watchdog based in France, on Friday said it was removing the four countries after “successful on-site visits” that showed “positive progress” in addressing shortcomings within agreed timeframes.

The FATF maintains “grey” and “black” lists for countries it has identified as not meeting its standards. It considers grey list countries to be those with “strategic deficiencies” in their anti-money laundering regimes, but which are nonetheless working with the organisation to address them.

FATF President Elisa de Anda Madrazo called the removal of the four “a positive story for the continent of Africa”.

South Africa revamped its tools to detect money laundering and terrorist financing, she said, while Nigeria created better coordination between agencies, Mozambique increased its financial intelligence sharing, and Burkina Faso improved its oversight of financial institutions.

Nigeria and South Africa were added to the list in 2023, preceded by Mozambique in 2022 and Burkina Faso in 2021.

Officials from the four countries – which will no longer be subject to increased monitoring by the organisation – welcomed the decision.

Nigerian President Bola Ahmed Tinubu said the delisting marked a “major milestone in Nigeria’s journey towards economic reform, institutional integrity and global credibility”, while the country’s Financial Intelligence Unit separately said it had “worked resolutely through a 19-point action plan” to demonstrate its commitment to improvements.

Edward Kieswetter, commissioner of the South African Revenue Service, also cheered the update but said, “Removing the designation of grey listing is not a finish line but a milestone on a long-term journey toward building a robust and resilient financial ecosystem.”

Leaders in Mozambique and Burkina Faso did not immediately comment, though Mozambican officials had signalled for several months that they were optimistic about being removed.

In July, Finance Minister Carla Louveira said Mozambique was “not simply working to get off the grey list, but working so that in the fight against money laundering and terrorist financing, when the FATF makes its assessment in 2030, it will find a completely different situation from the one detected in 2021,” MZ News reported at the time.

More than 200 countries around the world have pledged to follow the standards of the FATF, which reviews their efforts to combat money laundering, as well as terrorist and weapons financing.

The FATF’s black or “high-risk” list consists of Iran, Myanmar and North Korea.

The probe comes as the US government seeks additional leverage against Beijing amid escalating trade tensions.

The United States has launched an investigation into whether China is out of compliance with a 2020 trade deal they struck together, as trade tensions ratchet up between the world’s two largest economies.

US Trade Representative Jamieson Greer announced the investigation on Friday, as President Donald Trump travels to Asia to meet with his Chinese counterpart, Xi Jinping. China denies that it has failed to abide by the deal.

“China has scrupulously fulfilled its obligations in the Phase One Economic and Trade Agreement,” a spokesperson for the Chinese embassy in Washington said in a social media post.

The probe into unfair trade practices could grant President Trump greater authority to impose more tariffs on China, which he has hit with massive trade duties during his second term in office.

“The administration seems to be looking for new sources of leverage to use against Beijing, while adding another pressure point to get China to buy more US soybeans as well as other goods,” Wendy Cutler, a former US trade negotiator who is now vice president at the Asia Society Policy Institute, told The Associated Press news agency.

The “Phase One” deal came at the end of Trump’s first term in office in 2020, when the US imposed a series of tariffs on China in the name of bringing greater “balance” to their commercial exchange.

In that agreement, Beijing agreed to buy more US agricultural and manufacturing goods.

A Federal Register notice (PDF) from the Office of the US Trade Representative alleges that China has not followed up on that promise or others related to intellectual property protections, forced technology transfers or financial services.

September, for instance, marked the first month since 2018 that China imported no soya beans from US farmers.

“The initiation of this investigation underscores the Trump Administration’s resolve to hold China to its Phase One Agreement commitments, protect American farmers, ranchers, workers, and innovators, and establish a more reciprocal trade relationship with China for the benefit of the American people,” Greer said in a statement.

A new round of US-China trade talks is set to take place on Saturday, and discussions will focus on China’s restrictions on the export of rare earth metals, essential for many US tech products.