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Bangladesh Seeks I.M.F. Loan as Inflation Rocks South Asia

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Bangladesh Seeks I.M.F. Loan as Inflation Rocks South Asia

DHAKA, Bangladesh — Only a week after introducing scheduled energy outages in response to the hovering value of gasoline in Bangladesh, the federal government mentioned it was in search of assist from the Worldwide Financial Fund, becoming a member of two different nations in South Asia to take action in latest months.

Authorities officers mentioned the nation was operating low on overseas reserves, the issue that prompted each Sri Lanka and Pakistan to pursue I.M.F. help.

“We will’t print {dollars}; we now have to earn them,” A.H.M. Mustafa Kamal, the finance minister of Bangladesh, mentioned Wednesday. “We earn {dollars} by the onerous work of our individuals who work or do enterprise overseas. They’re the driving pressure of our financial system.”

Each cash despatched from Bangladeshis dwelling abroad and exports have fallen amid fears of a world recession.

Excessive inflation attributable to Russia’s invasion of Ukraine is dealing a tough blow to growing international locations whose economies run on imported gasoline. As commerce deficits widen, governments are struggling to shore up sufficient overseas reserves to import more and more costly diesel, gasoline and cooking gasoline.

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In Sri Lanka, the place drivers have to attend in line for days to refuel, the federal government defaulted on its debt in April, prompting a disaster that led to the president’s ouster this month. Observers worry that different international locations could face related turmoil.

“Sri Lanka’s authorities was the primary to fall. There have already been protests associated to meals and gasoline costs in a minimum of 17 international locations due to inflationary pressures,” Samantha Energy, administrator of the US Company for Worldwide Improvement, mentioned Wednesday in New Delhi throughout conferences on the worldwide meals disaster. “If historical past is any information, we all know that Sri Lanka’s authorities will doubtless not be the final to fall.”

Nepal, among the many poorest international locations within the area, had not absolutely recovered from the shocks of the pandemic and a drop in Mount Everest tourism when world inflation hit, additional depleting its overseas reserves.

Nepal’s authorities spends a few fifth of its price range on imported diesel, gasoline and different petroleum merchandise, and has seen its indebtedness to India — its sole supply of gasoline — rise to harmful ranges.

Authorities gasoline rationing has despatched client costs even increased.

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Rajendra Tamang, a taxi driver within the capital, Kathmandu, mentioned gasoline costs have practically doubled from a 12 months in the past.

“As soon as the gasoline value is hiked, the value of all the pieces — tea to garments and journey — goes up. Meals costs have additionally elevated. Home hire is growing,” he mentioned.

“However my incomes is lowering. Folks refuse to take a cab until they’ve an emergency,” he added.

Equally in India, a widening deficit is draining overseas reserves.

The nation’s overseas change reserves shrunk $7.5 billion within the week that ended July 15, greater than 6 p.c lower than the identical interval final 12 months, in keeping with central financial institution knowledge.

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India has tried to confront the issue by persevering with to import cheaper Russian oil and banning wheat exports, measures which have saved the nation from experiencing the shortage affecting a few of its neighbors.

However inflation is beginning to be felt.

India’s Parliament was rocked by protests this week after opposition leaders demanded a dialogue on rising meals costs. On Tuesday, Rahul Gandhi, an opposition chief from the Indian Nationwide Congress social gathering, was briefly detained after he staged a protest exterior the Parliament towards rising costs and unemployment.

Pakistan this month reached a preliminary settlement with the I.M.F. for the revival of a $6 billion bailout program because the nation neared the brink of a steadiness of funds disaster.

The deal broke a impasse in discussions that had dragged on for months and got here after Pakistan’s Prime Minister, Shehbaz Sharif, launched robust financial measures to satisfy I.M.F. calls for, together with elevating electrical energy charges, growing gasoline costs and ending authorities subsidies.

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These strikes have prompted public outcry and deepened the nation’s political disaster because it struggles with a cratering financial system, depreciating forex and double-digit inflation.

Whereas different international locations in South Asia reported sharp financial declines in 2020, Bangladesh was an outlier. Its powerhouse garments-for-export business, the second-largest on this planet, helped maintain the financial system rising.

However the invasion of Ukraine, and the surge of commodity costs, have confirmed a higher problem.

The federal government started scheduled energy cuts final week, and has shut off diesel-run energy vegetation indefinitely due to the excessive value of diesel. It has additionally ordered gasoline stations to shut a minimum of as soon as per week.

Rising gasoline costs are reducing into the garment business’s revenue margins.

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Showkat Osman Heera, a supervisor at Lyric Industries, a garment producer in Bangladesh, mentioned frequent energy cuts imply diesel mills have to be used to maintain meeting traces operating.

“Earlier than the latest energy disaster, we wanted solely 100 to 150 liters of diesel a day; now we’d like greater than 1,000 liters,” Mr. Heera mentioned. “We didn’t miss any shipments but, but when this case continues, we could face actual bother.”

Mr. Kamal, the finance minister, mentioned final week that Bangladesh wouldn’t want I.M.F. assist, downplaying the nation’s financial vulnerability. He didn’t clarify his about-face on Wednesday.

Rashed Al Mahmud Titumir, head of the Division of Improvement Research on the College of Dhaka, mentioned the nation was dealing with a tough scenario.

“Bangladesh’s financial system suffered two exterior shocks lately: the Covid-19 pandemic and the invasion of Russia to Ukraine,” he mentioned. “Bangladesh has little capability to face up to or take in this sort of exterior shock.”

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Saif Hasnat reported from Dhaka, Bangladesh, and Emily Schmall from New Delhi. Reporting was contributed by Karan Deep Singh in New Delhi, Christina Goldbaum in Sacramento and Bhadra Sharma in Kathmandu, Nepal.

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Albania Gives Jared Kushner Hotel Project a Nod as Trump Returns

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Albania Gives Jared Kushner Hotel Project a Nod as Trump Returns

The government of Albania has given preliminary approval to a plan proposed by Jared Kushner, Donald J. Trump’s son-in-law, to build a $1.4 billion luxury hotel complex on a small abandoned military base off the coast of Albania.

The project is one of several involving Mr. Trump and his extended family that directly involve foreign government entities that will be moving ahead even while Mr. Trump will be in charge of foreign policy related to these same nations.

The approval by Albania’s Strategic Investment Committee — which is led by Prime Minister Edi Rama — gives Mr. Kushner and his business partners the right to move ahead with accelerated negotiations to build the luxury resort on a 111-acre section of the 2.2-square-mile island of Sazan that will be connected by ferry to the mainland.

Mr. Kushner and the Albanian government did not respond Wednesday to requests for comment. But when previously asked about this project, both have said that the evaluation is not being influenced by Mr. Kushner’s ties to Mr. Trump or any effort to try to seek favors from the U.S. government.

“The fact that such a renowned American entrepreneur shows his interest on investing in Albania makes us very proud and happy,” a spokesman for Mr. Rama said last year in a statement to The New York Times when asked about the projects.

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Mr. Kushner’s Affinity Partners, a private equity company backed with about $4.6 billion in money mostly from Saudi Arabia and other Middle East sovereign wealth funds, is pursuing the Albania project along with Asher Abehsera, a real-estate executive that Mr. Kushner has previously teamed up with to build projects in Brooklyn, N.Y.

The Albanian government, according to an official document recently posted online, will now work with their American partners to clear the proposed hotel site of any potential buried munitions and to examine any other environmental or legal concerns that need to be resolved before the project can move ahead.

The document, dated Dec. 30, notes that the government “has the right to revoke the decision,” depending on the final project negotiations.

Mr. Kushner’s firm has said the plan is to build a five-star “eco-resort community” on the island by turning a “former military base into a vibrant international destination for hospitality and wellness.”

Ivanka Trump, Mr. Trump’s daughter, has said she is helping with the project as well. “We will execute on it,” she said about the project, during a podcast last year.

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This project is just one of two major real-estate deals that Mr. Kushner is pursuing along with Mr. Abehsera that involve foreign governments.

Separately, the partnership received preliminary approval last year to build a luxury hotel complex in Belgrade, Serbia, in the former ministry of defense building, which has sat empty for decades after it was bombed by NATO in 1999 during a war there.

Serbia and Albania have foreign policy matters pending with the United States, as both countries seek continued U.S. support for their long-stalled efforts to join the European Union, and officials in Washington are trying to convince Serbia to tighten ties with the United States, instead of Russia.

Virginia Canter, who served as White House ethics lawyer during the Obama and Clinton administrations and also an ethics adviser to the International Monetary Fund, said even if there was no attempt to gain influence with Mr. Trump, any government deal involving his family creates that impression.

“It all looks like favoritism, like they are providing access to Kushner because they want to be on the good side of Trump,” Ms. Canter said, now with State Democracy Defenders Fund, a group that tracks federal government corruption and ethics issues.

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Craft supplies retailer Joann declares bankruptcy for the second time in a year

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Craft supplies retailer Joann declares bankruptcy for the second time in a year

The craft supplies and fabric retailer Joann filed for bankruptcy for the second time in less than a year, as the chain wrestles with declining sales and inventory shortages, the company said Wednesday.

The retailer emerged from a previous Chapter 11 bankruptcy process last April after eliminating $505 million in debt. Now, with $615 million in liabilities, the company will begin a court-supervised sale of its assets to repay creditors. The company owes an additional $133 million to its suppliers.

“We hope that this process enables us to find a path that would allow Joann to continue operating,” said interim Chief Executive Michael Prendergast in a statement. “The last several years have presented significant and lasting challenges in the retail environment, which, coupled with our current financial position and constrained inventory levels, forced us to take this step.”

Joann’s more than 800 stores and websites will remain open throughout the bankruptcy process, the company said, and employees will continue to receive pay and benefits. The Hudson, Ohio-based company was founded in 1943 and has stores in 49 states, including several in Southern California.

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According to court documents, Joann began receiving unpredictable and inconsistent deliveries of yarn and sewing items from its suppliers, making it difficult to keep its shelves stocked. Joann’s suppliers also discontinued certain items the retailer relied on.

Along with the “unanticipated inventory challenges,” Joann and other retailers face pressure from inflation-wary consumers and interest rates that were for a time the highest in decades. The crafts supplier has also been hindered by competition from others in the space, including Michael’s, Etsy and Hobby Lobby, said Retail Wire Chief Executive Dominick Miserandino.

“It did not necessarily learn to evolve like its nearby competitors,” Miserandino said of Joann. “Not many people have heard of Joann in the way they’ve heard of Michael’s.”

Joann is not the first retailer to continue to struggle after going through bankruptcy. The party supply chain Party City announced last month it would be shutting down operations, after filing for and emerging from Chapter 11 bankruptcy in 2023.

Over the last two years, more than 60 companies have filed for bankruptcy for a second or third time, Bloomberg reported, based on information from BankruptcyData. That’s the most over a comparable period since 2020, when the COVID-19 pandemic kept shoppers home.

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Discount chain Big Lots filed for bankruptcy last September, and the Container Store, a retailer offering storage and organization products, declared bankruptcy last month. Companies that rely heavily on brick-and-mortar locations are scrambling to keep up with online retailers and big-box chains. Fast-casual restaurants such as Red Lobster and Rubio’s Coastal Grill have also struggled.

High prices have prompted consumers to pull back on discretionary spending, while rising operating and labor costs put additional pressure on businesses, experts said. The U.S. annual inflation rate for 2024 was 2.9%, down from 3.4% in 2023. But inflation has been on the rise since September and remains above the Federal Reserve’s goal of 2%.

If a sale process for Joann is approved, Gordon Brothers Retail Partners would serve as the stalking-horse bidder and set the floor for the auction.

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U.S. Sues Southwest Airlines Over Chronic Delays

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U.S. Sues Southwest Airlines Over Chronic Delays

The federal government sued Southwest Airlines on Wednesday, accusing the airline of harming passengers who flew on two routes that were plagued by consistent delays in 2022.

In a lawsuit, the Transportation Department said it was seeking more than $2.1 million in civil penalties over the flights between airports in Chicago and Oakland, Calif., as well as Baltimore and Cleveland, that were chronically delayed over five months that year.

“Airlines have a legal obligation to ensure that their flight schedules provide travelers with realistic departure and arrival times,” the transportation secretary, Pete Buttigieg, said in a statement. “Today’s action sends a message to all airlines that the department is prepared to go to court in order to enforce passenger protections.”

Carriers are barred from operating unrealistic flight schedules, which the Transportation Department considers an unfair, deceptive and anticompetitive practice. A “chronically delayed” flight is defined as one that operates at least 10 times a month and is late by at least 30 minutes more than half the time.

In a statement, Southwest said it was “disappointed” that the department chose to sue over the flights that took place more than two years ago. The airline said it had operated 20 million flights since the Transportation Department enacted its policy against chronically delayed flights more than a decade ago, with no other violations.

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“Any claim that these two flights represent an unrealistic schedule is simply not credible when compared with our performance over the past 15 years,” Southwest said.

Last year, Southwest canceled fewer than 1 percent of its flights, but more than 22 percent arrived at least 15 minutes later than scheduled, according to Cirium, an aviation data provider. Delta Air Lines, United Airlines, Alaska Airlines and American Airlines all had fewer such delays.

The lawsuit was filed in the United States District Court for the Northern District of California. In it, the government said that a Southwest flight from Chicago to Oakland arrived late 19 out of 25 trips in April 2022, with delays averaging more than an hour. The consistent delays continued through August of that year, averaging an hour or more. On another flight, between Baltimore and Cleveland, average delay times reached as high as 96 minutes per month during the same period. In a statement, the department said that Southwest, rather than poor weather or air traffic control, was responsible for more than 90 percent of the delays.

“Holding out these chronically delayed flights disregarded consumers’ need to have reliable information about the real arrival time of a flight and harmed thousands of passengers traveling on these Southwest flights by causing disruptions to travel plans or other plans,” the department said in the lawsuit.

The government said Southwest had violated federal rules 58 times in August 2022 after four months of consistent delays. Each violation faces a civil penalty of up to $37,377, or more than $2.1 million in total, according to the lawsuit.

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The Transportation Department on Wednesday also said that it had penalized Frontier Airlines for chronically delayed flights, fining the airline $650,000. Half that amount was paid to the Treasury and the rest is slated to be forgiven if the airline has no more chronically delayed flights over the next three years.

This month, the department ordered JetBlue Airways to pay a $2 million fine for failing to address similarly delayed flights over a span of more than a year ending in November 2023, with half the money going to passengers affected by the delays.

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