VOI - Voice of Indonesia | RRI - Radio Republik Indonesia

South Korea's national security adviser said on Thursday the United States has promised to review the impact of its new rules on subsidies for electric vehicles following concern they could hurt South Korean automakers, Yonhap news agency reported.

Kim Sung-han made the comment after meeting U.S. national security adviser Jake Sullivan in Hawaii, where they gathered for three-way talks with Japan chiefly to coordinate their Indo Pacific policies in the light of tensions between China and Taiwan.

Concerns have mounted in South Korea over the Inflation Reduction Act (IRA), signed into law by U.S. President Joe Biden last month.

Measures under the new law would include halting subsidies for EVs made outside North America, which could affect companies like Hyundai Motor Co (005380.KS) and its affiliate Kia Corp (000270.KS).

Kim said he raised the issue at a bilateral meeting with Sullivan, who in response pledged to look into the law's impact at the National Security Council, Yonhap said.

"He said the IRA is likely to bring more pluses than minuses to Korea, but he would take a closer look at how the electric vehicle subsidy issue will develop going forward and what impact it will have," Kim was quoted as telling reporters.

South Korea's parliament on Thursday passed a resolution expressing concern over the new rules, which have eliminated the federal tax credits for which South Korean automakers' EVs were previously eligible in the United States.

The resolution called for the South Korean government to respond, saying the law was discriminatory.

Lee Do-hoon, a South Korean vice foreign minister, said on Tuesday that Seoul has asked Washington to postpone the new rules until Hyundai completes building its Georgia factory in 2025. Seoul officials have also said the law may violate a bilateral free trade agreement. (reuters)

Sri Lanka has reached a preliminary agreement with the International Monetary Fund (IMF) for a loan of about $2.9 billion, the global lender said on Thursday, as the country seeks a way out its worst economic crisis in decades.

The agreement, which Reuters first reported on Wednesday, is subject to approval by IMF management and its executive board, and is contingent on Sri Lankan authorities following through with previously agreed measures.

"This staff-level agreement is only the beginning of a long road ahead for Sri Lanka to emerge from the crisis," senior IMF official Peter Breuer told reporters in Colombo.

"The authorities have already begun the reform process and it will be important to continue on this path with determination."

IMF conditions for the loan also include receiving financing assurances from Sri Lanka's official creditors and efforts by the country to reach an agreement with private creditors.

Its programme, spread over four years, will aim to boost government revenue, encourage fiscal consolidation, introduce new pricing for fuel and electricity, hike social spending, bolster central bank autonomy and rebuild depleted foreign reserves.

The country's reserves stood at $1.82 billion as of July, according to central bank data.

"Starting from one of the lowest revenue levels in the world, the programme will implement major tax reforms. These reforms include making personal income tax more progressive and broadening the tax base for corporate income tax and VAT," the statement said.

"The programme aims to reach a primary surplus of 2.3 percent of GDP by 2024," it added.

Once the IMF package is approved, Sri Lanka is also likely receive further financial support from other multilateral creditors.

The country's CSE All-Share index (.CSE) finished 2% higher, building on a 17% gain last month.

AUSTERITY AND JOB CUTS

Sri Lanka's current financial turmoil, its worst since the country's independence from Britain in 1948, stems from economic mismanagement as well as the COVID-19 pandemic that has wiped out the country's key tourism industry.

Sri Lankans have faced acute shortages of fuel and other basic goods for months, stoking unprecedented protests that forced a change in government.

Ranil Wickremesinghe, a veteran lawmaker who took over as president in July, has faced an uphill battle to stabilise the economy, which has been buffeted by runaway inflation that is now at almost 65% year-on-year.

Udeeshan Jonas, chief strategist at Sri Lankan investment bank CAL Group, said the IMF's comments were largely positive.

"They said the revenue measures that we've taken have been substantial (and) they're happy with what we've done from a fiscal perspective," he said.

Although welfare budgets for Sri Lanka's poorest would be protected, Jonas expects significant austerity measures and job cuts at loss-making state-owned enterprises.

"Privatisation is on the cards," he said, "and I think it will happen probably by next year."

Wickremesinghe, who also serves as the country's finance minister, on Tuesday presented an interim budget aimed at clinching the deal with the IMF.

The budget revised Sri Lanka's deficit projection for 2022 to 9.8% of the gross domestic product from 8.8% earlier, while outlining fiscal reforms, including a hike in value-added taxes.

CREDITOR COLLABORATION

IMF's Breuer said the preliminary agreement highlighted the commitment of Wickremesinghe's government to comprehensive and significant reforms.

"This is a credible device to show to creditors that Sri Lanka is serious about engaging in reforms," he said.

Sri Lanka needs to restructure nearly $30 billion of debt, and Japan has offered to lead talks with its other main creditors, including regional rivals India and China.

"If creditors are not willing to provide these assurances, that would indeed deepen the crisis here in Sri Lanka and would undermine its repayment capacity," Breuer said.

Sri Lanka will also need to strike a deal with international banks and asset managers that hold the majority of its $19 billion worth of sovereign bonds, which are now classified as in default.

Sri Lanka's debt had soared to unsustainable levels in the run up to the crisis. Years of populist tax cuts had depleted finances, which were further hammered by the pandemic.

The damage was compounded by a ban on chemical fertilisers that hit the farming industry, followed by soaring oil and food prices driven by the conflict in Ukraine.

"From our perspective, it is important to move expeditiously," Breuer said, referring to the need for creditors to work together.

"That really is the key here. Because we want to avoid the crisis becoming worse." (reuters)

Britain will keep working with international partners to try to change China's actions, Foreign Secretary Liz Truss said on Thursday, responding to a U.N. report that China may have committed crimes against humanity in its Xinjiang region

"The report ... provides new evidence of the appalling extent of China's efforts to silence and repress Uyghurs and other minorities in Xinjiang," said Truss, the frontrunner to become the next British prime minister in a leadership contest that ends next week.

"We will continue to act with international partners to bring about a change in China’s actions, and immediately end its appalling human rights violations in Xinjiang." (reuters)

Poland estimates its World War Two losses caused by Germany at 6.2 trillion zlotys ($1.32 trillion), the leader of the country's ruling nationalists said on Thursday, and he said Warsaw would officially demand reparations.

Poland's biggest trade partner and a fellow member of the European Union and NATO, Germany has previously said all financial claims linked to World War Two have been settled.

Poland's new estimate tops the $850 billion estimate by a ruling party lawmaker from 2019. The ruling Law and Justice (PiS) party has repeated calls for compensation several times since it took power in 2015, but Poland hasn't officially demanded reparations.

"The sum that was presented was adopted using the most limited, conservative method, it would be possible to increase it," Jaroslaw Kaczynski, leader of Law and Justice (PiS), told a news conference.

The combative stance towards Germany, often used by PiS to mobilize its constituency, has strained relations with Berlin. It intensified after Russia invaded Ukraine amid criticism of Berlin's dependence on Russian gas and its slowness in helping Kyiv.

Some six million Poles, including three million Polish Jews, were killed during the war and Warsaw was razed to the ground following a 1944 uprising in which about 200,000 civilians died.

The German government and Foreign Office did not immediately respond to requests for comment.

In 1953 Poland's then-communist rulers relinquished all claims to war reparations under pressure from the Soviet Union, which wanted to free East Germany, also a Soviet satellite, from any liabilities. PiS says that agreement is invalid because Poland was unable to negotiate fair compensation.

Donald Tusk, leader of Poland's biggest opposition party Civic Platform, said on Thursday that Kaczynski's announcement was "not about reparations".

"It's about an internal political campaign to rebuild support for the ruling party," he said.

PiS is still leading in most opinion polls but its edge over Civic Platform has narrowed in recent months amid criticism of its handling of surging inflation and an economic slowdown.