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S. Korea’s Cryptocurrency Industry Welcomes Regulator’s Dramatic Change of Heart

South Korea’s cryptocurrency industry is anticipating much better times as the market regulator changes tack from its tough stance on the virtual coin trade, promising instead to help promote blockchain technology.

The regulator said Tuesday that it hopes to see South Korea — which has become a hub for cryptocurrency trade — normalize the virtual coin business in a self-regulatory environment.

“The whole world is now framing the outline [for cryptocurrency] and therefore [the government] should rather work more on normalization than increasing regulation,” Choe Heung-sik, chief of South Korea’s Finance Supervisory Service (FSS), told reporters.

FSS has been leading the government’s regulation of cryptocurrency trading as part of a task force.

Cryptocurrency operators have drawn a new optimism from Choe’s comments, seeing them clearly indicating the government’s cooperation in their plans for self-regulation.

“Though the government and the industry have not yet reached a full agreement, the fact that the regulator himself made clear the government’s stance on cooperation is a positive sign for the markets,” said Kim Haw-joon of the Korea Blockchain Association.

Wednesday’s news is a stark reversal of the justice minister’s warnings in January that the government was considering shutting down local cryptocurrency exchanges, throwing the market into turmoil.

Instead, South Korea banned the use of anonymous bank accounts for virtual coin trading as of January 30 to stop cryptocurrencies being used in money laundering and other crimes.

Bitcoin, the world’s most heavily traded cryptocurrency, is now changing hands at a three-week high of $11,086 on the Luxembourg-based Biststamp exchange after falling as low as $5,920.72 in early February.

South Korean electronics giant Samsung has already started production of cryptocurrency mining technologies, local media reported in January.

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S. Korea Signs Free Trade Deals With 5 Central America Countries

South Korea said on Wednesday it is signing free trade agreements with five Central American nations aimed at boosting market access for the Korean auto sector and electronics makers.

Trade minister Kim Hyun-chong will meet representatives from Costa Rica, El Salvador, Honduras, Nicaragua and Panama in Seoul on Wednesday to sign five separate bilateral pacts which will eliminate duties on about 95 percent of traded goods and services, Korea’s trade ministry said in an e-mailed statement.

The agreements are subject to parliamentary approval in each country, and is likely to take effect at different times depending on the ratification process.

The five trade pacts open South Korea to key Central American countries after its deals with the U.S., the European Union and China helped boost exports.

“The South Korea-Central America free trade deals will enable the countries to build a more comprehensive, strategic partnerships going forward,” Kim said.

The ministry expects the five deals to accelerate South Korea’s economic growth by an overall 0.02 percent in the next 10 years, by boosting exports of cars, steel, cosmetics products, and auto components.

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Venezuela: Launch of ‘Petro’ Cryptocurrency Raised $735 Million

President Nicolas Maduro said Tuesday that Venezuela had received $735 million in the first day of a pre-sale of the country’s “petro” cryptocurrency, aimed at pulling the country out of an economic tailspin.

Maduro is hoping the petro will allow the ailing OPEC member to skirt U.S. sanctions as the bolivar currency plunges to record lows and it struggles with hyperinflation and a collapsing socialist economy.

Blockchain experts have warned the petro is unlikely to attract significant investment. Opposition leaders have said the sale constitutes an illegal debt issuance that circumvents Venezuela’s majority-opposition legislature, and the U.S. Treasury Department has warned it may violate sanctions levied last year.

Maduro did not give details about the initial investors and there was no evidence presented for his figure. He added that tourism, some gasoline sales and some oil transactions could be made in petro.

“Today, a cryptocurrency is being born that can take on Superman,” said Maduro, using the comic character to refer to the United States, as he was flanked by mining rigs in a state television address.

The official website for the petro on Tuesday published a guide to setting up a virtual wallet to hold the cryptocurrency.

The cryptocurrency goes public next month.

Venezuelan Cryptocurrency Superintendent Carlos Vargas last week said the government was expecting to draw investors in Turkey, Qatar, the United States and Europe.

The value of the entire petro issuance of 100 million tokens would be just over $6 billion, according to details given by Maduro in recent months, though no new price information was provided Tuesday.

The tokens will each be valued at and backed by a barrel of Venezuelan crude oil, Maduro has said.

Advisers working for the government have in the past recommended that 38.4 percent of the petros should be sold in a private auction at a discount of 60 percent.

Maduro says his government is the victim of an “economic war” led by opposition politicians with the help of the government of U.S. President Donald Trump.

Sanctions levied last year by Washington block U.S. banks and investors from acquiring newly issued Venezuelan debt, effectively preventing the nation from borrowing abroad to bring in new hard currency or refinance existing debt.

The petro will not be a token on the Ethereum network, as was previously disclosed in a whitepaper provided by the government.

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How US Coal Deal Warms Ukraine’s Ties With Trump

For the first time in Ukraine’s history, U.S. anthracite is helping to keep the lights on and the heating going this winter following a deal that has also helped to warm Kyiv’s relations with President Donald Trump.

The Ukrainian state-owned company that imported the coal told Reuters that the deal made commercial sense. But it was also politically expedient, according to a person involved in the talks on the agreement and power industry insiders.

On Trump’s side it provided much-needed orders for a coal-producing region of the United States which was a vital constituency in his 2016 presidential election victory.

On the Ukrainian side the deal helped to win favor with the White House, whose support Kyiv needs in its conflict with Russia, as well as opening up a new source of coal at a time when its traditional supplies are disrupted.

Trump’s campaign call to improve relations with the Kremlin alarmed the pro-Western leadership in Ukraine, which lost Crimea to Russia in 2014 and is still fighting pro-Moscow separatists.

However, things looked up when President Petro Poroshenko visited the White House on June 20 last year.

“The meeting with Trump was a key point, a milestone,” a Ukrainian government source told Reuters, requesting anonymity.

The Americans had set particular store by supplying coal to Ukraine. 

“I felt that for them it is important,” said the source, who was present at the talks that also included a session with Vice President Mike Pence.

Despite Trump’s incentives, U.S. utilities are shutting coal-fired plants and shifting to gas, wind and solar power.

Ailing U.S. mining companies are therefore boosting exports to Asia and seeking new buyers among eastern European countries trying to diversify from Russian supplies.

Trump, who championed U.S. coal producers on the campaign trail, pressed the message after meeting Poroshenko. 

“Ukraine already tells us they need millions and millions of metric tons right now,” he said in a speech nine days later. “We want to sell it to them, and to everyone else all over the globe who need it.”

The deal with Kyiv was sealed the following month, after which U.S. Commerce Secretary Wilbur Ross said: “As promised during the campaign, President Trump is unshackling American energy with each day on the job.”

The deal helped to “bolster a key strategic partner against regional pressures that seek to undermine U.S. interests,” Ross added, referring to past Russian attempts to restrict natural gas flows to its western neighbors.

A matter of necessity

Ukraine was once a major producer of anthracite, a coal used in power generation, but it has faced a shortage in recent winters as it lost control of almost all its mines in eastern areas to the separatists.

Along with South Africa, Ukrainian-owned mines in Russia have been the main source of anthracite imports but this is fraught with uncertainty. In the past Moscow has cut off gas supplies to the country over disputes with Kyiv, while the Ukrainian government considered forbidding anthracite imports from Russia in 2017 although no ban has yet been imposed.

Overall anthracite imports shot up to 3.05 million tons in the first 11 months of 2017 from just 0.05 million in all of 2013 — the year before the rebellion erupted.

Neighboring Poland, which Trump visited in July, is also turning increasingly to U.S. coal. Its imports from the United States jumped five-fold last year to 839,000 tons, data from the state-run ARP agency showed.

In July Ukrainian state-owned energy company Centrenergo announced the deal with U.S. company Xcoal for the supply of up to 700,000 tons of anthracite.

Centrenergo initially said it would pay $113 per ton for the first shipment, a price industry experts and traders told Reuters was expensive compared with alternatives.

However, chief executive Oleg Kozemko said the cost varied according to the quality of the coal delivered, so Centrenergo had paid around $100 per ton on average for the 410,000 tons supplied by the end of 2017.

Kozemko said in an interview that the U.S. deal was Centrenergo’s only viable option after three tenders it launched earlier last year had failed.

“The idea to sign a contract with Xcoal was a matter of necessity,” he said. “We had agreements but they didn’t work out, because the pricing that they discussed with us and that we signed an agreement on didn’t work out.”

Data on the state tenders registry and documents seen by Reuters show that two of the tenders failed due to a lack of bids, while the results of the third were cancelled.

If that contract had worked out, Centrenergo would have paid around $96 per ton, according to Reuters calculations based on the exchange rate at the time of the tender in April.

Energy expert Andriy Gerus told Reuters the Xcoal deal “probably helps Ukraine to build some good political connections with the USA and that is quite important right now.”


Mutual desire 

The anthracite for Centrenergo is mined in Pennsylvania, which backed Trump in 2016. This marked the first time a Republican presidential candidate had won the state since 1988, and followed Trump’s pledge to reverse the coal industry’s history of plant closures and lay-offs in recent years.

Centrenergo says it and Xcoal agreed the contract independently of their governments and without any political pressure. However, Kozemko said: “If talks between the heads of our countries helped in this, then we can only say thank you… It was a mutual desire.”

For the Ukrainian authorities, the diplomatic benefit is clear. When the first shipment of U.S. anthracite arrived in September, Poroshenko tweeted a photo of himself shaking hands with Trump in Washington. 

“As agreed with @realDonaldTrump, first American coal has reached Ukraine,” he wrote.

Poroshenko’s press service said the deal “is an exact example of when the friendly and warm atmosphere of one conversation helps strengthen the foundations of a strategic partnership in the interests of both sides for the future.”

The Washington meeting also discussed U.S.-Ukrainian military and technical cooperation. Soon after, the Trump administration said it was considering supplying defensive weapons to Ukraine to counter the Russian-backed separatists.

In late December the U.S. State Department announced that the provision of “enhanced defensive capabilities” had been approved.

Kozemko said the Xcoal deal was likely to be only the beginning of Centrenergo’s trade relations with the United States as it is currently holding talks on supplies of bituminous coal, a poorer quality variety.

“It’s good that we studied the U.S. market because we had never looked at it before. We see big prospects for bituminous coal,” he said, adding that other Ukrainian firms were thinking similarly. “We showed how to bring coal from America and they are following our lead.”

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Brazil Gov’t Acknowledges Pension Bill Going Nowhere

Brazil’s political affairs minister Carlos Marun said on Monday that passage of a bill to overhaul the country’s costly social security system has effectively ground to a halt in Congress and would become a campaign issue in this year’s election.

Marun spoke to reporters after the head of the Senate, Eunicio Oliveira, said the federal government’s military intervention in Rio de Janeiro would, by the rules of the country’s constitution, block any vote on pension reform or any other measure requiring a constitutional amendment.

But Marun acknowledged what President Michel Temer’s critics believe is the real reason for holding up a pension vote: the unpopular bill never gained enough support and the government faced certain defeat.

“We don’t have the votes. I couldn’t guarantee we would have the votes by the end of February,” he said. That was the government’s deadline for passing the bill before lawmakers turned their attention to securing their seats in the October general election.

Pension reform is the cornerstone policy in Temer’s efforts to bring a bulging budget deficit under control. Generous pension benefits and early retirement have turned social security into the main driver of a deficit that cost Brazil its investment grade.

Marun, the cabinet minister charged with mobilizing coalition support in Congress, said pension reform would become a key issue in the election campaign if Congress did not take it up again.

The legislation to streamline social security, which required amending the constitution, was lined up for a first vote in the lower house of Congress this week.

But on Friday the government ordered the army to take over command of police forces in Rio de Janeiro state in a bid to curb violence driven by drug gangs, an intervention that blocks any constitutional changes during its duration.

Temer decreed the Rio intervention through Dec. 31, his last day in office.

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Latvia’s Banking Sector Rocked by US Probe, Central Bank Chief’s Detention

Latvia’s ABLV Bank sought emergency support Monday after U.S. officials accused it of helping breach North Korean sanctions while the country’s central bank chief faced bribery allegations, turning up the spotlight on its financial system.

The Baltic country, which is a member of the euro zone and shares a border with Russia, has come under increasing scrutiny recently as a conduit for illicit financial activities.

Last year, two Latvian banks were fined more than 2.8 million euros ($3.26 million) for allowing clients to violate sanctions imposed by the European Union and United Nations on North Korea. Three others received smaller fines.

ABLV said it had sought temporary liquidity support from the central bank after depositors withdrew 600 million euros, about 22 percent of total deposits, following a warning by the United States that it was seeking to impose sanctions on the bank.

Latvia’s third-biggest lender denied wrongdoing.

“We don’t participate in any illegal activities,” ABLV Bank Deputy CEO Vadims Reinfelds told a news conference. “There are no violations of sanctions.”

The bank said it would not look for a bailout from the government and that it had adequate liquidity and capital.

The European Central Bank had earlier stopped all payments by ABLV, citing the sharp deterioration in its financial position in recent days and saying a moratorium was needed to allow the bank and Latvian authorities to address the situation.

A source close to the matter said the moratorium would be short, giving ABLV just a few days to assess its situation.

Only solvent institutions may receive emergency liquidity support and should the ECB determine that ABLV cannot meet its financial, liquidity and capital obligations, it could start proceedings that may lead to the bank being wound down.

Latvia’s own central bank said it had agreed to provide 97.5 million euros worth of funding to ABLV but that the bank has yet to receive the money.

The U.S. Treasury’s Financial Crimes Enforcement Network (FinCEN) said on Feb. 13 that ABLV “had institutionalized money laundering as a pillar of the bank’s business practices.”

It linked some of the alleged activities to North Korea’s ballistic missiles program, saying bank executives and management had bribed Latvian officials to cover up their activities.

​Central bank governor

Separately, Latvia’s anti-corruption authority released central bank Governor Ilmars Rimsevics, an ECB policymaker, who was arrested Saturday on suspicion of having solicited a 100,000 euro bribe. Rimsevics denied the allegations.

The Corruption Prevention and Combating Bureau said its investigation was not connected to the probe into ABLV.

“[Rimsevics’ arrest] … is about demanding a bribe of no less than 100,000 euros,” the bureau’s head, Jekabs Straume, told reporters at a news conference Monday.

Neither the police nor the anti-corruption authority gave details of the alleged request for a bribe.

A lawyer for Rimsevics, who was arrested after police searched his office and home, said he would hold a news conference at 11:00 a.m. (1000 GMT) Tuesday.

“I disagree with it categorically,” Rimsevics told Latvian news portal Delfi following his release, referring to the bribery allegations.

Prime Minister Maris Kucinskis had earlier called on the central bank chief to quit, saying: “I can’t imagine that a governor of the Bank of Latvia detained over such a serious accusation could work.”

Latvia joined the European Union in 2003 and adopted the euro currency at the start of 2014, a move that gave its central bank governor a seat on the ECB’s interest-rate-setting Governing Council.

The European Commission said Monday that Rimsevics’ detention was a matter for Latvian authorities.

Boom time

The economy of Latvia, which gained independence from the Soviet Union in 1991, has boomed in recent years. Its commercial banking sector is dominated by Nordic banks alongside a number of privately-owned local lenders.

In its document detailing the allegations against ABLV, the FinCEN said the reliance of some parts of the Latvian banking system on non-resident deposits for capital exposed it to increased illicit finance risk. It said such deposits amounted to roughly $13 billion.

“Non-resident banking in Latvia allows offshore companies, including shell companies, to hold accounts and transact through Latvian banks,” FinCEN said, adding that criminal groups and corrupt officials may use such schemes to hide true beneficiaries or create fraudulent business transactions.

“[Former Soviet Union] actors often transfer their capital via Latvia, frequently through complex and interconnected legal structures, to various banking locales in order to reduce scrutiny of transactions and lower the transactions’ risk rating.”

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French Jazz Violinist Didier Lockwood Dies Suddenly at 62

French jazz violinist Didier Lockwood, whose eclectic career spanned more than four decades and the world’s most prestigious festivals and concert halls, has died. He was 62.


Lockwood’s agent, Christophe Deghelt, said in a statement on Twitter that Lockwood died suddenly Sunday, a day after he performed in Paris.


President Emmanuel Macron paid tribute Monday to the musician he called a “friend and partner of the greatest” and said possessed “influence, open-mindedness and immense musical talent” that will be missed.


As a composer and an improviser while performing, Lockwood enjoyed crossing musical genres, from jazz-rock to classical. He was known for experimenting with different sounds on the electric violin.


He’s survived by his wife, French soprano Patricia Petibon, and three daughters.

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Without City Jobs, Tech-savvy Kenyan Youth Head Back to Farm

When Francis Njoroge graduated with an engineering degree in Nairobi, he expected to earn a six-figure salary. Instead he found himself working as an electrician on a three-month contract, for 20,000 Kenyan shillings (about $200) per month.

Realizing permanent and well-paid jobs were hard to come by in the Kenyan capital, he decided to move back to his parents’ farm in Kimandi, a village about 150km away, and start his own business planting and selling tree seedlings.

“My parents are tea and maize farmers and always managed to pay our school fees,” Njoroge told the Thomson Reuters Foundation, walking around the farm in dark blue overalls.

“So I thought rather than be frustrated in my job or not even have one, why not go into something I know will bring me money?”

Njoroge is not alone. Kenya has the highest rate of youth joblessness in East Africa, according to the World Bank, with nearly one in five young people who are eligible for work not finding jobs.

Poor job prospects and low pay in cities are pushing thousands of unemployed young people to return home and take up farming, said David Mugambi, a lecturer at Chuka University in central Kenya.

“Young people are increasingly realizing that farming can pay off,” he explained.

Njoroge used his savings to buy seeds from the Kenya Forestry Research Institute after realizing there was a shortage of seedlings among local farmers.

“At first I was making 7,000 shillings ($70) a month by selling tree seedlings to a community organization,” he added.

“Three years later, I now earn more than 10 times that amount.”

Tech-savvy youth

Kenyan youth are not only turning to farming, they are bringing their digital skills with them to rural areas, according to Mugambi.

“For example, tech-savvy youth are very good at using mobile apps that tell them when to plant or what fertilizers to use,” he said.

Knowing very little about tree seedlings, Njoroge joined a WhatsApp group of 30 fellow farmers to learn about issues like growing conditions and fertilizers.

“I take pictures of my produce, upload them to WhatsApp with a price tag, and then take calls from interested buyers,” he explained.

Like Njoroge, Phillip Muriithi, a teaching graduate from Kenyatta University, left Nairobi to return to his parents’ farm about 200km northeast of the city, and now grow tomatoes and cabbages.

“I wanted to become a high school teacher but without a job or income I felt like a balloon drifting to nowhere,” he told the Thomson Reuters Foundation, standing in the middle of a field of green tomatoes in Mitunguu, central Kenya.

“Living in the city was so expensive,” he added. “But with farming I was assured of food, a small income, and didn’t have to pay rent.”

Muriithi also uses his mobile to keep a record of costs, fertilizers and profit, and to market his produce on WhatsApp groups.

“My phone allows me to reach a wider audience than if I were travelling to the market — it’s just made farming a lot easier,” he added.

More funds and support

The Kenyan government is trying to promote entrepreneurship among young people by improving their access to credit, said Mugambi.

The Uwezo fund, for example, provides youth with grants and interest-free loans of up to 500,000 shillings (about $5,000) to set up their own business.

But more investment is needed to make farming attractive to a wider range of young people, Mugambi added.

“Many youth still see returning home as a failure and farming as a lowly affair,” he said.

Njoroge agrees, saying his friends tried to discourage him from going into farming, which they saw as the preserve of “older, uneducated folk.”

Some regret making the switch to farming. Mary Wanjiku, a teaching graduate from Chuka University, who went home to grow tomatoes and onions, said her experience turned into a “nightmare.”

“The little capital I had got used up in buying fertilizers, manure and seeds, and I nearly lost my entire tomato harvest to an attack by bacteria wilt,” she said, adding that she now sells second-hand clothes instead.

Muriithi’s advice is to “start small” to minimize any disappointment.

“I was really scared of failing so started with only a small chunk of land for the first two years,” he said. “But now my father is convinced of my success, he lets me use most of his eight-acre piece of land.”

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Egyptian Firm to Buy $15 Billion in Israeli Natural Gas

An Egyptian company will buy $15 billion of Israeli natural gas in two 10-year agreements announced on Monday, marking a major export deal that Israel hopes will strengthen diplomatic ties.

The partners in Israel’s Tamar and Leviathan offshore gas fields said they have signed with private Egyptian firm Dolphinus Holdings to supply a total of around 64 billion cubic meters of gas over a decade – with half coming from each field and the proceeds split equally between them.

Israeli Prime Minister Benjamin Netanyahu said the agreements would “strengthen our economy (and) strengthen regional ties.” His energy minister Yuval Steinitz called it the most significant export deal with Egypt since the neighbors signed their historic peace treaty in 1979.

Israel’s Delek Group and Texas-based Noble Energy have led both gas projects.

“Egypt is becoming a real gas hub,” Yossi Abu, CEO of Delek subsidiary Delek Drilling, told Reuters. “This deal is the first deal of potentially more to come.”

The partners have also been trying to finalize a long-term export deal with a Royal Dutch Shell plant in Egypt.

An Egyptian government official, who declined to be identified, said the deal did not mean Egypt itself would import any gas from abroad.

“International private companies will import gas from abroad in the framework of their own needs, and will liquefy and export them again,” the official said, without elaborating.

Shares in Delek Drilling were up 23 percent on the news and Delek Group shares were up 17 percent. Barclays analyst Tavy Rosner said weakness seen in Israeli gas shares over the past several months was due to investors being skeptical that gas exports would ever take place. “We believe today’s announcement will pave the way to a re-rating of the shares,” he said.

Leviathan, located about 80 miles (130 km) west of Haifa, was discovered in December 2010 and is scheduled to start producing by the end of 2019.

Exports from Tamar, which began production in 2013, are expected to start under the deal some time between the second half of 2020 and the end of 2021.

Dolphinus, Delek said, is a natural gas trade company that plans to supply large industrial and commercial consumers in Egypt. It added that Egypt had amended regulations last week to allow private groups to import gas.

The companies did not give a date for when supplies to Egypt were expected to start. The means of delivering the gas to Egypt still needs to be settled.

One export option, Delek said in a statement, was to supply the gas through an old pipeline built by East Mediterranean Gas (EMG) originally designed to send gas in the other direction.

Egypt had once sold gas to Israel, but the deal collapsed in 2012 after months of attacks on the pipeline by militants in Egypt’s Sinai peninsula.

Another option would be to use a pipeline being built as part of a separate deal to sell gas from Leviathan to Jordan.

The export agreements are conditioned upon receipt of regulatory and government approvals in Israel and in Egypt.

Noble and Delek Drilling together control 85 percent of Leviathan, with the rest held by Ratio Oil.

They are joined in Tamar by Isramco Negev, Tamar Petroleum – a spin-off of Delek – and two other small partners.

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Anti-Corruption Police Arrest Latvian Central Bank Chief

Latvian Prime Minister Maris Kucinskis assured the country and Europe “there is no sign of danger,” after anti-corruption police arrested the head of the Latvian central bank Saturday.

“For now, neither I, nor any other official, has any reason to interfere with the work of the Corruption Prevention Bureau,” Kucinskis said.

Neither Kucinskis nor the police gave any reason why central bank governor Ilmars Rimsevics was arrested. But a police spokeswoman said there will be an announcement “as soon as possible.”

The Latvian government plans an emergency meeting Monday.

Along with heading the Baltic nation’s central bank, Rimsevics is also one of 19 governors on the European Central Bank.

The U.S. Treasury Department has proposed sanctions against a major Latvian bank for alleged money laundering linked to North Korea’s weapons program.