The River Rhine Gets Shallow Again in Fresh Climate Blow

William Wilkes and Jack Wittels
Thu, October 19, 2023 



(Bloomberg) -- The cost of shipping fuel along the Rhine river has surged as low water levels curb barges’ carrying capacity following a hot, dry September.

The river is fed by glaciers and rain. But Alpine ice flows are declining each year as glaciers shrink due to global warming, according to the International Commission for the Hydrology of the Rhine Basin. September was unusually dry in Germany, while temperatures were the highest for the month since records began, according to the country’s DWD federal weather service.

“The extraordinary temperatures in this record September in Germany are further evidence that we are in the midst of climate change,” said Tobias Fuchs, head of the climate and environment division at the DWD.

The price for shipping fuel on the river by barge has soared, with costs between Karlsruhe — upriver of Kaub — and the Netherlands touching €57 a ton on Thursday — the highest since late December. That comes as the measured water level at the river’s Kaub chokepoint near Frankfurt fell to 67 centimeters (26 inches), the shallowest for the time of year since 2018. If the water gets too low, then it becomes uneconomical for many barges to transit this point.

The maximum load of diesel-type fuel for a standard 110-meter Rhine barge planning to pass through Kaub was limited recently to about 600 tons, said Mitchell van der Hoeven, a broker at Riverlake, which organizes shipments up the river.

The river at Kaub is usually at its shallowest in late fall, historical data show. Still, it’s forecast to deepen again in the coming days, with the measured water level projected to nudge above 90 centimeters on Saturday. Later this week, loads of about 1,000 tons and more will be possible for barges planning to pass through Kaub, van der Hoeven said.

With its source high in the Swiss Alps, the Rhine snakes about 800 miles through the industrial zones of Switzerland, Germany and the Netherlands before emptying into the North Sea. It serves as a key conduit for manufacturers such as BASF SE and Thyssenkrupp AG’s steel unit, as well as oil refiners.

--With assistance from Rachel Graham.

Libcom.org

https://libcom.org/article/murdering-dead-amadeo-bordiga-capitalism-and-other-disasters-antagonism

Murdering the dead: Amadeo Bordiga on capitalism and other .... 

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CRIMINAL CRYPTO CAPITALI$M
Gemini, DCG Sued by NY for Alleged $1.1 Billion Crypto Fraud

Erik Larson
Thu, October 19, 2023 



(Bloomberg) -- Gemini Trust Co. and Barry Silbert’s Digital Currency Group were sued by New York’s top law-enforcement officer for allegedly defrauding customers of $1.1 billion, escalating legal woes for two companies hit hard by last year’s plunge in cryptocurrency markets.

The lawsuit filed Thursday by New York Attorney General Letitia James accuses Gemini, which operated a crypto exchange, and DCG’s Genesis Global Capital unit of failing to disclose to investors the risks of a crypto-lending program they started in 2021. The venture’s assets collapsed last year amid several high-flying bankruptcies, including Sam Bankman-Fried’s FTX.

Gemini, founded by Tyler Winklevoss and Cameron Winklevoss, lied to customers about how risky loans were in its venture with Genesis and failed to disclose that at one point, almost 60% of its third-party loans were to Bankman-Fried’s crypto trading firm Alameda Research, the state claims. Genesis and DCG were accused in the suit of trying to conceal spiraling losses.

The claims by New York come after the US Securities and Exchange Commission in January sued Genesis and Gemini over their failed crypto-lender joint venture, known as Gemini Earn. Meanwhile, the three firms have also engaged in suing each other in the wake of sector woes. Genesis, which filed for bankruptcy in January, later sued its parent DCG seeking to recover about $620 million in outstanding loans. Gemini has also sued DCG as well as Silbert, seeking to recover “damages and losses” from alleged “fraud and deception” related to Gemini Earn.

Read More: Winklevoss’s Gemini Sues Crypto Conglomerate DCG for Fraud

The alleged fraud by the companies is “yet another example of bad actors causing harm throughout the under-regulated cryptocurrency industry,” James said in a statement. “My office will continue our efforts to stop deceptive cryptocurrency companies, and to push for stronger regulations to protect all investors,” said the attorney general, who has sought to position herself as a leading crypto enforcer.

The state said it wants to ban Gemini, Genesis and DCG from the financial investment industry in New York. James also is seeking restitution for investors and disgorgement of the companies’ allegedly ill-gotten gains.

Representatives for Gemini, Genesis and DCG didn’t immediately respond to requests for comment.

Gemini Earn purported to generate as much as 8% interest for Gemini customers by allowing Genesis to lend their cryptoassets to third parties. But more than $1 billion was invested in Three Arrows Capital, a hedge fund that failed in mid-2022, leaving a hole in Genesis’s balance sheet, according to the lawsuit. Around the same time, Genesis lost more than $100 million from another borrower, Babel Finance, James said.

Read More: Three Arrows Liquidators Seek $30 Million From Superyacht

Genesis is accused in the suit of failing to adequately audit Three Arrows and lying to Gemini when it claimed “to regularly review its borrowers’ financial statements,” James said. The state’s probe found that no such audit had been performed for more than two years, she said.

In July 2022, Gemini’s board of managers considered ending the Gemini Earn program due to the Genesis risks, with one board member comparing the company’s financial condition to Lehman Brothers, James said in her statement. But Gemini “failed to provide its investors with any meaningful warnings about these risks,” she said.

Read More: Gemini Pulled Genesis Funds Before Crypto Lender Collapsed

Silbert and former Genesis Chief Executive Officer Michael Moro, both of whom are named as defendants in the suit, are accused of repeatedly lying to investors as well as to Gemini about the financial woes. Genesis allegedly hid from Gemini the existence of a $1 billion promissory note that was created to conceal the extent of its losses, according to the complaint.

James said that some investors lost their lifesavings.

Read More: Crypto Empire DCG Faces US Investigation Over Internal Transfers

--With assistance from Emily Nicolle and stacy-marie ishmael.

Bloomberg Businessweek

COMMODITY FETISH
Bottle of 'most-sought after Scotch whisky' to come under hammer at Sotheby's in London next month

The Canadian Press
Thu, October 19, 2023



LONDON (AP) — A bottle of “the most-sought-after Scotch whisky” is set to go up for auction next month, with an estimated price of up to 1.2 million pounds ($1.4 million), the auction house Sotheby's said Thursday.

It said the 96-year-old bottle of single malt from distiller Macallan — The Macallan Adami 1926 — will come under the hammer in London on Nov. 18, with a price estimate above 750,000 pounds. Advance bidding will begin Nov. 1.

A version of The Macallan 1926 was sold by Sotheby's in 2019 for 1.5 million pounds, a record for any bottle of wine or spirit. The appearance of three different bottle variations of the whisky at auctions in 2018 and 2019 led to the record being broken three times.

“The Macallan 1926 is the one whisky that every auctioneer wants to sell and every collector wants to own,” said Jonny Fowle, Sotheby’s global head of spirits. “I am extremely excited to bring a bottle to a Sotheby’s auction for the first time since we set the record for this vintage four years ago.”

After being aged in sherry casks over six decades, just 40 bottles of The Macallan 1926 were bottled, making them the distillery's oldest vintage.

Sotheby's said some of the 40 were offered to Macallan clients, with up to 14 decorated with Macallan's iconic Fine and Rare label, including the record-breaker. Twelve of the bottles, including the one being sold next month, had their labels designed by Italian painter Valerio Adami.

The bottle going up for sale is the first to have undergone reconditioning by the distillery ahead of auction. This included replacing the cork and applying new glue to the corners of the bottle labels.

The Associated Press

US weekly jobless claims hit nine-month low

Lucia Mutikani
Thu, October 19, 2023

Signage for a job fair is seen on 5th Avenue after the release of the jobs report in Manhattan, New York City

By Lucia Mutikani

WASHINGTON (Reuters) - The number of Americans filing new claims for unemployment benefits fell to a nine-month low last week, indicating that strong job growth persisted in October as the labor market remains tight.

The unexpected decline in initial jobless claims reported by the Labor Department on Thursday added to solid retail sales and factory production in September in suggesting sustained momentum in the economy. The stream of upbeat economic data bolstered expectations that the Federal Reserve could keep interest rates higher for longer. Financial markets continued to discount a rate hike next month because of soaring U.S. Treasury yields.

"Companies on earnings calls may warn about the outlook and risks ahead, but they are still holding on tight to their workers as good help is increasingly hard to find," said Christopher Rupkey, chief economist at FWDBONDS in New York. "The economy and labor markets are simply not slowing down, and time will tell if this will reignite the inflation fires that until recently were looking contained."

Initial claims for state unemployment benefits dropped 13,000 to a seasonally adjusted 198,000 for the week ended Oct. 14, the lowest level since January. Economists polled by Reuters had forecast 212,000 claims for the latest week.

Though the labor market is gradually cooling, conditions remain tight, with claims at the very low end of their range of 194,000 to 265,000 for this year. Unadjusted claims declined 18,561 to 181,181 last week. There were large decreases in Texas, New York, New Jersey, Georgia and California, which more than offset a notable rise in Tennessee.

So far there has been a limited impact from the United Auto Workers (UAW) strikes, which have disrupted supply chains, though claims spiked in Michigan during the week ending Oct. 7, related to the industrial action. Ford Motor, General Motors and Chrysler-parent Stellantis have furloughed and laid off thousands of non-striking workers.

The Fed's Beige Book report on Wednesday said "labor market tightness continued to ease across the nation" in early October and implied cooling wage pressure. According to the Beige Book "several districts reported improvements in hiring and retention as candidate pools have expanded," but also noted that "most districts still reported ongoing challenges in recruiting and hiring skilled tradespeople."

The labor market is showing strength despite the U.S. central bank raising its benchmark overnight interest rate by 525 basis points to the current 5.25% to 5.50% range since March 2022. Financial markets expect the Fed will leave rates unchanged at its Oct. 31-Nov. 1 policy meeting, according to CME Group's FedWatch Tool, given the surge in Treasury yields.

Fed Chair Jerome Powell's speech at the Economic Club of New York later on Thursday could offer fresh clues on the future course of monetary policy.

Longer-dated bond yields have risen to multiyear highs in response to the economy's resilience. The labor market is driving consumer spending and the overall economy, ultimately keeping inflation elevated. The economy is expected to have grown in the third quarter at its fastest pace since late 2021.

Stocks on Wall Street were trading higher. The dollar fell against a basket of currencies. U.S. Treasury prices slipped, with the yield on the benchmark 10-year note flirting with 5%, a level not seen since just before the financial crisis in 2007.

HOME SALES DEPRESSED

While the broader economy is weathering the high interest rate environment, the housing market is in the doldrums and business sentiment remains weak. A second report from the National Association of Realtors showed existing home sales dropped 2.0% last month to a seasonally adjusted annual rate of 3.96 million units, the lowest level since October 2010.

Surging mortgage rates and tight supply combined to reduce affordability for many first-time buyers, whose share was 27% in September, well below the 40% that economists and realtors say is needed for a robust housing market.

With the average rate on the popular 30-year fixed mortgage well above 7.5%, home resales are likely to decline further.

"There's no relief in sight for the battered U.S. housing market absent a sharp drop in mortgage rates and a surge in inventory, which would go a long way toward improving affordability," said Jay Hawkins, a senior economist at BMO Capital Markets in Toronto.

A third report from the Philadelphia Fed showed business conditions in the Mid-Atlantic region still subdued in October, though manufacturers expected an improvement over the next six months. Firms in the region that covers eastern Pennsylvania, southern New Jersey and Delaware reported mostly steady employment this month.

The claims report covered the week during which the government surveyed business establishments for the nonfarm payrolls component of October's employment report. Claims fell between the September and October survey periods. The economy created 336,000 jobs in September, the most in eight months.

Data next week on the number of people receiving benefits after an initial week of aid, a proxy for hiring, will shed more light on the health of the labor market in October. The so-called continuing claims increased 29,000 to a still-low 1.734 million during the week ending Oct. 7, the claims report showed.

(Reporting by Lucia Mutikani; Editing by Chizu Nomiyama and Jonathan Oatis)

Applications for US jobless benefits fall to lowest level in more than 8 months

Thu, October 19, 2023 



Applications for unemployment benefits fell to their lowest level in eight months last week as businesses continue to retain workers despite elevated interest rates meant to cool the economy and labor market.

Jobless claim applications fell by 13,000 to 198,000 for the week ending Oct. 14, the Labor Department reported Thursday. That's the fewest since January.

Jobless claim applications are considered a proxy for layoffs.

The four-week moving average of claims, which flattens out some of the week-to-week volatility, ticked down by 1,000 to 205,750.

Though the Federal Reserve opted to leave its benchmark borrowing rate alone at its most recent meeting, it is well into the second year of its battle to rein in persistent inflation. The central bank has raised its benchmark rate 11 times since March of 2022, with part of its goal to cool hiring and bring down wages. But the labor market has held up better than expected.

In September, employers added 336,000 jobs, easily surpassing the 227,000 for August and raising the average gain for each of the past three months to a robust 266,000. The unemployment rate remained at 3.8%, close to a half-century low.

In August, American employers posted a surprising 9.6 million job openings, up from 8.9 million in July and the first uptick in three months.

Besides some layoffs early this year — mostly in the technology sector — companies have been trying to retain workers.

Overall, 1.73 million people were collecting unemployment benefits the week that ended Oct. 7, about 29,000 more than the previous week.

Matt Ott, The Associated Press

Behind Detroit's battery fight: Profits, UAW's power and Tesla

Joseph White
Thu, October 19, 2023 




DETROIT (Reuters) - The United Auto Workers and the Detroit Three automakers are stuck in a standoff over wages and union representation at future electric vehicle battery plants, with Tesla and Chinese rivals looming over the bargaining tables.

UAW President Shawn Fain is pushing negotiators for General Motors, Ford and Chrysler-parent Stellantis to open the doors for the union to organize future battery plant workers, and to raise wages at their respective joint-venture battery plants to match assembly workers' pay.

UAW and Detroit Three negotiators are exploring different options, including deploying workers displaced from UAW-represented factories to new battery operations, said people familiar with the discussions, who asked not to be identified.

But a breakthrough has eluded bargainers as costly strikes drag on. "The UAW is holding the deal hostage over battery plants," said Ford Chief Executive Jim Farley on Sept. 29.

Without disclosing details, Fain told UAW members on Oct. 6 that GM had agreed to include workers at Ultium LLC joint venture battery factories under the umbrella of its national agreement with the UAW - even though Ultium is a separate company that GM could choose to exclude from the talks. Since then, the union has not announced an agreement on battery plant issues with GM or the other automakers.

In effect, Fain is demanding that workers get a greater share of the $35 per kilowatt-hour in U.S. government battery cell manufacturing subsidies the plants hope to reap from U.S. President Joe Biden's Inflation Reduction Act (IRA).

The flow of cash from the IRA could be substantial. For example, 1,300 workers at GM's Ultium LLC battery plant in Northeast Ohio could some day produce 35 gigawatt hours of batteries annually, or 13 kilowatt-hours for each hour in a worker's 40-hour week.

At full capacity, the plant could generate an average $454 in subsidies per worker per hour in return for wages starting at $21 per hour, based on figures disclosed by Ultium. The actual subsidies would depend on the real production of usable batteries, and achieving domestic content targets for the materials. Automakers would split the subsidies with their battery partners.

The automakers see the IRA subsidies as necessary to cover more than just direct labor costs. Automakers want the federal money to offset billions invested in new factories, domestic battery supply chains and vehicle development in order to comply with regulatory demands to slash their carbon output, people familiar with the discussions said.

GM told investors last year that U.S. subsidies could add $3,500 to $5,500 per vehicle in pre-tax profit for each EV it sold.

COMPETITIVE WITH TESLA AND CATL

Automakers have said their labor costs must be competitive with Tesla and other battery manufacturers whose U.S. operations will get the same federal subsidies, but have more flexible work rules and pay less than the $32 an hour top wage earned by UAW workers in Detroit Three factories.

Detroit automakers also worry that Chinese battery makers such as CATL, whose costs are substantially lower than theirs, could eventually breach trade barriers that have discouraged them from entering the U.S. market.

CATL has a deal with Ford to produce low-cost lithium-iron batteries at a Michigan factory, though that project is now on hold.

Fain has rejected the automakers' concerns about Tesla as a "race to the bottom."

GM's proposal to the UAW would create an independent bargaining unit under the UAW master contract for Ultium production workers, people familiar with the discussions said.

The company would use data on the labor costs at competing battery makers, including Tesla, as benchmarks to determine what wages and working conditions should be at Ultium factories to assure they are producing battery cells at competitive costs, the sources said.

Stellantis has discussed opening jobs at joint venture plants to workers displaced from operations such as the shuttered Jeep assembly plant in Belvidere, Illinois, people familiar with the situation said.

Stellantis and Samsung SDI have announced plans to build two EV battery plants in Kokomo, Indiana, employing up to 2,800 workers in total. The first factory is scheduled to start production in early 2025.

Ford officials have not disclosed details of their proposals for battery plant wages or unionization.

"It's a very complex area, because these are joint ventures. The plants aren't even built yet. We haven't hired the workforce yet. The workforce isn't unionized yet. Yet, we are very open to working with them on a way forward on the battery plants," Ford executive Kumar Galhotra said on Oct. 12 of talks with the UAW.

(Reporting By Joe White, Editing by Nick Zieminski)

Recession, Inflation, Devaluation: Argentina’s Economic Troubles in Five Charts

Maria Eloisa Capurro
Thu, October 19, 2023

(Bloomberg) -- Argentina’s next president will take over in the middle of a financial emergency — which is par for the course in one of the world’s most dysfunctional economies

Voters are heading to the polls on Oct. 22 with the country in recession for the sixth time in a decade, and inflation running close to 140%. Candidates are promising solutions that range from the orthodox — a bout of budget belt-tightening — to the radical: Frontrunner Javier Milei says he’d adopt the US dollar as Argentina’s currency as an alternative to the peso.

There’s unlikely to be any quick fix because Argentina’s current economic woes have their roots in decades of mismanagement. Governments zig-zagged between policies, unable to pursue a consistent approach, and most investors fled. The result is that the country — once one of the region’s wealthiest — has an economy that looks increasingly unique, and not in a good way.

“Argentina is an outlier, and it has been for a long time,” says Martin Castellano, head of Latin America research at the Institute of International Finance. And initial steps toward getting the economy back on track are set to be painful.

With central bank reserves in the red, and the peso overvalued at official exchange rates, whoever wins the election will likely preside over a currency devaluation while trying to overhaul the public finances. “It’s an unavoidable adjustment that will result in another recession next year,” says Castellano.

Here are five charts illustrating the deep and distinctive trouble that Latin America’s third-largest economy is in:

Recession Champion

Argentina has a long history of drastic economic swings, a result of weak and inconsistent policies that stand out even in a volatile neighborhood. A 2018 study by the World Bank found that between 1950 and 2016, the nation spent roughly one-third of the time in recession, the most of any country in the world except the Democratic Republic of the Congo.

The economy is expected to contract again this year, according to the International Monetary Fund as well as analysts surveyed by Bloomberg. If those forecasts are correct, it will mean the economy has shrunk in almost half of the years since 1980.

Losing Inflation Battle

Several Latin American countries suffered bouts of high inflation or even hyperinflation during the 1980s and early 1990s. Most of them managed to get a grip on price pressures — by adopting inflation-targeting regimes, allowing their currencies to float, and developing local-currency debt markets.

Not in Argentina. After a currency peg ended in 2002, the country’s central bank has been increasingly financing the government’s deficit via money printing. As a result, the annual inflation rate reached a three-decade high of 138.3% in September, and it’s expected to surpass 180% by the end of the year.

Credit Desert

In most countries, the flow of bank credit to households and businesses is crucial for fueling economic growth. But in Argentina, years of high interest rates and inflation have been a barrier for both lenders and borrowers.

What’s more, private banks lend mainly to the ever-more-voracious government, leaving very little for individuals and companies. The result is that Argentina has one of the world’s lowest levels of credit to households, according to data from the Bank for International Settlements. Similarly, lending to businesses is only a fraction of the levels seen in neighbors Brazil and Chile.


Sinking Peso

The Argentine peso has lost almost 100% of its face value in the past two decades, and once again this year it has posted one of the worst spot returns among the main emerging economies. “They missed the opportunity to move to a flexible foreign exchange regime and it has never been done properly,” says Castellano.

No Foreign Capital

Amid all the volatility, it’s no wonder that Argentina has lagged its peers in attracting global money. Foreign direct investment in recent years has been much lower than in Brazil or Mexico, the only two Latin American economies that are larger.

Argentina has a big domestic market, but companies seeking to tap it face risks including nationalization or inability to send their profits to headquarters. Importers and exporters also have a tough time selling their products due to a byzantine system of capital controls. As for short-term funds, the country saw a surge of inflows under the market-friendly government of Mauricio Macri between 2015 and 2019 — but most of the hot money fled again as Macri presided over another economic collapse.

Bloomberg Businessweek

Honda to produce Civic Hybrid in Ontario and Indiana starting next year

The Canadian Press
Thu, October 19, 2023 



ALLISTON, Ont. — Japanese automaker Honda says it will start producing the Civic Hybrid next year at its plant in Alliston, Ont.

The company says the Ontario plant will produce the sedan version of the car.

The hatchback version of the Civic Hybrid will be manufactured at a plant in Indiana, according to the automaker.

Honda already produces the hybrid version of its CR-V sport utility vehicle in Alliston and at the plant in Indiana.

The company says the Civic Hybrid is a key step in its electrification strategy, which includes equipping its core models with hybrid-electric systems.

It says it expects Civic Hybrid sales to represent more than 40 per cent of Civic sales in North America.

This report by The Canadian Press was first published Oct. 19, 2023.

The Canadian Press

Africa Is Already Moving Past Defaults, Citigroup Economist Says

Colleen Goko
Thu, October 19, 2023



(Bloomberg) -- The probability of another sovereign debt default in Africa in the near term is practically zero, according to Citigroup Inc. economist David Cowan, who cites rebounding growth and multilateral support as the cushioning factors.

“We’ve reached a point now whereby the immediate threat of default has probably receded,” Cowan, a managing director and economist covering Africa at Citi Research, said in an interview with Bloomberg. “I don’t think anyone expects a default in the next six months.”

Even as Ghana and Zambia struggled this year to restructure their debt after payment failures, investors fretted over the potential for more defaults because of tighter monetary conditions. Those fears escalated in the past three months amid surging US yields and slowing global growth. However, domestic growth and the International Monetary Fund’s participation in the nations’ fiscal recast have made a credit event unlikely, Cowan said.

“There is no clear and obvious reason why we would expect a wider number of defaults across Africa in the coming years, even despite rising debt burdens in a large number of countries.”

The extra yield investors demand to own sovereign dollar bonds of African governments rather than US Treasuries has jumped 175 basis points since July to 927, according to JPMorgan Chase & Co. data. However, it is still lower than the 1000-plus levels — the widely accepted threshold that signified debt distress — that it had traded at until May.

The eurobond repayment burden of African countries is set to peak in the next two years with about $9 billion due, Bloomberg calculations show. Countries with big maturities due include Angola and Kenya.

At meetings this month in Marrakech, Morocco, the IMF said it will support at least eight countries facing a funding squeeze. Ghana and Zambia have both sought emergency bailouts and are restructuring their debts, while investors are watching Kenya, Angola, Malawi and Mozambique, among other heavily-indebted countries on the continent. Some countries that have received IMF funds are Tanzania, Ghana and Ivory Coast.

“These IMF programs are different from what we saw in the late 80s, early 90s, when cutting expenditure to stop default was the key goal,” Cowan said. “And so the drive of these programs is to increase revenue to close the fiscal deficit.”

Energy Opportunity

Cowan, who partly grew up in Africa where his father installed telex machines and joined Citigroup in 2007, said the growth rebound witnessed by many of the continent’s nations in 2021 continues to be robust.

He said good growth paired well with evolving economic policy, and would allow debt levels to stabilize and fall. IMF forecasts point to faster growth next year: 5.3% in Kenya, 8.8% in Senegal and 4.3% in Zambia.

Commodities will form a part of this growth story, particularly gas which has been discovered in a number of regions.

“We also think that exploiting existing and new mineral finds will be important. Several estimates show that Africa holds around 30% of the world’s mineral resources,” Cowan said. The continent is poised to play a key role in the global green transition, with its proven reserves of cobalt, copper, lithium and nickel, he said.

Most Read from Bloomberg Businessweek

CANADA

Auditor general calls for online application portal for refugees amid severe backlogs

The Canadian Press
Thu, October 19, 2023



OTTAWA — Refugees are being left behind by Canada's oversized immigration backlogs, and the federal auditor general is calling on the government to immediately create a way for them to apply online.

A report from Auditor General Karen Hogan released on Thursday suggests that while processing times improved for most permanent residency programs in 2022, they remained long for refugee and humanitarian programs.

Some applicants had waited almost three years for a decision,and as of the end of last year, 99,000 refugee applications were still waiting to be processed.

"Many applicants will wait years for a decision in the current processing environment," Hogan said in her report.

She said refugees would benefit from a secure online application process that was recently introduced for other immigration streams, and is calling for it to be created "without further delay."

The government had already planned to make online applications available to refugee claimants, and hopes to introduce the feature by the end of the month for privately sponsored refugees and in November for government-assisted refugees.

Hogan found that some of the delays are a result of higher workloads in offices with lower staff levels.

For example, almost half of the backlogged refugee applications were being handled by offices in Kenya and Tanzania. The auditor found the Nairobi office in Kenya had about half the staff but almost double the assigned workload of the office in Turkey.

The office in Tanzania's workload was five times greater than the Italian office in Rome, even though the offices had a comparable number of staff.

The government had committed in 2016 to assign applications based on which offices had capacity, but Hogan said that hasn't happened.

"As a result, regional backlogs continued to accumulate in the overseas family and refugee classes in some offices with limited capacity," Hogan said in her report.

That means that people from specific countries were facing bigger, longer backlogs for most of the permanent residency programs she looked at. More than half of the applications submitted by citizens of Somalia and the Democratic Republic of the Congo were backlogged.

In the case of refugees, the department told the auditor that unique conditions in some countries can also lead to delays, such as remote or dangerous locations that can make it difficult to conduct interviews.

The report on immigration backlogs was released alongside four other audits that delve into the inclusion of racialized employees in the public service, antimicrobial resistance, benefits delivery and technology modernization.

The auditor general found that efforts to combat racism and discrimination within federal public-safety and justice bodies, including the RCMP, is severely lacking.

Leaders are failing to adequately track whether the work lives of racialized employees are improving, Hogan found, and accountability for behavioural and cultural change was "limited and not effectively measured."

The auditor found that progress on modernizing IT systems has been slow, with two-thirds of the 7,500 applications used by departments and agencies being in poor health.

Meanwhile, the federal government's Benefits Delivery Modernization programme, has experienced significant delays, rising costs and staffing challenges. The program was launched in 2017 and aims to modernize the systems used to deliver the Canada Pension Plan, old age security and employment insurance benefits.

When it comes to combating the growing public-health threat of resistance to antibiotics and other antimicrobial drugs, the auditor also found the government's efforts wanting. The health department released an action plan in June, but Hogan found it to be incomplete, as it didn't include any measurable goals or timelines.

"There is a risk that action among federal, provincial, and territorial governments to tackle antimicrobial resistance will be delayed, poorly co-ordinated, and not comprehensive," she said in her report.

This report by The Canadian Press was first published Oct. 19, 2023.

— With files from Nojoud Al Mallees and Alessia Passafiume

Laura Osman, The Canadian Press

Canada court ruling on key environmental law risks deterring investments

Thu, October 19, 2023 

FILE PHOTO: Canada's Prime Minister Justin Trudeau speaks in the House of Commons on Parliament Hill in Ottawa

By Nia Williams and Divya Rajagopal

(Reuters) - A Canadian court ruling that voided most of Prime Minister Justin Trudeau's environmental assessment law for resource projects has sparked fresh policy uncertainty and risks deterring investments, company and industry executives said.

Canada's Supreme Court dealt Trudeau's Liberal government a blow last week when it ruled the Impact Assessment Act (IAA) was too broad in designating which major projects should fall under federal environmental assessment.

Already, Canada has a reputation for being a difficult place to build major projects due to high regulatory and environmental hurdles. The prospect of further policy changes risks unnerving investors and industry executives urged Ottawa to amend the legislation quickly.

"We haven't gotten any sort of concern from investors yet, but I think if the uncertainty draws out in terms of how they're going to move forward, then that could start to have an impact,” said Mark Selby, CEO of Canada Nickel Company, whose proposed Crawford Nickel Project in northeastern Ontario is going through the IAA process.

Selby said he was "very happy" with the IAA process so far and surprised by the court decision.

Canada's main oil-producing province Alberta, which brought the legal challenge against the IAA, celebrated the ruling as win for provincial jurisdiction and natural resource development. The Canadian Association of Petroleum Producers, an intervenor in the case, also said the law hindered project development.

The ruling leaves 23 major natural resources and infrastructure projects that were undergoing assessment waiting for clarity as the Impact Assessment Agency of Canada (IAAC) reviews the court's opinion.

"Prolonged uncertainty is a roadblock to building the mines and infrastructure we urgently need to achieve our climate change, supply chain security and critical minerals goals," the Mining Association of Canada said in a statement.

The ruling comes as Canada seeks billions of dollars of fresh investments to unearth minerals that play key role in the transition to a greener economy. More than $20 billion in foreign capital has fled the oil patch since 2017, partly because of delays in building new pipelines.

The CEO of Suncor Energy, whose proposed oil sands Base Mine extension in northern Alberta is undergoing an impact assessment, warned this week that unpredictable Canadian energy policy scared away capital.

Suncor did not respond to requests for comment on the impact of court decision.

The ruling also raises questions over Canada's ability to push through key climate legislation and the possibility of Ottawa facing fresh legal challenges to other policies. Both its Clean Electricity Regulations and an oil and gas emissions cap are firmly opposed by Alberta.

ONE LESS COOK

Despite the immediate uncertainty, some policy experts said the court decision should ultimately improve Canadian environmental assessments.

The federal government has pledged to work quickly to improve the legislation. An IAAC spokesperson said the agency will communicate more details on its planned approach in coming days.

Heather Exner-Pirot, special advisor at the Business Council of Canada, said the ruling was an opportunity to improve flawed federal policy.

A cabinet committee focused on regulatory efficiency for clean growth projects, set up in September and chaired by Labour Minister Seamus O'Regan, will look at possible amendments to the IAA, a government source said.

"O'Regan is the most pro-development minister there is," Exner-Pirot added.

Canada will likely end up with legislation similar to the Canadian Environmental Assessment Act (CEAA), which the IAA replaced, said Robin Junger, former head of British Columbia's Environmental Assessment Office and a partner at law firm McMillan.

He said amending the IAA could remove duplication with provincial environmental assessments and permitting, resulting in "one less cook in the kitchen".

(Reporting by Nia Williams and Divya Rajagopal; Editing by Denny Thomas and Josie Kao)

Impact assessment law ruling could 'reset' Canadian energy policy landscape: CAPP

The Canadian Press
Wed, October 18, 2023 



CALGARY — The head of an oil and gas lobby group says last week's ruling by the Supreme Court of Canada against large portions of the federal government's impact assessment law could reset the policy landscape in this country in favour of energy development.

Canadian Association of Petroleum Producers CEO Lisa Baiton said in a panel discussion in Calgary on Wednesday that Canada's oil and gas industry has been subjected to layer upon layer of federal regulation in recent years.

She said federal policies such as the promised emissions cap for the oil and gas sector and the proposed clean electricity regulations have scared away investment and harmed the industry.

Baiton said the federal impact assessment law, formerly known as Bill C-69, contributed to what she called a "pancake-ing" of regulation on industry.

But last Friday, the Supreme Court ruled that legislation, which lays out the process for federal assessment of the environmental impacts of major projects, is largely unconstitutional.

Baiton said while the oil and gas industry is watching closely to see how the federal government responds to the Supreme Court ruling, she believes the decision marks the start of a "significant shift" in energy sector regulation in Canada.

This report by The Canadian Press was first published Oct. 18, 2023.

The Canadian Press