Coronavirus poses risks to fragile recovery in global economy: IMF

By Andrea Shalal

WASHINGTON (Reuters) – The coronavirus epidemic has already disrupted economic growth in China and a further spread to other countries could derail a “highly fragile” projected recovery in the global economy in 2020, the International Monetary Fund warned on Wednesday.

In a note prepared for G20 finance ministers and central bankers, the global lender mapped out a plethora of risks facing the global economy, including the fast-spreading coronavirus and a renewed spike in U.S.-China trade tensions, as well as climate-related natural disasters.

Finance ministers and central bankers from the top 20 advanced industrialized economies will gather in Riyadh, Saudi Arabia, later this week amid continued uncertainty about the impact of the coronavirus, known as COVID-19.

The IMF said it was sticking to its January forecast for 3.3% growth in the global economy this year, up from 2.9% in 2019, already a downward revision of 0.1 percentage points from its forecast in October.

But it said the recovery would be shallow and risks remained skewed to the downside. “The recovery could be derailed by a sharp rise in risk premia, triggered for example by a re-escalation of trade tensions, or a further spread of the coronavirus,” the Fund said.

Chinese state television quoted President Xi Jinping as saying China could still meet its economic growth target for 2020 despite the epidemic. But the IMF note cast doubt on that.

“The coronavirus, a human tragedy, is disrupting economic activity in China as production has been halted and mobility around affected regions limited,” the Fund wrote in the note. “Spillovers to other countries are likely — for example through tourism, supply chain linkages, and commodity price effects.

It said the impact of the virus was still unfolding, and while the current scenario assumed a quick containment of the virus and a bounce-back later in the year, the impact of the epidemic could be larger and longer-lasting.

“A wider and more protracted outbreak or lingering uncertainty about contagion could intensify supply chain disruptions and depress confidence more persistently, making the global impact more severe,” the Fund said in the note.

Cyber attacks, an escalation of geopolitical tensions in the Middle East or a breakdown in trade negotiations between China and the United States could also impede the short-term global recovery, it said. And climate-related disasters, rising protectionism and social and political unrest triggered by persistent inequality posed further economic risks.

The Fund urged policymakers to maintain fiscal and monetary policy support. Low inflation required monetary policy to stay accommodative in most economies, it said.

(Reporting by Andrea Shalal; Editing by Tom Brown)

China approves imports of live poultry from U.S.

By Dominique Patton

BEIJING (Reuters) – China has approved the import of all poultry products from the United States, the Ministry of Agriculture and Rural Affairs said on its website on Monday, including breeding birds in addition to poultry meat approved late last year.

Beijing had banned all trade in poultry products from the United States since 2015 due to outbreaks of avian influenza there.

But it lifted the ban on poultry meat imports in November 2019 as a concession to the United States ahead of finalizing a limited trade deal.

The new announcement would also allow for the import of live birds, said Li Jinghui of the China Poultry Association, benefiting companies including Aviagen and Cobb-Vantress Inc, both based in the United States and among the world’s biggest poultry breeding companies.

Nobody at the China offices of Aviagen or Cobb could immediately be reached by phone.

Imports of live poultry from the U.S. were worth $38.7 million in 2013, dwarfed by other poultry products such as chicken feet.

However, the U.S. ban had a significant impact on China’s poultry producers, who needed the breeders to replenish their stock.

Opening up imports of live birds again is part of the trade deal, said Li, although he added that it may not have a major impact.

Both Aviagen and Cobb have increased production of their birds, known as ‘grandparent stock’, in other locations such as New Zealand to meet demand from China.

Two of China’s leading poultry firms, Shandong Yisheng Livestock and Poultry Breeding Co Ltd and Fujian Sunner Development Co Ltd., have also begun their own breeding programs to reduce their reliance on imports.

China is the world’s second-largest poultry producer and has been ramping up output to fill a huge meat shortage after a disease epidemic decimated its pig herd.

But prices have plunged in recent weeks because of measures taken by Beijing to tackle a coronavirus outbreak that has killed more than 1,700 people.

Restrictions on moving livestock and extended holidays in many areas have paralyzed the supply chain, leaving farmers stuck with large inventories of birds and eggs and slashing demand as restaurants and canteens stay shut.

Containers of frozen chicken feet from the U.S. have also been caught up in the logistics logjam, with many diverted away from China because of a lack of capacity to store additional cargoes.

(Reporting by Dominique Patton; Editing by Kim Coghill and Christian Schmollinger)

 

Fed says risks to economy easing, but calls out coronavirus in report to Congress

By Howard Schneider and Lindsay Dunsmuir

WASHINGTON (Reuters) – A “moderately” expanding U.S. economy was slowed last year by a manufacturing slump and weak global growth, but key risks have receded and the likelihood of recession has declined, the U.S. Federal Reserve reported in its latest monetary policy report to the U.S. Congress.

“Downside risks to the U.S. outlook seem to have receded in the latter part of the year, as the conflicts over trade policy diminished somewhat, economic growth abroad showed signs of stabilizing, and financial conditions eased,” the Fed said, noting that the U.S. job market and consumer spending remained strong.

“The likelihood of a recession occurring over the next year has fallen noticeably in recent months.”

Among the risks the Fed did note: the fallout from the spreading outbreak of coronavirus in China, “elevated” asset values, and near-record levels of low-grade corporate debt that the Fed fears could become a problem in an economic downturn.

Overall, however, the Fed saw risks to a more than decade long U.S. recovery easing following its three interest rate cuts in 2019, and evidence that “the global slowdown in manufacturing and trade appears to be at an end, and consumer spending and services activity around the world continue to hold up.”

It cautioned that “the recent emergence of the coronavirus, however, could lead to disruptions in China that spill over to the rest of the global economy.”

By law the Fed twice a year prepares a formal report for the U.S. Congress on the state of the economy and monetary policy.

Much of its amounts to a review of recent events. The new document repeats the Fed’s assessment that the current level of the federal funds rate, in a range of between 1.5% and 1.75% was “appropriate” to keep the recovery track.

It also reviewed the spike in the federal funds rate last fall and the steps the Fed has taken to relieve funding pressures, repeating it considers the measures technical and not a change in monetary policy.

Fed Chair Jerome Powell will present the report at two public hearings next week, and some Democratic U.S. senators have already posed in writing a series of questions challenging the Fed’s actions in those short-term funding markets.

The document did include a separate section analyzing how a slump in manufacturing last year impacted economic growth overall, after concern a downturn in that sector might pull the United States into a recession.

The Fed concluded that the slowdown in factory output, which also meant less business for parts and services suppliers, cut overall growth in gross domestic product between 0.2 and 0.5 percentage points.

That falls “well short” of the threshold associated with past recessions, the Fed said.

(Reporting by Howard Schneider and Lindsay Dunsmuir; Editing by Andrea Ricci)

U.S. Senate panel advances North American trade deal, final vote timing uncertain

By David Lawder

WASHINGTON (Reuters) – The U.S. Senate Finance Committee overwhelmingly approved the U.S.-Mexico-Canada Agreement on Tuesday, moving the revamped North American trade deal a step closer to a final Senate vote in the coming days or weeks.

The committee advanced the USMCA implementing legislation by a 25-3 vote, drawing opposition from Republican senators Pat Toomey of Pennsylvania and Bill Cassidy of Louisiana and Democratic Senator Sheldon Whitehouse of Rhode Island.

The timing of a long-delayed final U.S. congressional vote to approve the trade pact remains uncertain, as Senate Majority Leader Mitch McConnell has said its consideration would likely have to wait until after a Senate trial over the impeachment of President Donald Trump.

The trade deal, first agreed in October 2018 and revised last month, aims to modernize and broaden the 26-year-old North American Free Trade Agreement (NAFTA).

Trump’s Senate trial is also in limbo, because House Democrats have not yet sent articles of impeachment approved in December to the Senate as the two parties argue over terms of the proceedings.

Senate Finance Committee Chairman Chuck Grassley earlier told CNBC http://bit.ly/36vNLSN television USMCA would “pass the Senate sometime within the next few days or at the most the end of this month.”

Following the Senate panel’s vote, Grassley said the timing was up to McConnell, but articles of impeachment would take precedence over USMCA. A vote could occur quickly as there was little other legislation to stand in its way, he added.

The Senate’s parliamentarian has directed other some other committees to consider the legislation, which could delay a floor vote slightly, but Grassley said those panels were expected to quickly approve the trade deal.

“The intent is for the leader to get them to move quickly,” Grassley added.

The finance committee’s vote indicates broad bipartisan support for USMCA, which includes new chapters covering digital trade, stronger intellectual property protections and new requirements for automakers to use more parts and materials sourced in the region and from high-wage areas, notably the United States and Canada.

Toomey, an ardent free trade Republican, objected to the new automotive content rules, saying they were “designed to raise the cost to American consumers of buying Mexican-made cars.”

“It’s the first time we are ever going to go backwards on a trade agreement,” Toomey said during the committee’s debate.

Cassidy complained that the agreement weakens NAFTA’s investor-state dispute settlement mechanism, which will deter big projects such as a gas pipeline from the United States to Mexico.

Whitehouse, an ardent environmentalist, said he objected to USMCA because the trade deal does not mandate any action to fight global warming and rising sea levels.

(Reporting by Kanishka Singh in Bengaluru; Editing by Andrew Heavens and Tom Brown)

Take Five: What’s the deal?

LONDON (Reuters) –

1/AFTER PHASE ONE COMES PHASE TWO

U.S. President Donald Trump and Chinese officials have agreed to a “phase one” trade deal that includes cutting U.S. tariffs on Chinese goods.

Washington has agreed to suspend tariffs on $160 billion in Chinese goods due to go into effect on Dec. 15, Trump said, and cut existing tariffs to 7.5%.

The agreement covers intellectual property, technology transfer, agriculture, financial services, currency, and foreign exchange, according to Washington’s Trade Representative.

Neither side offered specific details on the amount of U.S. agricultural goods Beijing had agreed to buy – a key sticking point of the lengthy deal negotiations. News of the trade deal saw U.S. stocks romp to fresh record levels. But few doubt that the rollercoaster is over yet.

While Trump announced that “phase two” trade talks would start immediately, Beijing made it clear that moving to the next stage of the trade negotiations would depend on implementing phase one first. While markets cheered the December rally, few expect the trade deal rollercoaster ride to be quite over yet.

 

2/MORE NICE SURPRISES, PLEASE!

First clues as to whether euro zone powerhouse Germany can avoid a fourth quarter recession emerge on Monday when advance PMI readings for November are released globally.

The economic activity surveys, a key barometer of economic health, come after Citi’s economic surprise index showed euro zone economic data beating consensus expectations at the fastest pace since February 2018. The latest surprise was a 1.2% rise in German exports in October, defying forecasts of a contraction.

Hopes are high that exports and private consumption, which helped Germany skirt recession, will hold up. Last month’s PMI data showed manufacturing remained in deep contraction across the bloc.

A Reuters poll showed expectations of a modestly higher 46.0 manufacturing reading in the euro zone but that’s still far below the 50-mark which separates growth from contraction. Services, which have held up better so far, are expected to grow modestly from November, at 52.0.

Graphic: Citi surprise index most positive since Feb 2018, https://fingfx.thomsonreuters.com/gfx/mkt/12/9901/9813/Citi%20index.png

3/BEWARE THE BOJ

Japan’s central bank meets on Thursday with the global economic outlook “relatively bright,” according to Governor Haruhiko Kuroda.

Growth green shoots, a possible U.S.-China trade deal and something nearing certainty on Brexit has got almost everyone expecting the BOJ will do very little: Interest rates are at -0.1% and the bank has eased off bond buying – even though the bank’s balance sheet is bursting with negative-yielding paper.

The government has flagged a gigantic $122 billion stimulus package to keep things moving after next year’s Olympics. Yet the business mood is dire with Friday’s “tankan” survey at its lowest reading since 2013. Big manufacturers – especially automakers – are gloomiest, as the trade war takes its toll.

The Bank of Japan has justified standing pat on the view that robust domestic demand will cushion the hit. It blames the weather and a sales tax for recent patchy data. But another week of dollar weakness will not have gone unnoticed in Tokyo, where a cheaper yen is much desired. A surprise on Tuesday export data forecast to show further contraction and Thursday’s inflation reading could jolt yen longs out of their slumber.

4/JOHNSON, AND MORE JOHNSON

A thumping election win for Prime Minister Boris Johnson has raised hopes that 3-1/2 years of Brexit-fuelled chaos will finally end.

Expectations that he may swing slightly nearer the centre of his Conservative Party, sidelining the fiercest eurosceptics, and ease the path towards a free-trade deal with the European Union have sent sterling and British shares surging.

Yet there are signs of caution, with sterling stalling around $1.35. Further gains will hinge on Johnson’s new cabinet, how the global growth and trade war backdrop pans out and what the Bank of England might do.

At the central bank’s Dec. 19 meeting, markets will watch for any shifts in its views on inflation, the UK economy and the interest rate outlook for 2020. While policymakers have skewed dovish of late amid a torrent of dismal data and sub-target inflation, the election result – and a hoped-for growth recovery – have seen money markets halve the probability of an end-2020 cut to 25%.

Without more clarity, investors might just be wary of chasing sterling much higher.

Graphic: UK economic indicators, https://fingfx.thomsonreuters.com/gfx/mkt/12/9958/9869/GB.png

5/SWEDEN RETURNS TO ZERO?

While most central banks are busy pondering whether to hold or cut interest rates, Sweden may swim against the tide and deliver a 25 basis-point rate hike on Dec. 19. That will end half a decade of negative interest rates in the country and make it the first in Europe to pull borrowing costs from sub-zero territory.

Policymakers flagged a rate hike in October and recent data showing inflation rising to 1.7% — just off the 2% target — cemented those expectations. The crown’s rallied to eight-month highs versus the euro, up almost 5% since October.

The proposed interest rate increase has its critics, who cite still-sluggish inflation and factory activity at its weakest since 2012.

Meanwhile, neighbouring Norway’s policy meeting, scheduled for the same day, may be less exciting as no change is expected. Investors remain baffled by the Norwegian crown’s weakness – despite policy makers delivering four rate hikes since Sept 2018, it’s at near record lows to the euro.

Graphic: Swedish crown , https://fingfx.thomsonreuters.com/gfx/mkt/12/9961/9872/crown.png

(Reporting by Alden Bentley in New York, Tom Westbrook in Singapore, Sujata Rao, Elizabeth Howcroft and Yoruk Bahceli in London, compiled by Karin Strohecker; edited by Philippa Fletcher)

China wants tariffs cut to enable $50 billion imports from U.S.: Bloomberg

China wants tariffs cut to enable $50 billion imports from U.S.: Bloomberg
(Reuters) – China will struggle to buy $50 billion of U.S. farm goods annually unless the United States removes retaliatory tariffs on American products, Bloomberg reported on Tuesday.

China would make the purchases only if U.S. President Donald Trump rolls back levies put in place since the trade war began, Bloomberg said https://bloom.bg/2OR9dvt, citing people familiar with the matter.

Trump said on Friday that China had agreed to purchase $40 billion to $50 billion worth of agricultural goods from the U.S. in a first phase of an agreement to end the trade war.

(Reporting by Bhargav Acharya and Rama Venkat in Bengaluru; Editing by Andrew Heavens)

With U.S.-China tensions running high, hopes dim for end to trade war

By Andrea Shalal and Cate Cadell

WASHINGTON/BEIJING (Reuters) – Beijing sharply rebuked Washington on Tuesday for adding some top Chinese artificial intelligence startups to its trade blacklist, dimming hopes for progress in high-level talks aimed at ending a 15-month trade war between the two economic giants.

U.S. and Chinese deputy trade negotiators were due to meet in Washington for a second day of talks on Tuesday, laying the groundwork for the first minister-level meetings in over two months later this week.

A report from the South China Morning Post said China had tamped down expectations ahead of the talks scheduled for Thursday with Chinese Vice Premier Liu He, U.S. Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin, saying the Chinese delegation could leave earlier than planned because “there’s not too much optimism.”

The mood soured this week after the U.S. Commerce Department widened its trade blacklist to include 20 Chinese public security bureaus and eight companies including video surveillance firm Hikvision <002415.SZ>, as well as leaders in facial recognition technology SenseTime Group Ltd and Megvii Technology Ltd.

The action bars the firms from buying components from American companies without U.S. government approval, a potentially crippling move. It follows the same blueprint used by Washington in its attempt to limit the influence of Huawei Technologies Co Ltd [HWT.UL] for what it says are national security reasons.

Hikvision, with a market value of about $42 billion, calls itself the world’s largest maker of video surveillance gear.

U.S. officials said the action was tied to China’s treatment of Muslim minorities and human rights violations, provoking a sharp reaction from Beijing.

China said the United States should stop interfering in its affairs. It will continue to take firm and resolute measures to protect its sovereign security, foreign ministry spokesman Geng Shuang told a regular media briefing without elaborating.

Major U.S. stock indexes fell on Tuesday, amid the continued tensions between the United States and China, whose tit-for-tat tariffs have roiled financial markets, slowed capital investment, and triggered a slowdown in trade flows.

New International Monetary Fund Managing Director Kristalina Georgieva issued a stark warning about the state of global growth on Tuesday, saying trade conflicts had thrown it into a “synchronized slowdown” and must be resolved.

In her inaugural speech after taking over the global crisis lender on Oct. 1, Georgieva unveiled new IMF research showing that the cumulative effect of trade conflicts could mean a $700 billion reduction in global GDP output by 2020, or around 0.8%.

LOOMING TARIFF HIKES

The trade talks are taking place days before U.S. tariffs on $250 billion worth of Chinese goods are slated to rise to 30% from 25%. Trump has said the tariff increase will take effect on Oct. 15 if no progress is made in the negotiations.

President Donald Trump on Monday said a quick trade deal was unlikely, and that he would not be satisfied with a partial deal.

The two sides have been at loggerheads over U.S. demands that China improve protections of American intellectual property, end cyber theft and the forced transfer of technology to Chinese firms, curb industrial subsidies and increase U.S. companies’ access to largely closed Chinese markets.

Trump launched a new round of tariffs after the last high-level talks in late July failed to result in agricultural purchases or yield progress on substantive issues. China quickly responded with tariff increases of its own.

Washington is also moving ahead with discussions around possible restrictions on capital flows into China, with a focus on investments made by U.S. government pension funds, Bloomberg reported. The news sent shares of chipmakers sharply lower.

Another flashpoint has been a widening controversy over a tweet from an official with the NBA’s Houston Rockets. His backing of Hong Kong democracy protests was rebuked by the National Basketball Association, sparking a backlash.

Trump also called for a peaceful resolution to the protests in Hong Kong, and warned the situation had the potential to hurt trade talks.

Police in Hong Kong have used rubber bullets, tear gas and water cannons against pro-democracy demonstrators in the former British colony, which has been plunged into its worst political crisis in decades.

Beijing views U.S. support for pro-democracy protests in Hong Kong as interfering with its sovereignty.

(Reporting by Andrea Shalal and David Lawder in Washington and Cate Cadell in Beijing; Writing by Andrea Shalal; Editing by Paul Simao)

White House confirms U.S.-China trade talks starting Thursday

White House confirms U.S.-China trade talks starting Thursday
WASHINGTON (Reuters) – Top U.S. officials will welcome a high-ranking Chinese delegation starting Oct. 10 for the latest round of trade talks aimed at easing tensions between the world’s two largest economies, the White House confirmed on Monday.

“The two sides will look to build on the deputy-level talks of the past weeks. Topics of discussion will include forced technology transfer, intellectual property rights, services, non-tariff barriers, agriculture, and enforcement,” White House spokeswoman Stephanie Grisham said in a statement.

(Reporting by Makini Brice; Editing by Catherine Evans)

China buys U.S. soybeans after declaring ban on American farm goods

FILE PHOTO: Soybeans fall into a bin as a trailer is filled at a farm in Buda, Illinois, U.S., July 6, 2018. REUTERS/Daniel Acker

By Tom Polansek

CHICAGO (Reuters) – China snapped up a small volume of U.S. soybeans last week after pledging to halt purchases of American farm products due to the escalating trade war between Washington and Beijing, U.S. Department of Agriculture data showed on Thursday.

The world’s largest soybean importer struck deals from Aug. 9 to 15 to buy 9,589 tonnes for delivery in the current marketing year and 66,000 tonnes, approximately one cargo, for the next year, the data showed.

China’s Commerce Ministry said on Aug. 5 that Chinese companies stopped buying U.S. farm products in the latest escalation of the trade war between the world’s two largest economies.

“You do have some buying going on,” said Arlan Suderman, chief commodities economist for INTL FCStone. “It’s a little bit of a surprise.”

China last year imposed retaliatory tariffs that remain in place on imports of U.S. farm products including soybeans and pork. The duties have slashed exports of U.S. crops and prompted the Trump administration to compensate American farmers for losses over two years with as much as $28 billion.

China said on Thursday it hopes the United States will stop a plan to impose new tariffs, adding that any new duties would lead to a further escalation.

China has largely turned to South America for soybeans since the trade war began last year. U.S. soybean sales to China in 2018 dropped 74% from the previous year.

“Compared to what they used to buy, they essentially have halted – but some have gotten through,” Suderman said.

The sales of 9,589 tonnes for delivery in the current marketing year will probably be rolled ahead to be delivered in the next year, which begins on Sept. 1, said Don Roose, president of Iowa-based broker U.S. Commodities.

The cargo sold for delivery in the next marketing year could have been in the works before Beijing said Chinese companies would suspend purchases of U.S. farm goods, said Terry Reilly, senior commodity analyst for Futures International.

“The government may have just given the green light to say, ‘Let this one go through,'” Reilly said.

“One cargo is not going to change the fact that they’re not buying millions of tons of soybeans.”

(Reporting by Tom Polansek; Editing by Marguerita Choy)

Japan, South Korea agree on need for dialogue to resolve feud on wartime labor and Fukushima

Chinese Foreign Minister Wang Yi, South Korean Foreign Minister Kang Kyung-wha and Japanese Foreign Minister Taro Kono pose for photo ahead of the ninth trilateral foreign ministers’ meeting among China, South Korea and Japan at Gubei Town in Beijing, China, 21 August 2019. Wu Hong/Pool via REUTERS

By Hyonhee Shin and Ami Miyazaki

TOKYO/SEOUL (Reuters) – Japan and South Korea on Wednesday agreed on the need for dialogue to resolve a feud over compensating Korean wartime workers that has spilled into trade and put a deep chill on ties between Washington’s two biggest Asian allies.

Japanese Foreign Minister Taro Kono, speaking after talks with South Korean counterpart Kang Kyung-wha, said both sides shared that view over the dispute, which is a bitter legacy of Japan’s 1910-1945 colonization of the Korean peninsula.

“In that sense, I want to firmly make progress towards resolving (this matter),” Kono said outside the Chinese capital of Beijing, in comments carried live on Japanese public broadcaster NHK.

“I think the fact that we … were able to talk in this difficult situation could lead to big progress towards resolving this problem,” Kono said. “I want to stay in close touch and continue to talk.”

A South Korean official said both sides reiterated their positions but the meeting was meaningful in restoring diplomatic dialogue and reaffirming the need to keep talking, South Korea’s Yonhap news agency said.

Relations soured after the South Korean Supreme Court ordered some Japanese firms to compensate Korean wartime workers last October, a move strongly condemned by Tokyo, which says the matter was resolved by a 1965 treaty normalizing ties.

The feud has spilled over into trade, after Japan tightened export controls on materials vital to South Korean chipmakers and then dropped Seoul from a list of countries eligible for fast-track exports, prompting South Korea to take a similar step towards Japan.

The number of South Korean tourists visiting Japan fell last month to its lowest in nearly a year, amid a far-reaching boycott of Japanese products and services, from cars to beer and tours.

Kang again urged that Japan’s tightened controls be eased, and relayed concerns about media reports and international environmental groups’ claims that Japan plans to release contaminated water from the Fukushima nuclear plant into the ocean, Yonhap said.

Kono also said Japan wanted Seoul and Tokyo to maintain a military intelligence-sharing pact that could expire if South Korea decides not to roll it over this week.

“This is an important framework for the United States, Japan and South Korea and … should be maintained,” Kono said, adding that he had discussed the intelligence pact with Kang.

Though Kang declined to comment after the meeting whether South Korea would renew the deal, Kim Sang-jo, policy chief of President Moon Jae-in, said on Wednesday that Seoul would continue consideration “until the last minute”.

Kono urged both China and South Korea to scrap their import curbs on produce from areas around Japan’s Fukushima nuclear disaster site, where three reactors suffered melt downs after an earthquake and tsunami in 2011.

Seoul said on Wednesday it would double radiation testing of some Japanese food imports, for fear of contamination from the Fukushima plant.

An official of Japan’s Ministry of Agriculture, Forestry and Fisheries said Japanese food products were safe and increased radiation testing was unnecessary.

(Writing by Linda Sieg; Editing by Clarence Fernandez and Simon Cameron-Moore)