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US to Attend China’s Belt and Road Forum

In a move that is likely to give a boost to China’s Belt and Road Forum, the United States has announced that it will participate in meetings on the initiative beginning this weekend in Beijing.

The decision to attend is part of a 100-day plan and new deal between Washington and Beijing that was initially hammered out when President Donald Trump and China’s President Xi Jinping met early last month in Florida.

The interagency delegation from Washington will be led by Matthew Pottinger, a top adviser to the Trump administration and National Security Council senior director for East Asia. China is pleased with the decision.

“We welcome all countries to attend. And we welcome the United States’ attendance as the world’s largest economy in the relevant activities of the Belt and Road initiative,” said Vice Finance Minister Zhu Guangyao.

Fact and fiction

China has long been playing up the global benefits of its ambitious trade project, but analysts note that the plan is opaque and vague. Besides, the economic benefits for developed nations such as the United States are still unclear.

For many, the project still seems largely China-centric. It boasts six economic corridors, all of which are to enhance links with China through connectivity and trade infrastructure. Those include connections between China and Europe, the Middle East, Africa and Asia.

“It’s about making China great again — in Trumpian terms — and making China great on the international stage,” said Tom Miller, author of China’s Asian Dream: Empire Building Along the New Silk Road.

Domestically, China’s leaders present the project as part of their attempt at the grand rejuvenation of the Chinese people. Internationally, Beijing is trying to convince the world that it is a cooperative win-win plan that will equally benefit all participants.

So far the response has been mixed, but Beijing hopes that its forum on Sunday and Monday, which will include heads of state from 29 countries and official delegations from several other countries, will bring more clarity.

For starters, there is no official map of the grand plan, and the scope of the project continues to balloon. Beijing is entirely in the driver’s seat and the direction of the initiative is fuzzy at best, analysts said.

“What actually gets built will depend on what deals Chinese companies make with other countries abroad or on the deals that Chinese government makes with other governments abroad, and no one knows exactly what those are going to be,” Miller said.

Bumps on China road

There are also the geopolitical implications of the project.

Many developing countries along the route will obviously welcome and be eager and open to receive Chinese investment, infrastructure and development, said Paul Haenle, director of the Beijing-based Tsinghua-Carnegie Center for Global Policy.

In addition to communicating with developing countries, China needs to proactively engage with developed nations such as the United States and others as well.

China “should explain fully what the objectives are for the initiatives,” Hanele says. “And if it doesn’t do a very good job, I think then China risks these nations projecting their worst fears onto the Belt and Road initiative.”

While China-backed infrastructure projects could bring many benefits to developing countries, they could also make them reliant on Beijing’s largesse.

“The more power that China gains economically, [the more] it will have a geopolitical impact,” Miller said. “And in that sense, you can say that it does equate to a double win for China.”

Critical eye

Having developed countries such as the United States, Germany and Britain participate in the meeting could help make it more transparent.

Other developed European countries and the United States are right to look at Chinese behavior that is opaque and poorly defined with a critical eye, Haenle said.

He added Washington’s decision to attend and not shun the gathering, as it did during China’s formation of the Asian Infrastructure Investment Bank (AIIB) two years ago, is a better approach.

The United States would do well “to ask about what the rules will be and what the purpose is behind this, but at the end of the day, the U.S. should not have a hostile attitude,” Haenle said.

Friday’s last-minute announcement has raised questions about whether the United States may reverse former President Barack Obama’s decision to stay away from the AIIB and join. The bank is hosting a special press conference on Saturday to announce new members.

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Six Months After India Currency Ban, Poor Still Feel Effects

Like thousands of other small-business entrepreneurs in India, Charanjit Yadav saw his sales of generator sets and batteries plummet in the weeks after the government’s surprising move to scrap 86 percent of the country’s currency last November.

Six months on, as business booms, Yadav only recalls the currency ban when he looks at the crisp new notes that have replaced the old ones. “Everything is back to normal. It is absolutely OK for my work,” he said, glancing at the orders placed on another busy day.

But less than a kilometer from the bustling market where his shop is located in the business hub of Gurugram, near New Delhi, the massive cash crunch that India faced for more than two months has left its mark.

Braving sizzling summer temperatures of 44 degrees C (111 degrees F), a group of construction laborers had waited since dawn at a junction where contractors normally come to hire daily wage workers.

Fewer opportunities

Dhani Ram left for his village in January after work dwindled as cash shortages stopped many real estate projects. He returned a month ago, hoping that finding work would be easier. That has not happened.

“I hardly get work for 15 days in a month,” he said. “Earlier, I used to get work for about 25 days a month.”

Unable to eke out a living from his tiny farm in Uttar Pradesh state, Gajinder Singh and 11 others in his village came to the city with a contractor who promised them work. But after four days, he had not been placed anywhere.

“I sleep at night under the rail station, I don’t know what to do,” he said in despair.

Six months after India’s fast-growing economy was disrupted by the radical currency ban, growth is back on track in most sectors and stock markets are surging. But many poor people still scramble to find work as the country’s vast informal sector continues to struggle.  

Growth last year is estimated to have been around 7 percent — less than the 7.9 percent recorded in the previous year, but not as severely dented as many economists had feared. Indian officials say these numbers give the lie to grim warnings that the drastic move, meant to flush out untaxed money, would put a grinding brake on the economy.   

“It was clearly not doomsday. Looks like it was a blip, a banknote blip,” said chief economist D.K. Joshi at Crisil research and consultancy in Mumbai.

Auto sales jump

Many indicators support that. Automobile sales have jumped in recent months as serpentine lines outside banks to exchange old notes vanished. Automakers have lined up new launches as shoppers again open their purses.

Projections that the economy is poised for stronger growth has led stock markets to hit a record high in the past week. The rally has drawn tens of thousands of new middle-class investors into the market amid optimism that growth is rebounding.

Economists say most sectors of the economy are back to normal except those that depend heavily on cash transactions, such as real estate.

N.R. Bhanumurthy at the National Institute of Public Finance and Policy in New Delhi said it would take more time to assess the full impact of the currency ban on the economy. But he said he was optimistic it did not erode confidence as was widely feared.

He pointed to India’s strengthening currency — the rupee is at a nearly two-year high and has gained about 5 percent against the dollar in recent months.

“While other currencies in the world are depreciating because of the strengthening of the U.S. dollar, ours is the only major currency that is appreciating. So that shows that the foreign investor seems to be betting heavily on the Indian growth story,” he said.

‘Devastating’ for many

However, while it is largely business as usual for the middle class and formal sectors, economists say the impact on tens of millions of people who depend on the informal sector — hawkers, vegetable sellers and laborers in cities and small farmers in remote villages — has been much harder. India’s informal sector accounts for 40 percent of gross domestic product but employs as much as 75 percent of the country’s workforce.

Calling the move “devastating” for the informal sector, economist Kaushik Basu wrote this week in the Indian Express newspaper that “the brunt of the pain of demonetization has been shouldered by the poor and the lower middle class.”

While the full impact on them may not yet have been reflected in statistics, the mood of despondency among those waiting for work in Gurugram gave support to such assessments.

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China to Get American Beef and Gas Under Trade Agreement

A sweeping trade agreement, ranging from banking to beef, has been reached between Washington and Beijing, the U.S. Commerce Department announced on Thursday.

“It was pretty much a Herculean accomplishment to get this done,” said U.S. Commerce Secretary Wilbur Ross. “This is more than has been done in the whole history of U.S.-China relations on trade.”

The breakthrough results from an agreement U.S. President Donald Trump and Chinese President Xi Jinping made during their meeting at Trump’s Mar-a-Lago resort in Palm Beach, Florida, on April 6.

Trump “was briefed more or less every single day” as negotiations progressed since then, Ross said.

Beef imports

Following one more round of “technical consultations,” China has agreed to allow U.S. beef imports no later than July 16, consistent with international food and animal safety standards, Ross told reporters at the White House.

The United States Cattlemen’s Association applauded the agreement, saying market access to China is crucial for its members.

“Success in this arena will drive the U.S. cattle market and increase demand for U.S. beef” in China, association president Kenny Graner told VOA.

In exchange, Washington and Beijing are to resolve outstanding issues that would allow imports to the U.S. of cooked poultry from China “as soon as possible,” according to the Commerce Department.

Another significant breakthrough will see American liquefied natural gas (LNG) going to China. Under the agreement Chinese companies will be permitted “at any time to negotiate all types of contractual arrangement with U.S. LNG exporters, including long term contracts,” according to the Commerce Department.

This is “a very big change,” said Ross, noting China is trying to wean itself off coal at a time “it doesn’t produce enough natural gas to meet its needs.”

Financial, other business services

Among other action listed in the 100-Day Action Plan:

* China is to allow, by July 16, “wholly foreign-owned financial services firms” to provide credit ratings services and to begin licensing procedures for credit investigation.

* U.S.-owned suppliers of electronic payment services (EPS) will be able to apply for licensing in China under new guidelines.

* China is to issue bond underwriting and settlement licenses to two qualified U.S. financial institutions by July 16.

* China’s National Biosafety Committee is to meet by the end of this month to conduct science-based evaluations of all eight pending U.S. biotechnology product applications “to assess the safety of the products for their intended use.” Those that pass the tests are to get certificates within 20 working days.

The outcome of the joint dialogue will also see a United States delegation attending China’s Belt and Road Forum in Beijing next week.

A U.S.-China Comprehensive Economic Dialogue will be held this summer, according to the Commerce Department, to deepen engagement on these and other issues.

“There are probably 500 items you could potentially discuss” in the wider one-year plan for bilateral trade, Ross added.

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Cash and Chemicals: For Laos, Chinese Banana Boom a Blessing and Curse

Kongkaew Vonusak smiles when he recalls the arrival of Chinese investors in his tranquil village in northern Laos in 2014. With them came easy money, he said.

The Chinese offered villagers up to $720 per hectare to rent their land, much of it fallow for years, said Kongkaew, 59, the village chief. They wanted to grow bananas on it.

In impoverished Laos, the offer was generous. “They told us the price and asked us if we were happy. We said okay.”

Elsewhere, riverside land with good access roads fetched at least double that sum.

Three years later, the Chinese-driven banana boom has left few locals untouched, but not everyone is smiling.

Experts say the Chinese have brought jobs and higher wages to northern Laos, but have also drenched plantations with pesticides and other chemicals.

Last year, the Lao government banned the opening of new banana plantations after a state-backed institute reported that the intensive use of chemicals had sickened workers and polluted water sources.

China has extolled the benefits of its vision of a modern-day “Silk Road” linking it to the rest of the world – it holds a major summit in Beijing on May 14-15 to promote it.

The banana boom pre-dated the concept, which was announced in 2013, although China now regards agricultural developments in Laos as among the initiative’s projects.

Under the “Belt and Road” plan, China has sought to persuade neighbors to open their markets to Chinese investors. For villagers like Kongkaew, that meant a trade-off.

“Chinese investment has given us a better quality of life. We eat better, we live better,” Kongkaew said.

But neither he nor his neighbors will work on the plantations, or venture near them during spraying. They have stopped fishing in the nearby river, fearing it is polluted by chemical run-off from the nearby banana plantation.

Chinese frustration

Several Chinese plantation owners and managers expressed frustration at the government ban, which forbids them from growing bananas after their leases expire.

They said the use of chemicals was necessary, and disagreed that workers were falling ill because of them.

“If you want to farm, you have to use fertilizers and pesticides,” said Wu Yaqiang, a site manager at a plantation owned by Jiangong Agriculture, one of the largest Chinese banana growers in Laos.

“If we don’t come here to develop, this place would just be bare mountains,” he added, as he watched workers carrying 30-kg bunches of bananas up steep hillsides to a rudimentary packing station.

Chinese foreign ministry spokesman Geng Shuang said he was not aware of the specific issues surrounding Chinese banana growers in Laos, and did not believe they should be linked directly to the Belt and Road initiative.

“In principle we always require Chinese companies, when investing and operating abroad, to comply with local laws and regulations, fulfil their social responsibility and protect the local environment,” he told a regular briefing on Thursday.

Laos’ Ministry of Agriculture did not immediately respond to a Reuters request for comment for this article.

China is the biggest foreign investor in Laos, a landlocked country of 6.5 million people, with over 760 projects valued at about $6.7 billion, according to Chinese state-run media.

This influence is not only keenly felt in the capital Vientiane, where Chinese build shopping complexes and run some of the city’s fanciest hotels. It also extends deep into rural areas that have remained largely unchanged for decades.

Banana rush

Lao people say Chinese banana investors began streaming across the border around 2010, driven by land shortages at home.

Many headed to Bokeo, the country’s smallest and least populous province.

In the ensuing years, Lao banana exports jumped ten-fold to become the country’s largest export earner. Nearly all of the fruit is sent to China.

For ethnic Lao like Kongkaew, Chinese planters paid them more for the land than they could earn from farming it.

For impoverished, hill-dwelling minorities such as the Hmong or Khmu, the banana rush meant better wages.

At harvest time, they can earn the equivalent of at least $10 a day and sometimes double that, a princely sum in a country where the average annual income was $1,740 in 2015, according to the World Bank.

They are also most exposed to the chemicals.

Most Chinese planters grow the Cavendish variety of banana which is favoured by consumers but susceptible to disease.

Hmong and Khmu workers douse the growing plants with pesticides and kill weeds with herbicides such as paraquat. Paraquat is banned by the European Union and other countries including Laos, and it has been phased out in China.

The bananas are also dunked in fungicides to preserve them for their journey to China.

Switching crops

Some banana workers grow weak and thin or develop rashes, said Phonesai Manivongxai, director of the Community Association for Mobilizing Knowledge in Development (CAMKID), a non-profit group based in northern Laos.

Part of CAMKID’s work includes educating workers about the dangers of chemical use. “All we can do is make them more aware,” she said.

This is an uphill struggle. Most pesticides come from China or Thailand and bear instructions and warnings in those countries’ languages, Reuters learned. Even if the labeling was Lao, some Hmong and Khmu are illiterate and can’t understand it.

Another problem, said Phonesai, was that workers lived in close proximity to the chemicals, which contaminated the water they wash in or drink.

In a Lao market, Reuters found Thai-made paraquat openly on sale.

However, some workers Reuters spoke to said they accepted the trade-off. While they were concerned about chemicals, higher wages allowed them to send children to school or afford better food.

There is no guarantee the government’s crackdown on pesticide use in banana production will lead to potentially harmful chemicals being phased out altogether.

As banana prices fell following a surge in output, some Chinese investors began to plant other crops on the land, including chemically intensive ones like watermelon.

Zhang Jianjun, 46, co-owner of the Lei Lin banana plantation, estimated that as much as 20 percent of Bokeo’s banana plantations had been cleared, and said some of his competitors had decamped to Myanmar and Cambodia.

But he has no plans to leave. The environmental impact on Laos was a “road that every underdeveloped country must walk” and local people should thank the Chinese, he said.

“They don’t think, ‘Why have our lives improved?’ They think it’s something that heaven has given them, that life just naturally gets better.”

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Americans Rush to Trademark Catchy Phrases

Ideas were flying at a brainstorming session to create a slogan for a group of North Carolina Democrats when Catherine Cloud blurted out a phrase that made a colleague’s eyes light up: “Because this is America.”

The words were quickly scrawled on a notepad, and the New Hanover County Democratic Party in Wilmington began its scramble to own the phrase. It applied days later for a trademark with the U.S. Patent and Trademark Office.

From President Donald Trump’s dash to own “Keep America Great” for his 2020 re-election campaign — even before he took office — to a rush by a foundation for the victims of the September 11 attacks to claim “Let’s Roll” just days after New York’s Twin Towers were reduced to rubble, Americans are rushing to trademark catchy phrases.

There were 391,837 trademark applications filed last year, with the number growing an average of 5 percent annually, government reports show. The USPTO does not break out how many of those applications were for phrases.

‘That’s Hot’

The surge is the result of headline-grabbing cases like socialite Paris Hilton’s winning settlement of a lawsuit over her trademarked catchphrase “That’s Hot” from her former television reality show, said trademark attorney Howard Hogan of Washington.

“It can’t help but inspire others,” Hogan said. “It feels good to get recognition of something you feel you have created.”

Trademarks can mean cash from everything from bumper stickers to thongs printed with the protected phrase. More important for some, however, is claiming ownership of a powerful message.

” ‘Because this is America’ is a rallying cry that focuses on what we have in common, rather than what divides us,” Cloud said.

The phrase is the tagline in a commercial that was set for online release Thursday about the New Hanover Democrats’ key issues: “Clean water. Because this is America,” “Quality education for every child. Because this is America,” and “No matter your ethnicity, you are welcome here. Because this is America.”

Mindful that the slogan that could easily be employed by rival Republicans, the county Democratic committee filed to trademark it just 18 days after Cloud said it.

Trump looks ahead

Two days before Trump’s inauguration on January 20, Donald J. Trump for President Inc. applied to trademark the phrase he said he intends to use for his 2020 re-election campaign: “Keep America Great,” both with and without an exclamation point. The campaign committee already owns the trademark for Trump’s 2016 slogan: “Make America Great Again.”

Just 15 days after Todd Beamer inspired fellow airline passengers to overwhelm hijackers above a Pennsylvania field on September 11, 2001, the Todd M. Beamer Memorial Foundation applied to trademark his rallying cry, “Let’s Roll.”

Three days after “Nasty Woman” grabbed headlines when Trump used it to describe his opponent Hillary Clinton in an October 19, 2016, debate, entrepreneurs across America started filing trademark applications for the phrase. There are at least 11 applications pending to trademark “Nasty Woman” for the sale of products as wide-ranging as pillows, wine, firearms, scented body spray, mugs, backpacks and jewelry.

Typically it takes about 18 months for the Patent Office to grant a trademark.

But it can take much longer, as cartoonist Bob Mankoff of The New Yorker learned when he tried to trademark the caption to a 1993 cartoon. Two decades passed before he was allowed to register it on January 19, 2016.

Ironically, the phrase aptly describes Mankoff’s anticipated payday from the sale of merchandise, bearing the words that first appeared under his cartoon of a businessman trying to schedule a meeting: “How about never — is never good for you?”

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Iraq, Algeria Support Extension of Oil Production Cuts

Iraq and Algeria support the extension of oil production cuts by OPEC and non-OPEC producers through the end of the year to try to boost prices, they said in a joint statement Thursday.

The oil ministers of the two countries held a press conference in Baghdad where Iraqi Oil Minister Jabar Ali al-Luaibi said “there might be new ideas to be presented” at an OPEC meeting on May 25, without providing further details.

In late November, the Organization of the Petroleum Exporting Countries agreed to cut production by 1.2 million barrels a day, the first such reduction agreement since 2008. The following month, 11 non-OPEC oil-producing countries pledged to cut an additional 558,000 barrels a day, reaching an overall reduction of 1.8 million.

In March, OPEC announced the possibility that such cuts would be extended.

Iraq – OPEC’s second-largest producer and a country that relies on oil revenues for nearly 95 percent of its budget – committed to reduce daily production by 210,000 barrels to 4.351 million.

News of a possible extension of the OPEC cuts and reports that U.S. crude stockpiles have dropped by 5.2 million barrels last week slightly boosted worldwide oil prices.

Crude oil sold for over $100 a barrel in the summer of 2014, before bottoming out below $30 a barrel in January 2016. Brent Crude, used to price international oils, now trades at around $50 a barrel in London.

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Uber Chases GrabTaxi in Myanmar, Expanding in Southeast Asia

Uber is launching its private ride-hailing service in the Myanmar commercial capital of Yangon on Thursday, aiming to tap into one of the world’s youngest and fastest-growing online markets.

The launch follows Singapore-based GrabTaxi’s debut by about two months.

Uber is one of the world’s largest on-demand transportation platforms. It is seeking an alliance with the government to smooth acceptance of the use of private vehicles for commercial transport.

A taxi ride in Myanmar usually involves negotiating prices, no use of meters and a lack of air conditioning or seat belts. Using a ride-hailing app is still a relatively new concept, though the practice has been gaining in popularity.

Local travel services start-up Oway and Hello Cabs, a rival service run by a construction and auto dealership tycoon, also provide ride-hailing services. 

“I definitely want to try Uber,” said Nyan Zay Htet, 26, a company worker who was haggling with a driver over a fare on a downtown street in Yangon. “I welcome having international companies come in because it can be more convenient for us if we don’t have to bargain over prices and can just hop in and go.”

More than two-thirds of Southeast Asians are younger than 40 and the number going online to buy goods and services is soaring. A recent research report by Google and the Singaporean investment arm Temasek put the potential ride-sharing market in six larger regional markets at $13 billion by 2025, up from $2.5 billion in 2015.

With more than 50 million people, Myanmar is growing fast and its public transport networks are not keeping up. Taxis are plentiful in Yangon, with local media reporting authorities estimate there are more than 50,000 on the city’s jammed roads. The industry is something of a free-for-all, with non-licensed drivers turning their cars into taxis as they please. But the government has said it intends to crack down on that.

Incomes for most people are still low, so price competition may be key.

An online Uber fare estimator put the base fare in Yangon at 1,500 kyats (pronounced chuts) ($1.09) with a minimum charge of 1,800 kyats ($1.31).

Uber has faced trouble from regulators in various markets, including China, France, Spain and Mexico. But generally they target services transporting paying customers using private vehicles that are not registered for public transport, not ride-hailing that uses smartphone apps to call licensed taxis.

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Study: US Foreclosure Activity Drops to Lowest Level Since 2005 

Housing foreclosure activity in the United States dropped to the lowest level since 2005 last month, according to a business research group.

ATTOM Data Solutions tracks default notices, auctions and bank repossessions across the nation and says the number of actions dropped 23 percent from a year ago. That means more than 77,000 homeowners missed payments, and banks took some kind of action to encourage the repayment of their loans.

Severe problems in the U.S. housing market, and sales of securities backed by sometimes-faulty mortgages, played a key role in the financial crisis, which is one reason that investors and economists watch the housing market closely.

Seattle, a city in the Pacific Northwest state of Washington, did the best in this study, with the number of foreclosure notices dropping 38 percent from the same time a year ago. Atlantic City, New Jersey, had the worst foreclosure problem in this study, with one out of every 237 housing units getting a notice of some kind.

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New Study Warns of Wage Theft in US

Analysts at a liberal research institution in Washington say U.S. employers are stealing $15 billion a year from workers by failing to pay legally required minimum wages.

The Economic Policy Institute says the wage theft hits nearly one-fifth of low wage workers in the 10 largest U.S. states. The study’s authors say affected workers lose an average of $64 a week, or $3,300 a year out of their modest salaries.

Young people, women, minorities and immigrants are often stuck in low-level jobs and thus are most likely to be affected by wage theft. EPI says the shortfall obviously hurts workers, but also slows demand for goods and services, which can crimp economic growth.

On Thursday, government officials will look at the job market from a different angle, when the weekly jobless claims are published.  Economists track the number of Americans who sign up for unemployment assistance to gauge the health of the market.

A survey of economists shows most experts expect the number of such layoffs to rise slightly but still remain at a relatively low level consistent with a strong job market. A separate study produces the U.S. unemployment rate, which was just 4.4 percent in April, less than half the rate during the worst of the recession. Some analysts say with fewer unemployed workers seeking jobs, employers may have to boost wages to attract and keep staff members.  

Higher wages could contribute to inflation, and so could rising prices of imports, including oil. Friday, officials will report the latest data on price changes at the retail level with the Consumer Price Index. Experts predict the study will show inflation rose about 2 percent over the past year, a moderate level.  

U.S. central bank officials are supposed to guide the economy in ways that keep prices stable and unemployment low. They try to cool inflation by raising interest rates, but do so cautiously to avoid stalling the economy and hurting job growth. That is why experts quoted in the financial press say the Federal Reserve will raise rates again, slightly, at their June meeting.

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Yemen Minister: 60 Percent of Population in Dire Poverty

Yemen’s planning minister says 60 percent of the country’s population is in dire poverty more than two years since the Shi’ite rebels forced the country’s internationally recognized government and president out of the capital.

 

Mohamed El-Saadi says 22 million Yemenis are in need of humanitarian relief, a figure that exceeds the U.N.’s recent estimate that 19.8 million in Yemen need assistance.

El-Saadi spoke during a meeting on Wednesday in the Saudi capital, Riyadh, attended by the Gulf Cooperation Council and international organizations.

 

He warned that the “general security, political and humanitarian situation has witnessed an unprecedented decline.”

 

A Saudi-led coalition has been battling Yemen’s Houthi rebels March 2015. The war has killed more than 10,000 civilians and pushed a large portion of the population to the brink of famine.