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Tropical Storm Amanda kills at least seven people in El Salvador

SAN SALVADOR (Reuters) – Tropical Storm Amanda has killed at least seven people in El Salvador as heavy rains made rivers overflow, flooded city streets and produced landslides, Interior Minister Mario Duran said on Sunday.

“We’ve seen people asking for help, asking for the government. We haven’t deployed everywhere, the situation is overwhelming,” said Duran.

Among those killed was an eight-year-old boy, who died after the house he was in collapsed, while another person was killed by a falling wall and another drowned in a swollen river, Salvadoran civil protection authorities said.

The U.S. National Hurricane Center (NHC) said Amanda or its remnants are expected to produce rain totals of 10 to 15 inches over El Salvador, southern Guatemala, western Honduras, and the Mexican states of Tabasco and Veracruz.

The storm’s heavy rainfall could “cause life-threatening flash floods and mudslides across portions of Central America and southern Mexico, and these threats will continue over the next several days even after Amanda is no longer a tropical cyclone,” said the NHC.

Amanda was packing maximum sustained winds of nearly 40 miles per hour (65 kilometers per hour) with higher gusts and was expected to weaken “very soon” as its center moves farther inland, said the NHC.

It is forecast to degenerate into a remnant low or dissipate over the mountains of Central America later on Sunday.

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World News

No COVID-19 deaths reported in Sweden in 24 hours, but weekend figures typically delayed

STOCKHOLM (Reuters) – Sweden has not reported any coronavirus deaths in the last 24 hours, for the first time since March 13, the health authority said on Sunday, but there is typically a delay in reporting figures at weekends.

Sweden’s open approach to the virus, mostly based on voluntary social distancing and basic hygiene, has been criticized by some as a dangerous experiment, but also once touted as a future model by the World Health Organization.

Last week, Sweden had the highest number of COVID-19 deaths in Europe per capita over a seven-day-period, data showed.

There have been previous weekends where the death toll has increased by as little as two, only for a steeper rise to return in the following days when the reporting catches up, the health authority spokesman said.

The pandemic has killed 4,395 people in Sweden.

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Economy

Dubai faces 5.5% recession this year as $10 bln debt repayments loom, BofA says

DUBAI, May 31 (Reuters) – Dubai could see a recession of around 5.5% in 2020 as it faces about $10 billion in debt maturities this year while revenues are expected to drop in line with the pattern of the 2009 crisis, Bank of America said in a research note.

Measures to stem the spread of the coronavirus have dealt a blow to Dubai’s economy, bringing vital industries like tourism and aviation to a near halt.

Bank of America estimates that Dubai’s fiscal deficit could widen to $4.4 billion, or 3.9% of GDP, and could be as high as 5.3% if interest payments on a loan from Emirates NBD, Dubai’s biggest lender, are included.

Financing of the fiscal deficit or liquidity injection into government-related entities (GREs) will likely primarily be via loans from ENBD, Bank of America said. Dubai could also draw on $1.4 billion in deposits at ENBD or issue privately placed bonds.

International Monetary Fund data puts Dubai government and GRE debt at 110% of GDP, unchanged in nominal terms since the 2009 global financial crisis, but Bank of America said “more corporate distress” was possible in a sustained downturn.

“Sustained revenue losses could generate corporate solvency concerns if the recovery is shallow,” it said.

Citing IMF data, the bank said Dubai and government-related entities face some $10 billion in debt repayments this year.

It said it expected the government and banks to receive support from oil-rich Abu Dhabi and the UAE central bank, if needed, but that debt redemptions from Dubai government companies in the coming years were more at risk.

Sources told Reuters this month that the governments of Abu Dhabi and Dubai were discussing ways to prop up Dubai’s economy by linking up assets in the two emirates. Dubai denied the report. (Reporting by Yousef Saba; Editing by Nick Macfie)

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Business

Wall Street Week Ahead: Investors eye consumer discretionary stocks as U.S. reopens

NEW YORK (Reuters) – Investors are taking a closer look at the market’s consumer discretionary companies as a reopening U.S. economy fuels hopes of a turnaround for some of the sector’s hardest-hit names.

Many companies in the sector have been battered by the country-wide coronavirus-fueled lockdowns that have weighed on growth and damaged retail spending over the last several months, though the stocks of a few, like Amazon, have soared.

A gradual lifting of lockdowns in some states has stirred hopes for a bounce back for the retailers that make up much of the sector.

Some investors, however, say it may be months before consumers return to their previous shopping habits, making it unlikely that the companies will see a pickup in revenues in the near term.

Firms ranging from middle-income retailers such as Gap Inc and American Eagle Outfitters Inc to high-end destinations like Tiffany & Co and Vail Resorts Inc are expected to report results in the week ahead.

“This particular group is full of landmines,” said Jamie Cox, managing partner for Harris Financial Group. “There is not going to be a lot of investor follow-through until we get some certainty with what future revenue prospects are going to be.”

Shares of the Gap, for instance, are down 43% for the year to date. A recession that persists through the fourth quarter of this year would reduce the company’s revenues by 40%, according to a note by research firm Trefis.

Next Friday’s U.S. jobs report is expected to show that the unemployment rate rose to 19.8% in May, smashing April’s record 14.7%, according to a Reuters poll. Non-farm payrolls are expected to drop by 7.4 million, adding to the 20.5 million jobs lost the previous month.

Cox is focusing on dominant players such as Amazon.com Inc, Walmart Inc and Target Corp, which have a mix of essential items such as groceries as well as electronics and games that can appeal to customers who may face extended lockdowns during a potential second wave of the virus.

Overall, retail companies in the S&P 500 are up 12.9% for the year to date, a gain powered largely by Amazon’s 31% rally. Apparel companies, by comparison, are down 16.2% over the same time.

Brian Jacobsen, senior investment strategist for the Wells Fargo Asset Management Multi-Asset Solutions team, says retail companies will likely show rising expenses over the next several quarters due to items like more frequent sanitation of stores and technology purchases aimed at increasing the productivity of employees working from home.

“It’s really going to be a challenge to get a clear read of the direction for quite a while,” he said.

Despite those headwinds, investors may still gravitate toward companies that are able either to tap the capital markets for funds or draw from their financial reserves, said Randy Frederick, vice president of trading and derivatives with the Schwab Center for Financial Research.

Retailers such as J. Crew and J.C. Penney have already filed for bankruptcy due in part to the coronavirus pandemic, leaving more opportunity for companies that are able to survive and grab market share, said Frederick.

“You’re getting set up for potential upside surprises,” he said. “You may take a step back and look at this and say, ‘No matter how awful these numbers may be, at least they’re still in business.’”

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World News

Who is Mustafa al-Kadhimi, Iraq's new prime minister?

Al-Kadhimi is viewed as pragmatic as well as having good relations with main players across Iraqi political spectrum.

Iraq’s new Prime Minister Mustafa al-Kadhimi took office after the country’s parliament approved a new government on Wednesday following nearly six months of political wrangling.

The parliament approved 15 ministers out of a prospective 22-seat cabinet in a vote of confidence. Five candidates were rejected while voting on two ministers was postponed, leaving seven ministries still empty, including the key oil and foreign affairs positions.

More:

  • Iraq forms new government after six months of uncertainty

  • Could it be third time lucky in Iraq with new PM-designate?

  • Iraqi PM to resign after deadly anti-government protests

Two previous nominees for the role of prime minister – Mohammed Tawfiq Allawi and Adnan al-Zurfi – failed to secure enough support among cabinet ministers.

This led to President Barham Salih appointing al-Kadhimi as prime minister-designate last month as the third candidate to form a cabinet, amidst a backdrop of anti-government protests.

The protests began in October 2019 after thousands of Iraqis took to the streets and called for the overhaul of what they said was the country’s political and corrupt ruling elite.

Heavy-handed responses by the government security forces, which killed hundreds of protesters, forced then Prime Minister Adel Abdul Mahdi to resign, although he remained in a caretaker role until Allawi was appointed in early February.

Before the voting session on the new cabinet on Wednesday, al-Kadhimi said his government would be a “solution-based, not a crisis government”. He promised early elections and rejected the use of Iraq as a battleground by other countries.

The prime minister also pledged to address the repercussions of the economic crisis by rationalising spending and negotiating to restore Iraq’s share of oil exports.

Early life

Born Mustafa Abdellatif Mshatat in 1967 in the capital Baghdad, he left Iraq in 1985 to Iran, before moving to Germany and the United Kingdom, which he later became a citizen of.

He holds a bachelor’s degree in law and is better known for his work as a journalist, where he chose the title of al-Kadhimi. 

He was known to oppose the rule of the late Iraqi dictator Saddam Hussein. 

After the United States invasion of Iraq in 2003, al-Kadhimi returned to Iraq and cofounded the Iraqi Media Network, running in parallel with his work as executive director of the Iraq Memory Foundation, an organisation founded for the purpose of documenting the crimes under Hussein’s Baath regime.

Al-Kadhimi also served as editor-in-chief of Iraq’s Newsweek magazine for three years from 2010. He is also an opinions writer as well as the editor of the Iraq section of the US-based Al-Monitor website. 

In June 2016, al-Khadhimi took over the role of director of the Iraqi National Intelligence Service, in light of the intensification of the battles against the Islamic State of Iraq and the Levant (ISIL, also known as ISIS).

During his tenure, he forged links with dozens of countries and agencies operating within the US-led international coalition against ISIL.

During a rare visit to the Saudi capital, Riyadh, in 2017, accompanied by former Iraqi Prime Minister Haider al-Abadi, al-Kadhimi was seen in a long embrace with his friend Saudi Crown Prince Mohammed bin Salman (MBS). 

Al-Kadhimi is widely viewed by associates and politicians as having a pragmatic mentality in addition to cultivating relations with all the main players across the Iraqi political spectrum: a good relationship with the US, and another that has recently reached out to the Iranians.

Iran and its allied Iraqi Fatah political bloc had previously vetoed al-Kadhimi’s appointment.

Last month, Kataeb Hezbollah, an armed group close to Iran and linked to the Popular Mobilization Units, issued a statement accusing al-Kadhimi of having blood on his hands for the deaths of its leader Abu Mahdi al-Muhandis and Iranian General Qassem Soleimani, and accused him of collaborating with the US.

However, with the oil price crash and the coronavirus pandemic, compromises were made between the Fatah bloc and al-Kadhimi who said he will uphold the muhasasa, or political apportionment system.

Introduced in Iraq after the 2003 US-led invasion in an attempt to provide proportional government representation among Iraq’s various ethno-sectarian groups, many Iraqis believe the system is deeply flawed and acts as a conduit for corruption and political patronage.

According to Iraqi political analyst Hisham al-Hashimi, al-Kadhimi faces no easy task in getting the country back on its feet again.

“I don’t doubt his ability on the technical issues such as forming equitable laws and a fair commission,” al-Hashimi told Al Jazeera.

“He will succeed in preparing for early elections, but the timing is not on his side due to the dire economic conditions and the spread of the coronavirus pandemic.”

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World News

Bangladesh cartoonist, writer charged for anti-government posts

At least 11 people charged for posting content critical of the government’s handling of the coronavirus outbreak.

A Bangladeshi cartoonist and a writer are among 11 people to be charged for posting content on social media critical of the government’s handling of the coronavirus outbreak in the country.

Two of the 11 – cartoonist Ahmed Kabir Kishore and writer Mushtaq Ahmed – were arrested on Wednesday by the Rapid Action Battalion paramilitary forces under the Digital Security Act (DSA), which critics say is a serious threat to freedom of expression in the nation of 168 million people.

More:

  • Free speech concerns in Bangladesh as writers, activist arrested

  • Bangladesh editor arrested after report on executed Jamaat leader

  • Bangladesh editors protest ‘chilling’ Digital Security Act

Police have arrested at least 40 people in recent weeks under the controversial law that activists say is being used to suppress criticism of the government’s handling of the contagion.

The impoverished South Asian nation has reported 11,719 virus cases and 186 deaths so far, but experts say limited testing by authorities means the true figures could be much higher.

‘Spreading rumours’

The 11 have been charged with “spreading rumours and misinformation on Facebook about the coronavirus situation,” Dhaka Metropolitan Police Assistant Commissioner Shamim Ahmed told AFP news agency.

They are also accused of “undermining the image” of the late Sheikh Mujibur Rahman, the father of current Prime Minister Sheikh Hasina and the nation’s founding leader.

An investigation officer told the Daily Star newspaper that Kishore and Ahmed were arrested on charges of posting anti-government content on Facebook.

Prime Minister Sheikh Hasina, who enjoys an absolute majority in Parliament, has been accused of suppressing dissent and jailing opponents.

Kishore was working on a Life in the Time of Corona cartoon series that included caricatures of ruling party leaders and allegations of health sector corruption.

Ahmed has been a vocal online critic about the alleged shortage of protective gear for doctors.

The DSA passed in 2018 authorises prison sentences for up to 14 years for anyone who secretly records government officials or gathers information from a government agency using a computer or other digital device.

It also sets similar punishments for people who spread “negative propaganda” about the country’s 1971 war of independence and its founding leader Sheikh Mujib.

‘Assault to freedom of expression’

Activists and journalists fear misuse of the law.

“It is seen as an assault to freedom of expression, to the right to life and livelihood,” human rights activist Rezaur Rahman Lenin told AFP after the latest charges.

“The government should instead nurture a free press … which can greatly help in curbing the pandemic.”

Bangladesh reported 790 new infections on Wednesday – its fourth-straight one-day record of fresh cases.

The government on Monday extended its nationwide lockdown to May 16, but has allowed factories and some shops to reopen to kickstart the economy.

“There are deaths. We are sorry for that. But the number of deaths is still low compared to other nations,” Health Minister Zahid Maleque said on Tuesday as he acknowledged that the reopenings could drive up infections.

Bangladesh has also lifted restrictions on people congregating in mosques for prayers from Thursday.

Places of worship are to provide hand sanitiser and devotees should wear face masks and use their own prayer mats, the religious affairs ministry said on Wednesday.


UpFront

Shahidul Alam: Bangladesh is ‘an autocracy by any means’

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World News

England risks COVID-19 resurgence by ending lockdown too soon, scientific advisers say

LONDON (Reuters) – England risks losing control of the coronavirus pandemic again because it is starting to lift its lockdown without a fully operational track and trace programme in place, senior scientific advisers warned on Saturday.

One of the slowest countries to lock down, Britain is now one of the worst-hit. To allow some parts of the economy to reopen while curbing the virus spread, a test and trace system was introduced on Thursday that will ask the contacts of people who have been infected to isolate for 14 days.

Prime Minister Boris Johnson’s office said the cautious steps, which allow for up to six people to meet outside their homes in England and the resumption of some school classes, would ease the burden of lockdown while keeping the virus’ reproduction rate down.

“We have at all times been informed by the data and evidence,” it said.

But the scientific advisers said the system was untested, would not be fully operational until the end of June and risked being overwhelmed by the infection rate – currently around 8,000 new cases a day. A mobile tracing app is not yet ready.

John Edmunds, from the London School of Hygiene & Tropical Medicine and a member of Britain’s Scientific Advisory Group for Emergencies (SAGE), said the government was taking a risk.

“Track and trace was only launched the day before yesterday, so we can’t be sure that that is working effectively yet and yet we’re going ahead and making these changes anyway,” he told Sky News. “I think that that is rather dangerous.”

Three other SAGE members echoed this concern: Peter Horby, also the chairman of the New and Emerging Respiratory Virus Threats Advisory Group (NERVTAG), Jeremy Farrar, the director of the Wellcome Trust, and Calum Semple of the University of Liverpool.

London Mayor Sadiq Khan also said he was also deeply concerned and urged people to act with caution.

Britain has recorded more than 270,000 cases of coronavirus and says more than 38,000 have died after testing positive for the illness. The Office of National Statistics and other sources of data put the figure of fatalities from suspected and confirmed cases at 48,000.

Johnson’s government, which has been heavily criticised for its handling of the crisis, is now caught between the need to prevent a second wave and the need to reopen the economy and keep companies alive.

It says that while it may have made some mistakes it is grappling with the biggest public health crisis since the 1918 influenza outbreak and that it has prevented the health service from being overwhelmed.

Horby of the University of Oxford said there was still too much uncertainty about what would happen to the virus’ reproduction rate if schools reopen and other activities resume.

Related Coverage

  • Third British scientist warns over rush to lift lockdown

“Returning to a situation where we’ve lost control again is far worse than a week or two of social measures,” he told BBC Radio. SAGE includes more than 50 scientists, medics and academics who advise the government.

Government officials have repeatedly said they are following “the science” as they respond to the pandemic, but Edmunds said the decision to ease the lockdown from Monday was political.

“My frustration has been recently at least that they’re pretending that they’re not making a decision, that in fact it’s us who are making the decision, and that’s not really the case,” he said. “They have to make the decision and clearly they have.”

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World News

China PANICS: Warning Beijing is lashing out and risking war because it fears IRRELEVANCE

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Chris Patten said Chinese President Xi Jinping is so nervous about the position of the Communist Party that he is risking a new Cold War and imperiling Hong Kong’s position as Asia’s preeminent financial hub. Lord Patten said Xi’s “thuggish” crackdown in Hong Kong could trigger an outflow of capital and people from the city which funnels the bulk of foreign direct investment into mainland China.

“What does it mean? It means serious question marks not just about Hong Kong’s future as a free society but also about Hong Kong’s ability to continue as probably the premier international financial hub in Asia,” Lord Patten said in an interview.

“A lot of people will try to leave Hong Kong,” Lord Patten said, adding he feared capital would also flow out of the territory which Britain handed back to China in 1997.

The West, he said, should stop being naive about Xi.

“We have long since passed the stage where, without wanting another Cold War, we have to react to the fact Xi seems to want one himself, seems to want to be able to bully his way to whatever he thinks China wants,” Patten said.

Patten, now 76, watched as the British flag was lowered over Hong Kong when the colony was handed back to China in 1997 after more than 150 years of British rule – imposed after Britain defeated China in the First Opium War.

Hong Kong’s autonomy was guaranteed under the “one country, two systems” agreement enshrined in the 1984 Sino-British Joint Declaration signed by then Chinese Premier Zhao Ziyang and British Prime Minister Margaret Thatcher.

In some of his toughest rhetoric yet, this week US President Donald Trump said Beijing had broken its word over Hong Kong’s high degree of autonomy by proposing new national security legislation and the territory no longer warranted US economic privileges.

“We will take action to revoke Hong Kong’s preferential treatment as a separate customs and travel territory from the rest of China,” Mr Trump said, adding that Washington would also impose sanctions on individuals seen as responsible for “smothering – absolutely smothering – Hong Kong’s freedom.”

Mr Trump told reporters at the White House that China’s move on Hong Kong was a tragedy for the world, but he gave no timetable for the moves, leaving Hong Kong residents, businesses and officials to ponder just how far his administration will go.

The American Chamber of Commerce in Hong Kong said Saturday marked “a sad day” for China’s freest city.

“This is an emotional moment for Americans in Hong Kong and it will take companies and families a while to digest the ramifications,” AmCham President Tara Joseph said in a statement.

“Many of us … have deep ties to this city and with Hong Kong people. We love Hong Kong and it’s a sad day,” she said, adding the chamber would continue to work with its members to maintain Hong Kong’s status as a vital business centre.

China’s parliament this week approved a decision to create laws for Hong Kong to curb sedition, secession, terrorism and foreign interference. 

Mainland security and intelligence agents may be stationed in the city for the first time, with critics saying these moves put the city’s extensive freedoms at risk.

Authorities in Beijing and Hong Kong insist the legislation will target only a small number of “troublemakers” who threaten China’s national security. 

They say such action is urgently needed after months of sometimes violent anti-government protests rocked the city last year.

Protests are simmering again as Hong Kong emerges from its coronavirus shutdown, with demonstrators expected to take to the streets on Sunday.

Trump did not name any sanctions targets but said the announcement would “affect the full range of agreements we have with Hong Kong”, including the US-Hong Kong extradition treaty to export controls on dual-use technologies and more “with few exceptions”.

China’s Global Times, published by the People’s Daily, the official newspaper of China’s ruling Communist Party, said Trump’s decision was a “recklessly arbitrary” step.

The Hong Kong government has had a long history of working ties with US counterparts, distinct from Beijing, with cooperation on counter-terrorism, trade and money laundering.

More than 1,300 US firms have offices in Hong Kong and provide about 100,000 jobs. 

In the past decade, the US trade surplus with Hong Kong has been the biggest among all its trading partners, totalling $297 billion from 2009 to 2018.

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World News

Hong Kong leaders say Trump 'completely wrong' for curbing ties

HONG KONG (Reuters) – Senior Hong Kong government officials lashed out on Saturday at moves by U.S. President Donald Trump to strip the city of its special status in a bid to punish China for imposing national security laws on the global financial hub.

Speaking hours after Trump said the city no longer warranted economic privileges and some officials could face sanctions, security minister John Lee told reporters that Hong Kong’s government could not be threatened and would push ahead with the new laws.

“I don’t think they will succeed in using any means to threaten the (Hong Kong) government, because we believe what we are doing is right,” Lee said.

Justice minister Teresa Cheng said the basis for Trump’s actions was “completely false and wrong”, saying the need for national security laws were legal and necessary.

In some of his toughest rhetoric yet, Trump said Beijing had broken its word over Hong Kong’s high degree of autonomy from Beijing, by proposing the national security legislation and that the territory no longer warranted U.S. economic privileges.

Related Coverage

  • Timeline: Key dates in Hong Kong's anti-government protests

“We will take action to revoke Hong Kong’s preferential treatment as a separate customs and travel territory from the rest of China,” Trump said, adding that Washington would also impose sanctions on individuals seen as responsible for “smothering – absolutely smothering – Hong Kong’s freedom.”

Trump told reporters at the White House that China’s move on Hong Kong was a tragedy for the world, but he gave no timetable for the moves, leaving Hong Kong residents, businesses and officials to ponder just how far his administration will go.

The American Chamber of Commerce in Hong Kong said Saturday marked “a sad day” for China’s freest city.

“This is an emotional moment for Americans in Hong Kong and it will take companies and families a while to digest the ramifications,” AmCham President Tara Joseph said in a statement.

“Many of us … have deep ties to this city and with Hong Kong people. We love Hong Kong and it’s a sad day,” she said, adding the chamber would continue to work with its members to maintain Hong Kong’s status as a vital business centre.

(For an explainer on how important Hong Kong is to China as a free finance hub, please click.)

China’s parliament this week approved a decision to create laws for Hong Kong to curb sedition, secession, terrorism and foreign interference. Mainland security and intelligence agents may be stationed in the city for the first time – moves critics say put the city’s extensive freedoms at risk.

Authorities in Beijing and Hong Kong insist the legislation will target only a small number of “troublemakers” who threaten China’s national security. They say such action is urgently needed after months of sometimes violent anti-government protests rocked the city last year.

Protests are simmering again as Hong Kong emerges from its coronavirus shutdown. Demonstrators are expected to take to the streets on Sunday.

Trump did not name any sanctions targets but said the announcement would “affect the full range of agreements we have with Hong Kong”, including the U.S.-Hong Kong extradition treaty to export controls on dual-use technologies and more “with few exceptions”.

China’s Global Times, published by the People’s Daily, the official newspaper of China’s ruling Communist Party, said Trump’s decision was a “recklessly arbitrary” step.

The Hong Kong government has had a long history of working ties with U.S. counterparts, distinct from Beijing, with cooperation on counter-terrorism, trade and money laundering.

More than 1,300 U.S. firms have offices in Hong Kong and provide about 100,000 jobs. In the past decade, the U.S. trade surplus with Hong Kong has been the biggest among all its trading partners, totalling $297 billion from 2009 to 2018.

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Politics

Brexit warning: UK desperately needs trade deal more than EU – ‘Impacts far more severe’

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Negotiations on the future relationship between the UK and EU began in March after Prime Minister Boris Johnson delivered on his general election manifesto promise to “get Brexit done” on January 31. David Frost took a negotiating army to Brussels to begin talks with a team led by EU counterpart Michel Barnier, and there were smiles aplenty for the camera from the outset. But those smiles have soon been wiped off faces with the trade talks dominated by vicious blows between the two sides over their negotiating stances and demands for certain elements in any post-Brexit agreement.

Key areas such as the level playing field, state aid, tax and access to the single market all still remain unresolved – with no solution in sight.

Mr Johnson is insisting a trade deal must be signed with the EU before the end of the transition period on December 31, but has infuriated Brussels infuriated by refusing requests to extend this deadline.

Trade talks could reach a critical point on Monday when the next round of virtual negotiations begin, with Mr Frost continuing to warn the EU needs to dramatically change its stance in negotiations and relent on a number of areas if further progress is to be made.

On Wednesday, Mr Barnier sent a letter to UK opposition party leaders and said Brussels was open to the idea of extending the transition period by up to two years.

But this move was immediately slapped down by both Mr Johnson and Mr Frost, who are sticking by their determination to have a trade deal signed with the EU before the end of this year.

Despite Britain appearing to be in control of negotiations and making demands of the EU, political experts have warned that it is in fact Brussels who hold the upper hand in current trade talks.

Professor Alex de Ruyter, Director of the Centre for Brexit Studies at Birmingham City University, explained to Express.co.uk: “The EU holds all the advantage in the post-Brexit trade talks.

“As the UK conducts about half of its trade with the EU, whilst the EU in total only exports about 10 percent of its products to the UK, which will be heavily concentrated in certain sectors like automotive and fall more on countries like Germany.

“So whilst both sides would take a hit from ‘No Deal’, the effects would be far more severe for the UK.

When asked if the UK should extend the transition period beyond December 31, 2020, Professor de Ruyter added: “Yes, for all the reasons alluded to above. COVID-19 has sapped the ability of Government to devote time and resources to this.

“The prospect of a No Deal coming on top of the coronavirus disruption could tip many businesses over the edge and would devastate our manufacturing sector.”

Alistair Jones, Associate Professor in Politics and a University Teacher Fellow at De Montfort University, explained how Britain could find it difficult to operate in particular trade sectors if they are unable to strike an agreement with the EU.

He told this website: “The reality is that Britain probably needs the trade deal more.

“We import more than we export in our trade with the EU and much of what is imported, such as food and medicines, may be very difficult to source elsewhere.

“While the Germans are the largest individual trade partner (of the EU-27), they are pragmatic enough to try to find a common position.

“A lot of the smaller countries have negligible trade with the UK and are not going to invest time.”

Kostas Maronitis, Lecturer in Politics and International Relations at Leeds Trinity University, echoed Professor Jones’ comments, and said: “The EU has more of an advantage in these talks because it negotiates as a bloc of member states with more or less a clear understanding of economic and political objectives.

“Both sides are desperate for a comprehensive trade deal, but the prevailing idea in the UK that in the midst of a pandemic, nobody would notice just another wave of economic shocks and disruptions should be abandoned as soon as possible.

“The pandemic has exposed the UK’s dependence on migrant workers and on uninterrupted supply chains concerning food, medical and protective equipment.”

But Professor de Ruyter warned the EU will not change its negotiating stance in trade talks and is extremely unlikely to relent in the areas because of the risk the single market could “unravel” as a consequence.

He added: “The UK is a middle-sized economy with about 65 million people and the EU is a trade bloc with a population of about 450 million.

“If we look at the key areas of disagreement; fisheries and so-called “level playing field” provisions; on the former, fishing (whilst a totemic issue for the UK, despite its trivial economic contribution at about 0.01% of our GDP) is also equally totemic for EU countries with equally strong maritime traditions; the Netherlands, France, Spain, Denmark etc.

“Regarding the EU insisting on the UK abiding by level playing field provisions around, for example, labour laws, state aid and environmental standards, this is an existential issue for the EU.

“An ex-member state cannot be seen to extract favourable concessions on single market access, least other EU countries such as Poland and Hungary kick-off and start demanding similar treatment.

“At that point the whole single market really could unravel.”

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