China cuts key interest rate as recovery falters

A worker in a textile factory in Haian city, eastern Jiangsu Province, China.STR/AFP

China’s central bank has cut its key interest rates for the second time in three months as the world’s second-largest economy struggles to recover from the impact of the pandemic.

The People’s Bank of China (PBOC) lowered its one-year loan prime rate to 3.45% from 3.55%.

The country’s post-Covid recovery has been hit by a property crisis, falling exports and weak consumer spending.

The cut comes as other major economies raised rates to tackle rising prices.

The PBOC last cut its one year rate – on which most of China’s household and business loans are based- in June.

Economists had also expected the bank to lower its five-year loan prime rate, which the country’s mortgages are pegged to. However, it was unchanged at 4.2%

In a surprise move last week, short and medium-term rates were also cut.

China’s economy has struggled to overcome several major issues in the wake of the pandemic, which saw much of the world shut down.

Last week, the serious problems in its property market were highlighted when crisis-hit real estate giant Evergrande filed for bankruptcy protection in the US.

The heavily-indebted company is still working on a multi-billion dollar deal with creditors.

Earlier this month, another of the country’s biggest property developers, Country Garden, warned that it could see a loss of up to $7.6bn (£6bn) for the first six months of the year.

The same week, official figures showed China had slipped into deflation for the first time in more than two years.

That was as the official consumer price index, a measure of inflation, fell by 0.3% last month from a year earlier.

Beijing has also stopped releasing youth unemployment figures, which were seen by some as a key indication of the country’s slowdown.

In June, China’s jobless rate for 16 to 24 year olds in urban areas hit a record high of more than 20%.

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Tunnelling works completed for Phase 2 of Singapore's sewage 'superhighway'

CHALLENGING PROCESS

PUB said that tunnelling work for Phase 2 of the project “was a challenging process” through highly built-up areas. 

“The tunnelling works had to be carried out by five different contractors, using pioneering construction methods and smart technologies for safe and smooth operations,” the agency said.

“This served to greatly reduce disruption to above-ground infrastructure and the public.”

Construction of Phase 2 also saw the implementation of new features that will allow authorities to ensure the integrity of deep tunnels and maintain them more easily.

“These include the use of concrete resistant to microbiological-influenced corrosion, isolation gates to allow for flow diversion, fibre optic cables for remote monitoring of a tunnel’s structural integrity and the use of air jumpers to control air flow within the tunnels,” PUB said.

The Tuas Water Reclamation Plant, a key component of Phase 2, is expected to be ready by 2026.

The plant will be located with the National Environment Agency’s Integrated Waste Management Facility to form Tuas Nexus, Singapore’s first integrated used water and solid waste treatment facility that will be fully energy self-sufficient, PUB said.

In a statement, PUB chief executive Goh Si Hou described the DTSS as a “game-changer” for “one of the most water-stressed countries in the world”.

“The Deep Tunnel Sewerage System is not only an engineering feat, but a key pillar in strengthening Singapore’s water resilience to meet the long-term challenges of climate change and growing water needs,” he said.

“This has been made possible through the bold vision and innovation of our pioneers, and decades of meticulous planning and hard work by our planners, engineers and contractors.

“We look forward to the upcoming completion of our water reclamation and NEWater plants, which will realise the full potential of the DTSS in the years to come.”

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Snap Insight: Leadership succession ‘back on track’ but no clear timeline

HANDOVER TIMELINE STILL UNCLEAR

Committing to transition without a specific timeline raises questions about clarity and planning.

Certainly, Mr Lee’s words will fuel speculation about the potential timing of an upcoming election. He said in July that he had no plans to call an early election.

A clear handover timeline would provide stakeholders with a sense of direction and certainty. It would give clarity about how outgoing and incoming leaders can work collaboratively to ensure a seamless transition, without leaving the nation in a state of uncertainty.

Two scenarios emerge: A handover before the next election – due by 2025 – or shortly thereafter.

The former could signal Mr Lee’s confidence in the 4G team’s readiness and their ability to shape the nation’s path. Mr Lee might assume the role of a senior minister, as his predecessors did, to continue offering guidance.

On the other hand, if Mr Lee were to lead the next election, it might inadvertently imply that the 4G leaders are not yet fully prepared for the transition.

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Maiden Pharmaceuticals: Fury in The Gambia a year after cough syrup deaths

Ebrima Sajnia and his wife watched their son die last year

In September last year, Ebrima Sajnia watched helplessly as his young son slowly died in front of his eyes.

Mr Sajnia, who works as a taxi driver in The Gambia, says three-year-old Lamin was set to start attending nursery school in a few weeks when he got a fever. A doctor at a local clinic prescribed medicines, including a cough syrup, but the feverish child refused to take them.

“I forced Lamin to drink the syrup,” recalls Mr Sajnia, sitting at his home in Banjul, capital of The Gambia.

Over the next few days, Lamin’s condition deteriorated as he struggled to eat and even urinate. He was admitted to a hospital, where doctors detected kidney issues. Within seven days, Lamin was dead.

He was among around 70 children – younger than five – who died in The Gambia of acute kidney injuries between July and October last year after consuming one of four cough syrups made by an Indian company called Maiden Pharmaceuticals.

In October, the World Health Organization (WHO) linked the deaths to the syrups, saying it had found “unacceptable” levels of toxins in the medicines.

A Gambian parliamentary panel also concluded after investigations that the deaths were the result of the children ingesting the syrups.

Both Maiden Pharmaceuticals and the Indian government have denied this – India said in December that the syrups complied with quality standards when tested domestically.

It’s an assessment that Amadou Camara, chairperson of the Gambian panel that investigated the deaths, strongly disagrees with.

“We have evidence. We tested these drugs. [They] contained unacceptable amounts of ethylene glycol and diethylene glycol, and these were directly imported from India, manufactured by Maiden,” he says. Ethylene glycol and diethylene glycol are toxic to humans and could be fatal if consumed.

Banjul, the capital of The Gambia

It’s a difficult situation for The Gambia, one of Africa’s smallest countries, which imports most of its medicines from India. Some bereaved parents say they don’t trust Indian-made drugs anymore.

“When I read that a medicine is from India, I barely touch it,” said Lamin Danso, who lost his nine-month-old son.

But the reliance on Indian drugs is unlikely to change anytime soon.

“Most pharmacists are still bringing in drugs from India – it’s far cheaper than importing drugs from America or Europe,” says journalist Mustapha Darboe.

India is the world’s largest exporter of generic drugs, meeting much of the medical needs of developing countries. But allegations that its drugs have caused tragedies like the one in The Gambia – and in other countries such as Uzbekistan and the US – have raised questions about manufacturing practices and quality standards.

“If you see the tragedy, and the kind of alerts declared by WHO, so many countries are thinking twice. They are regularly enquiring. It’s not very comfortable. I call it an aberration. It’s a costly aberration,” says Udaya Bhaskar, director general of the Pharmaceuticals Export Promotion Council of India.

He says while incidents like the one in The Gambia and Uzbekistan have “made a dent” on the Indian pharmaceutical industry’s image, it hasn’t impacted exports.

India exported medicines worth $25.4bn (£20bn) in the financial year ending in March 2023 – of these, $3.6bn was to countries in Africa. Mr Bhaskar points out that the country has already exported drugs worth more than $6bn in the first quarter of the current financial year.

But India has announced steps such as making it compulsory for companies to get cough syrup samples tested at government-approved laboratories before exporting. The Gambia, which does not have drug testing laboratories, has also made this mandatory for medicines exported from India since July.

India has also set deadlines for its pharma companies to adopt WHO-standard good manufacturing practices.

Some of the families have filed a case in the Gambian high court

But some Indian activists allege that the country has had a “two-tier manufacturing system” for a long time.

“What we export to the US and Europe, we try and use much more stringent standards compared to drugs made for local consumption and exported to less regulated markets,” alleges Dinesh Thakur, a public health activist.

Mr Bhaskar disagrees, saying that several countries in Africa – India’s third-largest export destination – have “robust” regulatory mechanisms.

A recent Gambian government report on the tragedy has recommended the establishment of a quality control laboratory and two drug regulators have been dismissed.

“We know the anger in the society. We know the anger among the victims,” says Billay G Tunkara, the majority leader of the Gambian National Assembly and head of government business.

But devastated parents say nothing has changed in the country’s health sector over the past year – the medical system struggled to cope with the influx of fever cases and some parents were forced to raise funds to send their children to neighbouring Senegal.

Momodou Dambelleh, who sells wood for a living, was one of them. He last saw Aminata, his 22-month-old daughter, on a video call as she lay unresponsive on a hospital bed.

“I could only see her head moving. I was trying to let her know it was me, her papa,” he says. That was shortly before she died.

“Those who committed the crime, including the health minister, should face the full force of the law,” says Ebrima EF Saidy, spokesperson for a group representing the parents of the victims.

Dr Ahmadou Lamin Samateh, health minister of the Gambia, did not respond to the BBC’s request for an interview.

Momodou Dambelleh and his wife sent their daughter to neighbouring Senegal for treatment

A year on, many of the parents say they are determined to make sure that others in The Gambia don’t have to experience such pain again.

The families of 19 children have sued local health officials and Maiden Pharmaceuticals in the Gambian high court. They say they won’t hesitate to approach Indian and international courts as well if needed.

“The government’s negligence made the children die,” says Mr Sagnia, who is part of the group.

This is the first in a two-part series.

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Commentary: Taylor Swift, Coldplay concerts strike the right chord for Singapore’s stock market

THE STORY OF US

Investors in Singapore’s Straits Times Index (STI) may have something to cheer about, especially given the comparatively subdued performance this year. In the first quarter, the STI grew a modest 0.23 per cent, compared with the US S&P 500 Index, which grew by 7.03 per cent.

First, there is the direct impact on entertainment companies. Shares for UnUsUaL Productions, the concert promoter behind the Jacky Cheung marathon, jumped more than 13 per cent in the days after his concerts were announced.

Another big beneficiary would be stocks that traditionally gain from increased tourism, such as hotels. This has been reflected in the performance of Singapore’s hospitality REITs. Following Jacky Cheung’s concert announcement, CapitaLand Ascott Trust’s stock price rose 4.67 per cent between April and July. A similar pattern was observed for Far East Hospitality Trust’s stock price, which increased 4.88 per cent in the same period.

Their positive performances came despite the high interest rate environment. Higher interest rates tend to decrease the value of properties and increase REIT borrowing costs, meaning downward pressure on S-REITs. However, taking reference from the US Fed fund futures, a rate cut is expected to happen by the Fed meeting in December, which could be beneficial for REITs.

Likewise, the transport sector has similarly trended upward. From April to July this year, the share price of Singapore Airlines increased by 29.38 per cent. While the surge could partially be attributed to post-COVID “revenge travel,” concerts have offered an added catalyst for travel. In-country travel stands to benefit as well; notably, ComfortDelGro stocks have gained 5.88 per cent between April and July.

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The Big Read: Transporting migrant workers on lorries - why can't we stop the unsafe practice after so long?

MILLION-DOLLAR BUS RIDE The main “complexities” — costs, operational needs and infrastructural limitations – that have been highlighted by the authorities and business associations are not easy to manage, several companies told TODAY. Mr Allan Low, deputy director for quality, environment health and safety at Teambuild Construction Group, said thatContinue Reading

MPs welcome new Plus flats category, believe it will help young families, sandwich generation

NEW HDB PLUS FLATS HELP YOUNG FAMILIES, SANDWICH GENERATION 

The announcement of the Plus flats category “meets the concerns for many Singaporeans who are concerned about whether or not they can afford flats in choice locations”, MP Henry Kwek (PAP-Kebun Baru) told CNA. 

He said that the “proposals on how to maintain good social mix, ensure affordability, and ensure the system is fair” resonates with the views that he hears from many Singaporeans in the Forward Singapore conversation. 

“When we give more subsidies, it means that people of all income groups can afford a house and it also means that our various HDB estates can continue to have good social mix,” he added.

Asked what he wished could be better about the public housing announcements on Sunday, Mr Kwek cautioned that “housing is something that affects everybody” and that there are “so many dimensions that we have to watch out for”. He added that he “fully agrees” with the “measured approach” to the changes. 

“Personally, I believe that we have to take gradual steps and not rush to create too many changes at one shot, because the consequences could be unpredictable,” he said. 

Similarly, MP Nadia Samdin (PAP-Ang Mo Kio) pointed out that the introduction of Plus flats would benefit young couples who wish to stay near their family. 

“I often have a lot of young people who have come to me and say, ‘I really want to stay near my family. However, I don’t have any options.’ Or they feel that they are being priced out of their options,” she said, adding that the Plus category of flats would be good for such couples. 

Meanwhile, MP Melvin Yong (PAP-Radin Mas) pointed out that the Plus flats would be “especially beneficial” to his residents because his constituency is located in the central part of Singapore. As a result, the new BTO flats and resale flats “tend to be priced higher”. 

“A lot of my residents – both the elderly parents as well as (their) children – will have come to me for help,” he said. 

“Parents say, ‘Can you help my children to get a home nearer to me?’; young people say, ‘We have been balloting a lot and we cannot get a flat.’ So sometimes when we advise them to look for (a flat in) what they call a ‘non-mature estate’, they tend to be a lot further.”

Doing away with the decades-old labels of mature and non-mature estates and introducing the Standard, Plus and Prime classification model, “would certainly help hopefully lower the price”, Mr Yong believes.

“And then it will allow my residents a better chance of fulfilling their wish to stay nearer to their parents.”

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Resale restrictions for Plus, Prime flats may slow growing number of million-dollar HDB deals: Analyst

SINGAPORE: With longer minimum occupation periods (MOP) for new Housing Board flats in desirable locations, the number of million-dollar resale flat transactions could be crimped in time to come, said an analyst. Prime Minister Lee Hsien Loong announced on Sunday (Aug 20) a major shift to how HDB flats are classified, with Build-to-Order (BTO)Continue Reading

New ‘Plus’ BTO category, more housing options for singles: 5 key takeaways from PM Lee’s National Day Rally

5. Leadership succession is back on track

Mr Lee spoke briefly about leadership renewal, recalling his original plan to hand over and step down as Prime Minister by 2022 – before his 70th birthday. 

While the COVID-19 pandemic disrupted this, he said his succession plans are now back on track. Mr Lee is 71 years old this year.

“Recently, several controversial issues have drawn Singaporeans’ attention. I have spoken about them in parliament and in my National Day Message. We dealt with each of them thoroughly and transparently,” Mr Lee noted.

“Let me assure you – these incidents will not delay my timetable for renewal. We are on track.”

These issues included an extramarital affair between former Speaker of Parliament Tan Chuan-Jin and former Tampines GRC MP Cheng Li Hui, which emerged in the public eye about a month ago. The pair have resigned from parliament and the People’s Action Party.

Shortly before that, Transport Minister S Iswaran was arrested in relation to a corruption probe.

Mr Lee said that more and more, his task is to support the 4G (fourth-generation) team led by Deputy Prime Minister Lawrence Wong and their agenda.

He asked Singaporeans to give Mr Wong and his team their fullest support now and after they take over.

“Our nation’s future depends on them, working as one with you to take Singapore forward. I have every confidence in Lawrence Wong and his team,” Mr Lee added.

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