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Freeman H. Shen, Founder, Chairman & CEO of WM Motor, speaks during Fireside Chat on Day 2 of CNBC East Tech West at LN Garden Hotel Nansha Guangzhou on November 28, 2018 in Nansha, Guangzhou, China. 

Dave Zhong/Getty Images for CNBC International

Freeman H. Shen, Founder, Chairman & CEO of WM Motor, speaks during Fireside Chat on Day 2 of CNBC East Tech West at LN Garden Hotel Nansha Guangzhou on November 28, 2018 in Nansha, Guangzhou, China. 

Several Chinese auto and transportation industry leaders are preparing for a future in which people share cars, rather than own them individually.

“(The new generation), they’re not interested in the ownership. They’re probably more interested in accessibility,” Freeman Shen, founder and CEO of Chinese electric car company WM Motor, said last week at CNBC’s East Tech West conference in the Nansha district of Guangzhou, China.

Technological advances in the last several years have aided the rise of multibillion-dollar ride-hailing giants such as Uber and Didi. They, in turn, have challenged the traditional taxi driver system and cultivated a habit of on-demand car services for tens of millions of users globally despite ongoing safety concerns. Traditional automakers, many already trying to navigate rising interest in the electric vehicle market, are paying close attention to the ride sharing trend. Notably, General Motors is testing the waters with its own rental program.

In China, Feng Xing Ya, general manager of Guangzhou-based automaker GAC, also said the future of the auto industry lies in car sharing.

“(It’s) a challenge for the auto industry because people may buy fewer cars,” Feng said in Mandarin, according to a CNBC translation, during a Nov. 27 conference session.

Without giving much detail on a plan, Feng said he favored a strategy of entering — rather than avoiding — the car sharing economy, which he said can still generate a lot of income for a company.

However, such a rapid change in consumer tastes could give start-ups an advantage.

Shen, formerly a director at Fiat Chrysler and Chinese automaker Geely, said traditional automakers are too focused on selling cars rather than improving user experiences. He said his company’s focus on software and newness to the market means he has everything to gain and little to lose from a shift to ride sharing.

Shen founded WM Motor — which stands for “world champion” in German — in 2015 and the company has received more than $1 billion in funding, according to Crunchbase.

The rise of car sharing may also lead to new kinds of living environments in China as Beijing tries to encourage technological and urban developments through “smart cities.”

“If we can allocate the seats instead of vehicles … then we can use the transportation system more efficiently,” Henry Liu, vice president, chief scientist of smart transportation at Didi, said during a conference session.

“If you think about the future city, I think the future city will have much less in terms of parking spaces, road spaces, because we don’t really need that much of spaces for vehicles,” Liu said. “At that moment, I think we have an autonomous vehicle fleet. And they can serve the transportation demand.”

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Progress reported in race to find vaccine for African swine fever

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The race is underway to find a vaccine that can control African swine fever, a highly contagious and deadly viral infection ravaging China’s hog population. No treatment or effective vaccine is available for the swine fever, but some encouraging news was reported this week.

A government-run research facility in China developed two vaccine candidates that were proven in laboratory tests to provide immunity to the deadly pig disease, Reuters said Friday, citing a report originally from Beijing state media. The report also offered promise given clinical trials are planned.

“In the next step, the Chinese Academy of Agricultural Sciences will accelerate the progress of pilot and clinical trials, as well as vaccine production,” said the report, based on an online posting by China National Radio.

Beijing hasn’t divulged the exact number of hogs lost to swine fever, but Rabobank last month estimated up to 200 million animals could be affected and production could decline by 30%. That compares with about 75 million hogs and pigs in the total U.S. inventory.

Outbreaks of African swine fever also have been reported in other Asian countries, including Vietnam, Cambodia and Mongolia, as well as in Europe and Africa, where it was first identified more than a century ago. It comes amid worries the swine disease could reach the U.S. and cause significant economic impacts and the loss of exports.

Last week, the U.S. Department of Agriculture announced it also developed a new “surveillance plan.” The plan includes the testing of “high-risk animals,” such as sick or dead pigs as well as herds exposed to feral swine or garbage eating. Experts say the swine fever doesn’t pose a risk to humans.

USDA scientists also are intensifying research on a vaccine for African swine fever. Three gene-edited vaccine candidates have been developed so far by USDA scientists.

Manuel Borca, the lead scientist in the USDA’s Foreign Animal Disease unit at Plum Island Animal Disease Center in New York, said all three of the vaccine candidates are based on the most prevalent African swine fever strain currently circulating in Europe and Asia. Two candidates, though, are being modified further so that researchers will be able to distinguish between infected pigs and vaccinated animals.

Even as vaccine candidates continue to be evaluated, the federal government is beginning collaborations with vaccine manufacturers, according to USDA scientist Luis Rodriguez, the research leader at the Foreign Animal Disease unit. He said the goal is “to fully develop a vaccine that is safe, efficacious and allows differentiating vaccinated from infected animals (a key feature during disease eradication programs).”

Rodriguez estimates the timeline for the full development of vaccine candidates will take years and hinge on many factors, including the availability of a large-scale manufacturing process as well as confirmation of efficacy in field vaccine trials.

In Spain, meantime, scientists have reported progress toward an oral vaccine for wild boars, according to a study published last month in Frontiers in Veterinary Science. They found that a strain of the African swine fever virus protected 92% of orally vaccinated animals.

“Our observation that three wild boar were immunized through contact indicates that orally vaccinated animals can shed [the] vaccine virus,” according to the study, done under the direction of Jose Manuel Sanchez-Vizcaino, a professor in animal science at the University of Madrid. He wasn’t available for an interview for this story.

The testing on wild boars is seen as significant because movements of disease-carrying wild hogs have contributed to the spread of African swine fever in the Baltic and Eastern Europe region. Also, there’s always a risk of virus transmission to domestic pig herds.

According to the study, “this protection translated not only to animal survival but also to the absence of ASF-compatible clinical signs, pathological findings, and virus detection in target tissues.”

But some scientists caution against too much optimism.

“Theoretically, the vaccine could work as well for commercial pigs,” said Paul Sundberg, a veterinarian and executive vice president of the Iowa-based Swine Health Information Center. “There are issues with that vaccine, however, that I don’t think you’ll see it being used either in wild boar or certainly not in commercial pigs in the near future.”

Sundberg said there are more than 20 different strains of African swine fever and that what works in wild boars may not be effective and safe in domestic pigs. Moreover, there’s a risk the virus used in the vaccine could mutate, become virulent and cause a more severe strain.

As for China, Sundberg raised concerns that Beijing’s desperate effort to halt the spread of African swine fever in its pig population could involve risky or dangerous research in the laboratory.

“It’s an attempt to find something to stop this virus,” he said. “That attempt in itself can be very dangerous, because it might propagate the virus, that might perpetuate the virus, and that might ensure that it becomes endemic.”

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Dow rises nearly 100 points, but posts longest weekly losing streak since 2011

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Stocks rose on Friday, but notched weekly losses as investors worried the U.S.-China trade war is hurting economic growth.

The Dow Jones Industrial Average ended the day up 95.22 points at 25,585.69 while the S&P 500 climbed 0.1% to 2,826.06. The Nasdaq Composite rose 0.1% at 7,637.01. The indexes rebounded slightly from sharp losses on Thursday after President Donald Trump said Thursday afternoon the ongoing trade war could be over quickly.

“We still think the negotiators are going to reach a deal, but it’s clearly going to take a lot longer and be more difficult than investors thought a few weeks ago,” said Kate Warne, investment strategist at Edward Jones. “But any glimmer of hope that progress is being made will help stocks rebound.”

But Friday’s gains were not enough to offset this week’s losses. The Dow dropped 0.7% this week to post its fifth consecutive weekly decline, its longest streak since 2011. The S&P 500 and Nasdaq fell a third straight week of losses, their longest slide since December 2018. The weekly losses come at a time when investors are growing more convinced that the trade war will take longer than expected to conclude and could hurt the economy.

U.S. durable goods orders dropped 2.1% last month amid a slowdown in exports and a buildup in inventories. This is the latest economic data set showing cracks in the economy while the world’s largest economies engage in a trade war. IHS Markit said Thursday that U.S. manufacturing activity fell to a nine-year low.

Traders work on the floor of the New York Stock Exchange (NYSE) on May 03, 2019 in New York City.

Spencer Platt | Getty Images

Crude prices dropped 6.6% this week as trade worries spilled over to other markets. Investors also loaded up on Treasurys this week. On Thursday, the 10-year Treasury note yield fell to its lowest level since October 2017.

“It seems, for the moment, [trade] is the only thing investors are thinking about,” said Mike Bailey, director of research at FBB Capital Partners. “You’ve got this one narrow issue that’s basically spreading across the entire market.”

“Investors had been hoping for more certainty,” Bailey said. “Instead, they’re getting more uncertainty across the board.”

Energy and tech were the worst-performing sectors for the week. The energy sector fell 3.4% while tech — the largest S&P 500 sector by market weight — lost 2.8%.

Chipmakers led tech down this week as the VanEck Vectors Semiconductor ETF (SMH) dropped 5.6%. Qualcomm and Broadcom were the worst-performers in the ETF this week, dropping 18.8% and 11.7%, respectively.

Chip stocks have been under pressure as the U.S. increases pressure on Chinese telecom giant Huawei. Last week, the Trump administration made it harder for U.S. companies to do business with Huawei, before granting a temporary 90-day reprieve for the company.

Apple shares also contributed to the tech losses as several analysts raised concern over the company’s exposure to China. The stock ended the week down 5.3%.

“The growing worries around a US/China elongated trade battle and its implications on the tech space are heavily weighing on the minds of both investors and the companies themselves caught in the cross hairs,” Dan Ives, analyst at Wedbush Securities, wrote in a note to clients. “The ‘poster child’ for the US/China trade wars continue to be Apple with the stock under heavy pressure as many competitors are yelling fire in a crowded theater around the potential China impact to Cupertino if this situation worsens.”

—CNBC’s Silvia Amaro contributed to this report.

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Trump approves arms deals to Saudi Arabia, UAE amid Iran tensions

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U.S. Army infantryman fires a Javelin shoulder-fired anti-tank missile during a combined arms live fire exercise as part of Exercise Eastern Action 2019 at Al-Ghalail Range in Qatar, Nov. 14, 2018.

US Army photo

WASHINGTON — The Trump administration on Friday invoked a rarely used provision in federal law to bypass congressional review of arms sales to Saudi Arabia, citing threats the kingdom faces from Iran.

Secretary of State Mike Pompeo notified Congress of the decision to use an emergency loophole in the Arms Export Control Act to move ahead with sales of $7 billion in precision guided munitions, other bombs and ammunition and aircraft maintenance support to Saudi Arabia, along with the United Arab Emirates and Jordan, without lawmakers’ approval.

In his notification, Pompeo said he had made the determination “that an emergency exists which requires the immediate sale” of the weapons “in order to deter further the malign influence of the government of Iran throughout the Middle East region.” He said the transfers “must occur as quickly as possible in order to deter further Iranian adventurism in the Gulf and throughout the Middle East.”

Pompeo’s move follows President Donald Trump’s announcement that the U.S. plans to send 1,500 additional troops to the Middle East as part of a build-up in response to an unspecified threat from Iran.

It also comes as the administration has actively courted close ties with Saudi Arabia over congressional objections, notably following the killing of Jamal Khashoggi , a U.S.-based columnist for The Washington Post, by Saudi agents in October.

Khashoggi’s slaying, coupled with increasing concerns about civilian casualties resulting from a Saudi-led coalition’s military operation against Iran-backed Houthi rebels in Yemen, prompted lawmakers to block about $2 billion in arms sales to the kingdom for more than a year. Last month, Trump vetoed legislation that would have ended U.S. military assistance for the Saudi-led war in Yemen.

Critics of the Saudi campaign quickly denounced Friday’s step.

Sen. Bob Menendez of New Jersey, the top Democrat on the Senate Foreign Relations Committee, said the administration did not cite a specific legal or practical reason for using the loophole other than Iran.

“I am disappointed, but not surprised, that the Trump administration has failed once again to prioritize our long term national security interests or stand up for human rights, and instead is granting favors to authoritarian countries like Saudi Arabia,” Menendez said in a statement.

Sen. Chris Murphy, D-Conn., who earlier this week warned against bypassing Congress, said the administration was only declaring an emergency because lawmakers would have blocked the transfers.

“President Trump is only using this loophole because he knows Congress would disapprove of this sale,” Murphy said. “There is no new ’emergency’ reason to sell bombs to the Saudis.”

U.S. President Donald Trump, speaks with Mohammed bin Salman, the Kingdom of Saudi Arabia’s deputy crown prince and minister of defense, left, in the Oval Office of the White House in Washington, D.C., U.S., on Tuesday, March 14, 2017.

Mark Wilson | Pool via Bloomberg

The law requires Congress to be notified of potential arms sales, giving the body the opportunity to block the sale. But the law also allows the president to waive that review process by declaring an emergency that requires the sale be made “in the national security interests of the United States.”

Menendez and Murphy said they would challenge the decision but it was not immediately clear how they might do that.

“With this move, the president is destroying the productive and decades-long working relationship on arms sales between the Congress and the executive branch,” Menendez said. “The possible consequences of this decision will ultimately threaten the ability of the U.S. defense industry to export arms in a manner that is both expeditious and responsible.”

The chairman of the Foreign Relations Committee, Republican Sen. Jim Risch of Idaho, said he was “reviewing and analyzing the legal justification for this action and the associated implications.”

There is precedent for using the emergency exemption for arms sales to Saudi Arabia. President Ronald Reagan invoked it in the 1980s and both Presidents George H.W. Bush and George W. Bush used it for sales before the 1991 Gulf War and the 2003 Iraq war.

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