Foreign Firms Pull Billions in Earnings Out of China

The Wall Street Journal

SINGAPORE—For years, foreign companies plowed the profits they made in China back into China, using the cash to finance new hiring and investment as its giant economy expanded rapidly.

Now, as growth slows and tensions between Beijing and Washington rise, they are pulling those profits out.

Foreign firms yanked more than $160 billion in total earnings from China during six successive quarters through the end of September, according to an analysis of Chinese data, an unusually sustained run of profit outflows that shows how much the country’s appeal is waning for foreign capital. The torrent of earnings leaving China pushed overall foreign direct investment in the world’s second-largest economy into the red in the third quarter for the first time in a quarter of a century.

The outflows add to pressure on China’s currency, the yuan, when the country’s central bank is already battling to slow its decline as investors sour on Chinese stocks and bonds and new investment in China is scarce. The yuan has depreciated 5.7% against the U.S. dollar this year and touched its lowest level in more than a decade in September.

A range of factors have contributed to the profit exodus, economists and corporate executives say. Those include a widening gap between China’s interest rates and those in the U.S. and Europe that has made it more attractive to park earnings in the West. While the Fed and other central banks have been raising rates to fight inflation, China has been cutting them as policy makers battle a prolonged downturn in its real-estate market.

Related video: Chinese Premier Li Vows to Boost Imports, Expand Market Access (Bloomberg)

Duration 2:18  View on Watch

Bloomberg  Comgest's Kang on China Strategy

7:49

WION  Navigating China's fragile consumer price landscape

1:31

Fox Business  China has been ‘struggling’ to revive its economy: Lou Basenese

3:17

But many foreign firms are looking for better uses for their money, as China’s economy slows and geopolitical tensions rise. Chilly relations between Beijing and the U.S.-led West have pushed global companies to rethink their supply chains and exposure to China.

“Corporates are beginning to de-risk from China,” said Peter Kinsella, global head of foreign-exchange strategy at Union Bancaire Privé.

Firan Technology Group, an aerospace electronics company based in Toronto, pulled around 2.2 million Canadian dollars, equivalent to $1.6 million, from China in 2022 and the first quarter of 2023, said Chief Executive Brad Bourne. The company invested between eight million and 10 million Canadian dollars to expand its business in China over the past decade.

The main reason for withdrawing cash from China was to help finance two recent acquisitions in the U.S., Bourne said. But he added that deteriorating ties between Washington and Beijing are a concern for the company. “For sure, there are more uncertainties as to what will happen regarding tensions between China and the West/U.S.,” he said. “So having large sums of money there has some risk.”

Unlike most other major economies, China doesn’t distinguish between reinvested profits and new or “greenfield” foreign investment in its balance of payments, a record of a country’s international transactions.

China’s Ministry of Commerce, however, does publish monthly data on greenfield investment. By subtracting those data from the direct investment sums recorded in China’s balance of payments, economists can get a rough estimate of the flow of profits being reinvested in China or being pulled back overseas.

The data show that for all but two quarters between 2014 and the middle of last year, foreign firms were reinvesting more in China than they were transferring abroad. In 2021, for instance, firms reinvested a net $170 billion.

That shifted in the middle of 2022, when China was under sporadic lockdowns and the U.S. Federal Reserve began raising interest rates to combat rocketing inflation. Outflows have continued in each quarter since.

“Could this be a canary in the coal mine for future investment intentions? It’s possible,” said Alex Etra, senior macro strategist at Exante Data, which tracks global capital flows.

Recent surveys of U.S., European and Japanese companies in China show executives are souring on new investments there, unnerved by the prospect of conflict with Taiwan and China’s efforts to tighten oversight of foreign firms operating within its borders. Overall foreign direct investment in China was negative in the third quarter, with outflows of capital exceeding inflows by $11.8 billion—the first negative quarterly outflow recorded in balance-of-payments data that starts in 1998

The U.S. has imposed restrictions on American investment in China in sensitive sectors such as artificial intelligence and has prohibited the export to China of high-end computer chips, fearing they could be used by its military.

China has imposed exit bans on certain employees of foreign companies and earlier this year raided the offices of some consulting firms providing services to multinational companies. The government has also broadened its anti-spying laws to counter perceived foreign threats in ways that could encompass routine corporate activities.

Some firms have disclosed that they are taking profits out of China, though without giving many details. Swiss materials-technology company Oerlikon said in February it pulled 250 million Swiss francs, equivalent to $276 million, from China in 2022. A spokeswoman described the transfer as routine, saying the company regularly moves cash between major markets.

Georgia-based Chart Industries, which makes cooling systems, said in October it repatriated $35 million of cash from China in the first nine months of the year. The company didn’t respond to a request for comment.

Austrian engineering group Andritz, which makes machinery for the hydropower, paper and steel industries, said in July it chose to bring funds home from China this year to finance investments and acquisitions worldwide, though it didn’t say how much.

“In previous years, we made substantial investments in China to capitalize on the growing market opportunities in China and Southeast Asia. The returns from these successful investments will be utilized to fund future investments and further acquisitions within our group worldwide,” said a spokeswoman for Andritz.

The repatriation of companies’ earnings is part of a broader outflow of foreign capital from China as investors have soured on the country’s financial markets. Higher rates and bond yields in the U.S. have also made Chinese stocks and bonds far less attractive to global investors.

Foreign institutions have cut their holdings of yuan-denominated Chinese bonds by the equivalent of more than $110 billion since the start of 2022, after accumulating the securities for years. The exodus began the same month that Russia invaded Ukraine, and market participants have pointed to the geopolitical risks of investing in Chinese assets as a major reason.

Yields on Chinese government bonds last year also fell below comparable U.S. Treasury debt for the first time in more than a decade. That gap has since widened.

More recently, global investors have also become net sellers of stocks listed in mainland China. From August to October, they pulled more than $23 billion from yuan-denominated shares via a trading link between Hong Kong and stock exchanges in Shanghai and Shenzhen, according to data provider Wind.

These outflows have weighed on the yuan. The weaker currency has motivated companies to repatriate their earnings sooner rather than later, said Ju Wang, head of Greater China foreign-exchange and rates strategy at BNP Paribas.

“If anything, the outflow is driven by foreigners finding better investment opportunities elsewhere,” Wang said.

Reclaiming surfing as a traditional native women's sport

Story by The Canadian Press  

Nuu-chah-nulth youth gather around Lacy Kaheaku, learning how to carve a traditional wooden surf board and of the Indigenous roots sport. https://www.capitaldaily.ca/

Tofino, BC - As the sun beamed onto Esowista beach, youth of the Mułaa, Rising Tide Surf team gathered around Lacy Kaheaku, a native to Hawaiʻi, to learn how to carve traditional wooden surfboards and the Indigenous roots of the sport.

“Women did a lot of the surfing in native Hawaiian culture,” said Kaheaku, adding that royalty, alongside warriors, would also surf. “But majority of the leisurely surfing was done by women.”

Since ancient times, Pacific islanders have surfed. The pastime is believed to have originated in Polynesia, where cave paintings from the 12th century illustrate people riding the waves. 

During seafaring journeys the activity reached Hawaii, long before contact with European explorers and the process of colonization began.

Despite these Indigenous roots, hundreds of years later on the B.C. coast the sport has little First Nations participation, said Rachel Dickens, co-founder of Mułaa, Rising Tides Surf team.

“The surf culture [in Tofino] has been predominantly white male dominated,” she said. “There’s not many First Nations faces in the waters despite these being unceded Tla-o-qui-aht lands that most people are surfing on.”

Dickens said that Mułaa, Rising Tides Surf team allows youth to “explore and play and feel like they can take ownership of a sport that's traditionally Indigenous, and learn in an environment with supportive Indigenous mentors or non-Indigenous allies.”

Mułaa, Rising Tides Surf team runs on Monday afternoons throughout the school year and holds a two-week intensive surf camp in the summer.

Hannah Frank of Tla-o-qui-aht has been surfing since she was nine years old, and joined the Rising Tide Surf Team when she was 12 or 13.

“I never saw natives inside the water,” said Frank, who grew up at Esowista, along the coast near Tofino. “It was very rare to see our people go into our waters, except for fishing and crabbing.”

“I got into surfing because it was all I knew,” said Kaheaku. “I wanted to be a professional surfer when I was in high school; that was my dream.”

Kaheaku said that the lack of representation in the surf industry is what influenced her to stop surfing as a teenager.

“I just felt I didn’t fit the profile of what a surfer was,” she said.

“I would see girls that were blonde hair [and] blue eyes get sponsorships, and then I wouldn't be seen,” she said, adding it didn’t matter how well she had surfed. “That was a big part of why I stopped surfing.”

In Kaheaku’s first year of college she met her teacher, Tom Pōhaku Stone, who taught a surfing history class at the college level.

“That class - at that time - I did not know would change the course of my life,” she said.

Youth of the Mułaa, Rising Tide Surf team use a spokeshave to round the edges of traditional surfboards at Esowista. 

Alexandra Mehl, Local Journalism Initiative Reporter

Stone has been teaching Kaheaku for the last decade, and she has officially graduated to teaching her own workshops. 

She returned to surfing when she had children and wanted to teach them the skills. Kaheaku and her six-year-old son entered their first contest together in 2022 and plan to enter another in the coming year.

“What I didn't realize in that class was the movement that Tom Pōhaku Stone was making from a colonized surf industry, and reminding people and teaching people where it came from,” Kaheaku said.

Learning how to carve a traditional surfboard has built Kaheaku’s confidence as a surfer and a mother, she shared.

“I do feel like there will be a revolution in the surf industry,” said Kaheakhu. “I do feel like native and Nati people will be seen, [and] I do feel like women will be seen.”

Kaheaku said she wants to remind women that “this is what we do.”

“You can dominate this industry equally as much as men, if not more,” she said.

Carissa Moore, a native to Hawaiʻi and a professional surfer, was the first woman on team USA to take home an Olympic gold medal in 2020.

“I do see that there is change,” said Kaheaku. “It gives me so much hope for the next generation.”

Frank said that she would love to see youth from the surf team enter in competitions. 

“To have them train every day with somebody in the water and having an Indigenous representative from Tla-o-qui-aht in that contest; I think that would be really cool,” said Frank.

The Mułaa, Rising Tide Surf team also aims to shift the mindset around surfing from that of a competitive nature to one that is more collective.

“Not just looking at the physical aspects of surfing, but also the emotional and spiritual parts of being outside and being on the water,” said Dickens. 

Frank moved away to attend Shawnigan Lake School this past September and came back home for the summer. She said that getting back into the water made her “very happy.” 

“It was medicine,” said Frank.

The youth excitedly gathered around Kaheaku, some grabbing spokeshaves unable to wait, starting to carve as frequently as they could.

Kaheaku demonstrated to the youth how to use spokeshave to round out the corners of the board, explaining to walk slowly as though walking to the nose of the board when surfing.

“What makes it traditional is definitely the shapes,” she said. “The reason why the shapes are the way they are is because they're supposed to represent different things in the water, they’re supposed to be used for different types of waves in the water.”

“That function is related to nature, the ocean, the type of wave, where you are, what kind of wood,” she continued. “The connection of the wood, the forest to the ocean is what identifies as native.”

Kaheaku shared that the close ties between Hawaiʻi and B.C. were connected through the tides bringing wood from the Pacific Northwest to the Islands.

“That’s how we got some of our biggest canoes [and] some of our surfboards,” said Kaheaku. “The connection between B.C. and Hawaiʻi is a lot tighter and closer than what we might realize.”

“If I just stare at the ocean, it’s very much like beaches at home,” said Kaheaku.

-30-

Alexandra Mehl, Local Journalism Initiative Reporter, Ha-Shilth-Sa

'My heart was always just with the sheep.' One Navajo's push to keep tradition vibrant

GANADO, Ariz. (AP) — Growing up in Ganado, a small town in Navajo Nation in eastern Arizona, Nikyle Begay always wanted to visit their grandmother's sheep.

Begay's parents had grown up raising livestock, and their dad had always wanted to raise sheep and cattle, but it was a hard way to make a living. In a family with seven children, Begay and their younger sisters were the ones who felt drawn to the sheep. And as a kid, Begay, who is non-binary and uses the pronoun they, always felt connected to their grandmother. While she worked, carding and spinning wool outdoors, Begay would play with Hot Wheels cars, carving little roads in the sand and clay.

"You can never say that you’re broke, that you’re hungry, that you’re bored, that you don’t know what to do, because you have two hands," Begay remembered their grandmother saying while teaching them to weave.

It was a sentiment passed through the generations, one Begay says their great-grandmother had proven by winning the family's first truck, a 1950's Chevy, in a raffle as part of a local sheep shearing contest. By the time Begay was 13, they had gotten involved in local Future Farmers of America programs and started keeping a flock.

When Begay grew up, they moved to Tempe, outside Phoenix, and worked for an electronics manufacturing company. Then the company shifted its operations, and Begay had the option to move to California or Florida. They were torn about the decision, and felt disconnected and lonely.

So Begay came home. It was quiet out here, not loud like in Tempe, making them feel more grounded. Upon returning, Begay learned that their grandmother had, in a Navajo custom, buried their umbilical cord in a sheep corral in the hopes that they would carry on the tradition and become a shepherd and a weaver.

“My heart was always just with the sheep,” they said.

Now 34, Begay has 15 sheep. When it’s time for shearing, they tie their hooves into place and cut the wool by hand with a special pair of scissors. The sheep lies down, calm, as Begay pulls up a section and snips deftly with even strokes. If the sheep gets startled, they soothe them with a soft word or touch. Begay knows each sheep by shades of brown or white, by their horns and by their personalities—assertive, quiet and occasionally sassy or mean.

Begay's family used to have around 150 head, but that isn't possible now. A highway fence has been put up, and the grazing limits are lower. Erosion is common, because more than two decades of drought has meant fewer native grasses to hold the land in place when it does rain. The drought means spending more on feed in the winter. And traders no longer place as high a value on Navajo hand-weaving as they once did, because many, though not all, aspects of weaving can be accomplished by machine. In some ways, the art is dying.

Begay is determined to help stop that from happening. In 2020, they started Rainbow Fiber Co-Op, a wool co-op intended to protect ancestral flocks on Navajo Nation and to help other Diné (Navajo) shepherds get fair prices for their wool, especially wool from the Navajo-Churro breed prized by weavers around the world for their range of natural colors and quality of the fibers.

During the pandemic, they started teaching weaving classes on Zoom, which continue to this day each morning. And Begay is vocal about the importance of sheep and the art of weaving. Their Instagram, @navajoshepherd, shares weaving projects, historical and cultural moments of significance, and of course, pictures of the furry friends they’ve bonded with.

It also provides a window into the cultivating of wool for the purposes of weaving, which is a multi-step craft that requires lots of specialized knowledge. Some of the co-op's wool is processed commercially, but Begay knows how to do every part by hand.

After shearing, Begay uses a long platform made of chicken wire to sift out bits of wool that aren't the right length. They wash the wool by soaking it in water and a bit of dish soap.

Next comes carding — brushing the wool out on a rotating drum to prepare it for making yarn — and sometimes dyeing, a task Begay often takes to California where their best friend has the garage space for it. And finally, there's spinning, which Begay makes look easy — evenly feeding tufts of wool onto a roll that turns with the gentle up-and-down motion of a foot pedal.

Then they weave.

In front of a loom at the dining room table, Begay moves long sticks up and down between the fibers, threads brightly colored strands and uses a weaving comb to lock each line of a project into place. Begay’s current double-sided work, which has completely different colors and patterns on each side, requires deep patience — it can take hours to finish even just a small segment. Begay says many Navajo weavers have special ceremonies to cleanse themselves of the frustration and strong emotions that accompany the weaving.

“They say with weaving, you’re intertwining yourself with every weft,” Begay said.

Like keeping sheep, weaving is an emotionally potent practice for Begay, who describes occasionally having to return from mentally dark places. They sometimes wonder whether keeping the tradition alive even matters in the face of big forces like climate change, drought, and modern development. But Begay also thinks that by raising awareness, combined with simple solutions like adding interested young people to the grazing permits some elders might not be using, there’s hope for the future.

And Begay feels the satisfaction of fulfilling their ancestors’ prayers. They describe a day in 2020, when many of their family members were sick with COVID-19 and wildfire smoke had painted the morning sky with a choking orange sunrise. It felt apocalyptic. Distraught, Begay set about morning chores and took the sheep out to graze.

One of the sheep seemed to notice their distress and wouldn’t leave them alone. As Begay sat on a rock to watch the sun come up, the sheep came right up, face-to-face — and sneezed. Begay was covered in sheep snot, but still felt content.

“You take care of the sheep and they will take care of you,” Begay said.

___

Follow Melina Walling on X, formerly known as Twitter: @MelinaWalling.

___

The Associated Press receives support from the Walton Family Foundation for coverage of water and environmental policy. The AP is solely responsible for all content. For all of AP’s environmental coverage, visit https://apnews.com/hub/climate-and-environment

Melina Walling And John Locher, The Associated Press

U$A

Survivors say trauma from abusive Native American boarding schools stretches across generations

BOZEMAN, Mont. (AP) — Donovan Archambault was 11 years old in 1950 when he was sent from the Fort Belknap Indian Reservation in Montana to a government-backed Native American boarding school in Pierre, South Dakota, where abusive staff forced him to abandon his community's language and customs.

Archambault emerged bitter from the experience and said he drank alcohol for more than two decades before he finally pulled his life together, earning a master's degree in education and serving as chairman of the Fort Belknap tribes.

“It was probably the most brutal time of my whole life," Archambault recalled Sunday, “and it all stemmed from the trauma we suffered in the Pierre Indian School.”

Decades after the last Native American boarding schools stopped receiving federal money, the traumas inflicted by the abusive institutions are getting belated attention through a series of listening sessions hosted by federal officials across the U.S.

For over 150 years, Indigenous children were taken from their communities and forced into the boarding schools, which systematically abused students to assimilate them into white society. Religious and private institutions ran many of the schools and received federal funding as partners in government programs to “civilize” Indigenous students.

Sunday's event at Montana State University in Bozeman was the last of 12 stops on the “Road to Healing” tour by Interior Secretary Deb Haaland, a member of Laguna Pueblo in New Mexico who has prioritized examining the trauma caused by the schools.

The effects of the trauma have rippled through generations, fueling alcoholism, drug addiction and sexual abuse on reservations, said Jennifer Finley, a council member for the Confederated Salish and Kootenai Tribes whose grandparents went to one of the boarding schools.

“When we talk about historical trauma I always think, ‘If only that’s all we had.’ But we have fresh traumas piled on top of it every single day,” she said.

The U.S. enacted laws and policies in 1819 to support the schools and some continued to operate through the 1960s. An investigative report released last year by the Interior Department identified 408 government-backed schools in 37 states or then-territories, including Alaska and Hawaii.

The schools renamed children from Native American to English names, organized them into military drills and compelled them to do manual labor such as farming, brick-making and working on the railroad system, according to federal officials. At least 500 children died at the schools, according to the report — a figure that's expected to increase dramatically as research continues.

One of Haaland’s deputies, Rosebud Sioux member Wizipan Garriott, has described boarding schools as part of a long history of injustices against his people that began with the widespread extermination of their main food source — bison, also known as buffalo.

Tribes also lost their land base and were forced onto reservations sometimes far from their homelands.

Victims and survivors of the schools have shared tearful recollections of their experience during prior listening sessions in Oklahoma, South Dakota, Michigan, Arizona, Alaska and other states.

They told stories of being punished for speaking their native language, getting locked in basements and their hair being cut to stamp out their identities. They were sometimes subjected to solitary confinement, beatings and withholding food. Many left the schools with only basic vocational skills that gave them few job prospects, officials said.

Myrna Burgess, a Northern Cheyenne elder, said Sunday that she and her classmates faced escalating punishments for speaking their home language. First time they'd get hit with a ruler on the back of the hand. After a second offense they'd have to turn their hand over, to get hit on the palm. Another offense brought a strike to the back or head, she said.

“That was child abuse right there, but no one ever went to jail,” she said.

Archambeault said many of his classmates did not survive long enough to tell their stories and instead became victims of suicide, alcohol and violence that he traces back to the treatment they received at school.

A second investigative report is expected in coming months. It will focus on burial sites, the schools’ impact on Indigenous communities and also try to account for federal funds spent on the troubled program.

Montana had 16 of the schools — including on or near the Crow, Blackfeet, Fort Peck and Fort Belknap reservations. Most shut down early last century. Others were around recently enough that their former students are still alive.

A Native American boarding school school in the town of St. Ignatius on the Flathead Reservation was open until at least 1973. In southeastern Montana the Tongue River Boarding School operated under various names until at least 1970, when the Northern Cheyenne Tribe contracted it as a tribal school, according to government records.

The St. Labre school at the edge of the Northern Cheyenne continues to operate but has not received federal money in more than a century, according to government records.

The National Native American Boarding School Healing Coalition has tallied an additional 113 schools not on the government list that were run by churches and with no evidence of federal support. By 1926, more than 80% of Indigenous school-age children — some 60,000 children — were attending boarding schools that were run either by the federal government or religious organizations, according to the coalition.

The coalition's deputy chief executive, Samuel Torres, said Haaland's tour was a positive first step in addressing the schools' legacy. Next, he said, Congress must approve proposals to establish a truth and reconciliation commission, where survivors could continue airing their stories and the federal government's role in the abuse could be further documented.

“Boarding schools lasted over 150 years. It's going to take more than a couple of years of investigation,” Torres said. “It's going to require generations. But this is where it has to start.”

Matthew Brown, The Associated Press

COP28 conference looks set for conflict after tense negotiations on climate damage fund

BENGALURU, India (AP) — Tense negotiations at the final meeting on a climate-related loss and damages fund — an international fund to help poor countries hit hard by a warming planet — ended Saturday in Abu Dhabi, with participants agreeing that the World Bank would temporarily host the fund for the next four years.

The United States and several developing countries expressed disappointment in the draft agreement, which will be sent for global leaders to sign at the COP28 climate conference, which begins in Dubai later this month.

The U.S. State Department, whose officials joined the negotiations in Abu Dhabi, said in a statement it was “pleased with an agreement being reached” but regretted that the consensus reached among negotiators about donations to the fund being voluntary is not reflected in the final agreement.

The agreement lays out basic goals for the fund, including for its planned launch in 2024, and specifies how it will be administered and who will oversee it, including a requirement for developing countries to have a seat on the board, in addition to the World Bank's role.

Avinash Persaud, a special envoy to Barbados Prime Minister Mia Mottley on climate finance, said the agreement was “a challenging but critical outcome. It was one of those things where success can be measured in the equality of discomfort.” Persaud negotiated on behalf of Latin America and the Caribbean in the meetings.

He said that failure to reach an agreement would have “cast a long shadow over COP.”

Mohamed Nasr, the lead negotiator from Egypt, last year’s climate conference host, said, “It falls short on some items, particularly the scale and the sources (of funding), and (an) acknowledgment of cost incurred by developing countries.”

The demand for establishing a fund to help poor countries hit hard by climate change has been a focus of U.N. climate talks ever since they started 30 years ago and was finally realized at last year’s climate conference in Egypt.

Since then, a smaller group of negotiators representing both rich and developing countries have met multiple times to finalize the details of the fund. Their last meeting in the city of Aswan in Egypt in November ended in a stalemate.

While acknowledging that an agreement on the fund is better than a stalemate, climate policy analysts say there are still numerous gaps that must be filled if the fund is to be effective in helping poor and vulnerable communities around the world hit by increasingly frequent climate-related disasters.

The meetings delivered on that mandate but were “the furthest thing imaginable from a success,” said Brandon Wu of ActionAid USA who has followed the talks over the last year. Wu said the fund “requires almost nothing of developed countries. ... At the same time, it meets very few of the priorities of developing countries — the very countries, need it be said again, that are supposed to benefit from this fund.”

Sultan al-Jaber, a federal minister with the United Arab Emirates and CEO of Abu Dhabi National Oil Company who will oversee COP28 next month, welcomed the outcome of the meetings.

“Billions of people, lives and livelihoods who are vulnerable to the effects of climate change depend upon the adoption of this recommended approach at COP28," he said.

___

This story corrects the timing for the COP28 climate conference.

___

AP Science Writer Seth Borenstein in Washington contributed to this report.

Follow Sibi Arasu on X, formerly known as Twitter, at @sibi123

___

Associated Press climate and environmental coverage receives support from several private foundations. See more about AP’s climate initiative here. The AP is solely responsible for all content.

Sibi Arasu, The Associated Press

Ship traffic ramps up through the Northwest Passage as Arctic ice retreats

MONTREAL — Michael Wenger still remembers the patches of blood red and vivid violet that daub the landscape of the Northwest Passage.

“People usually think it's ice and glaciers and rocks. And then you get there and you see these meadows, with all the different plants,” he said, speaking by phone from Reykjavik, Iceland, where he was attending an Arctic Circle Assembly conference.

“It’s very colourful,” said Wenger, CEO of Polar Journal AG, who worked as an expedition guide on a northern cruise vessel in 2016.

A growing number of people are now getting to witness those vibrant tundras first-hand. The same climate shifts that affect Arctic flora have also forced a massive retreat in Arctic sea ice — even in the passage, where geography and wind currents freeze the waters for a longer period of the year than in other parts of the Far North.

“It’s happening at a crazy rate,” said Bernard Funston, former chairman of the Canadian Polar Commission.

In step with the melt, more and more ships are sweeping across the Northwest Passage as a heating planet clears a path for boat traffic through the Arctic corridor, raising hopes for commercial viability as well as concerns about the environmental and social impact.

Steeped in lore since before Roald Amundsen became the first European to fully chart it in 1906, the Northwest Passage runs 1,450 kilometres from east to west, threading an archipelago of islands between Baffin Bay and the Beaufort Sea via a half-dozen routes under a single name. Effectively off-limits to transcontinental shipping for centuries, the seaway hosted a bulk freighter from end to end for the first time in 2013.

With a hull strengthened to withstand floating ice, the Nordic Orion that year hauled a load of metallurgical coal from Vancouver and across the Arctic coastline to Finland. The journey shaved 1,000 nautical miles from the traditional route through the Panama Canal and shipped 25 per cent more cargo due to the greater depth of the passage.

The ramp-up since has been striking, with bulk carriers, fuel tankers, cruise liners and research expeditions leading the charge.

The number of unique vessels operating in the Canadian Arctic rose 35 per cent to 212 between 2016 and 2022, according to figures provided by the international Arctic Council.

Researchers say the Northwest Passage will likely never compete with trade arteries like the Panama Canal due to the inconsistent navigation season, lack of ports and still-hazardous conditions.

But the diminishing ice, growth of northern resource development and more recently Russia’s invasion of Ukraine have already prompted more commercial vessels to travel the channels.

“The season is getting longer and the ships are getting bigger,” said Hjalti Hreinsson, a project manager at the Arctic Council. Cruise liners are among the largest vessels venturing through.

More ships carry the potential for more underwater noise, fuel pollution and invasive species, affecting communities and the environment in and around the passage.

“The biodiversity of the area is being directly threatened not merely by the passage of mega ships but by proposed seismic testing and other activities that would follow,” Peter Ittinuar, the first Inuk member of Parliament, said in a 2017 paper, referring to oil and gas exploration.

In Pond Inlet, locals told Wenger they used to hunt narwhal in a day or two. “Now they have to go out for five or six days before they even see a narwhal,” Wenger said. Noise-sensitive beluga and bowhead whales, essential to subsistence hunting traditions, also flee the sound of engines, while seals retreat in sync with the sea ice.

The anxieties of shippers and residents can overlap. If boats are stranded or an accident occurs, the tiny shoreline towns are ill-equipped to handle an influx of rescuees or transform into staging grounds for a cleanup effort.

In 2018, the Russian-flagged Akademik Ioffe research vessel ran aground in the passage’s Gulf of Boothia with 162 people on board, prompting rescue by a pair of Canadian Coast Guard icebreakers — and reflection on the perils of the waterway.

“The weather changes, it basically pushes ice right in front of the vessels and then they get caught,” said Wenger.

Several other deterrents remain before the Northwest Passage can become a full-blownhighway.

For massive container ships, parts of the route are too shallow and the passage offers no ports where the vessels can drop cargo, which they typically do at several points along a voyage.

“There’s a complete and utter lack of infrastructure. So it’s risky for companies to do this, and it’s not foolproof. Just because it’s shorter doesn’t mean it’s going to take less time,” said Jackie Dawson, the Canada Research Chair in the human and policy dimensions of climate change at the University of Ottawa.

“There’s just a lack of predictability. And if you do have an accident, there’s no one immediately there to help.”

Still, the numbers speak for themselves. “Even pleasure craft is going up really quickly,” Dawson said. “People are excited by the idea of traversing the Northwest Passage.

“In my world, a lot of scientists who would have wanted to work in Russia now want to work here,” she added, referring to that country’s attack on its neighbour. “We’re going to see more science vessels.”

The trend is already underway, with 13 research ships cruising arctic waters in Canada last year versus four in 2016, according to the Arctic Council group.

For Wenger, the call of the wild animals — polar bears, seals, muskox — he saw in the passage persists. But other images remain even more frozen in his mind.

“Seeing an area that had been dubbed one of the hardest waterways to cross due to the ice conditions ... without any ice — that was a real wow,” he recalled. “I didn't expect that.”

This report by The Canadian Press was first published Nov. 5, 2023.

Christopher Reynolds, The Canadian Press

New Zealand's ex-Premier Jacinda Ardern will join conservation group to rally for environment action


WELLINGTON, New Zealand (AP) — Former New Zealand Prime Minister Jacinda Ardern will work alongside leaders from Conservation International to advocate for climate action and better treatment of the environment, the group said Monday.

Conservation International said Ardern has become its sixth Arnhold Distinguished Fellow and would serve a two-year term to advocate internationally, especially on issues affecting the Pacific and Antarctica. The group said the role was considered part-time and came with a stipend

It is one several new roles Ardern has announced since unexpectedly stepping down as prime minister in January. She is also completing dual fellowships at Harvard University's Kennedy School and writing a book on leadership.

“From the beginning of my time in the New Zealand Parliament, I’ve advocated for global climate action,” Ardern said in a statement. “My passion and sense of urgency on this issue has only increased over the last 15 years, especially as I witnessed firsthand the impact of climate change in our region."

Ardern's government joined other nations in 2020 by symbolically declaring a climate emergency. Though the declaration came without any new statutory powers or money, she said at the time that it acknowledged the burden the next generation faces.

“For them, it is instinctual, it is tangible, it is real,” Ardern said. “It is about the country they will inherit.”

Related video: Ardern on Power of Earthshot, Climate Change Outlook (Bloomberg)
Duration 8:28  View on Watch

Ardern also banned new exploration for offshore oil and gas and plastic shopping bags.

Conservation International CEO M. Sanjayan said Ardern's appointment was a win for the entire conservation and climate movement, adding that she "has modeled the kind of leadership, empathy and determination required to deliver crucial environmental and climate solutions.”

Just 37 when she became prime minister in 2017, Ardern became a global icon of the left. When she stepped down she said she no longer had “enough in the tank” to do the job justice. Her political popularity in New Zealand had been fading, and her successor Chris Hipkins suffered a heavy defeat in a general election last month.

Nick Perry, The Associated Press

Kentucky’s Democratic governor would rather not talk about climate change

Katie Myers, Grist
November 5, 2023 

Kentucky Gov.Andy Beshear speaks to the press on July 31, 2022, in Whitesburg, Kentucky. At least 28 people were killed in the state, with hundreds rescued, but many still unaccounted for, due to flooding after heavy rainfall. 

Michael Swensen/Getty Images


Kentucky’s Democratic governor, Andy Beshear, has been called the state’s “consoler-in-chief.” He’s presided over a period of extreme weather in the state, from tornadoes that leveled entire towns in the farmlands of western Kentucky, to record flooding that washed out thousands of homes in its mountainous Appalachian east. Through it all, voters have taken note that the governor has made a habit of personally visiting disaster sites and committing to funding their recovery.

But when it comes to the root causes of the state’s weather troubles, Beshear is quieter.

“I wish I could tell you why we keep getting hit here in Kentucky,” said in a media briefing after the floods. “I can’t give you the why, but I know what we do in response to it.”

Though climate scientists and environmental advocates have drawn a link between the disasters and human-caused climate change, Beshear has avoided discussing the topic at length. Now, he’s up for reelection, against a Republican cut from Senate Minority Leader Mitch McConnell’s cloth.


On Tuesday, Kentucky voters will be choosing between Beshear and challenger Daniel Cameron, the state’s Republican attorney general. Beshear, a Democrat, upset staunch Republican (and climate denier) Matt Bevin in 2019 in a deep-red state that is still mainly controlled by right-wingers at the local levels and in the state legislature. Cameron, who has reliably come out against environmental regulation at many turns, is appealing for a return to Republican hegemony. As the state has been both pummeled by climate disaster and remains politically enmeshed with the coal industry, Beshear has toed a careful line, one that at times appears self-contradictory, in order to keep his poll numbers strong.

Beshear is among the most popular Democratic governors in the country, and he’s currently polling just ahead of Cameron. He’s accepted endorsements from the United Mine Workers union and high-profile coal mine operators, and he’s eschewed endorsements from major environmental groups that might typically support a Democratic candidate. He’s acknowledged that climate change is real, but in a state that was once ranked third in the country for coal production, connecting fossil fuels specifically to climate change can be tricky.

Kentucky experienced a 65 percent drop in coal production between 2013 and 2022, and eastern Kentucky is reeling from the rapid decline of the industry and resulting layoffs and bankruptcies. Nonetheless, coal still holds cultural significance and exerts economic pull in the state. There are still plenty of active coal mines in both east and west, and the state is still one of the top five coal-burning states in the country.

It’s unclear what actions a re-elected Beshear, or Cameron, would take to speed up the transition to clean energy. Kentucky has been found to be “dead last” in the race to decarbonize, running far behind other states in wind and solar production. Both candidates support an “all-of-the-above” approach to energy.

Beshear, alone among Democratic governors, turned down millions in Inflation Reduction Act money for climate mitigation earlier this year, saying that Kentucky cities could still accept the funds. Though the state’s municipalities all are eligible, the move may leave behind rural communities with fewer resources, since application can be arduous.

In 2021, Beshear and the state’s Energy and Environment Cabinet unveiled a program called “E3,” which lists gas and oil as essential parts of a diverse energy portfolio, makes no commitments toward decarbonization, and does not mention climate change once. Kentucky’s last climate action plan was created in 2011 — by Steve Beshear, the state’s last Democratic governor and Andy Beshear’s father.

When discussing the energy transition, Beshear tends to focus on something that might be more tangible to his voters: jobs. News releases from the administration center on Kentucky’s record-low unemployment rate and tout thousands of potential jobs in the state’s electric vehicle sector.

Lane Boldman, the executive director of a bipartisan advocacy group called the Kentucky Conservation Committee, says that in red states like Kentucky, it’s crucial for Democratic leaders to keep the focus away from controversial topics that could provoke a knee-jerk negative reaction in voters. “I think it’s a matter of the language you use, versus what your actions are on the ground,” Boldman said.

Boldman pointed to recent investments in utility-scale solar on abandoned eastern Kentucky strip mines, and new electric vehicle battery plants slated for construction across the state, as evidence of progress under Beshear’s administration. She also noted that the administration is going after separate funding within the Inflation Reduction Act for workforce development in the energy-efficiency sector. One report showed that Kentucky’s clean energy sector workforce grew faster than that of any other industry in the state in 2022. If Beshear wants to win, Boldman said, it’s better to keep his head down when it comes to talking about climate change.

“The actions he’s taking are, I think, pretty pro-environment for a state where the politics are very, very conservative,” she said.

Grist is a nonprofit, independent media organization dedicated to telling stories of climate solutions and a just future.

TVO workers vote to accept deal with employer, ending 11-week strike 

The Canadian Press



TORONTO — Dozens of workers at Ontario's public broadcaster will return to their jobs Monday after voting this weekend to accept a new collective agreement and end a strike that's stretched on for nearly three months.

TVO says the accepted offer includes a wage increase of 7.7 per cent over three years -- three per cent retroactive to 2022, 2.75 per cent in 2023 and 1.75 per cent in 2024.

"Everyone at TVO is looking forward to having our team at full strength once again and focusing our efforts on delivering the important educational content and current affairs journalism TVO is known for," CEO Jeffrey Orridge said in a news release.

The employer said TVO also withdrew various proposals that would have extended employment contracts beyond two years and the new deal increases access to job opportunities for production staff.

Meredith Martin, president of the TVO branch of Canadian Media Guild, the union which represents around 70 journalists, producers and education workers at the broadcaster, would not provide the percentage of its membership that voted for the latest offer but said it passed with a clear majority.

"Although we acknowledge this is not what we were hoping for, all the members of the bargaining team feel this is the best we can get at this time, given that we are a 74-member branch up against an employer that was aiming for major concessions," she wrote in an email to union members Friday.

TVO workers have been on strike for 11 weeks after walking off the job on Aug. 21, more than three days after a strike deadline ran out amid negotiations.

The Canadian Media Guild had said its main sticking points in bargaining were below-inflation wages and temporary contract work.

In early October, at roughly the six-week mark in the job action, workers voted to reject what the company's management said was its "final" offer, which included the same wage increase. The union said the wages on offer were well below what’s needed for workers to catch up to inflation, and had previously said temporary contract work was also a sticking point.

Members have received below-inflation wage increases for the past 10 years, including three years of complete wage freezes, the guild said.

The new deal also includes voluntary buyout packages for members under the collective agreement, which Martin said has "high monetary value" and would not have been gained had the union not remained on strike, as well as a $500 annual training budget per employee that serves as "an acknowledgement of the hard work" done since shooting down TVO's previous offer.

Some employees at TVO are represented by Unifor and are not part of the current bargaining process. The Canadian Media Guild also represents some employees at The Canadian Press.

TVO airs current affairs shows including “The Agenda with Steve Paikin,” but also has a mandate to provide learning resources that follow the provincial school curriculum.

This report by The Canadian Press was first published Nov. 5, 2023.

The Canadian Press