Trash and Burn: Big Brands’ New Plastic Waste Plan

The global consumer goods industry’s plans for dealing with the vast plastic waste it generates can be seen here in a landfill on the outskirts of Indonesia’s capital, where a swarm of excavators tears into stinking mountains of garbage.

These machines are unearthing rubbish to provide fuel to power a nearby cement plant. Discarded bubble wrap, take-out containers and single-use shopping bags have become one of the fastest-growing sources of energy for the world’s cement industry.

The Indonesian project, funded in part by Unilever PLC , maker of Dove soap and Hellmann’s mayonnaise, is part of a worldwide effort by big multinationals to burn more plastic waste in cement kilns, Reuters has detailed for the first time.

This “fuel” is not only cheap and abundant. It’s the centerpiece of a partnership between consumer products giants and cement companies aimed at burnishing their environmental credentials. They’re promoting this approach as a win-win for a planet choking on plastic waste. Converting plastic to energy, these companies contend, keeps it out of landfills and oceans while allowing cement plants to move away from burning coal, a major contributor to global warming.

Reuters has identified nine collaborations launched over the last two years between various combinations of consumer goods giants and major cement makers. Four leading sources of plastic packaging are involved: The Coca-Cola Company, Unilever, Nestle S.A. and Colgate-Palmolive Company. On the cement side of the deals are four top producers: Switzerland’s Holcim Group, Mexico’s Cemex SAB de CV , PT Solusi Bangun Indonesia Tbk (SBI) and Republic Cement & Building Material Inc, a company in the Philippines.

These projects span the world, from Costa Rica to the Philippines, El Salvador to India. In Indonesia, for instance, Unilever is partnering with SBI, one of that country’s largest cement makers.

The alliances come as the cement industry – the source of 7% of the world’s carbon dioxide emissions – faces rising pressure to reduce these greenhouse gases. Consumer brands, meanwhile, are feeling the heat from lawmakers who are banning or taxing single-use plastic packaging and pushing so-called polluter-pays legislation to make producers bear the costs of its clean up.

Critics say there’s little green about burning plastic, which is derived from oil, to make cement. A dozen sources with direct knowledge of the practice, among them scientists, academics and environmentalists, told Reuters that plastic burned in cement kilns emits harmful air emissions and amounts to swapping one dirty fuel for another. More importantly, environmental groups say, it’s a strategy that could potentially undercut efforts spreading globally to boost recycling rates and dramatically slash the production of single-use plastic.

Such thinking is naive, said Axel Pieters, chief executive of Geocycle, the waste-management arm of Holcim Group, one of the world’s largest cement makers and partner with Nestle, Unilever and Coca-Cola in plastic-fuel ventures. Pieters told Reuters that burning plastic in cement kilns is a safe, inexpensive and practical solution that can dispose of huge volumes of this trash quickly. Less than 10% of all the plastic ever made has been recycled, in large part because it’s too costly to collect and sort. Plastic production, meanwhile, is projected to double within 20 years.

“Thinking that we recycle waste only, and that we should avoid plastic waste, then you can quote me on this: People believe in fairy tales,” Pieters said.

Unilever would not comment specifically on the Indonesia project. It said in an email that in situations where recycling isn’t feasible, it would explore “energy recovery initiatives.” That’s industry parlance for burning plastic as fuel.

 

Coca-Cola, Unilever, Colgate and Nestle did not respond to questions about the environmental and health impacts of burning plastic in cement kilns. The companies said they invest in various initiatives to reduce waste, including boosting recycled content in their packaging and making refillable containers.

Cemex, SBI, Republic Cement and Holcim’s Geocycle unit told Reuters their partnerships with consumer goods firms were aimed at addressing the global waste crisis and reducing their dependence on traditional fossil fuels.

Exactly how much plastic waste is being burned in cement kilns globally isn’t known. That’s because industry statistics typically lump it into a wider category called “alternative fuel” that comprises other garbage, such as scrap wood, old vehicle tires and clothing.

The use of alternative fuel has risen steadily in recent decades and already is the dominant energy source for the cement industry in some European countries. There’s no question the amount of plastic within that category has increased and will keep climbing given a worldwide explosion of plastic waste, according to 20 cement industry players interviewed for this report, including company executives, engineers and analysts. Reuters also reviewed data from cement associations, individual countries and analysts that confirmed this trend.

For example, Geocycle currently uses 2 million tonnes of plastic waste a year as alternative fuel at Holcim plants worldwide, according to Geocycle CEO Pieters, who said the company intends to increase this to 11 million tonnes by 2040, including through more partnerships with consumer goods companies.

 

Pieters said the cement industry has the capacity to burn all the plastic waste the world currently produces. The United Nations Environment Program estimates that figure to be 300 million tonnes annually. That dwarfs the world’s plastic recycling capacity, estimated to be 46 million tonnes a year, according to a 2018 estimate by the Organization for Economic Co-operation and Development (OECD), a global policy forum.

Plastic pollution, meanwhile, is bedeviling communities whose landfills are reaching capacity and despoiling the Earth’s wild places. Plastic garbage flowing into the oceans is due to triple to 29 million tonnes a year by 2040, according to a study published last year by the Pew Charitable Trusts. This detritus is endangering wildlife and contaminating the seafood humans consume.

“The cement industry is definitely a solution,” Geocycle’s Pieters said.

Toxic emissions

Consumer goods giants are turning to cement firms for help in reducing plastic litter as other initiatives stumble. Reuters reported in July that a set of new “advanced” plastic recycling technologies promoted by big brands and the plastic industry had suffered major setbacks across the world.

Cement-making is one of the world’s most energy-intensive businesses. Fuel – mainly coal – is its single-biggest expense, industry executives said. In the 1970s, producers looking to reduce costs began stoking kilns with rubbish such as tires, biomass, sewage sludge – and plastic. Those materials aren’t as efficient as coal, but are virtually free. Some local governments even pay cement makers to take this waste.

In Europe, refuse now makes up roughly half the fuel used by the cement industry. In Germany, the bloc’s biggest producer, the ratio is 70%, according to 2019 data from the Global Cement & Concrete Association (GCCA), a London-based trade organization. The United States uses 15% alternative fuel in its kilns, according to the Portland Cement Association, a U.S. industry group. Spokesperson Mike Zande said its members have the capacity to catch up with Europe.

While cost-cutting remains the primary driver, the industry in recent years has begun touting its garbage fuel as a way to reduce the “societal problem” of plastic waste, said Ian Riley, CEO of the London-based World Cement Association (WCA), which represents producers in developing countries.

So it was logical that cement makers would team up with consumer goods companies, the largest source of single-use plastic packaging, in the recent partnerships to burn discarded plastic in their kilns.

In emerging markets, big brands sell a slew of food and hygiene products packaged in plastic sachets, typically single-serving portions tailored to the budgets of poor households. Billions of these flexible pouches are sold each year. Sachets are nearly impossible to recycle because they’re made of layers of different materials laminated together, usually plastic and aluminum, that are difficult to separate.

Indonesia, an archipelago of more than 270 million people, is the second-largest contributor to ocean plastic pollution behind China, partly due to its widespread use of sachets, according to a 2015 study published in the journal Science. Plastic garbage can be seen everywhere around Jakarta, the sprawling capital of more than 10 million people. It clogs storm drains, litters its teaming slums and mars its shoreline.

Developing countries have generally welcomed assistance with waste management. Thus Indonesia was a natural location for Unilever’s waste-fuel venture with cement maker SBI and the local Jakarta government. At last year’s launch, Andono Warih, head of Jakarta’s environment service, praised the initiative and expressed hope that it would spark other such collaborations.

The project uses plastic that’s already been buried in the region’s Bantar Gebang landfill, one of the largest dumps in Asia. Waste excavated by earth-moving equipment is transported to a warehouse at the landfill site. There, it is shredded, sieved and dried into a brown mix resembling manure. That material, known as Refuse Derived Fuel (RDF), is then fed into the kiln at an SBI cement plant in Narogong, just outside Jakarta.

SBI currently uses 20% RDF at that plant, a figure that could increase to 35%, according to Ita Sadono, SBI’s business development manager. The operation still relies primarily on coal, she said, but she contends RDF is “significantly helping to reduce plastic waste.”

Unilever is helping to fund a second RDF project in Cilacap, an industrial region in Central Java, according to SBI and a 2020 sustainability report by Unilever’s local Indonesian unit. The two facilities could send 30,000 tonnes of plastic waste per year to SBI’s cement plants, according to a Reuters analysis of data provided by SBI.

Unilever did not respond to detailed questions about these projects. Sadono said in a text message that Reuters’ calculations were “OK,” without giving further details.

About two kilometers from SBI’s cement plant near Jakarta, Dadan bin Anton, 63, runs a roadside stall selling plastic sachets of soap, washing powder and instant coffee, including brands owned by Unilever. He said he often has trouble breathing and blames the cement plant.

“People here are breathing dust every day,” he said.

SBI has invested in mitigation measures to cut dust at its plants, Sadono said. And it isn’t clear whether the cement facility has anything to do with Dadan’s burning chest. Jakarta boasts some of the dirtiest air in Asia. Pollutants from industry smokestacks, agricultural fires and auto exhaust routinely blanket the city.

But some scientists say incinerated plastic is a dangerous new ingredient to add to the mix, particularly in developing nations where air-quality rules often are weak and enforcement spotty.

 

Plastic releases harmful substances like dioxins and furans when burned, said Paul Connett, a retired professor of environmental chemistry and toxicology at St. Lawrence University in Canton, New York, who has studied the poisonous byproducts of burning waste. If enough of those pollutants escape from a cement kiln, they can be hazardous for humans and animals in the surrounding area, Connett said.

Such fears are overblown, said Claude Lorea, cement director at GCCA, the industry group representing big cement firms including Holcim and Cemex. She said super-heated kilns destroy all toxins resulting from burning any alternative fuel, including plastic and hazardous waste.

But things can go wrong.

In 2014, a cement plant in Austria released hexachlorobenzene (HCB), a highly toxic substance and suspected human carcinogen, after the facility burned industrial waste contaminated with the pollutant. Cheese and milk sourced from cattle raised near that plant in southern Carinthia state were tainted, Austria’s health and food safety agency found. And blood samples drawn from area residents also contained HCB, which can damage the nervous system, liver and thyroid.

An investigation commissioned by the state government found multiple failures by local regulators and the cement plant, including that the kiln was not running hot enough to destroy contaminants like HCB.

The Austrian cement maker which operates the plant, w&p Zement GmbH, told Reuters that it had worked to eliminate all the environmental pollution from the incident and that it had provided help to the community such as replacing contaminated animal feed.

Carinthia province spokesperson Gerd Kurath said in an email that the government’s continued monitoring of air, soil and water samples in the area shows that contamination levels have declined.

The cement industry, meanwhile, is heralding waste-to-fuel as a way to fight global warming. That’s because burning refuse, including plastic, emits fewer greenhouse gases than coal, the GCCA trade group said.

Burning garbage “reduces our fossil fuel reliance,” spokesperson Lorea said. “It’s climate neutral.”

The European Commission, which sets emission rules in Europe, told Reuters that plastic does emit fewer carbon dioxide emissions than coal but more than natural gas, another fuel used by the cement industry.

The U.S. Environmental Protection Agency, which regulates environmental policy in the world’s largest economy, reached a different conclusion. It said in a statement there is no significant climate benefit to be gained from substituting plastic for coal, and that burning this waste in cement kilns can create harmful air pollution that must be monitored.

Measuring plastic’s CO2 emissions against those of coal, the world’s dirtiest fossil fuel, is not the benchmark to use if the cement industry is serious about fighting global warming, said Lee Bell, advisor to the International Pollutants Elimination Network, a global coalition working to eliminate toxic pollutants. Reducing the industry’s massive carbon emissions, he said, requires a switch to fuels such as green hydrogen, a more expensive but low-polluting fuel produced from water and renewable energy.

“The cement industry should leap-frog the whole burning-waste paradigm and move to clean fuel,” Bell said.

The GCCA told Reuters the industry is improving energy efficiency and is considering the use of green hydrogen.

Ever more plastic

While cement plants in industrialized countries are gearing up to burn more plastic, explosive growth is anticipated in the developing world.

China and India together account for 60% of the world’s cement production in facilities whose primary fuel is coal. Over the next decade, these countries have set targets of using alternative fuel to stoke 20% to 30% of their output. If they reached just a 10% threshold, that would equate to burning 63 million tonnes of plastic annually, up from 6 million tonnes now, according to SINTEF, a Norwegian scientific research group. That’s more plastic waste than the United States generates each year.

In 2019, 170 countries agreed to “significantly reduce” their use of plastic by 2030 as part of a United Nations resolution. But that measure is non-binding, and a proposed ban on single-use plastic by 2025 was opposed by several member states, including the United States.

Thus the waste-to-fuel option may well become an unstoppable juggernaut, said Matthias Mersmann, chief technology officer at KHD Humboldt Wedag International AG, a German engineering firm that supplies equipment to cement plants worldwide. Plastic waste is quickly outstripping countries’ capacity to bury or recycle it. Burning it eliminates large amounts of this material quickly, with little special handling or new facilities required. There are an estimated 3,000 or more cement plants worldwide. All are hungry for fuel.

“There’s only one thing that can hold up and break this trend, and that would be a very strong cut in the production of plastics,” Mersmann said. “Otherwise, there is nothing that can stop this.”

That momentum has some environmentalists worried, including Sander Defruyt, who heads a plastics initiative at the Ellen MacArthur Foundation, a United Kingdom-based nonprofit focused on sustainability. The foundation in 2018 worked out waste-reduction and recycling targets with Coca-Cola, Nestle, Unilever, Colgate-Palmolive and hundreds of other consumer brands.

Defruyt said the foundation does not support its partner companies’ pivot towards incineration. Burning plastic for cement fuel, he said, is a “quick fix” that risks giving consumer goods companies the green light to continue cranking out single-use plastic and could reduce the urgency to redesign packaging.

“If you can dump everything in a cement kiln, then why would you still care about the problem?” Defruyt said.

Coca-Cola, Nestle, Unilever and Colgate-Palmolive said their cement partnerships are just one of several strategies they’re pursuing to address the waste crisis.

‘Plastic prayers’

In the central England village of Cauldon, residents have complained in recent years to the local council and Britain’s environmental regulator about noise, dust and smoke coming from a nearby cement plant owned by Holcim. Those efforts have failed to derail the expansion of that facility to burn more plastic.

When completed next year, alternative fuel, including “non-recyclable” plastics such as potato chip bags, will account for up to 85% of the facility’s fuel, according to planning documents filed with local authorities on behalf of Geocycle, which will manage the project.

The move will recover energy from plastic waste otherwise destined for landfills, the documents said.

Cauldon resident Lucy Ford, 42, said the cement maker’s plans have only added to some villagers’ fears about emissions. “They say they are the answer to all of our plastic prayers,” she said. “I don’t like the idea of it.”

Geocycle’s Pieters said he understood the community’s concerns. He said the company complies with all local regulations and that it carefully monitors the plant’s emissions, which would be lowered by the upgrades.

Britain’s Environment Agency said in an email that it took all complaints about the plant seriously. It said the Cauldon facility has a permit to burn waste and that the plant has to comply with its regulations.

Back in Indonesia, Unilever and SBI told Reuters that using plastic for energy was preferable to leaving it in a landfill.

Local environmentalists say they are alarmed that cement kilns could be shaping up as the fix for a nation flooded with plastic waste.

It would allow consumer brands to continue business as usual, while adding to Indonesia’s air-quality woes, said Yobel Novian Putra, an advocate with the Global Alliance for Incinerator Alternatives, a coalition of groups working to eliminate waste.

“It’s like moving the landfill from the ground to the sky,” Putra said.

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UN Aims to Cut Millions of Road Traffic Deaths, Injuries by Half

The World Health Organization has kicked off a campaign to cut millions of road traffic deaths and injuries by at least half by 2030.This follows the August 2020 adoption by the United Nations General Assembly of a Decade of Action for Road Safety.

More than 50 million people have died in road crashes since the automobile was invented by German entrepreneur Karl Benz in 1886. Now, the World Health Organization reports road accidents kill more than 3,500 people every day, adding up to nearly 1.3 million deaths and some 50 million injuries every year.

The WHO cites road traffic injuries as the leading cause of death globally for children and young people aged 5 to 29 years. The director of the WHO’s Department for Social Determinants, Etienne Krug, said most of these deaths and injuries are preventable.

He said a centerpiece of the U.N.’s Global Plan for reducing traffic accidents and saving lives is to get people out of their cars and have them shift to safer, healthier modes of transportation.

“Move away from a car-based transportation system to more walking, cycling and public transport. And to do that, we have to make it safe. The plan also advocates for involving more young people. As I said, it is the leading cause of death for young people and giving them a bigger role in shaping the new wave of transportation. And a greater role for private sector,” he said.

Krug said the private sector is important because of its responsibility for the safety of the vehicles it manufactures. He said a big source of danger is the large number of secondhand cars dumped by rich countries into developing countries.

“Secondhand cars who are not up to the safety standards, who either are sold in the countries or are imported from other countries who do not want them anymore. So regulating the export of used cars and the import on the other side is a very important part of improving safety on our roads,” he said.

A report last year by the U.N. Environment Program found an estimated 14 million poor quality, highly polluting older vehicles were exported from Europe, Japan, and the United States between 2015 and 2018.Four out of 5 cars, it said, were sold to poorer countries, with more than half going to Africa.

If things remain as they are, the World Health Organization warns an estimated 13 million deaths, and 500 million injuries will occur during the next decade. Most of these preventable deaths and injuries, it says, will be in low- and middle-income countries. 

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G-20 Leaders Pledge to End Financing for Overseas Coal Plants 

G-20 leaders meeting in Rome have agreed to work to reach carbon neutrality “by around mid-century” and pledged to end financing for coal plants abroad by the end of this year.

The final communique was issued Sunday at the end of a two-day summit, ahead of talks at ahead of a broader U.N. climate change summit, COP26, this week in Glasgow, Scotland.

Leaders in Rome addressed efforts to reach the goal of limiting global warming to 1.5 degrees Celsius, in line with a global commitment made in 2015 at the Paris Climate Accord to keep global warming to “well below” 2 degrees Celsius above pre-industrial levels, and preferably to 1.5 degrees.

“We recognize that the impacts of climate change at 1.5°C are much lower than at 2°C. Keeping 1.5°C within reach will require meaningful and effective actions and commitment by all countries,” the communique said, according to Reuters.

The group of 19 countries and the European Union account for more than three-quarters of the world’s greenhouse gas emissions.

Two dozen countries this month have joined a U.S.- and EU-led effort to slash methane emissions by 30% from 2020 levels by 2030.

Coal, though, is a bigger point of contention. G-20 members China and India have resisted attempts to produce a declaration on phasing out domestic coal consumption.

Briefing reporters ahead of the summit, a U.S. senior administration official said U.S. President Joe Biden and other leaders are hoping to get a commitment to end overseas financing of coal-fired power generation. 

Climate financing, namely pledges from wealthy nations to provide $100 billion a year in climate financing to support developing countries’ efforts to reduce emissions and mitigate the impacts of climate change, is another key concern. Indonesia, a large greenhouse gas emitter that will take over the G-20 presidency in December, is urging developed countries to fulfill their financing commitments both in Rome and in Glasgow.

Global supply chain 

Biden will hold a meeting at the summit’s sidelines to address the global supply chain crisis. The group of 20 countries in the summit account for more than 80% of world GDP and 75% of global trade. 

“The President will make announcements about what the United States itself will do, particularly in respect to stockpiles, to improving… the United States’ capacity to have modern and effective and capable and flexible stockpiles,” White House national security adviser Jake Sullivan told VOA aboard Air Force One en route to Rome, Thursday. “We are working towards agreement with the other participants on a set of principles and parameters around how we collectively manage and create resilient supply chains going forward.”

Addressing global commerce disruptions has been a key focus for the Biden administration, which is concerned that these bottlenecks will hamper post-pandemic economic recovery. To address the nation’s own supply chain issues, earlier this month the administration announced a plan to extend operations around the clock, seven days a week, at Los Angeles and Long Beach, two ports that account for 40% of sea freight entering the country. 

“Whether it’s you’re talking about medical equipment or supplies of consumer goods or other products, it’s a challenge for the global economy,” said Matthew Goodman, senior vice president for economics at the Center for Strategic and International Studies.

Some of the concrete measures to alleviate global supply chain pressure points may need to be longer term, such as shortening supply chains and rethinking dependencies, said Leslie Vinjamuri, director of the U.S. and the Americas program at Chatham House.

“Those are not quick fixes,” she said. “But the G-20 is historically set up really to be dealing with short-term crises. So, I think that there will be considerable effort made to really discuss and come to terms with that.” 

While global supply chain issues are a key concern for the leaders in Rome, Goodman said he doubts the meeting will result in tangible solutions. 

“It’s a very difficult group — the G-20 to get consensus to do very specific things. And this may be one area in which it’s going to be particularly difficult,” he added. 

President Xi Jinping of China, considered to be the “world’s factory,” is not attending the summit in person. In his virtual speech to G-20 leaders, Xi proposed holding an international forum on resilient and stable industrial and supply chains, and welcomed participation of G-20 members and relevant international organizations. 

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Johns Hopkins: World COVID-19 Death Toll Nears 5 Million

Johns Hopkins Coronavirus Resource Center reported early Sunday that the death toll from the coronavirus pandemic is less than 4,000 short of the 5 million mark. The 4 million tally was reached a little more than four months ago.

India’s prime minister told world leaders at the G-20 summit in Rome that India will produce 5 million COVID-19 vaccines by the end of next year for use in his country and around the world.

Narendra Modi said Saturday, however, that the 5 million doses would be easier to produce if the World Health Organization were to approve India’s Covaxin vaccine and place it on the WHO’s emergency use list. Covaxin is produced by India’s Bharat Biotech.

Meanwhile, Xi Jinping, China’s leader, told the summit Saturday, via a video platform, that China has already produced more than 1.6 billion COVID-19 vaccines that have been distributed around the world.

New York City municipal workers rushed last week to receive COVID-19 vaccines to fulfill the requirements of a mandate that they show proof of being inoculated with at least one dose of a COVID-19 vaccine by Friday. One in six, or more than 26,000 workers, however, remain unvaccinated. The unvaccinated workers will be placed on unpaid leave.

 

 

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UN Climate Change Conference: What’s on the Table? 

The latest round of climate talks are getting under way Sunday in Glasgow, Scotland. They are billed as the most important since the Paris conference six years ago. Here are some of the main goals of the 2021 United Nations Climate Change Conference, also known as COP26.

Keep 1.5 alive 

Negotiators pledged in Paris that they would aim to keep the planet from warming more than 1.5 degrees Celsius above preindustrial levels.

Scientists have warned that the goal is slipping out of reach without drastic cuts in emissions of carbon dioxide and other planet-warming greenhouse gases.

The planet is already more than 1 degree warmer than it was in the late 1800s, producing more intense heat waves, stronger storms, deeper droughts, bigger wildfires, rising sea levels and more. The higher global temperatures go, the worse things will get, scientists say.

The plans that countries have submitted will not keep the world below the 1.5-degree goal. According to the latest United Nations Emissions Gap Report,  current pledges put the world on a path to a disastrous 2.7-degree temperature increase.

Some experts are cautiously optimistic, however.

While 2.7 degrees of warming is dangerous, the world was headed for 3.7 degrees or more before the Paris conference, they note. 

Plus, dozens of countries have pledged that by 2050 they will produce “net-zero” emissions. That means slashing carbon-generating sources and balancing the remaining emissions with carbon-absorbing measures such as planting trees.

Following through on these pledges would limit warming to about 2.2 degrees, according to the U.N. report — still too much, but getting closer.

“The Paris agreement is working, but it was never meant to work in one step,” Kaveh Guilanpour, vice president for international strategies at C2ES, a climate policy analysis nonprofit, said in a call with reporters.

Under the agreement, countries update their plans every five years, with the expectation that they will make deeper cuts. After a COVID-19-induced delay, COP26 will be the first chance since Paris to formally revisit those plans.

Most countries have increased their ambitions, with some important exceptions. China has not submitted a new plan. Nor has India, the world’s third-biggest greenhouse gas emitter. Russia’s new plan is no more ambitious than its old one. And Mexico and Brazil backslid.

Guilanpour does not expect negotiators to get to 1.5 degrees by the end of Glasgow. But all is not lost. “COP26 will be an important step, but not the last one,” he said. 

Pay up 

Developing countries are angry that industrialized nations have fallen short on a 12-year-old pledge to help them fight climate change.

They say they have little to do with warming the planet but are suffering the effects. Since industrialized nations caused the problem by burning fossil fuels as they developed, they say, these nations should take responsibility by helping developing nations pursue a low-carbon development path and adapt to a warmer planet.

Back in 2009, developed countries agreed. They pledged to commit $100 billion per year to developing countries.

They have not. Funding reached $79.6 billion in 2019, according to the latest available data from the Organization for Economic Cooperation and Development.

“These failures to deliver on the commitments agreed to by developed countries undermines trust and confidence in the multilateral system,” said a sharply worded statement from a group of 24 developing countries including China, India, Indonesia and Saudi Arabia.

[[??This week,]] developed nations announced a plan to reach $100 billion by 2023, which did not satisfy critics.

Developing countries are also calling for additional financing to cover loss and damage from extreme weather disasters and other climate impacts.

The United States has vigorously opposed any language that suggests liability.

Other developed countries oppose separate funding, too. The European Union prefers to include it under adaptation. It’s not clear that there will be any movement on this front in Glasgow.

Can the US deliver? 

U.S. President Joe Biden will be attending the World Leaders Summit at the start of COP26. Biden aims to present a much different approach than his predecessor, Donald Trump, who withdrew the United States from the Paris Agreement.

Biden rejoined the agreement on his first day in office. He has quadrupled the U.S. commitment to climate finance. And he has pledged that the United States will be at net-zero emissions by 2050.

Political realities are complicating his goals, however.

[[CHECK IF STILL OK WHEN USED]] Congress has stripped key provisions from a major bill addressing climate change. The bill is still under negotiation. It is not clear whether Biden will arrive in Glasgow with legislation to back up his ambitions.

The mood going into Glasgow is fairly downbeat.

“Progress on these issues will not be easy,” Lorena Gonzalez of the World Resources Institute Finance Center told reporters. Many of the agenda items “have been put off in years past because they’re among the most complex issues that negotiators are trying to tackle.” 

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G-20 Leaders to Discuss Climate Change

The G-20 heads of state from the world’s major economies will discuss climate change Sunday on day two of their meeting in Rome.

Saturday, Italian Prime Minister Mario Draghi welcomed the heads of state, including U.S. President Joe Biden, to the Italian capital, where they discussed issues of mutual concern, including the pandemic recovery.

The G-20 leaders supported a sweeping global tax deal agreed to by 136 finance ministers earlier this month, including a minimum 15% global corporate tax rate for companies with annual revenues of more than $870 million. It still needs to be implemented within each member country’s legal framework.

On COVID-19, G-20 health and finance ministers announced the formation of a new panel to improve future pandemic preparedness, proposed by the United States and Indonesia, but did not specify funding for it.

German Chancellor Angela Merkel, French President Emmanuel Macron and British Prime Minister Boris Johnson met on the sidelines with Biden and said they support Biden’s pledge to return the United States to full compliance with the Iran nuclear deal, so long as Tehran does the same. Talks are scheduled for November.

This year’s meeting is the the first face-to-face G-20 meeting in two years. Notably absent were Chinese President Xi Jinping and Russian President Vladimir Putin, who joined virtually, citing pandemic concerns at home.

“Despite the G-20 decisions, not all countries that need them can have access to vaccines,” Putin said. “This happens partly because of dishonest competition, protectionism and because some states, especially those of the G-20, are not ready for mutual recognition of vaccines and vaccination certificates.”

Activists marched Saturday through the streets of Rome protesting the lack of action by G-20 leaders in tackling climate change, before the leaders move on the United Nations climate conference in Glasgow, Scotland.

 

 

 

 

 

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Climate Change Threatens Russia’s Permafrost and Oil Economy

Parts of the planet that were once thought to be permanently frozen are starting to thaw – posing problems for countries like Russia where permafrost covers vast areas of its territory. The thaw is threatening Russia’s oil economy as Oleksandr Yanevskyy tells us in this report narrated by Amy Katz.
Camera: Oleksandr Yanevskyy

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Day One of G-20 Summit Focuses on Global Minimum Tax, Pandemic Preparedness

The G-20 Summit hosted by Italy in Rome this weekend brought together leaders from the world’s major economies. White House Bureau Chief Patsy Widakuswara has this report from Rome.

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To Stargazers: Fireworks Show Called Northern Lights Coming

A fireworks show that has nothing to do with the Fourth of July and everything to do with the cosmos is poised to be visible across the northern United States and Europe just in time for Halloween.

On Thursday, the sun launched what is called an “X-class solar flare” that was strong enough to spark a high-frequency radio blackout across parts of South America. The energy from that flare is trailed by a cluster of solar plasma and other material called a coronal mass ejection, or CME for short. That’s heading toward Earth, prompting the National Oceanic and Atmospheric Administration to issue a warning about a potentially strong geomagnetic storm.

It might sound like something from a science fiction movie. But really, it just means that a good chunk of the northern part of the country may get treated to a light show this weekend called the aurora borealis, or Northern Lights.

Geomagnetic storms as big as what might be coming can produce displays of the lights that can be seen at latitudes as low as Pennsylvania, Oregon and Iowa. It could also cause voltage irregularities on high-latitude power grids as the loss of radio contact on the sunlit side of the planet. 

 

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G-20 Summit Begins in Rome With Focus on Climate Change, COVID Pandemic

The G-20 Summit hosted by Italy kicked off Saturday in Rome, where leaders from the world’s major economies discussed issues of mutual concern, including pandemic recovery and climate change.

The red carpet was rolled out at La Nuvola, Rome’s Convention Center, as Italian Prime Minister Mario Draghi welcomed U.S. President Joe Biden and other leaders amid strict COVID-19 protocols.

This summit is the leaders’ first face-to-face meeting in two years, following last year’s virtual summit hosted by Saudi Arabia. Notably absent are Russian President Vladimir Putin, Chinese President Xi Jinping and Mexico’s President Andrés Manuel López Obrador. They will join virtually, citing pandemic concerns at home.

Pandemic response and prevention

On Friday, G-20 health and finance ministers released a communique committing to bringing the pandemic under control everywhere as soon as possible. They said the G-20 will take all necessary steps needed to advance on the global goals of vaccinating at least 40% of the population in all countries by the end of 2021 and 70% by mid-2022, as recommended by the World Health Organization.

However, the ministers could not reach agreement on a separate financing and coordination mechanism to prepare for future pandemics proposed by the U.S. and Indonesia.

“We’re looking for not the ultimate final product of a financing mechanism or the ultimate final product of a task force or a board that would operate as kind of a global coordinating body going forward,” National Security Advisor Jake Sullivan told VOA aboard Air Force One en route to Rome, Thursday. “So the hope is to have in the communiqué a statement of intent that we will work towards these two outcomes.”

Climate change

In Rome, United Nations Secretary-General Antonio Guterres called the summit an opportunity to “put things on track” ahead of the U.N. COP26 climate conference in Glasgow that G-20 leaders will participate in following their Italy meeting.

“There is a serious risk that Glasgow will not deliver,” Guterres said. “The current nationally determined contributions, formal commitments by governments, still condemn the world to a calamitous 2.7-degree increase,” he said referring to the pledge made at the 2015 Paris Climate Accord to limit global warming to 2 degrees Celsius, ideally to 1.5 degrees Celsius.

Countries are expected to announce more emissions reduction pledges to reach the target of net-zero emissions by around mid-century, but some analysts are skeptical of these voluntary commitments that come without enforcement mechanisms.

“There’ll be pledges, the best-case scenario something along the lines of what we saw in Paris,” said Dalibor Rohac, a resident scholar at the American Enterprise Institute. 

Rohac added that to make progress on climate change, the world needs tangible actions.

“Rather than to proceed with this habit of looking for a big-bang multilateral solution, to pursue sound domestic policies that that accelerate decarbonization,” he said.    

A key issue to watch is whether G-20 members can agree on coal actions. The U.N. has called for wealthy countries to phase out coal by 2030, but G-20 environment ministers have failed to agree on a timeline.  

Guterres also called on wealthy nations to uphold commitments to provide funding to help developing nations mitigate the impacts of climate change. Under the 2015 Paris Climate Accord, wealthy nations pledged a minimum of $100 billion per year in climate funding to lower-income countries. Much of that money has not been delivered.

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WHO: Vaccine Inequity ‘Demonstrates Disregard for the World’s Poorest’

The World Health Organization has written an open letter to the heads of state gathered in Rome for the G-20 meeting, urging them to increase vaccine supplies for the world’s poorest, ensure access to vaccines for all people on the move and support low- and middle-income countries in combating COVID-19 with all available means.

“The current vaccine equity gap between wealthier and low resource countries demonstrates a disregard for the lives of the world’s poorest and most vulnerable,” the open letter said. “For every 100 people in high-income countries, 133 doses of COVID-19 vaccine have been administered, while in low-income countries, only 4 doses per 100 people have been administered.”

The WHO letter also warned, “Vaccine inequity is costing lives every day, and continues to place everyone at risk. History and science make it clear: coordinated action with equitable access to public health resources is the only way to face down a global public health scourge like COVID-19. We need a strong, collective push to save lives, reduce suffering and ensure a sustainable global recovery.”

Britain’s Prince Harry and his wife, Meghan, joined WHO Director-General Tedros Adhanom Ghebreyesus in signing another open letter to the G-20 leaders, urging them to make good on their promised vaccine donations to poor countries. “When the leaders of the world’s wealthiest nations met at the G-7 Summit in June, they collectively announced that 1 billion doses of COVID-19 vaccines would be sent to low- and low-and-middle-income countries to help vaccinate the world. Pharmaceutical companies have pledged almost the same.

“Yet, as several nations still don’t even have enough vaccines for their own health workers, the world is left asking: Where are the doses?” the letter said. “Of the almost 7 billion doses that have been administered globally, just 3% of people in low-income countries have had a jab so far. Where are the rest? … Promises aren’t translating into vaccines reaching the people that need them.”

British media has reported that Prime Minister Boris Johns is expected to announce at the G-20 summit that the U.K. will donate 20 million vaccine doses to low-income countries by the end of the year.

The Johns Hopkins Coronavirus Resource Center said early Saturday that it has recorded more than 246 million global COVID infections and nearly 5 million global deaths. The center said nearly 7 billion vaccines have been administered.

Friday, the U.S. Food and Drug Administration authorized the Pfizer COVID-19 vaccine for emergency use in children 5-11 years old.

The FDA approved doses for children that are one-third the amount that teens and adults receive.

“With this vaccine kids can go back to something that’s better than being locked at home on remote schooling, not being able to see their friends,” Dr. Kawsar Talaat of Johns Hopkins University said, according to The Associated Press. “The vaccine will protect them and also protect our communities.”

Tuesday, advisers to the Centers for Disease Control and Prevention will make detailed recommendations, and the CDC director will have the final say.

Approval by the regulatory agencies would make the vaccine available in the coming days to 28 million American children, many of whom are back in school for in-person learning. Only a few other countries, including China, Cuba and the United Arab Emirates, have so far cleared COVID-19 vaccines for children in this age group and younger.

Meanwhile, the World Health Organization Regional Office for Europe on Friday called for schools to stay open, provided appropriate prevention and response measures are in place.

The recommendation comes after WHO reported the European region has now seen four consecutive weeks of growing COVID-19 transmission, the only WHO region to do so. The agency said Europe’s rising numbers accounted for 57% of new cases worldwide in the third week of October.

In a statement from the agency’s website, WHO/Europe says instead of closing educational institutions in response to this latest surge, it recommends a “whole-of-society approach” to reducing transmission through mitigation measures such as physical distancing, cleaning hands frequently, wearing masks and ensuring adequate ventilation.

The WHO regional director for Europe, Dr. Hans Henri Kluge, said, “Last year’s widespread school closures, disrupting the education of millions of children and adolescents, did more harm than good, especially to children’s mental and social well-being. We can’t repeat the same mistakes.”

Kluge said that in the coming months, decisions by governments and the public to reduce the impact of COVID-19 should be based on data and evidence, “with the understanding that the epidemiological situation can change, and that our behavior must change with it. Science must trump politics.”

The Pacific island of Tonga has recorded its first COVID infection. The fully vaccinated infected person arrived on the island Friday on a commercial flight from New Zealand.

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Thai Businesses Eager for Foreign Tourists’ Imminent Return

Before the pandemic effectively closed Thailand off to the rest of the world in March of last year, Bangkok’s Kin & Koff Café was perfectly placed to catch the throngs of tourists traipsing past the city’s gilded Grand Palace and its orbit of opulent temples.

In the capital of one of the world’s most popular holiday getaways, the resplendent grounds of the former royal residence were a must-see for most first-time visitors. Then came COVID-19, lockdown and a hard freeze on foreign tourists, decimating a pillar of Thailand’s economy — and the core of Kin & Koff’s client base with it.

So, like many in the business of catering to those tourists, owner Siripong Sanomaiwong welcomed the news that Thailand will start lifting lengthy quarantine mandates for some fully vaccinated foreigners on Nov. 1. Prime Minister Prayut Chan-ocha announced the move Oct. 11 in a televised address.

“I think the government is [acting] the right way to open up because we cannot hide from the virus,” Siripong said on another slow day in his café opposite the palace walls.

“We must live together with the COVID; we must live together … in safety,” he added, reflecting the business community’s general mood of wary resolve.

Risk and reward

In his address, Prayut acknowledged the risks. He said daily COVID cases were “almost certain” to rise with new arrivals but insisted Thailand was prepared and had to cash in on the coming November-March high season having missed out on the last one.

“We will have to track the situation very carefully and see how to contain and live with that situation because I do not think that the many millions who depend on the income generated by the travel, leisure and entertainment sector can possibly afford the devastating blow of a second lost New Year holiday period,” he said.

The World Bank says tourism accounted for 20% of Thailand’s gross domestic product and more than 1 in 5 jobs in 2019, when some 40 million people visited the country. The government says Thailand will be lucky to see 100,000 visitors in 2021 and is aiming for 1 million through this high season.

The Tourism Council of Thailand, an industry body, says the lockdown has cost the country some 3 million tourist-linked jobs. Even so, most Thais may not be on board with the government’s timing.

In an online poll conducted by Thailand’s Suan Dusit Rajabhat University between Oct. 11 and Oct. 14, 60.1% of respondents said the country was not yet ready to reopen to tourists without quarantine mandates. They cited Thailand’s low vaccination rate as the main reason.

While Bangkok and the popular resort island of Phuket have fully vaccinated the large majority of locals, the fully vaccinated rate nationwide only recently topped 40%. New daily COVID cases peaked at nearly 22,000 in mid-August but have yet to dip below 7,000. Thailand has recorded about 1.88 million cases in all.

Thitinan Pongsudhirak, a professor of political science at Bangkok’s Chulalongkorn University, said local polls can be unreliable but believed Suan Dusit’s latest effort frankly mirrored the popular mood.

“The sentiment on the ground is that the infection numbers are still high and the government’s vaccine management has been inept … [that] lives are still at risk and reopening too soon is still not optimal,” he said.

Positive thinking

The government hopes to allay those fears by opening up to only 46 countries at first, including major markets such as the United States and China, much of Europe and some Asian neighbors.

In addition to showing proof of vaccination and a negative test result before departure, visitors must have health insurance covering COVID for up to $50,000, download a tracking application and wait one night in a government-approved hotel for the results of a second test on arrival. If cleared, they will be free to roam the country. If not, they will have to spend more time in a hospital or approved hotel.

Siripong hopes that will be enough for his café to claw back by March about 40% of the business it had before the pandemic, and he’s confident the authorities can keep the virus in check.

Katenaphas Muattong is not so sanguine.

She left her catering job to help her parents run their small restaurant by the palace after the pandemic hit and their two employees had their wages cut and then quit. Tapping into online delivery services helped them survive, but business is still less than a third of what it was.

Katenaphas worries the government may apply the entry rules in what she called “Thai style,” explaining that to mean a lax attitude toward enforcement.

“On one [hand] we should open because business is going down, down,” she said. “But if we don’t have a good plan, we should wait.”

Turning the thoughts over in her mind a moment, she finally sided with the government and said Thailand should take the risk.

Vali Villa owner Val Saopayana is more of an avowed optimist.

Three years ago, the professional artist turned her childhood home into a boutique mid-range hotel a few blocks from Bangkok’s Khaosan Road, another popular tourist haunt packed with bars and clubs that once throbbed with dance music into the early morning hours. With nary a customer in sight one recent Friday afternoon, most of the strip was closed or boarded up, a microcosm of Thailand’s tourist sector writ large.

With Thailand now reopening to foreigners, Val is hopeful about reclaiming at least half of her pre-pandemic business by the end of this season.

“I have a good feeling that we’re going to be able to do it and the whole economy of Thailand is going to be better because I believe in the medical system and they try to do their best,” she said.

“We just hope that it will be back to normal very soon,” she added. “We have to believe and we have to have positive energy, and people are going to come.”

Reality check

The Association of Thai Travel Agents, another industry body, says “normal” will take a few more years, as some major markets such as China still mandate weeks of quarantine for travelers on their return.

“When you have that amount of quarantine days, it’s going to be a real limit for us. So, I think the opening, while we’re making great progress, it will very much depend on the origin countries’ levels of restrictions and quarantine days as well,” said ATTA board member Pilomrat Isvarphornchai.

She said the association was being “realistic” about the coming high season and forecast a 20% return to pre-pandemic business for inbound travel agencies, at least for those still open. The ATTA’s last member survey found that roughly half of them had closed during the past 19 months of lockdown, some for good.

“In terms of the economy, we are at that point now where we’re going to have to learn how to live with the pandemic, not just in terms of tourism but even opening up domestically, for example with restaurants, with retail stores. It needs to happen now,” Pilomrat said. 

 

 

 

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China Hits Reset on Belt and Road Initiative

Green energy is the new focus of China’s one-of-a-kind Belt and Road Initiative or BRI, that aims to build a series of infrastructure projects from Asia to Europe.

The eco-friendlier version of BRI has caught the attention of some 70 other countries that are getting new infrastructure from the Asian economic powerhouse in exchange for expanding trade.

The reset on China’s eight-year-old, $1.2 trillion effort comes after leaving a nagging layer of smog in parts of Eurasia, where those projects operate.

Now the county that’s already mindful of pollution at home is preparing a new BRI that will focus on greener projects, instead of pollution-generating coal-fired plants. It would still further China’s goal of widening trade routes in Eurasia through the initiative’s new ports, railways and power plants.

The Second Belt and Road announced in China on October 18, coincides with the 2021 United Nations Climate Change Conference, or COP26, which runs from Sunday through November 12 in Glasgow, Scotland. China could use the forum to detail its plans.

“China’s policy shift towards a more green BRI reflects China’s own commitment to reach net zero carbon emissions by 2060 and its efforts to implement a green transition within China’s domestic economy,” said Rajiv Biswas, Asia-Pacific chief economist with the market research firm IHS Markit.

“Furthermore, China’s policy shift…also reflects the increasing policy priority being given towards renewable energy and sustainable development policies by most of China’s BRI partner countries,” he said.

The Belt and Road helps lift the economies of developing countries from Kazakhstan to more modern ones, such as Portugal. BRI also unnerves China’s superpower rival, the United States, which has no comparable program.

History of focusing on fossil fuel

China has a history of putting billions of dollars in fossil fuel projects in other countries since 2013, the American research group Council on Foreign Relations says in a March 2021 study.

From 2014 to 2017, it says, about 90% of energy-sector loans by major Chinese banks to BRI countries were for fossil fuel projects and China was “involved in” 240 coal plants in just 2016. In 2018, the study adds, 40% of energy lending went to coal projects. Those investments, the group says, “promise to make climate change mitigation far more difficult.”

South and Southeast Asia are the main destinations for coal-fired projects at 80% of the total Belt and Road portfolio, the Beijing-based research center Global Environmental Institute says.

Global shift toward green energy

Chinese President Xi Jinping said last year China would try to peak its carbon dioxide emissions before 2030. The Second Belt and Road calls for working with partner countries on “energy transition” toward more wind, solar and biomass, the National Energy Administration and Shandong provincial government said in an October 18 statement. 

Some countries are pushing China to offer greener projects due to environmental pressure at home, though some foreign leaders prefer the faster, cheaper, more polluting options to prove achievements while in office, said Jonathan Hillman, economics program senior fellow at the Center for International & Strategic Studies research organization.

“There was a period in the first phase of the Belt and Road where projects were being shoveled out the door and with not enough attention to the quality of those projects,” he said.

Poorer countries are pressured now to balance providing people basic needs against environmental issues, said Song Seng Wun, an economist in the private banking unit of Malaysian bank CIMB. The basics still “take priority,” he said, and newer coal-fired plants help.

“Although I would say environmental issues (are) important, I think a lot of people don’t realize how much more efficient these more modern coal plants are, so I think we must have a balance,” Song said.

In the past few years however, cancellation rates of coal-fired projects have exceeded new approvals, Hillman said. “The action honestly has come more from participating countries,” he said. “They’ve decided that’s not the direction they want to go.”

In February, Chinese officials told the Bangladesh Ministry of Finance they would no longer consider coal mining and coal-fired power stations. Greece, Kenya, Pakistan and Serbia have asked China to dial back on polluting projects, Hillman said.

“The next decade will show to what extent the Belt and Road will drive green infrastructure,” London-based policy institute Chatham House says in a September 2021 report.

Belt-and-Road renewable energy investments reached a new high last year of 57% of its total for energy projects in 2020, according to IHS data.

New pledges at COP26?

COP26 is expected to showcase the environmental achievements of participating countries as they try to meet U.N. Paris Climate Change commitments, Biswas said.

China’s statements ahead of the conference so far differ little from past statements. But China’s energy administration said on October 18 that its second Belt and Road “emphasizes the necessity of increased support for developing countries” in terms of money, technology and ability to carry out green energy projects.

Chinese companies on BRI projects may eventually be required to reduce environmental risks, Biswas said. Those companies would in turn follow principles released in 2018 to ensure that their projects generate less carbon. A year later, as international criticism grew, Chinese President Xi added a slate of Belt and Road mini-initiatives, including some that touched on green projects.

But the 2019 plans were non-binding and untransparent, Hillman said. At COP26, he said, “I would take any big announcements with more than a grain of salt.”

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Farmers, Groups in Africa Prepare for a Future Made Uncertain by Climate Change

Some farmers and organizations in Africa are adopting smart and technology-based solutions as the continent seeks to prepare itself for the effects of climate change. Brenda Mulinya reports from Nairobi.
Camera: Amos Wangwa Producer: Amos Wangwa

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US Wages Jump by Most in Records Dating Back 20 Years

Wages jumped in the three months ending in September by the most on records dating back 20 years, a stark illustration of the growing ability of workers to demand higher pay from companies that are desperate to fill a near-record number of available jobs.

Pay increased 1.5% in the third quarter, the Labor Department said Friday. That’s up sharply from 0.9% in the previous quarter. The value of benefits rose 0.9% in the July-September quarter, more than double the preceding three months.

Workers have gained the upper hand in the job market for the first time in at least two decades, and they are commanding higher pay, more benefits and other perks like flexible work hours. With more jobs available than there are unemployed people, government data shows, businesses have been forced to work harder to attract staff.

Higher inflation is eating away at some of the wage increases, but in recent months overall pay has kept up with rising prices. The 1.5% increase in wages and salaries in the third quarter is ahead of the 1.2% increase in inflation during that period, economists said.

However, compared with a year ago, it’s a closer call. In the year ending in September, wages and salaries soared 4.2%, also a record gain. But the government also reported Friday that prices increased 4.4% in September from year earlier. Excluding the volatile food and energy categories, inflation was 3.6% in the past year.

Many experts expect inflation to slow

Jason Furman, a former top economic adviser to President Barack Obama, said Friday that inflation-adjusted wages still trail their pre-pandemic level, given the big price jumps that occurred over the spring and summer for new and used cars, furniture and airline tickets.

Whether inflation fades in the coming months will determine how much benefit workers get from higher pay.

Many economists expect inflation to slow a bit, while wages are likely to keep rising.

Pay is rising much faster in the recovery from the pandemic recession than in the recovery from the Great Recession of 2008-09, when wage growth kept slowing until a year after that downturn ended. That’s because of the different nature of the two recessions and the different policy responses.

There has been much more government stimulus during and after the pandemic recession compared with the previous one, including the $2 trillion financial support package signed by former President Donald Trump in March 2020 and the $1.9 trillion in aid approved by President Joe Biden this March. Both packages provided stimulus checks and enhanced unemployment benefits that fueled greater spending.

Lower-paid workers have seen the biggest gains, with pay rising for employees at restaurants, bars and hotels by 8.1% in the third quarter from a year earlier. For retail workers it’s jumped 5.9%.

The healthy increase for disadvantaged workers “is the result of specific policy choices to give workers a better bargaining hand and to ensure the economy recovered faster,” said Mike Konczal, a director at the left-leaning Roosevelt Institute. “The fact that it’s happening is pretty unique.”

The stimulus checks and an extra $300 a week in jobless benefits, which ended in early September, gave those out of work more leverage to demand higher pay, Konczal said. In addition, the Fed’s low-interest rate policies helped spur more spending, raising the demand for workers.

In August, there were 10.4 million jobs available, down from 11 million in July, which was the most in two decades.

Millions of Americans are responding to rising wages by quitting their jobs for better-paying positions. In August, nearly 3% of American workers quit their jobs, a record high. A higher number of quits also means companies have to raise pay to keep their employees.

Workers who switch jobs are seeing some of the sharpest income gains in decades. According to the Federal Reserve Bank of Atlanta, in September job-switchers saw their pay jump 5.4% compared with a year earlier. That’s up from just 3.4% in May and the biggest increase in nearly 20 years. For those who stayed in their jobs, pay rose 3.5%.

‘It was a no-brainer’

Esther Cano, 26, is one of those who found a new job that paid more in the July-September quarter. A recent college graduate who isn’t yet sure of her long-term career path, she left a job as a dispatcher at an HVAC firm in Fort Lauderdale, Florida, for a position at the job placement agency Robert Half. She started in July and got a raise of about 10%.

“What I was requesting was lower than what they were willing to pay,” Cano said. “It was a no-brainer on that end, plus the environment, the room for growth, the opportunity.”

Cano has already gotten a promotion to a team leader position, where she helps place temporary employees who work in finance and accounting.

Most economists expect solid wage gains to continue for the coming months. Data from the Indeed job listings website shows that employers are still posting huge numbers of available jobs.

Higher pay can fuel inflation, as companies raise prices to cover their increased costs. But that’s not the only way businesses can respond. Lydia Boussour, an economist at Oxford Economics, notes that corporate profits in the April-June quarter were at their highest level in nearly a decade. That suggests many companies can pay higher salaries without having to lift prices. 

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Tonga’s First COVID-19 Case Detected, May Face Lockdown

Tongan Prime Minister Pohiva Tuionetoa warned Saturday that residents on the country’s main island Tongatapu faced a possible lockdown next week after recording its first case of COVID-19.

The tiny Pacific kingdom had been among only a handful of countries to escape the virus so far, and the infection was detected in a person in managed isolation after returning to Tonga on a repatriation flight from New Zealand.

“The reason the lockdown won’t happen this weekend is because I have been advised that the virus will take more than three days to develop in someone who catches it before they become contagious,” Tuionetoa said.

“We should use this time to get ready in case more people are confirmed they have the virus.”

Most of Tonga’s population of 106,000 live on Tongatapu, and fewer than a third have received two doses of COVID-19 vaccine.

Health officials said the person who tested positive had received their second jab in mid-October.

The repatriation flight included members of Tonga’s Olympic team, who had been stranded in Christchurch since the Tokyo Games. The athletes were double vaccinated before they left for the Olympics.

New Zealand’s health ministry confirmed the infected person had tested negative before the flight left Christchurch, where there are only four known cases of COVID-19, all of them in the same household 

 

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