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Hong Kong Exchanges and Clearing proposes merger with LSE



An aerial view of the London Stock Exchange Paternoster Square

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Hong Kong Exchanges and Clearing Limited (HKEX) said Wednesday it has made a proposal to the board of London Stock Exchange Group Plc (LSE) to “combine the two companies,” in a deal which values the LSE at about £29.6 billion ($36.6 billion).

The HKEX said the deal would be funded by a combination of existing cash and a new credit facility. It cautioned, however, that its statement to the market should be considered as an announcement to make a possible offer and is not confirmation of a firm intention to bid.

The statement from HKEX said a further announcement will be made “as and when appropriate.”

HKEX has proposed £20.45 a share in cash as well as 2.495 newly issued HKEX shares. LSE shares rallied shortly after 10:00 a.m. London time, rising by 8.5% before giving up some of the initial gains. 

HKEX said it expected key LSE management to keep their jobs and work for the new owners.

“The board of HKEX believes that the two businesses are highly complementary and as such, looks forward to working with the relevant authorities to deliver a clear path to completion,” the HKEX said.

HKEX added that the proposed deal would only go ahead if LSE backs down from its plan to buy Refinitiv. The data group, which is majority owned by the private equity group Blackstone, was last year spun out of the news wire service Reuters.

LSE had announced plans to spend $27 billion on Refinitiv in order to provide a complete one-stop-shop to banks and brokers who need a platform for trading, hardware and a continuous flow of data and news. It was considered a strategy that would directly challenge Bloomberg’s terminal and data package.

HKEX is already the owner and operator of the London Metal Exchange, the world’s largest market in options and futures contracts on base and other metals. It bought the LME in 2012 for £1.4 billion.

—Reuters contributed to this article.



U.S. to help El Salvador handle more asylum seekers




WASHINGTON, D.C./NEW YORK (Reuters) – The United States and El Salvador on Friday agreed to attempt to reduce the flow of Central American migrants arriving at the U.S.-Mexico border by strengthening El Salvador’s capacity to receive asylum seekers but did not detail any concrete actions.

“The core of this is recognizing El Salvador’s development of their own asylum system and committing to help them build that capacity,” Acting Department of Homeland Security Secretary Kevin McAleenan told reporters after signing documents with El Salvador’s minister of foreign affairs, Alexandra Hill.

McAleenan added, “Individuals crossing through El Salvador should be able to seek protections there” even if they are intending to apply for asylum in the United States.

But neither official said when the arrangement would take effect or provide details on how it would be administered.

“We are going to work out operational details. This is just a broad agreement,” Hill told Reuters upon leaving the signing ceremony.

This was the latest effort by McAleenan to seal immigration deals with the Northern Triangle countries of Central America – Guatemala, Honduras and El Salvador – where most immigrants arriving at the U.S. southern border hail from.

U.S. President Donald Trump has made immigration enforcement a centerpiece of his administration and is pushing to staunch the flow of migrants – many of them families – crossing into the United States. Border crossings reached record highs earlier this year, frustrating Trump, whose central presidential campaign promise was to cut down on illegal immigration.

Guatemala signed a deal that requires asylum seekers to ask for refuge in Guatemala instead of in the United States if they traveled through the former country on the way to the U.S.-Mexico border. The Guatemalan Congress, however has not ratified the deal.

The United States has a similar “safe third country” agreement with Canada.    

Immigration advocates contend Central American countries, where many people are fleeing from violence, poverty and endemic corruption, do not have the capacity to process more asylum claims and cannot assure safety for vulnerable migrants.

FILE PHOTO: Acting U.S. Homeland Security Secretary Kevin McAleenan attends a news conference in San Salvador, El Salvador August 28, 2019. REUTERS/Jose Cabezas/File Photo

El Salvador, which has 6.6 million people, is one of the world’s most violent nations, largely due to criminal gangs involved in drug trafficking and extortion.

Even as the U.S. government has pursued these deals, the Department of Homeland Security issued a rule on July 16 that would bar most migrants from gaining U.S. asylum if they had not sought safe haven in a country they transited through first.

The rule accomplishes virtually the same thing as the agreements, but it has faced legal challenges. A federal court initially blocked the rule from taking effect, but the Supreme Court on Sept. 11 allowed it to be implemented while the court challenges are ongoing. [L2N2641F4]

Reporting by Richard Cowan in Washington D.C. and Mica Rosenberg in New York; Additional reporting by Jan Wolfe in Washington D.C. and Daina Beth Solomon in Mexico City; Editing by Cynthia Osterman

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Most Europeans see China’s ‘aggressive’ trade practices as a threat




Nelson Ching | Bloomberg | Getty Images

The majority of EU citizens believe China’s “aggressive competitive practices” are a threat to their economic interests, a new survey has claimed.

In a report published Thursday, the thinktank the European Council on Foreign Relations (ECFR) found that 57% of Europeans felt their country’s economy, and the wider European economy, were being insufficiently protected by lawmakers from Chinese trade practices.

The ECFR polled 60,000 people across 14 EU member states to gauge voter sentiment toward foreign policies.

Less than 20% of voters in each individual member state felt their country’s interests were well insulated from aggressive Chinese competitive practices.

In France and Italy, almost three quarters of respondents felt their governments were failing to safeguard their economic interests from China’s trade and economic policies, with more than 60% saying the same in Spain, Germany and Greece.

More than a third of French, Italian and Spanish voters said the EU needed to do more to keep the region’s economy competitive and minimize the countereffects of China’s dominance.

“(Europeans) are ahead of their politicians in understanding the need for a stronger Europe in a world where it could be pushed around by ever more aggressive and nationalistic superpowers,” Susi Dennison, a senior fellow at ECFR, said in a press release Thursday.

However, there was some confidence in the EU’s role as a political force. Respondents said that if the EU were to fall apart tomorrow, the third biggest loss — following the collapse of the single market and the euro — would be European states’ ability to act as a continent-sized power in contests with global players such as China, Russia, and the United States.

Why is China seen as a threat?

With a population of more than 1.3 billion, the Chinese market is already a huge source of revenue for companies around the world — but the state’s economic policies have faced heavy criticism.

It’s been accused of pressuring companies to hand over tech blueprints as a condition for doing business in the country. Foreign firms operating in China also complain about “lengthy and opaque administrative procedures, especially with respect to permits, registration, and licensing.” China has also been criticized for distorting markets with heavy state sponsorship of its own firms — it paid a record $22 billion in subsidies to its domestic corporations last year, the Financial Times reported.

In a joint statement in May, the U.S., European Commission and Japan said countries were creating unfair advantages for their workers and businesses by using “harmful subsidies,” “forced technology transfer policies” and developing state enterprises into national champions — although no country was explicitly named.

Chinese authorities argue that China has created a trading environment that benefits the international economy. In a white paper last year, the Chinese government said it had “comprehensively fulfilled its commitments to the WTO, substantially opened its market to the world, and delivered mutually beneficial and win-win outcomes on a wider scale.”

New rules in Europe?

The EU already has some rules in place to regulate competition with China.

China is part of the EU’s competition cooperation partnership in Asia, alongside 13 other countries including India, Japan and South Korea. The European Commission also signed a framework with China in 2015 to strengthen cooperation between the two powers on reviewing cross-border company mergers.

However, EU lawmakers have suggested that regulations on both sides need to be updated to allow a level playing field.

In April, European Commission President Jean-Claude Juncker said in a statement that the EU and China needed to “find a better balance and level of reciprocity.”

“Europe wants to trade more and invest more in China, but we need rules that allow us to do so,” he said. “We want to work with China, because we believe in the potential of our partnership.”

But the Commission has urged EU member states to work as a whole when it comes to partnering with the world’s second-largest economy.

A March report by the European Commission, which dubbed China “an economic competitor” and a “systemic rival,” noted China’s ambitions to become a leading global power.

“This requires a flexible and pragmatic whole-of-EU approach enabling a principled defence of interests and values,” the Commission said, arguing that “neither the EU nor any of its member states can effectively achieve their aims with China without full unity.”

Earlier this year, Italy became the first major European economy to join China’s belt and road initiative, the country’s huge investment and infrastructure project. Analysts at the time told CNBC the move undermined Europe’s ability to stand up to China.

Meanwhile, EU antitrust chief Margrethe Vestager told members of the European Commission in January that China had a competitive edge over the bloc, according to the Financial Times, due to its “significant levels of strategic subsidies, restrictions on inward investment and state-sponsored outward investment.

— CNBC’s Holly Ellyatt and Reuters contributed to this report.


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Death toll from Taliban bomb attack rises to 39




KABUL: The death toll from a massive Taliban bomb attack which flattened a hospital in southern Afghanistan earlier this week has risen to at least 39, officials said Friday.
The jump in the toll from the blast, which took place in the town of Qalat in Zabul province on Thursday, takes the total number of people killed in just three days of violence across the war-torn country this week to at least 91.
“The toll from the hospital attack in Qalat has jumped to 39 killed, 140 others wounded,” Gul Islam Seyal, the spokesman for the provincial governor, told AFP.
Earlier, authorities had said the blast had killed 20 people.
Another official put the toll even higher Friday, at 41.
The surge in violence, with civilians paying the heaviest price, has come after US President Donald Trump called off talks with the Taliban that could have seen Washington begin withdrawing troops, and as the country gears up for a presidential election.
The insurgents responded to Trump’s declaration that the talks were “dead” earlier this month by promising to continue fighting, and have vowed to target the September 28 polls.
But they also left the door open for talks to resume. The White House has said the talks will not continue if the violence does, but the Taliban have argued that the US is also killing people in Afghanistan.
Thursday’s bloodshed began with the Qalat bomb near dawn.
Hours later, reports emerged of an air strike in eastern Nangarhar province said to have killed at least nine civilians.
“US forces conducted a precision strike against Da’esh terrorists in Nangarhar early (on September 19),” Col. Sonny Leggett, spokesman for US Forces-Afghanistan, said in a statement on Friday, using the Arabic acronym for the Islamic State militant group.
“We are aware of allegations of the death of non-combatants and are working with local officials to determine the facts to ensure this is not a ploy to deflect attention from the civilians murdered by the Taliban at a hospital in Zabul earlier.”
The strike came just hours after four people were killed on Wednesday when unknown gunmen and a suicide bomber stormed a government building in nearby Jalalabad, capital of Nangarhar.
On Tuesday, the Taliban killed nearly 50 people in two separate attacks — one at a campaign rally for President Ashraf Ghani in the central province of Parwan, and the other in Kabul.
Ordinary Afghans continue to bear the brunt of the conflict, with more civilians killed in 2018 than during any other year on record, according to the United Nations.

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