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Global economic crisis felt in Pakistan: Daily

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Islamabad: The international impact of the stock market collapse was felt in Pakistan, said a daily here on Tuesday.

us-Stock1An editorial “Black August” in the News International said that following the panic in the international stock markets created by a slowdown of the Chinese economy, the Karachi Stock Exchange (KSE-100) plummeted by 1,300 points near the close of trading on Monday, down around 4 percent on a single day.

Analysts have blamed the panicking small investors and the exit of foreign investors from the market. Some suggest foreign investors made profits by selling Pakistani stocks as they suffered serious losses in other emerging markets.

The daily said that market capitalization fell by Rs.300 billion.

“In addition to the Chinese slowdown, the international downturn is also being attributed to the fall in international commodity prices, uncertainty over when US Federal Reserve might raise interest rates and the Greek economic collapse.”

The editorial said that the crisis started when the Chinese government decided to devalue the yuan by around 2 percent two weeks ago which sparked concerns over low growth in Chinese exports. Experts have now predicted that the devaluation of the Chinese currency is likely to flood the market with cash.

“The biggest impact was felt by Chinese stock markets where the Chinese Shanghai Composite index came down by 8.5 percent on Monday. This is the biggest one-day slump in China since 2007.”

“…The impact of what is being called ‘Black Monday’ is being felt across the globe with KSE-100 being a small part of the global collapse… While some observers are calling it a ‘correction’ in the global markets, Monday has shown an underlying instability in the global financial system,” said the daily.

The editorial went on to say that the three key nodes of the global economy are in a steady crisis. “Europe, the US and China are all facing serious problems.”

“There are no immediate remedies available in the stock market as the international impact of the collapse will be felt in Pakistan.”

It added that the month of August has wiped at least $5 trillion off the global economy.

“Is this a full-blown economic crisis?,” the daily asked and added: “It is too early to say.”

“But it does say something about the volatility of the global economy that a decrease in the value of the Chinese currency has set off questions about the entire economic recovery story that has been painted since the last global economic crisis in 2007,” it said.

(IANS)

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China, US Set To Take Action Against Each Other

US business executives are now bracing for further retaliation from China due to Meng's arrest

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President Donald Trump with China's President Xi Jinping during their bilateral meeting, Dec. 1, 2018 in Buenos Aires, Argentina. VOA

China and the US are set to take action against each other as tensions escalate over trade, cyber hacking and espionage as senior American law enforcement officials identified Beijing as the most serious threat to Washington’s national security, officials said.

China’s methods of non-traditional espionage, including their use of ordinary Chinese expatriates instead of spies at universities and businesses, and intellectual property theft, were explained by the officials from the FBI and Departments of Justice and Homeland Security who briefed US lawmakers on Wednesday, CNN reported.

“As the US proceeds a whole of society response to this threat, we must address the vulnerabilities within our system while preserving our values and the open, free and fair principles that have made us thrive,” E.W. Priestap, the Federal Bureau of Investigation’s Assistant Director of Counter-intelligence told the Senate Judiciary Committee.

“What hangs in the balance is not just the future of the US, but the future of the world.”

The Department of Justice’s (DOJ) top national security official told lawmakers on Wednesday the administration was reacting to China’s “steadily increasing” economic espionage activity, which costs the US an estimated $225 billion a year.

From 2011 to 2018, more than 90 per cent of the DOJ’s cases alleging economic espionage by a state have involved China, and more than two-thirds of trade secret thefts have a nexus to China, Assistant Attorney General John Demers said.

Donald Trump, democrats, government,, pakistan
U.S. President Donald Trump. VOA

“From underwater drones and autonomous vehicles to critical chemical compounds and inbred corn seeds, China has targeted advanced technology across sectors that align with China’s publicly announced strategic goals,” Demers said. “The play book is simple: rob, replicate and replace.”

Priestap and his colleagues testified hours after Secretary of State Mike Pompeo confirmed in an interview with Fox News that the US believes Beijing was behind the massive cyber-attack on the Marriott hotel chain, CNN reported.

The New York Times reported on Tuesday that the assault was part of a broader Chinese operation that also targeted health insurers and the security clearance files of millions of Americans.

Also Read- Bug Spotted in Microsoft Office 365, Outlook

Those disclosures came a day after President Donald Trump said that he would be willing to use Huawei’s Chief Financial Officer (CFO) Meng Wanzhou who was arrested in Canada for violating US sanctions on Iran as a bargaining chip in his trade war with Beijing, which for now is in a 90-day pause.

A Canadian judge on Tuesday night granted Meng a $7.5 million bail, while she awaits extradition to the US.

US business executives are now bracing for further retaliation from China due to Meng’s arrest. (IANS)