Cuba Says Investor Interest Up Despite US Hostility

Cuba’s foreign trade and investment minister said on Wednesday the country had signed nearly 200 investment projects worth $5.5 billion since it slashed taxes and made other adjustments to its investment law in 2014.

Cuba began a major effort to attract foreign investment as socialist ally Venezuela’s economy went into crisis and has ratcheted it up as export revenues decline and the Trump administration backtracks on a detente begun under then-U.S. President Barack Obama.

“Foreign investment in Cuba is growing despite the recent strengthening of the U.S. economic, trade and financial blockade, though it is below what we want,” the minister, Rodrigo Malmierca, said at an investment forum in Havana.

Even as the forum unfolded, debate on an annual resolution condemning U.S. sanctions got under way at the U.N. General Assembly in New York and the Trump administration said that on Thursday it would announce new sanctions aimed at Cuba’s military and security services.

Malmierca said 40 new projects were signed over the last year valued at $1.5 billion.

Many agreements are in the tourism sector and are often simple management and marketing accords. Others are in manufacturing, oil exploration and, to a lesser extent, areas such as pharmaceuticals, agriculture and logistics.

Cuba says it wants a minimum $2.5 billion per year in direct foreign investment to dig its way out of years of crisis and stagnation.

While $5.5 billion in deals may have been signed since 2014, the government has said only around $500 million has actually been invested annually, including foreign government credits and donations.

Diplomats and business officials report that many projects are hard pressed to obtain financing and the Communist-run country’s bureaucracy also slows deals from getting off the ground.

For example, since 2014 five golf resorts valued at close to $2.5 billion were signed with British, Chinese and Spanish investors, but ground has yet to be broken on any of them, according to foreign business officials and diplomats with knowledge of the projects.

Malmierca said the country was working to overcome numerous obstacles for investors, such as lengthy delays for project approval, lack of experience among Cuban negotiators and Cuba’s dual monetary system with fixed exchange rates.

Under then-leader Fidel Castro, foreign investment was first nationalized, then, after the fall of former benefactor the Soviet Union it was viewed as an unfortunate necessity. Today it is lauded as an integral part of the country’s development strategy.

Rare NATO-Russia Talks Address Military Drills, 1987 Missile Treaty

NATO and Russia envoys on Wednesday discussed their respective large-scale military exercises and a Cold War-era missile treaty that Washington vows to quit over accusations of Russian non-compliance, the Western alliance said.

The talks, the first between the former Cold War foes since May, came against a backdrop of renewed tensions between the West and Russia, most notably over Moscow’s 2014 annexation of Crimea and involvement in eastern Ukraine.

A NATO statement said the sides had an “open exchange” of views on Ukraine, Russia’s Vostok military exercises and NATO’s ongoing Trident Juncture drills, as well as on Afghanistan and hybrid security threats.

NATO this month launched its largest exercises since the Cold War in Norway, whose non-NATO Nordic neighbors Sweden and Finland have drawn closer to the alliance since being spooked by Russia’s role in the turmoil in Ukraine.

NATO troops are manoeuvring close to the borders of Russia, which held its huge annual Vostok military drill in September. The two are regularly irked by each other’s exercises, where a show of force and deterrence play a major role.

The drills have steadily grown in size in recent years as an atmosphere of stand-off between Russia and the West has grown. Russia’s 2018 edition of Vostok mobilized 300,000 troops and included joint exercises with the Chinese army — the biggest such drills since the Soviet Union broke up in 1991.

NATO head Jens Stoltenberg also called on Russia to make quick changes to comply in full with the 1987 Intermediate-Range Nuclear Forces (INF) treaty. Russia denies violating it.

“We all agree that the INF Treaty has been crucial to Euro-Atlantic security … Allies have repeatedly expressed serious concerns about the new Russian missile system, known as the 9M729 or SSC-8,” Stoltenberg said in the statement.

He said development of the SSC-8 land-based, intermediate-range Cruise missile posed “a serious risk to strategic stability.”

“NATO has urged Russia repeatedly to address these concerns in a substantial and transparent way, and to actively engage in a constructive dialogue with the United States … We regret that Russia has not heeded our calls,” Stoltenberg added. At the same time, NATO hopes Washington — whose other rivals China or Iran are not constrained by the treaty that rid Europe of land-based nuclear missiles — will not pull out in the end. 

European leaders worry any collapse of the INF treaty could lead to a new, destabilizing arms race.

US Supreme Court Divided Over How Google Settled Privacy Case

U.S. Supreme Court justices, in an internet privacy case involving Google, disagreed on Wednesday over whether to rein in a form of settlement in class action lawsuits that awards money to charities and other third parties instead of to people affected by the alleged wrongdoing.

The $8.5 million Google settlement was challenged by an official at a Washington-based conservative think tank, and some of the court’s conservative justices during an hour of arguments in the case shared his concerns about potential abuses in these awards, including excessive fees going to plaintiffs’ lawyers.

Some of the liberal justices emphasized that such settlements can funnel money to good use in instances in which dividing the money among large numbers of plaintiffs would result in negligible per-person payments. Conservatives hold a 5-4 majority on the high court.

The case began when a California resident named Paloma Gaos filed a proposed class action lawsuit in 2010 in San Jose federal court claiming Google’s search protocols violated federal privacy law by disclosing users’ search terms to other websites. Google is part of Alphabet Inc.

A lower court upheld the settlement the company agreed to pay in 2013 to resolve the claims.

Critics have said the settlements, known as “cy pres” [pronounced “see pray”] awards, are unfair and encourage frivolous lawsuits, conflicts of interest and collusion between both sides to minimize damages for defendants while maximizing fees for plaintiffs’ lawyers. Supporters have said these settlements can benefit causes important to victims and support underfunded entities, such as legal aid.

During the arguments, several justices, both liberal and conservative, wondered whether the plaintiffs had suffered harm through the disclosure of their internet searches, sufficient to justify suing in federal court, signaling they may dismiss the case rather than deciding the fate of cy pres settlements.

Liberal Justice Stephen Breyer seemed doubtful that simple searches, of one’s own name for instance, would be enough to sustain a privacy lawsuit.

Conservative Justice Brett Kavanaugh appeared to disagree.

“I don’t think anyone would want … everything they searched for disclosed to other people,” Kavanaugh said. “That seems a harm.”

Google agreed in the settlement to disclose on its website how users’ search terms are shared but was not required to change its behavior. The three main plaintiffs received $5,000 each for representing the class. Their attorneys received about $2.1 million.

Under the settlement, the rest of the money would go to organizations or projects that promote internet privacy, including at Stanford University and AARP, a lobbying group for older Americans, but nothing to the millions of Google users who the plaintiffs were to have represented in the class action.

Cy pres awards, which remain rare, give money that cannot feasibly be distributed to participants in a class action suit to unrelated entities as long as it would be in the plaintiffs’ interests.

‘A sensible system’

While wrestling over the privacy aspects of Google searches, the justices also disagreed about the settlement both sides reached. Conservative Justice Samuel Alito raised concerns that the money would go to groups that some plaintiffs might not like but have no say in opposing.

“How can such a system be regarded as a sensible system?” Alito asked.

Chief Justice John Roberts, another conservative, noted that AARP engages in political activity, an issue that the Google deal’s opponents, led by Ted Frank, director of litigation for the Competitive Enterprise Institute, had raised.

Google has called Frank a “professional objector.”

Roberts also said it was “fishy” that settlement money could be directed to institutions to which Google already was a donor. Some beneficiary institutions also were the alma mater of lawyers involved in the case, Kavanaugh noted.

Liberal Justice Ruth Bader Ginsburg told Frank, who argued the case on Wednesday, that at least the plaintiffs get an “indirect benefit” from the settlement.

“It seems like the system is working,” added Justice Sonia Sotomayor, another liberal.

In endorsing the Google settlement last year, the San Francisco-based 9th U.S. Circuit Court of Appeals said each of the 129 million U.S. Google users who theoretically could have claimed part of it would have received “a paltry 4 cents in recovery.”

UK Chief Brexit Negotiator Says He Expects Deal by November 21

Britain’s Brexit secretary has told lawmakers that he expects a long-elusive divorce deal with the European Union to be finalized before November 21, though there is still little sign of a breakthrough on the vexed issue of the Irish border.

Dominic Raab told Parliament’s Exiting the EU Committee in a letter that he would give evidence to the panel “when a deal is finalized, and currently expect 21 November to be suitable.”

The committee released the October 24 letter Wednesday. Raab’s Department for Exiting the European Union said later “there is no set date for the negotiations to conclude” and that the secretary mentioned November 21 in response to a suggestion that he appear before the committee on that date.

Britain is due to leave the EU on March 29, but London and Brussels have not reached an agreement on their divorce terms and a smooth transition to a new relationship. The stalemate has heightened fears that the U.K. might leave without a deal in place, leading to chaos at ports and economic turmoil.

Prime Minister Theresa May has said a Brexit deal is 95 percent done, but the two sides remain at odds over the issue of the border between the U.K.’s Northern Ireland and EU member Ireland.

Britain and the EU agree there must be no customs posts or other barriers that could disrupt businesses and residents on either side of the border and undermine Northern Ireland’s hard-won peace process. But the two parties have rejected each other’s proposed solution.

Raab said in his letter that “despite our differences, we are not far from an agreement on this issue.”

He said the U.K. and the EU agree “on the principle of a U.K.-wide customs backstop” – a plan to keep the U.K. in a customs union with the bloc, rendering border checks on goods unnecessary.

Britain has said such a solution must be temporary, while the EU wants a permanent fix. But Raab said agreement should be possible, and “the end is now firmly in sight.”

An October 17-18 EU summit that had been billed as the deadline for a breakthrough ended with the talks still deadlocked. But behind-the-scenes talks have continued.

Irish Foreign Minister Simon Coveney said Wednesday in Paris that a deal in the next month was feasible, but “if they want to conclude the text of a withdrawal treaty in November, then the negotiations need to intensify.”

Any agreement reached by the two sides must be approved by the British and European parliaments. 

 

May’s proposed deal faces strong domestic opposition both from pro-Brexit lawmakers, who say it keeps Britain bound too closely to the bloc, and from pro-EU legislators, who argue it will create barriers between the U.K. and its biggest trading partner.

  

 

Birthday Blues for Bitcoin as Investors Face Year-on-Year Loss

Bitcoin was heading towards a year-on-year loss on Wednesday, its 10th birthday, the first loss since last year’s bull market, when the original and biggest digital coin muscled its way to worldwide attention with months of frenzied buying.

By 1300 GMT, bitcoin was trading at $6,263 on the BitStamp exchange, leaving investors who had bought it on Halloween 2017 facing yearly losses of nearly 3 percent.

A year ago, bitcoin closed at $6,443.22 as it tore towards a record high of near $20,000, hit in December.

That run, fueled by frenzied buying by retail investors from South Korea to the United States, pushed bitcoin to calendar-year gains of over 1,300 percent.

Ten years ago, Satoshi Nakamoto, bitcoin’s still-unidentified founder, released a white paper detailing the need for an online currency that could be used for payments without the involvement of a third party, such as a bank.

Traders and market participants said the Halloween milestone was inevitable, given losses of around 70 percent from bitcoin’s peak and the continuing but incomplete shift towards investment by mainstream financial firms.

“The value mechanisms of crypto and bitcoin today are based more on underlying tech than hype and FOMO (fear of missing out),” said Josh Bramley, head trader at crypto wealth management firm Blockstars.

Growing use of blockchain – the distributed ledger technology that underpins bitcoin – is now powering valuations of the digital currency, he said, cautioning that some expectations for widespread use have not yet materialized.

Others said improvements to infrastructure such as custody services may allow mainstream investors who are wary of buying bitcoin to take positions.

“We see behind closed doors financial and non-financial institutions beavering away to create the infrastructure,” said Ben Sebley, head of brokerage at NKB Group, a blockchain advisory and investment firm.

Bitcoin has endured year-on-year losses before, according to data from CryptoCompare, most recently in 2015.

Retail investors still account for a strong proportion of trading, market players said.

Investors who bet early on bitcoin and have stuck with it have faced a roller-coaster ride in its first decade. Many told Reuters they are optimistic that they are still onto a winner.

 

UK-Canadian ‘Grand Committee’ Seeks to Question Zuckerberg

Parliamentary committees in Britain and Canada on Wednesday urged Facebook CEO Mark Zuckerberg to testify before a joint hearing of international lawmakers examining fake news and the internet.

Damian Collins, the head of the U.K. parliament’s media committee, is joining forces with his Canadian counterpart, Bob Zimmer, to pressure Zuckerberg to personally take part in hearings, as he did before the U.S Congress and the European Parliament. The so-called “international grand committee” session would be held Nov. 27 and could include lawmakers from other countries.

“We understand that it is not possible to make yourself available to all parliaments. However, we believe that your users in other countries need a line of accountability to your organization — directly, via yourself,” the pair said in a letter to Zuckerberg. “We would have thought that this responsibility is something that you would want to take up.”

Social media companies have been under scrutiny in Britain following allegations that political consultancy Cambridge Analytica used data from tens of millions of Facebook accounts to profile voters and help U.S. President Donald Trump’s 2016 election campaign. The committee is also investigating the impact of fake news distributed via social media sites globally.

Collins has been irate with Facebook for sending Zuckerberg’s underlings to his committee’s hearings while the leader of the Silicon Valley company declined invitations to attend. Joining forces with Canada — and perhaps other countries — seems designed to prod Zuckerberg and persuade him to change his mind.

“No such joint hearing has ever been held,” the pair wrote. “Given your self-declared objective to ‘fix’ Facebook, and to prevent the platform’s malign use in world affairs and democratic process, we would like to give you the chance to appear at this hearing.”

Facebook Caught in an Election-security Catch-22

When it comes to dealing with hate speech and attempted election manipulation, Facebook just can’t win.

If it takes a hands-off attitude, it takes the blame for undermining democracy and letting civil society unravel. If it makes the investment necessary to take the problems seriously, it spooks its growth-hungry investors.

That dynamic was on display in Facebook’s earnings report Tuesday, when the social network reported a slight revenue miss but stronger than expected profit for the July-September period.

Shares were volatile in after-hours trading — dropping the most, briefly, when executives discussed a decline in expected revenue growth and increasing expenses during the conference call.

With the myriad problems Facebook is facing, that passes for good news these days. It was definitely an improvement over three months ago, when Facebook shares suffered their worst one-day drop in history, wiping out $119 billion of its market value after executives predicted rising expenses to deal with security issues along with slowing growth.

“Overall, given all the challenges Facebook has faced this year, this is a decent earnings report,” said eMarketer analyst Debra Aho Williamson.

Facebook had 2.27 billion monthly users at the end of the quarter, below the 2.29 billion analysts were expecting. Facebook says it changed the way it calculates users, which reduced the total slightly. The company’s user base was still up 10 percent from 2.07 billion monthly users a year ago.

The company earned $5.14 billion, or $1.76 per share, up 9 percent from $4.71 billion, or $1.59 per share, a year earlier. Revenue was $13.73 billion, an increase of 33 percent, for the July-September period.

Analysts had expected earnings of $1.46 per share on revenue of $13.77 billion, according to FactSet.

CEO Mark Zuckerberg called 2019 “another year of significant investment” during the earnings call. After that, he said “I know that we need to make sure our costs and revenue are better matched over time.”

The company had already warned last quarter that its revenue growth will slow down significantly for at least the rest of this year and that expenses will continue to balloon as it spends on security, hiring more content moderators around the world and on developing its products, be they messaging apps, video or virtual reality headsets.

The following day the stock plunged 19 percent. Shares not only haven’t recovered, they’ve since fallen further amid a broader decline in tech stocks .

Facebook’s investors, users, employees and executives have been grappling not just with questions over how much money the company makes and how many people use it, but its effects on users’ mental health and worries over what it’s doing to political discourse and elections around the world. Is Facebook killing us? Is it killing democracy?

The problems have been relentless for the past two years. Facebook can hardly crawl its way out of one before another comes up. It began with “fake news” and its effects on the 2016 presidential election (a notion Zuckerberg initially dismissed) and continued with claims of bias among conservatives that still haven’t relented.

Then there’s hate speech, hacks and a massive privacy scandal in which Facebook exposed the data of up to 87 million users to a data mining firm, along with resulting moves toward government regulation of social media. Amid all this, there have been sophisticated attempts from Russia and Iran to interfere with elections and stir up political discord in the U.S.

All this would be more than enough to deal with. But the business challenges are also piling up. There are stricter privacy regulations in Europe that can impede how much data it collects on users. Facebook and other tech companies face a new ”digital tax ” in the UK.

On Tuesday, Arjuna Capital and the New York State Common Retirement Fund filed a shareholder proposal asking Facebook to publish a report on its policies for governing what is posted on its platform and explain what it is doing to “address content that threatens democracy, human rights, and freedom of expression.”

“Young users are deleting the app and all users are taking breaks from Facebook,” said Natasha Lamb, managing partner at Arjuna Capital. “When you start to see users turn away from the platform, that’s when investors get concerned.”

A recent Pew Research Center survey found that more than a quarter of U.S. Facebook users have deleted the app from their phones and 42 percent have taken a break for at least a few weeks. Younger users were much more likely to delete the app than their older counterparts.

Nonetheless, Facebook is still enjoying healthy user growth outside the U.S.

Facebook’s stock climbed $4.07, or 2.8 percent, to $150.29 in after-hours trading. The stock had closed at $146.22, down 17 percent year-to-date.

 

Spain: Artist Arrested for Red Paint on Late Dictator’s Tomb

An artist has been arrested after painting a dove in red on Gen. Francisco Franco’s tomb, an attack that comes as debate rages in Spain over the exhumation of the country’s 20th-century dictator.

Artist Enrique Tenreiro can be seen in a video shared online as he kneels before Franco’s tomb in the Valley of the Fallen, draws a dove and writes “for freedom” before security personnel take hold of him.

Police later arrested Tenreiro, according to a statement by Spain’s National Heritage department, which manages the glorifying mausoleum where Franco was interred in 1975.

The Spanish government has promised to relocate his remains before next year.

In a statement signed by the artist and emailed by aides, Tenreiro says he wanted to make a statement on behalf of Franco’s victims.

Austria Will Not Join Global Migration Agreement

Austria said Wednesday it will join the United States and Hungary in not signing a global agreement meant to minimize the factors that push migrants to leave their home country, while boosting safety, access to services and inclusion for those who are compelled to go.

Nations are due to gather in early December in Morocco to adopt the non-binding Global Compact for Safe, Orderly and Regular Migration, which was negotiated through a U.N.-led process during the past two years.

Austrian Chancellor Sebastian Kurz said his government fears the agreement would pose a threat to its national sovereignty and that it would blur the lines between legal and illegal migration.

Vice Chancellor Heinz-Christian Strache said there is not and should not be a human right to migration.

Hungary also cited concerns about the agreement going against national interests when it announced in July it would not be part of the pact.

Hungarian Foreign Minister Peter Szijjarto told reporters that contrary to his government’s policies, the agreement would promote migration as “good and inevitable,” and “it could inspire millions” of migrants.

The United States was the first to step away from the negotiations, deciding in December of last year that the proposed agreement was “inconsistent with U.S. immigration and refugee policies.”

Then-U.S. Secretary of State Rex Tillerson said the United States supports international cooperation on migration issues, “but it is the primary responsibility of sovereign states to help ensure that migration is safe, orderly, and legal.”

The Global Compact features 23 objectives, including boosting access to basic services, strengthening anti-smuggling and anti-trafficking efforts, eliminating discrimination, safeguarding conditions that ensure decent work, and facilitating safe and dignified return for those who are sent back home.

The United Nations estimates there are about 258 million migrants in the world — or just over three percent of the world’s population. The world body considers a migrant to be anyone who changes their country, regardless of the reason. It expects the number of migrants to increase due to factors such as population growth, trade, rising inequality and climate change.