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NEW YORK — Stock markets dropped further on Friday on prospects of more aggressive rises in interest rates to fight inflation, renewing concerns over the global economy entering recession next year.

After a healthy rally in recent weeks fueled by signs that price rises were slowing, the US Federal Reserve, European Central Bank and Bank of England this week dampened the holiday cheer by hiking borrowing costs again by sizable amounts and warning of more pain.

While inflation in many leading economies has started coming down — helped by a drop in energy costs — it still remains at or near multidecade highs.

Observers have warned that economies could be heading for a period of stagflation where prices keep rising but growth stalls.

"In a nutshell, it is all about fears over a sharper economic slowdown in 2023 than previously expected," noted Fawad Razaqzada, market analyst at City Index trading group.

"While macro data have been weak of late, there was still hope that the downturn might be short-lived and that a recession might be avoided in some regions altogether, amid signs of inflation peaking in some regions like the US."

The latest rate hikes came as data showed US and UK retail sales dropping in November as consumers — key drivers of growth — feel the pinch from high prices and rate hikes.

Recession on horizon? 

Eurozone and London shares all closed firmly in the red. 

Wall Street stocks meanwhile extended losses too, with major indices ending about 1 per cent lower.

OANDA analyst Craig Erlam said the prospect of a "Santa rally" was fading.

"Going into December, there was growing optimism that policymakers could be a source of optimism going into the new year but instead, they've taken on the role of grinch, bringing a swift end to the celebrations," he added.

Earlier, Asia had also seen losses, with Tokyo closing down 1.9 per cent.

On the upside, Hong Kong rose on progress in talks over allowing US officials to audit Chinese firms listed in New York, easing concerns about a possible delisting of some big names such as Alibaba and Tencent.

The news provided a little more help to Hong Kong traders, whose sentiment has been lifted also by China's shift away from the economically damaging zero-COVID policy as well as moves to open the city further to overseas visitors.

And a report in Hong Kong's South China Morning Post said the border with mainland China would be fully reopened next month, providing another much-needed boost to the beleaguered economy.

However, the mood was soured a little by a US decision to put 36 Chinese companies including top producers of advanced computer chips on a trade blacklist, severely restricting their access to any US technology.

BEIJING — China's retail sales plunged last month, official data showed Thursday, as COVID restrictions and a property market crisis hammered the world's second-largest economy.

The figures highlight the work ahead for the government as it moves away from almost three years of strict containment measures that have whittled growth and sent shudders through supply chains.

November retail sales sank 5.9 per cent on-year, marking the second successive contraction, according to data released by the National Bureau of Statistics (NBS).

The figure was also much worse than the 4 per cent shrinkage forecast in a survey by Bloomberg News.

The data also showed industrial production grew 2.2 per cent on-year last month, less than half October's rate, while unemployment rose 0.1 percentage point to 5.6 per cent.

China was the last major economy persisting with a zero-COVID strategy through harsh lockdowns and mass testing, with authorities effectively abandoning the policy only last week after suffering an economic slowdown and mounting public anger.

November saw some of the highest infection numbers ever recorded in China, with as much as a quarter of the population under some form of lockdown by the end of the month, according to analysts' estimates.

"In November, local outbreaks spread to most provinces across the country, residents' travel decreased and consumption scenarios were restricted," NBS statistician Fu Jiaqi said in a statement.

"The sales of non-essential goods and gathering-based consumption were significantly affected," Fu said.

"While the move away from zero-COVID lays the groundwork for an eventual recovery in activity down the line, the transition period will prove quite disruptive," Julian Evans-Pritchard and Zichun Huang, economists at Capital Economics, said in a note on Thursday.

The economists predicted subdued economic performance in December and warned of declined activity as "many households try to minimise in-person interactions during the reopening wave of infections".

But "reopening is happening much faster than the market expected two months ago, hence the transition period is likely to be shorter", Zhiwei Zhang, chief economist at Pinpoint Asset Management, wrote in emailed comments Thursday.

Chinese leaders have set an annual economic growth target of about 5.5 per cent, but many observers think the country will struggle to hit it, despite announcing a better-than-expected 3.9 per cent expansion in the third quarter.

A crisis rippling through China's massive property sector has also weighed on the economy, with developers defaulting on loans and struggling to raise cash after Beijing imposed widespread lending curbs in 2020.

BRUSSELS — The EU vowed billions of dollars of investment in southeast Asia Wednesday, as leaders looked to bolster ties at a summit in the face of the Ukraine war and challenges from China. 

The European Union billed its first full summit with the Association of Southeast Asian Nations (ASEAN) in Brussels as a chance to push trade relations with the region's fast-growing economies. 

"There might be many, many miles that divide us, but there are much more values that unite us," European Commission President Ursula von der Leyen told the gathered leaders.

But different opinions over Russia's war in Ukraine and concerns about tensions with China over a key shipping route for global trade loomed over the meeting. 

The EU has been on a diplomatic push to galvanise a global front against Moscow as its invasion has sent economic and political shock waves around the world. 

ASEAN's 10 nations — nine of which were represented, after Myanmar's junta was not invited — have been divided in their response to the Kremlin's war on Ukraine.

Singapore has gone along with Western sanctions on Russia, while Vietnam and Laos, which have close military ties to Moscow, have remained more neutral. 

Along with Thailand, they abstained from a United Nations vote in October condemning Russia's attempted annexation of regions of Ukraine seized since February. 

The diverging views led to intense wrangling over a final declaration from the summit as the EU pushed for stronger language to condemn Moscow.

A draft of the final statement said "most members" decried Russia's war, but conceded there were also "other views and different assessments". 

China looms 

While Europe pressed for a tougher response to Russia, another global giant figured prominently at the summit. 

Chinese claims over the South China Sea have set it against some neighbours and sparked fears in Europe over trade flows through the key global thoroughfare. 

But China remains the biggest trade partner for ASEAN and many in the region are wary of distancing themselves from their giant neighbour.

The EU is keen to pitch itself as a reliable partner for southeast Asia's dynamic economies amid the growing rivalry between Beijing and Washington. 

The EU and ASEAN are each other's third-largest trading partner and Europe sees the region as a key source for raw materials and wants to increase access to its booming markets.

EU nations are pushing to diversify key supply chains away from China as the war in Ukraine has highlighted Europe's vulnerabilities. 

Von der Leyen offered an investment package over the next five years worth 10 billion euros ($10.6 billion) under the EU's Global Gateway strategy designed as a counterweight to China's largesse.

"There is a battle of offers today in the geopolitical arena, not only a battle of narrative," said EU foreign policy chief Josep Borrell. "We have to offer more."

Sex law furore 

ASEAN and the EU suspended their push for a joint trade deal over a decade ago — but the bloc's top officials said they hoped to relaunch efforts for a broad agreement. 

So far deals with Vietnam and Singapore are in place, and the EU is looking now to make progress with ASEAN's largest economy Indonesia and to resume talks with Malaysia, Philippines and Thailand.

One issue that risked clouding discussions was a new law in Indonesia criminalising sex outside marriage that has sparked fears for foreign visitors to country.

Indonesia's President Joko Widodo insisted though that the EU-ASEAN relationship needed to be based more on "equality". 

"There must be no imposition of views," he said. 

"There must not be one who dictates over the other and thinks that my standard is better than yours."

SAN FRANCISCO — Elon Musk relaunched a Twitter subscription service on Monday after a first attempt saw an embarrassing spate of fake accounts that scared advertisers and cast doubt on the site's future.

The first try last month came just 10 days after Musk's $44 billion takeover of the platform and a mass round of layoffs that saw company staff levels halved, including teams of workers moderating content.

The relaunch of Twitter Blue in a handful of countries including the United States comes as the Tesla and SpaceX owner has stepped up his tweets endorsing right-wing causes, including opposition to the use of gender neutral pronouns and the US government's response to COVID-19.

The subscription service costs $8 per month for users accessing Twitter on the web and $11 if signing up on an Apple device. 

The initial rollout of Twitter Blue caused an uproar when many fake accounts popped up pretending to be celebrities or companies and Musk's team was forced to pull the plug on the scheme.

This time, the company beefed up its verification procedure with a review required by Twitter before receiving the coveted blue mark.

A blue checkmark on an account, which indicates it has been verified by Twitter, was previously free but reserved for organisations and public figures in an attempt to avoid impersonation and misinformation.

The relaunch came the same day as reports that Musk disbanded Twitter's Trust and Safety Council — a body created six years ago that allows the company to tap into global experts for help shaping strategies around hate speech, child safety, civil rights and other sensitive issues.

An e-mail sent to council members said Twitter is reevaluating how it brings "external insights" into its work and decided that the council is "not the best structure to do this", The Washington Post and CNN reported, citing copies of the message.

Some members of the Trust and Safety Council had already resigned in protest, saying the wellbeing of Twitter users was declining with Musk in charge, CNN reported.

Personal attacks 

Since his takeover, content moderation has proved to be a major headache for Musk, who has described himself as a free-speech absolutist and vowed to let people tweet whatever they want, within the law.

But the billionaire's commitment to unfettered comment has scared off major advertisers and caught the attention of regulators.

Musk believes that the previous ownership of Twitter held a strong left-wing and pro-LGBTQ bias and unfairly banned accounts, including that of former US president Donald Trump.

On Sunday he lashed out against the outgoing key advisor for the US response to the COVID-19 pandemic, Anthony Fauci, a frequent target of vitriol on right-wing media.

"My pronouns are Prosecute/Fauci," Musk said, tauntingly playing on the growing practice for people to indicate their preferred gender pronouns.

By late Monday, trending comment on Twitter in response to Musk called for people to change their pronouns to Boycott/Tesla.

The White House blasted Musk for the tweets against Fauci calling them "disgusting" and "divorced from reality".

"These are incredibly dangerous, these personal attacks that we are seeing," said White House spokeswoman Karine Jean-Pierre.

CNN reported that Twitter's former head of trust and safety had fled his home after baseless attacks on Twitter, endorsed by Musk.

Yoel Roth, who left the company in November, has been the subject of threats since Musk's release of internal documents that play into unsubstantiated theories about collusion by some inside Twitter with the Democratic Party.

The attacks took a serious turn Sunday when Musk endorsed a tweet that accused Roth of being an apologist for pedophilia — a common trope used by conspiracy theorists to target opponents.

The South African-born billionaire's embrace of right-wing talking points seemed to attract increasing scorn in politically liberal San Francisco, where Twitter is headquartered.

Musk was loudly booed by a crowd in the city late Sunday after he was invited on stage by comedian Dave Chappelle.

"It's almost as if I've offended San Francisco's unhinged leftists... but nahhh," Musk tweeted after the event.

Carolina Milanesi, a tech analyst for Creative Strategies, warned that Musk's political turn on Twitter could be problematic for the company going forward.

BAGHDAD — Iraq, a top oil exporter battered by climate change impacts, must diversify its economy and pursue a "greener growth model", the World Bank said on Tuesday.

In a new report presented to authorities in Baghdad, the Washington-based institution said $233 billion must be invested by 2040 to allow Iraq to embark "on a green growth path".

The mostly desert country, after decades of war and turmoil, is also suffering worsening climate change shocks from drought and water scarcity to rising temperatures.

Iraq's infrastructure is crumbling while its economy remains heavily dependent on oil, which accounts for 90 per cent of government revenue.

"Iraq faces the challenge of moving away from total oil dependence towards a more diversified, private sector-led economy that creates jobs and builds human capital while building resilience to climate change," said Ferid Belhaj, World Bank regional vice president for the Middle East and North Africa.

Citing water shortages, desertification and air pollution, Belhaj told AFP that "Iraq has enough financial resources to manage these challenges".

"The question is how to ensure that these financial resources are made available for new policies to tackle environmental challenges, and how to do it in an efficient way."

Among the proposed reforms, the World Bank recommended that Iraq upgrade dams and irrigation systems and "decarbonise industry, agriculture and the waste sectors".

The report also called on Iraq, plagued by chronic power shortages, to eliminate the wasteful practice of gas flaring, where natural gas in wells is burned off before oil is extracted.

The UN ranks Iraq as one of the world's five countries most exposed to impacts of climate change, with water shortages, desertification and rising temperatures predicted to devastate its agricultural sector in particular.

ZURICH — Swiss food giant Nestle said Monday it was opening a new production site in war-torn Ukraine, and would invest tens of millions in a factory and production network set to employ 1,500 people.

"Nestle is announcing the opening a new production site in Ukraine," the company, which had three facilities in Ukraine before the war broke out, said in a statement.

It said that "40 million Swiss francs ($43 million) will be invested in production in Smolyhiv located in Volyn region, in the western part of the country". 

The aim was to increase "the capacity of noodles culinary production in Ukraine", the company said, adding that it also wanted to help support growth of the Ukrainian economy, which has been ravaged since Russia's full-scale invasion in February. 

"I am proud to confirm our commitment to invest in Ukraine," Alessandro Zanelli, head of Nestle's South Eastern Europe Market division, said in the statement.

"This is an important move for Nestle, taken in a very challenging time for the country."

Along with the existing Torchyn factory, the Volyn production network will become Nestle's European regional hub for food and culinary products.

"The Hub will employ 1,500 people and aim to supply both Ukrainian and all other European markets," the statement said.

Nestle also highlighted that it had since the start of the war been providing humanitarian aid of "necessary food and drinks for Ukrainians and their pets".

It said it had donated more than 4,000 tonnes of products to support Ukrainians both inside Ukraine and who have fled to neighbouring countries. 

ATHENS — With most of Europe struggling with soaring energy costs, Greece has launched an initiative to put its mild winters to good use and attract sun-seeking travellers all year round.

The Mediterranean nation recorded November temperatures comfortably exceeding 20ºC — quite a draw for Europeans eager to save on heating bills that have rocketed in the wake of the war in Ukraine.

The Greek government has earmarked 20 million euros ($21 million) for a poster campaign targeting mainly European pensioners that could boost an economy where the travel sector represents 25 per cent of annual output.

"Wanna feel 20 again?" says the poster featuring an elderly pair nibbling watermelon and sipping drinks on a yacht.

"With warm winter temperatures up to 20ºC, Greece is the place to be," it adds.

Tourism Minister Vassilis Kikilias, fresh from a tour of several European capitals including Paris and Berlin to promote the initiative, told AFP the government was working "on a plan to campaign for Greece 12 months per year".

With northern European countries facing much longer and bitterly cold winters, "energy-wise there are many more needs than here in the south where the winter is mild" and shorter, he added.

"You live a great one or two months here enjoying your vacation and spending less than you would have spent staying at home," Kikilias said.

The Florida of Europe? 

"In Greece, no German has to freeze," top-selling German daily Bild wrote in September, while business daily Handelsblatt suggested the country could become "the Florida of Europe".

Kikilias said there was a "tradition" among northern European travellers to winter in Spain and Portugal, but he urged holidaymakers eager for sun, sea and sand to "take a look at the eastern Mediterranean [too]".

After two years of economically painful travel restrictions caused by the COVID-19 pandemic, arrivals in 2022 could finish near the all-time high of 33 million tourists recorded in 2019.

By the end of September, 23.7 million people had holidayed in Greece, and the number of French, German and British visitors even topped 2019 levels.

TUI, the world's largest tourism operator, earlier this year brought forward the launch of the tourist season because of high demand.

But tour operators have yet to take the plunge in the winter months. 

For the time being, TUI does not offer organised trips to Greece from December to February, said Evangelos Georgiou, one of the company's communications managers.

And German charter airline Condor only offers flights to Kalamata airport in the Peloponnese Peninsula until the end of November.

Condor flights to Heraklion on the island of Crete and Rhodes will only resume at the beginning of April, according to spokeswoman Johanna Tillmann.

DAMASCUS — Syria's nose-diving pound hit a new record low Saturday against the dollar on the black market, according to websites monitoring the exchange rate, as the country faces severe fuel shortages.

The Syrian economy has been battered by more than 11 years of war and crippling Western sanctions, pushing 90 per cent of the population into poverty, according to the United Nations.

The exchange rate reached more than 6,000 Syrian pounds to the US dollar for the first time, the websites said, driving up the price of goods.

Syria's official exchange rate has stood at around 3,015 pounds to the greenback since September — compared to 47 pounds to the dollar in 2011.

The unofficial rate means the currency is now worth almost 99 per cent less on the black market than the official rate before the start of the conflict.

An average monthly salary of 130,000 Syrian pounds, according to figures reported in Syrian media, is now worth about $21.

Chronic fuel shortages in the war-torn country have intensified in recent weeks, prompting the government to adopt austerity measures including temporarily instating a reduced working week in the public sector.

Syria's sporting federation on Wednesday announced the suspension of "all sports activities... until the end of the year" due to the acute shortages.

Syria's civil war has killed nearly half-a-million people, displaced millions, fragmented the country and ravaged its economy and infrastructure.

RIYADH — Chinese President Xi Jinping on Friday touted close security and energy ties with Gulf nations during summits in Saudi Arabia that have highlighted tensions with Washington.

On the third and final day of his visit, Xi attended a gathering of the six-member Gulf Cooperation Council (GCC) and a broader China-Arab leaders' meeting.

It was only Xi's third journey outside China since the coronavirus pandemic began.

Friday's talks followed bilateral sit-downs on Thursday with Saudi royals that yielded a joint statement stressing "the importance of stability" in oil markets — a point of friction with the United States, which has urged the Saudis to raise production.

"China will continue to firmly support the GCC countries in maintaining their own security... and build a collective security framework for the Gulf," Xi said on Friday at the start of the China-GCC summit.

"China will continue to import large quantities of crude oil from GCC countries on an ongoing basis," he said, also vowing to expand other areas of energy cooperation including liquefied natural gas imports.

Additionally, Xi said China would make full use of a Shanghai-based platform "to carry out RMB [yuan] settlement of oil and gas trade" — a move that, if Gulf countries participate, could weaken the global dominance of the US dollar.

Asked at a press conference, as the summits came to close Friday evening, if Riyadh would agree to such a scheme, Saudi Foreign Minister Prince Faisal Bin Farhan said he had "nothing to add".

Oil from Saudi Arabia alone accounted for 17 per cent of China's imports last year, and last month Qatar announced a 27-year natural gas deal with China.

Rejecting 'polarity' 

Xi's visit comes amid persistent rancour between Saudi Arabia and the US, its long-time partner and security guarantor, over oil production, human rights issues and regional security. 

It follows US President Joe Biden's trip to Jeddah in July, before midterm elections, when he failed to persuade the Saudis to pump more oil to reduce prices.

Xi's arrival in the kingdom on Wednesday earned a rebuke from the White House, which warned of "the influence that China is trying to grow around the world". 

Washington called Beijing's objectives "not conducive to preserving the international rules-based order".

Saudi officials have repeatedly stressed that they value deep ties with Washington but will not hesitate to explore relationships elsewhere.

"We are very much focused on cooperation with all parties and I think competition is a good thing," Prince Faisal said on Friday, adding that Riyadh will also continue to have strong relations with the US "across the board". 

"We will continue to work with all of our partners and we don't see it as a zero-sum game by any means," he added.

"We don't believe in polarity."

Trade talks 

Crown Prince Mohammed bin Salman, Saudi Arabia's 37-year-old de facto ruler, addressed both summits on Friday, promising "continuing Arab-Chinese cooperation to serve our common goals and aspirations of our peoples".

The Gulf countries, strategic partners of Washington, are bolstering ties with China as part of an eastward turn that involves diversifying their fossil fuel-reliant economies. 

At the same time China, hit hard by its Covid lockdowns, is trying to revive its economy and widen its sphere of influence, notably through its Belt and Road Initiative which provides funding for infrastructure projects around the world. 

One area of focus for the China-GCC summit was a free trade agreement under discussion for nearly two decades. 

Drawing those negotiations to a close would be "a matter of prestige for Beijing", said Robert Mogielnicki of the Arab Gulf States Institute in Washington.

"It's not as simple for the GCC states, which seem to be more invested in advancing bilateral ties and are engaged in varying degrees of regional economic competition with their neighbouring member states." 

No breakthrough was announced on Friday.