US Business

Uber has reached a deal with a powerful Australian union after years of legal battles, campaigns and negotiations that will offer 100,000 drivers and food delivery workers more protections.

The Transport Workers Union — one of Uber’s most vocal critics — reached the agreement with the rideshare giant late Tuesday, with both sides backing minimum standards for all gig economy workers and the right to unionise.

In a joint statement, Uber and the union said they also supported the setting up of an independent body by the Australian government to create standards across the sector.

The “gig economy” — which uses temporary independent contractors for short-term tasks — has grown rapidly since Uber’s launch in 2009 and is promoted as a flexible way for people to earn money without the constraints of a full-time job.

But there has been growing backlash in Australia about the conditions and dangers gig workers face, particularly after a spate of delivery driver deaths during the Covid-19 pandemic when demand spiked.

A 2020 survey by the Transport Workers Union found 73 percent of food delivery drivers were worried about “being seriously injured or killed at work” — although safety concerns are not limited to Australia, or Uber.

In the United States, according to the advocacy group Gig Workers Rising, more than 50 drivers working for companies including Uber and Lyft have been killed on the job since 2017.

An Australian court last week ruled slain gig worker Xiaojun Chen, who was killed on the job in 2020 while working for food delivery service Hungry Panda, was an employee, not a contractor.

His family was awarded an A$830,000 (US$573,000) compensation payment, believed to be the first of its kind for a gig worker in Australia.

Uber’s general manager in Australia, Dom Taylor, conceded that the company and the union “may not seem like obvious allies”, but the deal struck between the two would “improve workers’ protections”.

“We want to see a level playing field for the industry and preserve the flexibility that gig workers value most,” he said.

The deal comes in the wake of Australia’s May election of a centre-left Labor government that has previously supported reforms to protect gig workers.

When Hong Kong transitioned from British to Chinese rule, Edmond Hui was a floor trader at the bustling stock exchange, witnessing the roaring growth of a city at the crossroads of the West and Asia.

Under a deal signed with Britain ahead of the 1997 handover, China promised Hong Kong could keep its capitalist system for 50 years, an arrangement that helped the city thrive as one of the world’s top financial hubs.

Friday marks the halfway point of that experiment, with uncertainty clouding the economic future of Hong Kong — a city reliant on an increasingly isolated China, struggling to shake off the reputational damage from political unrest and pandemic-induced border closures.

Hui, now the chief executive of a mid-tier stockbroker with nearly 300 employees, said post-handover markets have undergone a drastic shift, becoming more China-focused than ever.

“Before 1997, foreign capital propped up half of the market,” he said. “After 1997, things changed gradually until the whole market was held up by Chinese capital.”

China’s meteoric rise in the past two decades yielded vast benefits for Hong Kong, which became the gateway for mainland firms to raise funds and for foreign businesses to access what is today the world’s second-largest economy.

“Hong Kong was sort of a poster child of free trade and open markets,” veteran pro-Beijing Hong Kong politician Regina Ip told AFP.

But the interlocking of its fate with China has also led to warnings about overreliance and complacency.

Chinese companies made up around 80 percent of the market capitalisation in Hong Kong’s stock market this year, up from 16 percent in 1997.

And Chinese firms now account for seven of the top 10 holdings of the benchmark Hang Seng Index, which used to be anchored by homegrown brands such as Cathay Pacific and Television Broadcasts Limited.

Hong Kong’s GDP, meanwhile, has gone from being equivalent to 18 percent of mainland China’s in 1997 to less than three percent in 2020.

Hui greeted this comprehensive shift with a mild shrug.

“It’s just a matter of changing who’s boss,” he said.

“We can only hope that our country’s momentum will surpass that of Europe and the United States.”

– ‘The gateway to China’ –

As China’s economic and political power has grown over the last few decades, so have tensions with Western nations — which has also affected Hong Kong.

Beijing cracked down on dissent in the city after massive democracy protests in 2019, prompting the United States to revoke Hong Kong’s preferential trade status on the grounds that it was no longer autonomous enough.

Washington also sanctioned some Hong Kong officials.  

“Back in 1997, we were able to play the role of a very important middleman. But now… everyone has more doubts about our background,” Yan Wai-hin, an economics lecturer at the Chinese University of Hong Kong, told AFP.

“If a trading partner feels that (Hong Kong) isn’t a neutral middleman… then the mutual trust might be lost.”

Yan said regional rivals such as Singapore were looking to capitalise on what they saw as an opening to supplant Hong Kong.  

Adding to that pressure, the tightening of political control has also meant Hong Kong has stuck to mainland China’s zero-Covid policy.

Stringent travel restrictions have kept the business hub cut off both from China and the world for the last two years, with authorities acknowledging it has prompted a talent exodus. 

But Ip said once restrictions were lifted, Hong Kong would recover.

“Our extremely advantageous geographical location is still there,” she said.

“We’re still the gateway to China.”

– ‘Complacent and insular’ –

Some industries other than finance, though, have struggled after the handover. 

“In the past 10 years or so, our GDP growth has lost steam and I think this had to do with Hong Kongers being complacent and insular,” said Simon Ho, president of the Hang Seng University of Hong Kong.

The city’s port, for instance, was among the world’s busiest for decades but has slipped in the rankings after peaking in 2004.

“The government took a neoliberal, non-interventionist approach, and there was no blueprint for developing industries and the economy,” Ho added.

He said authorities had devoted resources to sectors such as research and development, but that the results were “half-baked” and not competitive enough when compared with neighbouring tech hub Shenzhen.

“Hong Kong needs to figure out its role,” Ho said.

“In the past, we didn’t know how to complement the mainland, and in some cases even competed with it. In the long run, that will only get harder.” 

Japan’s Sony is launching a new brand that will offer PC gaming gear, the company announced Wednesday, as it tries to compete for a share of the lucrative gaming peripherals market.

Sony is looking to expand beyond its flagship PlayStation console and boost revenue from other sectors, including PC and mobile gaming.

The gaming peripherals market of items used by players was valued at $3.88 billion globally in 2019 according to Grand View Research.

Sony’s first offerings from its new Inzone brand will be three wireless headsets and two monitors, the priciest of which will retail for a suggested $899.99 in the United States.

“The market has been expanding with a higher interest in gaming with the spread of esports tournaments and the advancement of gaming entertainment,” said Yukihiro Kitajima, head of Sony’s game business and marketing office, in a statement.

Sony is “very late” to the “hopelessly crowded” sector, said Serkan Toto, CEO of game industry consultancy Kantan Games.

Rival Microsoft is already well-positioned, along with competitors like Razer, though Sony will bring unique hardware features, he told AFP.

The firm’s decision to enter the market now is linked to its “aggressive plan to boost sales from PC and mobile for its PlayStation unit to around 50 percent by fiscal 2025,” Toto said.

It “apparently believes that the goal is easier to achieve by leveraging its position in hardware to raise awareness among PC gamers.”

An EU ban on insuring ships transporting Russian oil could potentially hurt Moscow more than its embargo on the nation’s crude, analysts say.

The European Union recently unveiled the insurance ban in a sixth set of economic sanctions aimed at punishing Russia over its invasion of Ukraine.

In a further knock, G7 leaders are seeking a price cap for Russian oil to further hurt Kremlin revenues.

The EU insurance and reinsurance ban, covering all maritime transportation of Russian oil, comes as Moscow seeks to ramp up sales to China and India to help offset the embargo.

– ‘Further reaching than embargo’ –

The insurance ban “would have further-reaching consequences for the oil market than the EU oil embargo”, noted Commerzbank analyst Carsten Fritsch.

Companies will no longer be permitted to transport oil from Russia by sea, or to insure such shipments. 

EU insurers have until the end of this year to implement the ban, while those in Britain are expected to follow suit.

“There is going to be an impact and there is going to be a pricing impact,” said Marcus Baker, international head of marine at US broker Marsh.

A similar ban was used in 2012 when the EU prohibited European insurers and reinsurers from covering vessels carrying Iranian oil.

The bloc had also slapped an embargo on the purchase of Iranian crude as part of sanctions against Tehran’s controversial nuclear programme.

Commercial ship operators require insurance for the vessel, its cargo and for protection and indemnity (P&I) covering events such as war and environmental damage.

Mathieu Berrurier, managing director of marine insurance broker Eyssautier-Verlingue, told AFP that vast amounts of cash were required for potential payouts caused by such disasters.

This results in insurers forming P&I clubs that “are able to offer guarantees equal to the risks involved in” events including “a major oil spill or “collision with an oceanliner”, said Berrurier.

“Colossal amounts are needed,” he stressed, adding that such disasters can potentially cost “billions of dollars”.

Russia’s former president Dmitry Medvedev, who is deputy head of the country’s security council, has hinted that Moscow could get around the ban by providing state guarantees to cover oil exports.

That could allow Russia to self-insure and circumvent EU sanctions, he insisted.

“That is true to an extent,” said analyst Livia Gallarati at consultancy Energy Aspects.

But with as much as 95 percent of the P&I insurance market handled by EU and UK-based insurers, according to experts, it will be difficult for Russia to completely get around the ban.

“The market is so heavily entwined in Europe (that it) is going to be almost impossible” to escape the impact of the ban, an oil shipping executive told AFP on condition of anonymity.

“There is not a very mature and deep alternative insurance market out there,” the executive noted.

– India ‘helping Russia’ –

It emerged late last week that India has reportedly stepped in to offer certification services for some tankers carrying Russian crude.

That threw the spotlight on this week’s G7 summit, which focused on more co-ordinated financial action against Russia.

“India is helping Russia to continue selling its oil despite the West’s sanctions,” said Commerzbank analyst Fritsch.

He added that India has provided safety certification for more than 80 ships belonging to a Dubai-based subsidiary of the state Russian shipping company Sovcomflot.

G7 leaders, meeting in Germany on Monday and Tuesday, condemned Russia’s Ukraine invasion as “illegal and unjustifiable”.

“We reemphasise our condemnation of Russia’s illegal and unjustifiable war of aggression against Ukraine,” they said in their draft final statement.

The communique was issued after the G7 held talks with Indian Prime Minister Narendra Modi, as well as the leaders of Argentina, Indonesia, Senegal, South Africa and Ukraine.

The European Union approved a plan to end the sale of vehicles with combustion engines by 2035 in Europe, the 27-member bloc announced early Wednesday, in a bid to reduce CO2 emissions to zero. 

The measure, first proposed in July 2021, will mean a de facto halt to sales of petrol and diesel cars as well as light commercial vehicles and a complete shift to electric engines in the European Union from 2035. 

The plan is intended to help achieve the continent’s climate objectives, in particular, carbon neutrality by 2050.

At the request of countries including Germany and Italy, the EU-27 also agreed to consider a future green light for the use of alternative technologies such as synthetic fuels or plug-in hybrids.

While approval would be tied to achieving the complete elimination of greenhouse gas emissions, the technologies have been contested by environmental NGOs.

Environment ministers meeting in Luxembourg also approved a five-year extension of the exemption from CO2 obligations granted to so-called “niche” manufacturers, or those producing fewer than 10,000 vehicles per year, until the end of 2035. 

The clause, sometimes referred to as the “Ferrari amendment”, will benefit luxury brands in particular.

These measures must now be negotiated with members of the European Parliament. 

“This is a big challenge for our automotive industry,” acknowledged French Minister of Ecological Transition Agnes Pannier-Runacher, who chaired Tuesday night’s meeting. 

But she said it was a “necessity” in the face of competition from China and the United States, which have bet heavily on electric vehicles seen as the future of the industry. 

These decisions will “allow a planned and accompanied transition”, the minister said. 

– Openness to synthetic fuels –

Europe’s automotive industry, which is already investing heavily in the move to electric vehicles, fears the social impact of a too-rapid transition. 

“The overwhelming majority of car manufacturers have chosen electric cars,” said Frans Timmermans, the EU Commission Vice President in charge of the European Green Deal, at a press conference. 

He affirmed the EU body’s willingness to be open-minded to other technologies — like synthetic fuels, which are also referred to as e-fuels. 

“We are technology neutral. What we want are zero-emission cars,” he explained. 

“At the moment, e-fuels do not seem a realistic solution, but if manufacturers can prove otherwise in the future, we will be open.” 

The technology of synthetic fuels, currently under study, consists of producing fuel from CO2 from industrial activities using low-carbon electricity, in a circular economy approach. 

Like the oil industry, the automotive sector has high hopes for these new fuels, which would extend the use of internal combustion engines now threatened by the emergence of completely electric vehicles. 

But environmental organisations object to the use of this technology in cars, as it is considered both expensive and energy-consuming.

The synthetic-fuelled engines also emit as much nitrogen oxide (NOx) as their fossil fuel equivalents, they say.

Cars are the main mode of transport for Europeans and account for just under 15 percent of total CO2 emissions in the EU. It is also one of the main gases responsible for global warming. 

In response to manufacturers’ concerns about insufficient consumer demand for 100 percent electric cars, the Commission has recommended a major expansion of charging stations. 

“Along the main roads in Europe, there must be charging points every 60 kilometres (37 miles),” said European Commission President Ursula von der Leyen last year. 

Manufacturers regularly complain about the lack of such infrastructure, especially in southern and eastern European countries.

Startups and major carmakers are starting to incorporate solar panels on their electric vehicles, an addition that extends the range of the cars even if perpetual motion remains a dream.

As it rolls under the blistering sun of northern Spain, the Lightyear 0 generates enough electricity every day to drive 70 kilometers (43 miles) thanks to the five square metres of solar panels integrated into hood and roof.

The company was founded by young Dutch engineers who earned their spurs in running solar cars in races across the Australian desert.

Thanks to the drop in the price of solar panels, Lightyear is trying to incorporate them into road cars.

With its sleek, aerodynamic line and motors integrated into the wheels, the Lightyear 0 consumes less energy than electric SUVs. 

Coupled with a battery that offers 625 kilometres per charge, the company says some customers who drive only short distances each day may only need to charge during the winter.

“The clock is ticking, we need to have sustainable cars as soon as possible,” one of the founders, Lex Hoefsloot, told AFP. 

“Charging points are still a big hurdle. If we don’t need them, we can scale electric cars much quicker,” he added. 

Lightyear targeted the top-end of the market with the 0, with the 1,000 or so cars produced setting back buyers 250,000 euros, the equivalent of a Bentley.

The company hopes to launch a mass-market model with a price tag of 30,000 euros ($31,500) in 2024-2025. 

– Going mainstream –

As sales of electric vehicles are soaring, a number of models with solar panels are expected to arrive in dealerships in the coming months.

Toyota is now proposing solar panels as an option on Prius hybrids, as well as its first 100 percent electric vehicle, the BZ4X.

Tesla also plans to offer solar panels as an option on its pickup that is due to hit the road next year.

Mercedes equipped its luxurious EQXX with solar panels in the roof. The sedan, sleek like the Lightyear, has a range of 1,000 kilometres.

The cost of adding solar panels to cars has now fallen to several hundred dollars, a small amount compared to the overall cost of most models.

“Solar is now so inexpensive that even imperfectly sunny locations are worth putting solar on,” said Gregory Nemet, a solar power expert at the University of Wisconsin-Madison.

“The value of putting solar on cars is that it can extend the range of the car,” he said.

While it may not be able to fully charge the battery in a day, “it can provide enough energy to get home”.

Or solar panels can help provide enough electricity to run the air conditioning in the vehicles, noted Gautham Ram Chandra Mouli, a specialist on electric mobility at Delft University in the Netherlands. 

– Parking problems –

Drivers will likely want to run the air conditioning as they will have to park in the sun in order to get a good charge.

That could pose problems for some city drivers with parking spaces in garages.

The season is also an important factor. Drivers in northern Europe will get much less of a charge from integrated solar panels in the winter than during the summer. 

The California startup Aptera, which has 25,000 orders, designed its futuristic three-wheeler to be highly efficient in order to get the most from solar power.

The two-seater vehicles, which should begin to be delivered to buyers this year, could get over 60 kilometres of travel from its solar panels.

Depending on the model, which cost from $26,000 to $46,000, the cars can travel from 400 to 1,600 kilometres on a full battery charge.

German firm Sono Motors has taken a more classic approach with its compact-minivan Sion.

A boxy, black five-seater that screams family car, the Sion is completely covered in solar panels.

“We developed a technique that allows covering all the car” with solar panels, said Jona Christians, a co-founder of Sono Motors.

The first Sions should be delivered next year and the current pre-order price is 28,500 euros.

The firm already has 18,000 such pre-orders and hopes to be able to manufacture over a quarter-million vehicles this decade.

The Sion is also being designed to offer different functionalities from its battery, including powering other devices and charging other vehicles. It can even give power back to the grid.

The Dutch firm Squad Mobility is targeting a different market — what it calls sub(urban) mobility.

The Squad Solar City Car may resemble an enclosed golf cart, but the two- or four-seat vehicles can zip around fast enough and have enough room to make completing many urban errands convenient. 

With the solar panels in the roof, the car can generate enough power to travel 20 kilometres per day in Europe. 

The company says such microcars travel around 12 kilometres per day on average, meaning most users won’t need to charge it daily.

“Solar panels will get more affordable, drivetrains will get better,” said Squad Mobility’s chief, Robert Hoevers.

“Sooner or later you’ll drive everyday on solar.” 

Fears of a recession caused by sharp interest rate hikes aimed at fighting soaring inflation sent Asian markets tumbling Wednesday, tracking a sharp drop on Wall Street.

The hefty selling came after more than a week of gains across the world caused by hopes that any signs of contraction could give central banks room to ease up on their pace of monetary tightening.

The fluctuations on trading floors show how tough it has become for investors to find their feet, just as financial policymakers struggle to find a balance between containing prices and maintaining economic growth.

Wednesday’s selling came after New York’s three main indexes tanked in reaction to data showing confidence among US consumers — who are a crucial driver of the world’s top economy — had fallen to its lowest level in more than a year.

The mood-sapping reading was partly driven by a feeling inflation would persist, suggesting consumers are not sure the Federal Reserve’s aggressive efforts to tame inflation will work.

The news overshadowed a surprise move by China to slash the quarantine period for incoming travellers, raising hopes for further relaxations that can allow the country’s giant economy to recover more quickly.

In early Asian trade, Hong Kong, Tokyo, Shanghai, Sydney, Seoul, Taipei, Jakarta and Wellington were all well down.

Top Fed officials on Tuesday tried to play down the chances of a recession, with the heads of the Fed in San Francisco and New York saying they were upbeat a soft landing could be achieved.

“I see us tapping on the brakes to slow to a more sustainable pace, rather than slamming on the brakes, going over the handlebars and having the proverbial recession,” San Francisco’s Mary Daly told an online event hosted by LinkedIn.

“I wouldn’t be surprised, and it’s actually in my forecast, that growth will slip below two percent, but it won’t actually pivot down into negative territory for a long period of time.”

– Threading a fine line –

But analysts were more sceptical, with Sim Moh Siong at Bank of Singapore saying “low US consumer expectations suggest weaker growth in (the second half of 2022) as well as growing risk of recession by year end”.

The Conference Board’s chief economist Dana Peterson warned the United States will likely see a recession in late 2022.

And Emily Weis, at State Street Corp, said: “The Fed still believes it can thread that very fine line between tightening financial conditions while not hurting the economy too much.

“We’re still not sure they’re going to be able to pull that off. That’s what we’ve seen reflected in the markets over the last month or so.”

Oil prices dipped though remain elevated following a run-up in recent days on expectations that demand will continue to rise — despite recessionary talk — and supplies remain tight owing to the ban on imports from Russia.

And while G7 leaders agreed to work on a price cap for Russian oil as part of efforts to cut the Kremlin’s revenues, observers warned that will not likely have a massive impact on prices.

“The easing of China’s zero-Covid policy helped oil to the third day of gains following a decent correction in recent weeks,” said Craig Erlam at OANDA. 

“As did reports that the UAE and Saudi Arabia are producing near capacity, in stark contrast to claims that both are holding back and could do more.”

He added that OPEC and other major producers were 2.7 million barrels per day below target in May, “taking the total shortfall under the agreement to more than half a billion”.

“Even sanctions being lifted on Iran and Venezuela can’t do much against that backdrop. It may well take a recession to return oil prices to sustainable levels any time soon,” he warned.

– Key figures at around 0230 GMT –

Tokyo – Nikkei 225: DOWN 1.1 percent at 26,759.99 (break)

Hong Kong – Hang Seng Index: DOWN 0.9 percent at 22,205.99

Shanghai – Composite: DOWN 0.1 percent at 3,404.32

Dollar/yen: DOWN at 136.10 yen from 136.20 yen Friday

Pound/dollar: UP at $1.2207 from $1.2187

Euro/dollar: UP at $1.0531 from $1.0525

Euro/pound: DOWN at 86.26 pence from 86.32 pence

West Texas Intermediate: DOWN 0.5 percent at $111.24 per barrel

Brent North Sea crude: DOWN 0.6 percent at $117.25 per barrel

New York – Dow: DOWN 1.6 percent at 30,946.99 (close)

London – FTSE 100: UP 0.9 percent at 7,323.41 (close)