The World Today for May 02, 2017

NEED TO KNOW

Northerly Neighbors

When American policymakers complain about trade imbalances in North America, Mexico typically figures as the culprit.

In fact, trade with Canada is usually discussed in much more genteel terms.

But in recent weeks, economic relations between America and its northern neighbor have gone topsy-turvy: It looks like the two allies are on the brink of stumbling into a trade war.

The US is even keeping a list of grievances, the Financial Post reported Monday.

It started when Washington announced it would impose duties averaging 20 percent on imports of Canadian softwood lumber – a move that affects roughly $5.66 billion worth of goods, wrote Reuters.

Softwood lumber has been a simmering contention point between Washington and Ottawa for decades, the newswire noted.

But these new tariffs have escalated tensions over the commodity – and they could spill over into other sectors beyond Canada’s large forestry industry.

Some Canadian officials have responded by calling for Ottawa to ban the shipment of thermal coal in retaliation.

“We’ve gone from seeing Americans as being good trading partners to being hostile trading partners,” Christy Clark, the leader of British Columbia, told Canadian media as the reason for her request.

But US Commerce Secretary Wilbur Ross justified Washington’s move by accusing Canada of “dumping lumber” rather than playing by trade rules.

Now Canada’s complex dairy policy of placing high tariffs on imported milk – still allowed under NAFTA – looks like it might be the next to come under tougher scrutiny in Washington.

No concrete measures have been taken yet, but US President Donald Trump has already singled out Canada’s milk tariffs for being “a disgrace” that hurts US farmers.

Still, it’s questionable whether these new duties will strengthen American businesses.

Tariffs on softwood lumber – which is mainly used for building new homes in the US – could add an average of nearly $3,600 to the price of a new home in an industry that’s just barely reaching a recovery point, wrote Politico.

In any case, Canada might soon find itself with an ace up its sleeve: legalized marijuana.

The Canadian government recently unveiled its roadmap to legalize recreational marijuana by July 1, 2018.

Estimates suggest this will put Canada’s market for marijuana – currently the world’s second largest at $500 million – on equal footing with the US’ by 2020, when it’s forecast to hit $22 billion, according to CNBC.

That’s one commodity market that’s set to flourish no matter what trade policies either side adopts.

WANT TO KNOW

Rewriting the Rules

Venezuelan President Nicolas Maduro called for a new legislative body with the power to rewrite the constitution, a citizens’ assembly, on Monday in his latest move to counter growing opposition protests.

That was after hundreds of thousands took to the streets again to call for his ouster, the Washington Post reported.

He said the measure was needed to prevent the protest movement against him, now in its second month, from growing into a coup. But those same opponents decried it as another attempt to undermine democracy, like an earlier move by Maduro’s backers on the Supreme Court to dissolve the opposition-controlled legislature.

Details are in short supply. But many expect the president’s administration to give itself the power to pick a majority of delegates to a constitutional convention. Drafting a new constitution could then be an excuse to put off regional elections scheduled for this year and presidential elections that were to be held in 2018.

The head of the National Assembly has called on the people to rebel against what he called a coup by the president.

No Grexit Yet

Greece and its foreign creditors reached a long-awaited agreement on financial reforms mandated as part of its earlier bailout.

The deal includes labor and energy reforms as well as pension cuts and tax hikes, Reuters reported. Talks had dragged on for months due to a dispute between the European Union and International Monetary Fund over fiscal targets, the agency said.

Athens promised to cut pensions in 2019 and lower the income level below which citizens do not pay taxes in 2020 to produce savings worth 2 percent of gross domestic product. The agreement was seen as key to averting a financial meltdown that would have dire effects across the eurozone.

Now, Greece has to vote the measures into law before its 7.5 billion euros in debt matures in July, so that eurozone finance ministers will approve new loans.

Closer to the Brink?

North Korea warned that Washington’s decision to send two bombers over the Korean peninsula as part of a joint exercise with Seoul has pushed the region to the brink of nuclear war.

The warning comes amid an uptick in the North’s normally bellicose rhetoric, and a day after US President Donald Trump suggested he might be willing to meet with North Korean dictator Kim Jong-un.

Two supersonic B-1B Lancer bombers flew over the peninsula as part of a training exercise meant as a show of force Monday, amid rising concerns about Kim’s continued pursuit of nuclear weapons and intercontinental ballistic missiles.

North Korean state media said the bombers conducted “a nuclear bomb dropping drill against major objects” in its territory, as Trump and “other US warmongers are crying out for making a preemptive nuclear strike.”

“If it would be appropriate for me to meet with (Kim), I would absolutely, I would be honored to do it,” Trump told Bloomberg News Monday, in another diversion from a longstanding US policy.

DISCOVERIES

Ticking Time Bomb

A cold brew after work might cause irregularities with your ticker, even if you’re otherwise healthy, according to a study published recently in the European Heart Journal.

While at the Munich Oktoberfest, researchers from University Hospital Munich tested the breath alcohol content of over 3,000 festival goers who had imbibed but weren’t legally impaired.

After testing their heart functions, researchers found that more than a quarter of the group showed signs of sinus tachycardia, a condition characterized by a resting heart rate of more than 100 beats per minute.

That’s much higher than the 1 to 2 percent of the general population that normally experiences the condition, the New York Times reported.

The presence of arrhythmia, or an irregular heartbeat, increased among festival goers with higher breath alcohol levels, even when controlling for an array of factors.

Your heart rate will likely return to normal once the alcohol leaves your system, said Moritz F. Sinner, the study’s lead author and an assistant professor of cardiology at University Hospital Munich.

But his research shows that people with an undiagnosed condition may develop a longer-lasting arrhythmia “under the stress of alcohol.”

That could be a bummer for beer drinkers.

Correction:

In Friday’s NEED TO KNOW section, we said Egypt was the world’s most populous Muslim-majority country. In is in fact the Arab world’s most populous Muslim-majority country. We apologize for the error.