Tag Archives: Economic Crisis

United Auto Workers strike could be the next crisis for the economy

UAW-Strike-2023

Important Takeaways:

  • ‘We’re in the abyss’: How the UAW strike could hit the economy
  • While the current economic impact of a targeted strike by the United Auto Workers (UAW) is limited, the threat of a full walkout looms over contract negotiations with auto giants Ford, General Motors and Stellantis.
  • Right now, that threat is hard to quantify — any estimate will depend on the length of the strike and how many more workers are called to the picket line.
  • Even so, the economic impact of a full-fledged 10-day strike against the Big Three could top $5 billion, the Anderson Economic Group estimated in an August report.
  • A months-long work stoppage could also eat into the Big Three’s cash holdings, Fitch Ratings warned Friday, particularly if the targeted strikes balloon to a widespread shutdown.
  • And autoworkers are already being laid off by some companies, as thousands more UAW members brace for making just $500 per week on the picket line.
  • “Nobody knows now. We’re in the abyss,” Pete DeVito Jr., and automotive director of the United Service Workers Union, told The Hill in a phone interview.
  • Automakers and suppliers are already planning to lay off nonstriking workers and are ringing alarm bells about the potential long-term impacts.
  • Ford temporarily laid off 600 workers Friday, citing “knock-on effects” from the strike, and General Motors said it would likely lay off around 2,000 employees, the Detroit Free Press reported.
  • DeVito also warned that consumers could bear the brunt of higher car prices, which had just begun to fall from historic highs during the pandemic.

Read the original article by clicking here.

Exclusive: Sudan cut off from $650 million of international funding after coup

By Aidan Lewis, Khalid Abdelaziz and Nafisa Eltahir

KHARTOUM (Reuters) – Sudan was unable to access $650 million in international funding in November when assistance was paused after a coup, the finance minister of the dissolved government said – a freeze that puts in doubt basic import payments and the fate of economic reforms.

The financing included $500 million in budget support from the World Bank and $150 million in special drawing rights from the International Monetary Fund, said Jibril Ibrahim, who was appointed to a civilian transitional government in February.

Foreign funding was seen as crucial in helping Sudan emerge from decades of isolation and supporting a transition towards democracy that began with the 2019 overthrow of Omar al-Bashir.

The Oct. 25 coup upended that transition. The United States has put on hold $700 million in economic assistance since the coup and the World Bank, which had promised $2 billion in grants, has paused disbursements.

After mass protests, the military on Nov. 21 announced a deal to reinstate Prime Minister Abdalla Hamdok. He is tasked with forming a government of technocrats but faces political opposition to the deal.

“Sudan had tremendous international support. Now donors will be much more cautious,” said one former official from the dissolved government.

The onus will now be on the military and the government to show they are not returning to the very Bashir-era model that was being restructured and reformed, the former official said.

The U.S. Treasury declined to comment. The IMF, which approved a $2.5 billion, 39-month loan program in June that is subject to periodic review, said it continued to “closely monitor developments”.

Before the coup the inflation rate, one of the highest in the world, had begun to fall, and the exchange rate had stabilized following a sharp devaluation in February.

Western diplomats and bankers say those reforms are now at risk and it is unclear how Sudan can fund imports without printing banknotes, a policy that fueled a long-running economic crisis but stopped during the transition.

Around the time of the coup, Sudan had enough reserves to cover just two months of strategic imports, a second former official said.

GOLD REVENUES

Ibrahim, a former rebel leader who secured his ministerial role through a peace deal and expects to retain it, said he hoped international support would return gradually over the next three to six months and that meanwhile bills could be paid and reforms would continue.

“Basically we depend on tax, customs and gold revenues and on different (state) companies working in various fields,” Ibrahim said in an interview at the Finance Ministry in Khartoum. For imported basic goods, such as flour, fuel and medicine, “we cannot cover it completely, but the majority of the strategic commodities we can cover with our exports,” he said.

The government had begun to reduce its trade deficit through tax and customs reforms, but those revenues were interrupted by a blockade by a tribal group at Port Sudan before the coup. A further blockade has been threatened.

Ibrahim said the main impact of the freeze in international support would be on development projects covering areas including water supply, electricity, agriculture, health and transport. An internationally funded basic income program to lessen the impact of subsidy reform has also been frozen.

Sudan’s 2022 budget was being planned with no allowance for international assistance, Ibrahim said, but with a target of sticking to a 1.5% deficit limit defined under an IMF financing program. Projected growth for 2022 could fall from 3% to 1.5-2%, he said.

Ibrahim said Sudan would seek investment rather than grants from wealthy Gulf Arab states that now face their own economic challenges.

“Up till now there have not been any big promises of support from any country, Arab or non-Arab, but contacts with all friendly states continue,” he said.

(Additional reporting by Andrea Shalal, Writing by Aidan Lewis, Editing by William Maclean)

Thousands stranded as Afghan-Pakistan border crossing stays closed

QUETTA, Pakistan (Reuters) – Hundreds of trucks and other vehicles waited at one of the main crossings between Pakistan and Afghanistan on Monday as the border closed again after a brief opening the day before, despite promises that it would reopen, traders said.

The Chaman border crossing, the second-largest commercial border point between the two countries after Torkham in Khyber Pakhtunkhwa, links with Spin Boldak in the Afghan province of Kandahar, and is regularly used by thousands of laborers and traders from both countries.

The crossing, a vital source of customs revenue for the cash-strapped government in Afghanistan, has been closed for about three weeks, despite repeated protests by truckers and others stuck waiting at the border.

“We also have a life. We have children and we need money,” said truck driver Turyalai.

As Afghanistan sinks deeper into economic crisis, neighboring countries have been increasingly worried about a mass movement of refugees.

But the closure of Chaman and interruptions to traffic at Torkham as well as the suspension of Pakistan Airlines flights from Kabul have left Afghanistan largely cut off.

Originally closed by Pakistani authorities due to security threats, disputes over issues ranging from COVID-19 to the validity of Afghan travel documents have prevented the re-opening of the Chaman crossing, despite severe hardship to truckers and local farmers.

The border was briefly opened on Sunday to let people with urgent medical needs into Pakistan, which has a much more developed health system than Afghanistan. But it was quickly closed again, leaving many stranded.

“Many people, some of them sick, were left here,” said Mohammad Younus, from the southern Afghan province of Helmand, who was trying to return home from Quetta in Pakistan when the border was sealed.

He said security forces had dispersed waiting crowds with baton charges and it was unclear when the border would re-open.

“Some people are saying the border will open (again), others are saying it will not,” he said.

(Reporting by Gul Yousafzai; writing by James Mackenzie; editing by Nick Macfie)

Afghan central bank drained dollar stockpile before Kabul fell

By John O’Donnell and Rupam Jain

FRANKFURT/MUMBAI (Reuters) – The Afghan central bank ran down most of its U.S. dollar cash reserves in the weeks before the Taliban took control of the country, according to an assessment prepared for Afghanistan’s international donors, exacerbating the current economic crisis.

The confidential, two-page brief, written early this month by senior international economic officials for institutions including the World Bank and International Monetary Fund, said the country’s severe cash shortage began before the Taliban took control of Kabul.

It criticized how the central bank’s former leadership handled the crisis in the months before the Taliban’s conquest, including decisions to auction unusually large amounts of U.S. dollars and move money from Kabul to provincial branches.

“FX (foreign exchange) reserves in CB’s (central bank) vaults in Kabul have depleted, the CB cannot meet … cash requests,” the report, seen by Reuters, said.

“The biggest source of the problem is the mismanagement at the central bank prior to the Taliban takeover,” it added.

Shah Mehrabi, chairman of the central bank’s audit committee who helped oversee the bank before the Taliban took over and is still in his post, defended the central bank’s actions, saying it was trying to prevent a run on the local Afghani currency.

The extent of the cash shortage can be seen on the streets of Afghan cities, where people have been queuing for hours to withdraw dollar savings amid strict limits on how much they can take out.

Even before the shock of the Western-backed government’s collapse, the economy was struggling, but the return of the Taliban and abrupt end of billions of dollars in foreign aid has left it in deep crisis.

Prices for staples like flour have spiraled while work has dried up, leaving millions facing hunger as winter approaches.

AID DRIES UP

Under the previous government, the central bank relied on cash shipments of $249 million, delivered roughly every three months in boxes of bound $100 notes and stored in the vaults of the central bank and presidential palace, according to three people with direct knowledge of the matter.

That money has dried up as foreign powers shy away from dealing directly with the Taliban, which fought against foreign troops and the ousted government. Thousands of people – many of them civilians – died.

The central bank, which plays a key role in Afghanistan because it distributes aid from countries like the United States, said on Wednesday it had finalized a plan to meet the country’s foreign currency needs. It gave no details.

The hard currency crunch is making it difficult for the Taliban to meet basic needs, including paying for power or dispersing salaries to government employees, many of whom have not been paid in months.

Afghanistan’s roughly $9 billion of offshore reserves were frozen as soon as the Taliban captured Kabul, leaving the central bank with just the cash in its vaults.

According to the report, the central bank auctioned off $1.5 billion between June 1 and Aug. 15 to local foreign exchange dealers, which it said was “strikingly high”.

“By August 15, the Central Bank had an outstanding liability of $700 million and 50 billion Afghanis ($569 million) towards the commercial banks,” it said, adding that this had been a major factor in emptying its coffers.

Afghan central bank official Mehrabi said, however, that although almost $1.5 billion of auctions had been announced, the actual amount sold was $714 million.

He said the central bank had “continued its foreign exchange auction to reduce the depreciation and inflation.”

MONEY MISSING?

The report also questioned a decision by the central bank to shift some of its reserves to provincial branches, putting it at risk as Taliban militants made advances across the country from late 2020 in the runup to their victory.

It said around $202 million was kept in these branches at the end of 2020, compared with $12.9 million in 2019, and that the cash was not moved as provinces started to fall to the insurgents.

“Some money is reportedly lost (stolen) from ‘some’ of the provincial branches,” the report said, without specifying how much.

Mehrabi said the central bank was investigating money “stolen” from three of its branches, although not by the Taliban. He gave no further details.

Former central bank governor Ajmal Ahmady, who left the country the day after Kabul fell, did not respond to emails and other messages requesting comment on his and the bank’s actions in the months before the Taliban returned to power.

Ahmady has said on Twitter in recent weeks that he did his best to manage the situation, and blamed any cash shortfall on the freezing of central bank assets abroad.

In his statements, he also said the central bank had managed the economy well prior to the fall of Kabul and that he felt bad about leaving staff behind but feared for his safety. He has said no money was stolen from any reserve account.

($1 = 87.8700 Afghanis)

(Additional reporting by James Mackenzie; writing By John O’Donnell; Editing by Mike Collett-White)

Taliban expand economic team as Afghan crisis deepens

(Reuters) – Afghanistan’s Taliban government bolstered its economic team on Tuesday, naming a commerce minister and two deputies as the group tries to revive a financial system in shock from the abrupt end to billions of dollars in foreign aid.

Nooruddin Azizi, a businessman from Panjshir province north of Kabul, was named as acting minister of commerce and industry and would start work immediately, Taliban spokesman Zabihullah Mujahid told a news conference.

Azizi joins the acting finance minister and minister for economic affairs, both of whom were announced previously, in a team facing a daunting task.

Exacerbated by a drought that threatens to leave millions of people hungry, the economic crisis is among the biggest challenges facing the Taliban 20 years after they were driven from power by a U.S.-led campaign in the wake of the Sept. 11 attacks.

“We are working day and night on this and on making sure that the economic issue is resolved as soon as possible,” Mujahid told reporters.

He did not give concrete proposals as to how this could be achieved, but did promise that government workers who have been unpaid since at least July would start receiving salaries soon.

Underlining the economic pressures building on Afghanistan’s new government, prices for staples like flour, fuel and rice have risen and long queues are still forming outside banks as they strictly ration withdrawals.

Some humanitarian aid has started to arrive and limited trade has returned across land borders with Pakistan, but a severe cash shortage is crippling day-to-day economic activity and decades of war have left much infrastructure in tatters.

Foreign aid payments, which accounted for 40% of Afghanistan’s gross domestic product, have all but stopped as the West considers how to deal with a group that, until August, led a deadly insurgency against the U.S.-backed government.

Amruddin, a former member of the provincial council in the northern city of Kunduz, said farmers caught up in the war during the harvest season and the dire state of some of the country’s roads meant much of the produce had gone to waste.

“Kunduz is known as the bread basket of Afghanistan, but the economic situation, especially the agriculture situation in Kunduz, is miserable,” he said. “Farmers could not get products like melon and grapes to Kabul due to all the problems.”

BUSINESS DOWN

In the cities, normally bustling commercial areas are unusually quiet, and impromptu markets have sprung up where people try to sell their household goods to raise cash.

Even before the Taliban seized Kabul on Aug. 15, 47% of the population lived in poverty, according to the Asian Development Bank, and a third survived on the equivalent of $1.90 a day.

While many people welcomed the end to 20 years of fighting between the Taliban and ousted Afghan forces supported by foreign troops, the economic crisis is causing the new government increasing concern.

Afghanistan’s central bank has been blocked from accessing more than $9 billion in foreign reserves held outside the country, and Mujahid said millions of dollars belonging to the state had disappeared before the Taliban entered the capital.

He said officials were making efforts to find out what happened to the missing cash that he said had been taken out of banks before the government of President Ashraf Ghani collapsed.

Banks are limiting withdrawals to $200 or 20,000 afghani a week for private citizens and many people say they cannot even access that. Potentially more serious in the longer term is the lack of work.

“Unfortunately, there are no job opportunities for us,” said one Kabul resident, who declined to give his name. He said he earned 1,000-1,500 afghani a day before the Taliban arrived but now had nothing.

(Writing by James Mackenzie)

Taliban go door-to-door telling fearful Afghans to work

(Reuters) – Armed Taliban members knocked on doors in cities across Afghanistan on Wednesday, witnesses said, telling fearful residents to return to their jobs a day after the militants announced they wanted to revive the country’s battered economy.

Widespread destruction during a 20-year war between U.S.-backed government forces and the Taliban, the drop in local spending due to departing foreign troops, a tumbling currency and lack of dollars are fueling economic crisis in the country.

In their first press conference since seizing the capital Kabul, the Taliban on Tuesday promised peace, prosperity, and appeared to depart from previous rules of banning women from work. But many people remain wary.

Wasima, 38, said she was shocked when three Taliban members with guns visited her home in the western city of Herat on Wednesday morning. They took down her details, enquired about her job at an aid organization and her salary and told her to resume working, she said.

A dozen people told Reuters there had been unannounced visits from the Taliban in the past 24 hours, from the capital Kabul to Lashkar Gah in the south and northern Mazar-i-Sharif.

They did not wish to give their full names, for fear of reprisals.

As well as encouraging people to work, some said they also felt the checks were designed to intimidate and instill fear of the new leadership.

A Taliban spokesperson did not immediately respond to a request for comment on the visits.

Many businesses in the capital Kabul remain closed and large parts of the city have been deserted since the Taliban captured it on Sunday at the end of a lightning sweep across the country.

The only major traffic in the usually congested capital was at the airport, where people are trying to flee the country aboard diplomatic evacuation flights, residents said.

Seventeen people were injured in a stampede there on Wednesday, and the Taliban said they fired in the air to disperse crowds.

At Tuesday’s press conference, Taliban spokesman Zabihullah Mujahid said the Islamist movement was seeking good relations with other countries to allow economic revival and “prosperity to come out of this crisis.”

But some are skeptical of the Taliban, who during their previous rule from 1996-2001 dictated that women could not work and girls were not allowed to attend school, and imposed punishments such as public stoning.

Presenter Shabnam Dawran said in a video shared on Twitter on Wednesday that she was turned away from her job on Afghanistan’s state-owned Radio Television Afghanistan.

“They told me that the regime has changed. You are not allowed, go home,” she said.

The Taliban and the news organization did not immediately comment on the incident.

Wasima, who watched the Taliban’s news briefing with her two daughters, said she feared that opportunities for women would diminish under the Taliban, even if they were now urging her back to work.

“The Taliban say women should work but I know for a fact that opportunities will shrink,” she said.

(Reporting by Kabul newsroom and Rupam Jain; Writing by John Geddie; Editing by Mike Collett-White)

One month after Cuba protests, hundreds remain behind bars

By Sarah Marsh

HAVANA (Reuters) – Hundreds of people, including dozens of dissident artists and opposition activists, remain detained in Communist-run Cuba a month after unprecedented anti-government protests, according to rights groups.

Thousands took to the streets nationwide on July 11 to protest a dire economic crisis and curbs on civil rights. The government said the unrest was fomented by counter-revolutionaries exploiting hardship caused largely by U.S. sanctions.

Rights group Cubalex has recorded around 800 detentions, a number that has risen daily as relatives come forward. Many are still too afraid to report the arrest of family members, said Cubalex director Laritza Diversent.

While 249 people have been released, many to house arrest, most remain in “preventative jail,” she said. The whereabouts of 10 people is unknown.

Dozens have already been sentenced to up to a year in prison or correctional work in summary trials, with simplified procedures and often without the chance of hiring a defense lawyer on time, said Diversent.

“The government’s aim is to make an example of those who protested, to stop others from doing the same,” she said.

The government did not respond to requests for comment for this story.

Cuban authorities have not given a figure for the total number of detained in the recent unrest but say they have so far carried out trials for 62 people, 22 of which had hired a lawyer. All but one have been deemed guilty of crimes including public disorder, resisting arrest, and vandalism, they said.

The protests were largely peaceful, although state media showed some demonstrators looting and throwing stones at police. One person died and several people, including government supporters, were injured, authorities have confirmed.

Several of those sentenced were not protesting, but were caught up in the unrest, according to their relatives.

Yaquelin Salas, 35, says her husband intervened peacefully in the arrest of a woman, calling on police agents to not treat her so aggressively. Now he is serving a 10-month prison sentence on charges of public disorder after a collective trial in which just two of the 12 detained had lawyers.

“What they are doing is totally unfair,” said Salas.

Since Cuba’s 1959 revolution, authorities have tightly controlled public spaces, saying unity is key to resisting coup attempts by the United States, which has long openly sought to force political change through sanctions and democracy initiatives. The White House has said it will do what it can to support Cuban protesters.

FAMILIES ‘SILENCED’

Gabriela Zequeira, 17, one of several minors detained in the protests, said she was sentenced to house arrest for eight months after being arrested while walking home from the hairdressers on July 11.

Upon her admission to jail, where she was kept 10 days incommunicado, she said she was required to put a finger in her vagina to show she was concealing nothing as part of a strip search. Officers kept interrupting her attempts to sleep and one officer made sexual taunts, she said in an interview.

The Cuban government initially said no minors had been detained, a statement later contradicted by state prosecutors.

Some relatives of those detained said authorities were pressuring them to stop speaking out.

“My family has been silenced,” said emigre Milagros Beirut from her home in Spain. She said four of her relatives in Havana and the eastern city of Guantanamo remained behind bars for protesting peacefully. “They’ve been told those detained will receive a stricter sentence if they say anything.”

Dozens of political activists and dissident artists were among the detained, including some who did not participate in the protests but appeared to have been arrested pre-emptively, said Diversent from Cubalex.

Jose Daniel Ferrer, the leader of Cuba’s largest opposition group, and Luis Manuel Otero Alcantara, head of a dissident artists collective, were both arrested on their way to the protests before even arriving, according to their supporters.

Ferrer’s sister Ana Belkis Ferrer said the family had not been able to speak to or see him, a complaint of many relatives of those detained.

“We don’t know if he’s being beaten, if he’s well or not, whether or not he’s doing a hunger strike,” she said.

Another detained activist, Félix Navarro, 68, president of the Party for Democracy, was in hospital with COVID-19, said Diversent. Several of those detained have denounced unsanitary conditions in jail amid one of the worst COVID-19 outbreaks https://www.reuters.com/world/americas/coronavirus-surge-pushes-cubas-healthcare-system-brink-2021-08-11 in the world.

(Reporting by Sarah Marsh and Reuters TV in Havana, Editing by Rosalba O’Brien)

Beirut marks year since port blast with demands for justice

By Imad Creidi

BEIRUT (Reuters) – Thousands of Lebanese gathered near the port of Beirut on Wednesday to mark the first anniversary of a catastrophic explosion that devastated the city, demanding justice for the victims.

One year since the disaster, caused by a huge quantity of ammonium nitrate stored unsafely at the port for years, no senior official has been held to account, infuriating many Lebanese as their country also endures financial collapse.

One of the biggest non-nuclear explosions ever recorded, the explosion wounded thousands and was felt in Cyprus, more than 240 km (150 miles) away.

An investigation is stalling with requests denied for immunity to be lifted from senior politicians and former officials. All those sought for questioning by the Lebanese investigators have denied any wrongdoing.

“We will not forget and we will not forgive them ever. And if they can’t bring them to account, we will by our own hands,” said Hiyam al-Bikai, dressed in black and clutching a picture of her son, Ahmad, who was killed when masonry fell on his car.

A huge banner on a building overlooking the port said: “Hostages of a Murderous State.”

French President Emmanuel Macron, who has led Western pressure for reform in Lebanon, said its leaders owed the people the truth and heaped new criticism on the governing elite for failing to deal with the economic crisis.

The damage is still visible across much of Beirut. The port resembles a bomb site, its huge wrecked grain silo unrepaired.

Thousands of people, waving Lebanese flags and holding pictures of the dead, had marched towards the port, where prayers are expected to be held just after 6 p.m. (1500 GMT), coinciding with the time of the blast.

“We want our rights – the rights of the martyrs and victims. Their immunities are not more dear than the blood of the martyrs and victims,” said Hanan Hoteit, whose relative, Tharwat, was killed at the port.

A Human Rights Watch report released this week concluded there was strong evidence to suggest some Lebanese officials knew about and tacitly accepted the lethal risks posed by ammonium nitrate.

Reuters reported last August that Prime Minister Hassan Diab and President Michel Aoun were both warned in July last year that the chemicals posed a security risk and could destroy the capital if they exploded.

Aoun has said he is ready to testify if needed, and that he supports an impartial investigation.

Diab, who quit after the blast, has said his conscience is clear.

The chemicals arrived on a Russian-leased cargo ship that made an unscheduled stop in Beirut in 2013. An FBI report seen by Reuters last week estimated around 552 tonnes of ammonium nitrate exploded, less than the 2,754 tonnes that arrived.

That discrepancy is one of the many questions that remain unanswered. No one ever came forward to claim the shipment.

PRAYERS

Leading prayers at a hospital that was badly damaged in the blast, Greek Orthodox Archbishop Elias Audi said the investigation must continue until punishment is meted out to those who deserve it.

Nobody was above the law, he said, and “whoever obstructs justice is a criminal, even if they are highly placed.”

At the time of the explosion, Lebanese were already facing deepening hardship due to the financial crisis caused by decades of state corruption and waste.

The meltdown worsened throughout the last year with the governing elite failing to establish a new cabinet to start tackling the crisis even as poverty has soared and medicines and fuel have run out.

Hosting a donors’ conference for Lebanon, Macron pledged a further 100 million euros ($120 million) in emergency aid and 500,000 doses of COVID-19 vaccines. He is trying to raise more than $350 million.

“Lebanese leaders seem to bet on a stalling strategy, which I regret and I think is a historic and moral failure,” he said.

Pope Francis wished Macron success and said donors should help Lebanon “on a path of resurrection.” He said he had a great desire to visit Lebanon, where many had lost “even the illusion of living.”

The state has taken no steps towards reforms that might ease the economic crisis, with the sectarian elite locked in a power struggle over cabinet posts.

(Additional reporting by Philip Pullella at Vatican City and Michel Rose in Paris; Writing By Maha El Dahan/Tom Perry; Editing by Giles Elgood and Angus MacSwan)

Cubans turn to herbal remedies, barter amid medicine scarcity

By Rodrigo Gutierrez

HAVANA (Reuters) – Dayana Rodriguez says her son is overwhelmed with scabies but she has not been able to find any of the treatments prescribed by their doctor at the poorly-stocked pharmacies in Havana so she is now turning to a herbal remedy instead.

Even as Cuba is leading the race to become the first country in Latin America to develop its own COVID-19 vaccine, the country is suffering acute shortages of basic medicines amid its worst economic crisis in decades.

“There aren’t any of the ones they prescribed him, Benzyl benzoate, or the other one for itching too that used to be in all the pharmacies,” said Rodriguez, buying medicinal plants at a shop on a commercial boulevard in Central Havana.

Nine families in Havana told Reuters they were struggling to treat outbreaks of scabies, a highly infectious yet preventable skin disease, due to medicine shortages.

Three doctors consulted by Reuters who declined to be named said they had resorted to advising their patients to boil up a mix of herbs to apply to their skin to provide temporary relief for scabies as it was futile to prescribe medicines that are scarce. One of those doctors also recommended a veterinary treatment for one of his patients.

Cuba’s healthcare system, built by late leader Fidel Castro, is one of the revolution’s most treasured achievements, having produced results on a par with rich nations using the resources of a developing country and in spite of the decades-old U.S. trade embargo.

But cash woes in the ailing state economy since the fall of former benefactor the Soviet Union have taken their toll on both healthcare facilities and the availability of medicine.

Over the past few years, the decline in aid from ally Venezuela, new U.S. sanctions and the pandemic have plunged Cuba into its worst economic crisis since the 1990s.

Health Minister Jose Portal reported on state television last year that as of June around a 116 basic medicines were scarce. Of those, 87 were produced locally and 29 imported.

Florencio Chavez, who has run a medicinal plant shop for 25 years, recommends guacamaya francesa, cundeamor, neem, Parthenium hysterophorus to treat scabies. He says demand for herbal remedies has risen in recent years.

Cubans have also set up groups on social media to barter medicines or other products for those they need, while the black market is thriving on the streets and online.

CHRONIC SHORTAGES

Cuban authorities started talking about chronic shortages of drugs, including basic ones like those treating hypertension and contraceptives due to a cash crunch in 2017, saying it had had to slash imports of inputs necessary for local production.

Last year, the country said shipping delays due to the pandemic had exacerbated the situation, as had U.S. sanctions.

While medicine is theoretically exempt from sanctions, the sanctions still are a strong disincentive to overseas medical providers, who might risk being fined, and the embargo hurts the economy across the board so there is less cash for imports.

Some senior citizens like Yolanda Perez, 80, who suffers from glaucoma, complain they do not have the stamina needed to line up at pharmacies overnight in the hope of grabbing their share of scant deliveries.

“It’s been six months since I was last able to get my latanoprost,” the drug that helps prevent her from going blind, she said.

Authorities in the eastern province of Holguin in January warned Cubans not to turn to the black market though because some drugs were not what they advertised and could even be harmful.

“The problem is people are despairing over the lack of medicine,” wrote a reader identified as Arcela under an article on the topic in state outlet Juventud Rebelde. She said her sister had had to buy black market antibiotics.

“That’s why they resort to these methods.”

(Reporting by Reuters TV; Writing by Sarah Marsh; Editing by Christian Plumb and Aurora Ellis)

Lebanon sets starting point for sea border negotiations with Israel

BEIRUT (Reuters) – President Michel Aoun on Thursday specified Lebanon’s starting point for demarcating its sea border with Israel under U.S.-mediated talks, in the first public confirmation of a stance sources say increases the size of the disputed area.

Israel and Lebanon launched the negotiations last month with delegations from the long-time foes convening at a U.N. base to try to agree on the border that has held up hydrocarbon exploration in the potentially gas-rich area.

A presidency statement said Aoun instructed the Lebanese team that the demarcation line should start from the land point of Ras Naqoura as defined under a 1923 agreement and extend seaward in a trajectory that a security source said extends the disputed area to some 2,300 square km (888 sq. miles) from around 860 sq. km.

Israel’s energy minister, overseeing the talks with Lebanon, said Lebanon had now changed its position seven times and was contradicting its own assertions.

“Whoever wants prosperity in our region and seeks to safely develop natural resources must adhere to the principle of stability and settle the dispute along the lines that were submitted by Israel and Lebanon at the United Nations,” Yuval Steinitz said.

Any deviation, Steinitz said, would lead to a “dead end”.

Last month sources said the two sides presented contrasting maps for proposed borders. They said the Lebanese proposal extended farther south than the border Lebanon had years before presented to the United Nations and that of the Israeli team pushed the boundary farther north than Israel’s original position.

The talks, the culmination of three years of diplomacy by Washington, are due to resume in December.

Israel pumps gas from huge offshore fields but Lebanon, which has yet to find commercial gas reserves in its own waters, is desperate for cash from foreign donors as it faces the worst economic crisis since its 1975-1990 civil war.

(Additional reporting by Ari Rabinovitch in Jerusalem; Writing by Ghaida Ghantous; Editing by Janet Lawrence)