Pakistan’s fresh £580m loan from China intensifies debt burden fears

Loan is on top of £25bn that cash-strapped Islamabad already owes Beijing and Chinese commercial banks

China has agreed to loan Pakistan $700m (£580m) to help it weather its worst economic crisis in a generation, in a development that will intensify concern among western countries about cash-strapped Islamabad’s debt burden to Beijing.

The loan comes on top of $30bn (£25bn) that Pakistan already owes China and Chinese commercial banks. Securing the financing will help to unlock bailout cash from the International Monetary Fund (IMF).

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Hedge funds holding up vital debt relief for crisis-hit Sri Lanka, warn economists

Exclusive: 182 experts say only debt cancellation offers chance of recovery but private investors are playing hardball

Some of the world’s most powerful hedge funds and other investors are holding up vital help for crisis-hit Sri Lanka by their hardline stance in debt-relief negotiations after the Asian country’s $51bn (£42bn) default last year, according to 182 economists and development experts from around the world.

In a statement released to the Guardian on Sunday, the group said extensive debt cancellation was needed to give the economy a chance of recovery and that Sri Lanka would be a test case of the willingness of the international community to tackle a looming global debt crisis.

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China’s screeching U-turn on Covid will not be an instant fix

If Beijing is expecting an immediate boost from abandoning its tough controls it is mistaken

From zero tolerance to “let it rip”. China has not just changed its mind on how to cope with Covid, it has executed the mother of all U-turns in response to slower growth and mounting civil unrest at the draconian lockdowns.

If Beijing is expecting an immediate economic boost from abandoning its tough controls it is mistaken. There will be a growth dividend from the policy shift but the state of the world’s second biggest economy will get worse before it gets better, and it will be next spring at least before the easing of restrictions starts to pay off.

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Economists hail end to zero Covid in China but huge human toll is feared

Low rate of vaccination of elderly and a lack of natural immunity mean country may be in for a bumpy ride

Beijing’s abrupt dismantling of zero-Covid controls has been welcomed by economists, even as the country braces itself for the human impact of letting the disease spread through a vulnerable population.

The leadership’s abrupt U-turn on how it handles the pandemic appears to have been triggered by protests against controls that began last month, a nationwide show of discontent on a scale China had not seen in decades.

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Without effective vaccines, China’s economy may not heal

Changes to zero-Covid policy could prove insufficient if lockdowns are expected to continue

China’s nearly three-year policy of enacting strict lockdowns to contain outbreaks of Covid-19 came with a heavy price for the world’s second largest economy.

The question for its president, Xi Jinping, and his inner court of advisers is whether a sudden relaxation of lockdown rules brought in this week will both prevent a recurrence of the shockwave of protests across the country and turn the economy around.

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Markets optimistic as China eases Covid rules, but experts warn of danger ahead

Amid signs that supply chain woes are improving, economists remain uncertain that China is ready to live with Covid

Global shares and the price of some key commodities have risen on hopes that the easing of China’s strict zero-Covid measures would help to bring down inflation, even as some experts warned that the country was not prepared to live with the disease.

China’s government on Wednesday announced a significant shift towards living with the virus. People with Covid-19 who have mild or no symptoms can quarantine at home, while officials have been instructed to stop launching temporary lockdowns. Testing will no longer be required for “cross-regional migrants”.

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Zero-Covid: five charts that show how restrictions are throttling the Chinese economy

Three years into the pandemic, China is still relying on snap lockdowns and mass testing – and that could spell trouble for the global economy

Protests against pandemic restrictions in China could unleash a new wave of volatility into a global economy already racked by inflation, energy shocks and the war in Ukraine.

The government’s continued reliance on lockdowns, quarantine orders and mass testing to limit the spread of the virus has provoked the biggest protest movement in decades. But there’s little evidence that authorities are willing to diverge from the path they have taken.

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New Zealand, particularly vulnerable to a housing crash, tightens its belt as rates soar

New Zealand’s reserve bank delivered its largest rate hike in history on Wednesday, piling pressure on the country’s homeowners

Rosie Smyth and Richard Larsen, along with their toddler daughter, had spent years looking for an affordable home in Lyttelton, a small port town at the edge of Christchurch where Smyth grew up.

They were hunting in the midst of New Zealand’s housing affordability crisis, when prices rose to nearly nine times the average income. The market had a frenetic quality – every month seemed to bring a new rise, and with it the feeling, Smyth says, that if you didn’t get in now, prices could permanently dance out of reach.

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New Zealand forecasts recession in 2023 as it delivers largest rate hike in history

New Zealand’s reserve bank says spending levels still need to be reduced with rate rises, in order to tame inflation

New Zealand’s reserve bank has forecast that the country will tip into recession in 2023, and has lifted the official cash rate by an unprecedented 75 basis points, to 4.25%.

The cash rate hike, announced on Wednesday, is the largest in the central bank’s history, and comes as it attempts to rein in New Zealand’s 7.2% inflation rate.

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G20’s dysfunctional family show little sign of working together in a crisis

Communique unlikely to stretch beyond usual platitudes despite the need for a global plan for recovery

The Cambodian prime minister, Hun Sen, was struck down by Covid, the Argentinian prime minister, Alberto Fernández, had gastroenteritis and the Russian foreign minister, Sergei Lavrov, either did or did not have chest pains that sent him to hospital. Given that Indonesia’s G20 slogan plastered all around Bali says: “Recover Together, Recover Stronger”, it was not an auspicious performance by the world’s leaders.

Unfortunately, there is precious little sign of recovery at the G20, either at a political or economic level.

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China economy grows faster than expected, but falls short of targets as risks loom

GDP rose 3.9% in the July to September quarter, but China remains on track to deliver among weakest growth in almost four decades

China’s economy expanded faster than economists expected in the September quarter but the poor performance of the nation’s property market and weak retail and import data underscored the nation’s ongoing growth challenges.

China, the world’s second-largest economy, posted a 3.9% increase in gross domestic product in the July-September period from a year earlier, the national bureau of statistics said.

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India is quietly laying claim to economic superpower status

India recently overtook UK as the world’s fifth biggest economy – and it could be third by 2030

The rise of China has been the biggest story in the global economy in recent decades. But amid concern about its stumbling property market and global fears about inflation, the emergence of its neighbour, India, as a potential new economic superpower may be going under the radar.

You won’t find mention of it in Liz Truss’s blueprint for a “modern brilliant Britain”, but the UK has just been overtaken by India as the world’s fifth biggest economy. The nation of 1.4 billion people is on track to move into third place behind the US and China by 2030, according to economists.

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IMF offers Sri Lanka provisional $2.9bn loan to tackle debt crisis

Funding still needs to be approved but could offer breathing space amid country’s economic turmoil

The International Monetary Fund has tentatively offered Sri Lanka a $2.9bn (£2.5bn) loan to help the country recover from the worst economic crisis since it gained independence from Britain in 1948.

The funding is meant to provide some breathing space for Sri Lanka, which is scrambling to restructure nearly $30bn in debt to creditors including China, India and a string of international banks.

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Burn out: Inside the 2 September Guardian Weekly

On the frontline of Britain’s energy bills crisis. Plus: Visions of outer space
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The spiralling cost of living has been an increasingly urgent problem in the UK. But for many people, huge rises in energy bills are about to turn a difficult situation into an impossible one.

The squeeze on European gas supplies, largely as a consequence of Vladimir Putin’s war in Ukraine, has led to a near-doubling of prices in the UK, with even worse predicted for next year. Political inertia, caused by a lengthy Conservative leadership contest, has only added to a deepening sense of national frustration.

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China’s export sector posts stronger than expected figures for July

Outbound shipments grew 18% after struggle with shortages of raw materials and lockdowns in first half of year

China’s export industries performed strongly last month after spending the first half of the year hampered by shortages of raw materials and pandemic-related lockdowns at major ports.

Offering an encouraging boost to the economy, outbound shipments grew 18% in July from a year earlier, the fastest pace this year, official customs data showed on Sunday, beating analysts’ expectations for a 15% gain, though imports remained sluggish.

Analysts had expected exports to fade amid growing signs that Europe, the US, UK and Australia are heading for recession, dampening the outlook for global consumption.

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