From German Faucets to Italian Chocolate, Trade Barriers Are Rising Again in Europe By Valentina Pop Updated Dec. 13, 2017 12:16 p.m. ET


Illustration by Jessica Kuronen

Globalization in Retreat

The world’s most ambitious free-trade area is colliding with a surge in economic nationalism.

Unfettered trade is the law of the land across the 28-country European Union, and Emmanuel Macron won the French presidency in May on a campaign of more European unity, not less, proudly posing with the EU’s blue and gold flag.

In July, though, Mr. Macron nationalized a French shipyard to block its takeover by Italian company Fincantieri SpA, citing what he called “national interest.” The takeover went ahead three months later, after Mr. Macron secured unusual guarantees for the French state. He supports limiting employment from lower-paying countries such as Poland and Romania. A French food-labeling rule co-written by Mr. Macron when he was economy minister has gutted dairy imports from Belgium, Sweden and Germany. All six countries are members of the EU.

Italy outlawed the much-coveted words “Made in Italy” from any food products that contain imported ingredients. That means Baci hazelnut-filled chocolates, first made in 1922 in the Italian city of Perugia, can’t be labeled as Italian because their cocoa comes from Africa. Across the rest of Europe, Baci are still marketed as “the true Italian chocolates.”

The chocolate production line at Baci, in Perugina, Italy.

The chocolate production line at Baci, in Perugina, Italy. Photo: Baci Perugina

These new barriers are overturning a generation of moves toward trade liberalization—and driving countries further away from a well-functioning common market. Trade hurdles increase the cost of existing and potential new businesses, disrupt cross-border supply chains and discourage multinational investments.

“Sometimes, the local measures taken for naive reasons create lots of unintended consequences,” says Marco Settembri, the chief executive of Nestlé SA in Europe, the Middle East and North Africa (Nestlé makes Baci). He worries that political leaders take the single market for granted.

Europe’s single market is one of the most significant postwar economic achievements, and it celebrates its 25th anniversary in January. It began one year before the North American Free Trade Agreement, which President Donald Trump is attempting to renegotiate. Products, services, labor and capital freely move across Europe, which, with more than 500 million consumers, would be the world’s largest economy by output and demand.

In practice, implementation in each of these areas has varied widely, with goods—until recently—moving mostly freely and services less so.

Many economists say standardization fostered by the EU has lowered costs for producers and consumers alike. Labor unions and small businesses counter that it bestows overwhelming advantages on corporate behemoths.

The EU rode out a string of recent crises more resiliently than even optimists had predicted a year ago. A debt crisis, a wave of migrants, the U.K.’s decision to quit the bloc and the popularity of anti-EU politicians have only dented the EU so far, while stiffening the resolve of many EU supporters.

In many ways, though, the single market remains a work in progress, partly because national regulations vary from country to country. Not all EU rules are translated into national laws, some rules can be interpreted differently and the EU’s single-market rules are enforced less strictly than its competition rules.

That is one explanation for the new proliferating trade barriers. Last year, the European Commission, the EU’s executive arm, launched more than three times as many legal actions against alleged violations of single-market rules compared with 2015.

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After Doug Jones’s win, here’s what Democrats need to do to retake the Senate in 2018 – Andrew Prokop Dec 13, 2017, 2:05pm EST


If they hold all their own seats (which won’t be easy), they need to pick up two more.

Tom Williams/CQ Roll Call/Getty

Just a few months ago, practically no one would have predicted that Democrats would pick up a US Senate seat in the Alabama special election. But they did with Doug Jones’s victory Tuesday — and their chances for retaking the chamber next year have dramatically improved.

It’s long been very difficult to plot a plausible path to a Democratic Senate takeover in 2018, since the party faces such a disadvantage in the map. Democrats have needed to gain, on net, three seats. Assuming they defend all 26 of their own that are up (no easy task), there are then two Republican-held seats — Nevada and Arizona — that have seemed seriously in play.

But the other six Republican seats up next year have long seemed like long shots — meaning it was difficult to envision where Democrats could pick up that elusive third GOP-controlled seat. Not anymore, though — as former Obama administration staffer Matthew Miller tweeted after Jones won, the magic number for the party is now down to two:

The Alabama result also serves as a reminder that seemingly uncompetitive races can, under certain circumstances, tighten up. A divisive GOP primary ended in the controversial Moore defeating the party establishment’s preferred candidate. The race was closer than expected even before Moore was accused of sexually assaulting two teenagers last month; after it, Jones got enough of a boost to win.

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Mountain: a movie that reaches new peaks of cinematography – Ed Douglas Wednesday 13 December 2017 17.14 GMT


The world’s high places are having a moment. Not only is there a minor publishing boom in books about our fascination with mountains, there have been some dramatic films too, partly driven by advances in technology that allow us to get intimate with these rugged landscapes in ways we never have before. In the wake of Baltasar Kormákur’s Everest and the documentary Meru, both released in 2015, comes Mountain, an exploration of our modern fascination with the world’s orogenic zones.

It is a dizzying experience. Mountain brings together some of the strongest adventure sport cinematography of recent years, ricocheting around the planet, from Nepal to New Zealand and Austria to Antarctica, in an exhilarating game of vertical pinball. Few of these locations are identified. It’s the physical beauty of mountains that are explored here – not their actual locations. The adventurers appearing in the film aren’t identified either, nor is what they do set in context. We are left to marvel at what the outliers of our species are capable of achieving.

Mountain is Australian director Jennifer Peedom’s follow-up to the much grittier, Bafta-nominated Sherpa, which was all about disadvantaged mountain people taking excessive risks on Everest while working for wealthy foreign tourists. I worked as a consultant on that film and was struck by Peedom’s determination, working and living at over 5,000 metres, to cover every angle of a complex story and her sensitivity to the subject. I also admired her secret weapon on that project, the American film-maker and climber Renan Ozturk.

Ozturk is also the visual lynchpin of Mountain. He shot most of the arresting sequences in the film, some drawn from his earlier work on landmark adventure documentaries such as Meru and the Last Honey Hunter. If you’ve been at one of the increasing number of mountain film festivals in recent years, you will recognise some of these scenes. If you haven’t, prepare to be amazed. The opening sequence is Ozturk’s work, showing his friend Alex Honnold, the most famous solo climber in history, perched on his toes hundreds of feet up El Potrero Chico, a limestone cliff in Mexico, with no rope to break his fall, casually shaking out both arms at the same time. It’s enough to make your palms sweat.

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Tencent Music Drowns Out Spotify and Apple in China More stories by Lulu Yilun Chen – December 13, 2017, 1:30 PM PST


One of China’s most-anticipated initial public offerings next year may be music to the ears of Tencent Holdings Ltd. investors because of its potential to drown out any noise Spotify and Apple Music want to make in the biggest market.

Tencent Music, a streaming and downloading service, is expected to raise at least $1 billion and is valued at $10 billion, people familiar with the matter have said, with no decision yet on which exchange it would list on. Underpinned by three separate platforms, Tencent Music already has twice as many paying customers as Spotify Ltd.

Asia’s biggest internet company wants to capitalize on digital-music sales in mainland China that are expected to surge 88 percent within four years, according to PricewaterhouseCoopers. Apple Music debuted in 2015, yet most smartphones bought in China use the Android operating system, and Spotify hasn’t announced plans to expand there.

Tencent also has the advantage of an octopus-like business where one arm — music sales and streaming — can benefit from others such as the WeChat messaging app, a video-streaming site, a karaoke app and content-licensing deals with more than 200 international and domestic record companies.

“Tencent Music has a dominant status in China,” said Li Yujie, an analyst with RHB Research Institute Sdn in Hong Kong. “It would make sense to spin off the unit, allowing it to create strategic alliances and unlock value for investors. It could be one of the most-anticipated IPOs next year.”

The service offers more than 17 million songs to 700 million monthly active users, said Andy Ng, vice president for Tencent Music. About 120 million people have paid to stream or buy music, compared with Spotify’s 60 million paid users.

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AS TRUMP BLOCKS REFUGEES, AFRICANS FLEEING VIOLENCE MAKE THE TREACHEROUS TRIP TO THE U.S. THROUGH MEXICO- Molly O’Toole December 13 2017


THE HOSTEL IN Tapachula looked at first like any other border town flophouse. Dark back rooms with naked mattresses. Dust unspooling in the sunlit lobby. A bird cage under a dirty towel. A few tenants hung out over smartphones, skin slick in the thick air of southernmost Mexico. Then a young woman in a black hijab passed through.

“Salam alaikum,” she said, exchanging greetings with a Somali student who’d folded himself onto a small bench in the lobby. Her long skirt disappeared around the corner.

The student chose the pseudonym Ahmed Ali Hassan, the Somali equivalent of anonymity, and kept his voice low. He was 24, and the hostel’s other guests were mostly young African men like him.

Another Somali sat down next to Hassan, warning that my colleague and I could be spies. The month before, American voters had elected Donald Trump, who campaigned on suspicion of refugees and Somalis in particular. Now they had their own.\

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Republican civil war erupts anew – By ELIANA JOHNSON and ALEX ISENSTADT 12/13/2017 06:39 PM EST


Roy Moore’s loss has the Bannon and McConnell wings of the GOP heaping blame on one another, with no signs of a resolution.

Democrat Doug Jones’ victory in Alabama — far from settling the score between the McConnell and Bannon wings of the Republican Party — instead touched off another round of internecine GOP infighting over who’s to blame for the party’s loss in one of the most conservative states in the country.

From the outset, the race served as a proxy war between the tight-lipped Senate Majority Leader Mitch McConnell, a paragon of the party establishment, and Steve Bannon, the former White House chief strategist who has dedicated himself to disrupting everything McConnell represents.

Now, both sides are blaming the other for Tuesday’s loss, with each painting the results as a case study in the other’s political ineptitude. Bannon has argued from the outset that Republican leaders have positioned themselves against the president, determined to thwart his agenda. But McConnell and his allies are using Tuesday’s results to tell the president — whom Bannon helped to cajole into the race on Moore’s behalf — that his former chief strategist is a political liability.

Jones’ victory “unmasked Steve Bannon’s incompetence,” said Josh Holmes, a former McConnell chief of staff and top political adviser. “What has been exposed here is that Steve Bannon has been the most harmful person to the Trump presidency in all of politics — Republican or Democrat.”

Karl Rove told Fox News that Bannon, despite the hype about his political genius, did little more in Alabama than rant and rave “about the so-called establishment in Washington. Not a winning message.”

Bannon, naturally, is unbowed, refusing to take any responsibility for ceding what looked like an impossible-to-lose seat in the Deep South. He has told associates that the Alabama results are a case study in McConnell’s malpractice.

“Team Mitch did everything in their power to endanger our majority in the Senate and threaten the passage of the Trump agenda by ensuring the outcome that we saw last night,” said Andy Surabian, a spokesman for Bannon, who went on to accuse the Senate majority leader of gloating “about the fact that the Republican nominee in Alabama was defeated.”

Prior to the election, McConnell told associates that he wanted to destroy Bannon politically, according to one person familiar with the Republican leader’s thinking. Their goal: to curtail his influence ahead of the 2018 midterms, in which Bannon has vowed to recruit candidates to knock off McConnell-backed incumbents.

Bannon is supporting Danny Tarkanian, who has vowed to unseat Nevada’s Republican senator, Dean Heller, as well as former New York congressman and ex-convict Michael Grimm, who is trying to recapture his old House seat.

McConnell hopes Tuesday’s outcome will put a dent in those efforts. His allies argue that Bannon is a charlatan — a man who has sold himself to the president as the guru of the Trump movement who possesses a preternatural understanding of the president’s political base only to drive the president into a ditch in Alabama.

“Bannon hurt Trump by giving him poor advice,” said Scott Reed, a political strategist for the U.S. Chamber of Commerce. The results in Alabama, Reed said, “hurt the Trump movement.”

The face-off over the Alabama race is the latest iteration of the bitter infighting that has dominated the Republican Party since the rise of the Tea Party in 2010, and that reached an apex last year with the election of Donald Trump, a Bannon-backed outsider loathed by politicians in both parties.

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