South Korea awaits 2nd Kim-Trump summit with both hope and fear

SEOUL, SOUTH KOREA (NYTIMES) – If there is anyone keeping his fingers crossed for President Donald Trump and the North Korean leader Kim Jong Un to agree on how to denuclearise the North when they meet in Vietnam this month, it is President Moon Jae-in of South Korea.

With no quick fix available for South Korea’s stubborn economic troubles, Mr Moon’s best chance for reversing his falling approval ratings rests on whether he can jump-start his signature policy of helping advance the North’s denuclearisation and improving inter-Korean ties.

But that depends on Mr Trump and Mr Kim striking a denuclearisation deal when they meet on Feb 27-28 in Hanoi, the Vietnamese capital, that is significant enough for Washington and the United Nations to ease sanctions and create room for Mr Moon to push his ambitious plans for economic cooperation with North Korea.

“But if the second US-North Korea summit fails, there will be more criticism blaming President Moon,” said Dr Koh Yu-hwan, a professor of North Korean studies at Dongguk University in Seoul.

“There will be more critics accusing him of having been too optimistic and naïve, misreading North Korea’s intentions and misrepresenting them to the Americans.”

Since his election in 2017, Mr Moon has dedicated himself to mediating between Washington and Pyongyang, tirelessly selling Mr Trump on the merits of negotiating with Mr Kim.

In doing so, he has bet so heavily on Mr Trump and Mr Kim reaching a denuclearisation deal that his own political fortunes at home have become increasingly tied to the whims of the two unpredictable leaders.

Mr Moon’s approval ratings soared higher than 80 per cent last spring when he met Mr Kim twice on the inter-Korean border to help defuse a possible military confrontation between the United States and North Korea.

That set the stage for the historic June summit meeting between Mr Kim and Mr Trump in Singapore.

But Mr Moon’s ratings have since plummeted below 50 per cent amid stalled talks between Washington and Pyongyang over how to carry out the vague promise Mr Trump and Mr Kim made in Singapore to “work toward complete denuclearisation of the Korean Peninsula” and establish a permanent peace between their countries.

Mr Moon flew to Pyongyang in September to meet Mr Kim again to break the logjam between Washington and Pyongyang.

But the deadlock remains, prompting Mr Moon’s critics to question whether he has oversold Mr Kim’s willingness to denuclearise.

When he met Mr Moon in September, Mr Kim promised to become the first North Korean leader to visit Seoul.

But with his negotiations with Washington stalled, the year ended without Mr Kim visiting as Mr Moon said he would, further raising doubts about Mr Moon’s influence over Mr Kim.

While Mr Moon remained preoccupied with North Korea, domestic affairs turned against him.

The popularity of his governing Democratic Party has plunged as its politicians have been tainted by #MeToo accusations and other scandals.

South Koreans in their 20s, a traditional support base for progressives like Mr Moon, have been fast losing faith in his government because of his inability to create more jobs, according to the polling company Realmeter.

Older, more conservative South Koreans have rallied in central Seoul almost every weekend in recent months, criticising as dangerous Mr Moon’s economic policies and his rapprochement efforts with the North.

But Mr Moon remains convinced that Mr Trump’s strong desire to achieve something none of his predecessors could accomplish – ending the North Korean nuclear crisis – and Mr Kim’s desperate need to improve his country’s economy can create a singular opportunity for both Koreas.

Mr Trump and Mr Kim, he says, can denuclearise the Korean Peninsula and end the tensions there, opening the way for economically integrating the impoverished North, with its cheap labour, and the South, whose slowing economy needs a new source of growth.

“We have never had an opportunity like this since the Korean War ended in an armistice in 1953, and we should not miss it because it will never come again,” Mr Moon said last month.

Long-time North Korea observers saw the current stalemate coming when Mr Trump and Mr Kim ended their Singapore meeting without sorting out key details, especially what is meant by the “complete denuclearisation of the Korean Peninsula”.

In the past, the North used that term when it argued that it would give up its nuclear weapons only when the United States ceased hostilities, including ending its military presence in South Korea.

Mr Moon says Mr Kim has made a strategic decision to give up his nuclear weapons in a “verifiable and irreversible way” and focus on rebuilding his country’s economy should Washington take corresponding actions, like easing sanctions, to prove that it is no longer hostile.

He also said last month that there was “no difference” between the United States and North Korean definitions of “complete denuclearisation”, saying it meant dismantling all North Korean nuclear weapons and fissile materials and their production facilities.

“First, we ought to take him at his word,” General Vincent Brooks, who retired as commander of the US military in South Korea in November, told PBS NewsHour last month, referring to Mr Kim.

“And that’s not an easy thing to accept, especially given the track record of North Korea. But this is a new leader in North Korea.”

Mr Trump, who in 2017 threatened to unleash “fire and fury” against North Korea and derided Mr Kim as “Little Rocket Man” because of his provocative missile tests, now promises to help rebuild the country’s economy if it denuclearises.

“North Korea will become a different kind of rocket – an economic one!” he said on Twitter this month.

But last month, Mr Trump’s director of national intelligence, Mr Dan Coats, told Congress that North Korea was “unlikely to completely give up its nuclear weapons and production capability because its leaders ultimately view nuclear weapons as critical to regime survival”.

Nevertheless, Washington’s special representative for North Korea, Mr Stephen Biegun, spent three days in Pyongyang this month exchanging “detailed and exhaustive” lists of what the two governments wanted from each other to make denuclearisation possible, said Mr Kim Eui-kyeom, Mr Moon’s spokesman, after Mr Biegun briefed South Korean officials on his trip.

But with the Hanoi summit meeting less than a week away, South Korean officials said, the two sides are still bargaining to settle the hardest part of their negotiations: figuring out what specific actions they could take in order to start denuclearisation.

All this makes the Hanoi meeting as much a gamble for Mr Moon as for Mr Trump and Mr Kim.

Unlike Mr Kim, who has hedged his bets by improving ties with China, Mr Moon has put all his eggs in Mr Trump’s basket, analysts said.

“Presidents Moon and Trump are in the same boat on this,” said Mr Kim Sung-han, a former vice foreign minister of South Korea who teaches at Korea University in Seoul.

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Fed eyes end to balance sheet reductions later this year

NEW YORK/SAN FRANCISCO (Reuters) – Federal Reserve policymakers are coalescing around a plan to stop trimming their $4 trillion balance sheet later this year, remarks from three U.S. central bankers showed on Friday.

And despite apparently competing views on why they need a balance sheet permanently bigger than what they had envisioned only a few months ago, they also agree on a secondary aim: to make the Fed’s balance sheet boring again.

“When we started the normalization journey, I promised that it would be the policy equivalent of watching paint dry — and it certainly was, for over a year,” Philadelphia Fed President Patrick Harker told a monetary policy conference in New York. “Yet despite laying out a gradual, predictable path, and communicating that path with regularity, the recent interest in the subject makes me wonder if I’ve underestimated the allure of dried paint.”

Indeed. Investors have in recent months complained that financial conditions are tightening because of the Fed’s gradual reductions to its balance sheet, swollen from trillions of dollars of bond-buying in the post-crisis years.

The reductions are capped at $50 billion a month, a level that Harker and other Fed officials believed would have little effect on markets or the economy.

But even U.S. President Donald Trump was critical, calling on the Fed in a tweet in December to “Stop with the 50 B’s.”

Minutes of the Fed’s January policy-setting meeting, released earlier this week, showed policymakers were well along in a debate over doing just that.

In remarks Friday, Harker said he had proposed ending the reductions to the Fed’s asset holdings later this year.

Federal Reserve Governor Randal Quarles said the Fed had discussed doing so “sometime in the latter half of this year.” He added that he favors a balance sheet big enough so that on most days banks would have plenty of reserves to manage their liquidity, with the Fed stepping in to add liquidity on “those few days” it might be needed.

But neither bought into the view that the need to stop reductions to the balance sheet has much to do with the economy. Both cast their support for a big balance sheet as a technical measure designed to allow financial markets and banks to function smoothly, rather than as any response to economic conditions.

Some Fed officials speaking in other venues have linked the balance sheet to the fate of the economy.

San Francisco Fed President Mary Daly said Thursday that the Fed’s balance sheet policy should not work at “cross purposes” with interest rate policy, now on hold as the Fed assesses whether the economy is strong enough to withstand further tightening.

Speaking in New York on Friday, St. Louis Fed President James Bullard took aim directly at the view that shrinking the Fed’s balance sheet has any impact on the economy. He said his analysis shows that the Fed’s bond holdings only impact the economy when interest rates are near zero, and that the impact of a shrinking balance sheet, with rates now between 2 percent and 2.5 percent, is relatively minor.

“Balance sheet policy may be less important today than it was during the heyday of QE,” Bullard said, referring to the central bank tool of bond buying, known as quantitative easing.

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US seeks to recover US$38 million in assets from 1MDB case

WASHINGTON (REUTERS) – The US Justice Department on Friday (Feb 22) said it had filed complaints seeking forfeiture and recovery of approximately US$38 million (S$51 million) in assets associated with its 1Malaysia Development Berhard – or 1MDB – case, bringing the assets now subject to forfeiture to a total of about US$1.7 billion.

“These new lawsuits target assets collected by corrupt officials and their associates through a massive scheme that stole billions of dollars from the people of Malaysia and laundered the proceeds across the world,” US Attorney Nick Hanna said in a statement.

The complaints filed on Friday in California involve luxury real estate in London and New York, as well as converted equity in a Kentucky facilities management company, and are tied to 2012 and 2013 bond offerings from the sovereign wealth fund, the department said.

Earlier this week, Malaysia’s home minister said the country may postpone the extradition of a former Goldman Sachs Group banker wanted in the multibillion-dollar scandal so he can face criminal charges in the Southeast Asian nation first.

The department has estimated that a total of US$4.5 billion was misappropriated by high-level 1MDB fund officials and their associates between 2009 and 2014, including some funds that Goldman Sachs helped raise as underwriter and arranger of three bond sales totaling US$6.5 billion.

Goldman has consistently denied wrongdoing and said certain members of the former Malaysian government and 1MDB lied to it about the bond sale proceeds.

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Left-turning driver v right-turning motorcyclist: Who's right?

SINGAPORE – A video of a left-turning driver getting into an argument with a right-turning motorcyclist has attracted nearly two thousand comments, with netizens debating who is in the wrong.

Titled “Am I right or wrong?”, the minute-long video uploaded onto the Roads.sg Facebook group on Thursday (Feb 21), shows the perspective of a driver initially in the first lane, on a road at the Bugis area.

After turning, he goes to the middle lane, after which a motorcyclist comes up from behind, gesturing angrily.

The driver is then heard sounding his horn and appears to lower his window as he argues with the motorcyclist, with each of them saying they had the right of way.

The video has since gotten more than 1,800 comments and has been viewed more than 161,000 times.

Netizens are divided about whether the driver had the right of way to turn into the middle lane.

Singapore Road Safety Council chairman Bernard Tay told The Straits Times that it was difficult for him to assess who was right from the video, as the camera was only facing the front and there was no way to know what driving conditions were like.

But Mr Tay said that generally, the rule is that motorists who are turning should keep to their lane for safety reasons.

“When you turn into the first lane, you keep to the first lane. Then if you want to go to the second lane, you must make sure that there is no vehicle in front or behind you. You signal, you check, and then you turn,” he said.

“Crossing into another lane is dangerous and could cause accidents.”

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'Don't mess with Pakistan', India is told amid Kashmir tension

RAWALPINDI, PAKISTAN (REUTERS) – Pakistan will respond to any attack by India with “full force”, the army’s spokesman said on Friday (Feb 22) amid heightened tensions between the two nuclear-armed neighbours over Kashmir, as Islamabad said it took over the base of a militant group that claimed a deadly bombing in Kashmir.  

Army spokesman Major General Asif Ghafoor was speaking a week after a Pakistani-based militant group  Jaish-e-Mohammed  claimed responsibility for a suicide car bomb attack that killed 40 Indian paramilitary policemen the Himalayan region disputed between India and Pakistan.

Pakistan late on Friday announced a takeover of Jaish’s headquarters in a southern Punjab province district bordering India. 

Jaish, an Islamist jihadi group that fights for the independence of the disputed Kashmir region from India, has offices and infrastructure in Pakistan where its chief Maulana Masood Azhar is based. 

The authorities took over Jaish’s headquarters in Bahawalpur and appointed an administrator to look after its affairs, a government statement said. It said the headquarters and an attached seminary has 600 students and 70 teachers. 

India’s top military commander in the region has alleged Pakistan’s main Inter-Services Intelligence (ISI) spy agency was involved in the attack. 

“We have no intention to initiate war, but we will respond with full force to full spectrum threat that would surprise you,” Ghafoor told reporters in the garrison city of Rawalpindi.”Don’t mess with Pakistan.”

The army’s response came two days after Prime Minister Imran Khan urged India to share any actionable evidence, offering full cooperation in investigating the blast.

He also offered talks with India on all issues, including terrorism, which India has always sought as a pre-requisite to any dialogue between the two arch-rivals.

India and Pakistan have fought two wars since independence in 1947 over Kashmir, which both the countries claim entirely.

Ghafoor also reiterated the talks offer.

“Kashmir is a regional issue,” he said. “Let us talk about it. Let us resolve it.”

India blames Pakistani Islamist militant groups for infiltrating into its part of Kashmir to fuel an insurgency and help separatist movements.

Washington and Delhi allege that the Pakistani army nurtures the militants to use them as a foreign policy tools to expand power in neighbouring India and Afghanistan. The army denies that.

One such group is Lashkar-e-Taiba (LeT), which India blamed for attacks in Mumbai in 2008 which killed 166 people, saying its founder, Hafiz Saeed, was the mastermind.

The United States has offered a $10 million reward for information leading to his conviction over the Mumbai attacks.

Pakistan has put him under house arrest several times and banned his Islamist groups, Jamaat-ud-Dawa (JuD) and Falah-e-Insaniat Foundation (FIF), which the United States and the United Nations say are terrorist fronts for the LeT.

Islamabad reinstated the ban on the groups yet again on Thursday, but Saeed remains free, allowed to roam the country and make public speeches and give sermons.

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In hot job market, Fed still frets about low inflation

NEW YORK/SAN FRANCISCO (Reuters) – Despite a U.S. unemployment rate that has plumbed its lowest levels in nearly 50 years, Federal Reserve policymakers remain worried about excessively low inflation, a view that helps explain the central bank’s recent decision to put interest-rate hikes on hold.

Traditionally, economists have found that when labor markets run hot, eventually inflation will as well. A spate of new research from within and outside the Fed, however, has suggested that relationship may have weakened.

Speaking Friday at a University of Chicago Booth School of Business conference, New York Federal Reserve Bank President John Williams and San Francisco Fed President Mary Daly both said they still believe that tight labor markets do put upward pressure on inflation, and that with unemployment at 4 percent, the Fed must guard against prices surging.

But, they said, they are just as concerned about excessively low inflation.

“Inflation has been below our target for a long time,” Daly said. “Complacency can go both ways and it’s important to be vigilant on both sides of the target, not just on the upside but also on the downside.”

Williams cited his own analysis that showed low unemployment does in fact still exert upward pressure on prices and said he concurred that the Fed should be vigilant about a takeoff in inflation.

“We must be equally vigilant that inflation expectations do not get anchored at too low a level,” he said.

The concern about excessively low inflation is remarkable, given that the Fed was until recently raising interest rates to keep the economy from overheating as unemployment fell and businesses hired hundreds of thousands of new employees month after month.

But it is indicative of a Fed newly cautious about downside risks to the economy and increasingly convinced that globalization and new technologies have upended old inflation dynamics. This new wariness is in part behind the Fed’s January promise to be “patient” about further rate hikes, putting a three-year-old process of policy tightening on hold.

Indeed, Williams and Daly said Friday, inflation expectations are key to keeping inflation on track, and expectations are shaped in large part by experience.

That is why inflation’s recent track record of riding well below the Fed’s 2-percent target is concerning.

They made the remarks in response to a paper released on Friday that argued that the Fed should not ignore the possibility that low unemployment rates and rising wages could eventually spark higher inflation, as it did in the 1960s. The paper’s authors, including the global head of economic research at Deutsche Bank AG’s securities division, Peter Hooper, also warned that political pressures could make the Fed complacent about the danger of inflation.

U.S. President Donald Trump last year publicly chastised the Fed for raising rates and tightening monetary policy, describing it as an obstacle to his administration’s goal of boosting the economy.

A Fed economic report released Friday showed why concerns about weak inflation have suddenly taken such public root. After raising rates amid faster than expected growth through 2018, the Fed said a series of developing risks likely began slowing the economy late in the year and into 2019.

That included weakening consumer spending and business investment, risks from a global slowdown and trade tensions, “deteriorated” risk appetite among investors, and even a nick to gross domestic product from the partial government shutdown.

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Margins in focus as results drive big swings in European stocks

LONDON (Reuters) – Europe’s main share benchmarks rose marginally on Friday but company results including Sweden’s Elekta and France’s Sopra Steria drove big swings in stocks as investors awaited news from crucial U.S.-China trade talks.

The STOXX 600 and Germany’s DAX were up 0.2 and 0.3 percent respectively, with the main action at the share level.

Sopra Steria topped the STOXX 600, up 17.8 percent after the French IT services and consulting firm reported full-year results and said it was targeting an improvement in margins this year.

“This should help ease concerns of on-going pricing pressure as the worst seems to be behind us now following the profit warning in Q3 2018,” said Georgios Kertsos, an analyst at Berenberg.

Chipmaker ASM International jumped 11.9 percent after it said fourth-quarter order intake hit a record high of 301.6 million euros, well above its forecast.

Its strong results bucked a trend of weakness in a semiconductor sector hit by trade tariffs and slowing global car demand.

Swiss construction chemicals maker Sika also rose 4 percent after full-year profit beat expectations.

Elekta brought up the rear with a 13.5 percent slide after the Swedish radiation therapy equipment maker reported third-quarter earnings well below market expectations, and cut its full-year margin forecast.

Margin pressure has been a broader theme across European shares this earnings season, with the gap between revenue beats and earnings beats growing as companies face rising costs.

According to UBS strategists this gap has reached an eight-year high.

Elsewhere the food and beverage sector was the worst-performing, down 0.8 percent, after U.S.-based Kraft Heinz reported weak results.

AB Inbev fell 3.6 percent, Nestle lost 0.9 percent and Danone dipped 0.5 percent. Unilever also dropped 1.6 percent.

Kraft Heinz and AB InBev share a stakeholder: 3G Capital.

RBC analysts said that “given overlapping ownership between the two companies and similar cultures of margin maximization, we wouldn’t be surprised if investors make some connection.”

In other results, Saint Gobain shares fell 1.6 percent after the company reported a slump in annual net profit, blaming asset impairments amid uncertainty over the economy.

French meal vouchers firm Edenred jumped 5.3 percent after reporting record 2018 earnings and sounding a confident note about growth this year.

In the UK, M&A livened up trading. Dairy Crest shares surged 15.3 percent after Canada’s Saputo bought Britain’s largest dairy food company for about 975 million pounds ($1.3 billion).

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Japan Battles Worst Measles Outbreak in Years

Health officials in Japan are combating the country’s worst measles outbreak in years, with many infections clustered among attendees of a Valentine’s Day gift fair and a religious group that avoids vaccinations.

A total of 167 cases were reported in 20 of Japan’s 47 prefectures as of Feb. 10, the National Institute of Infectious Diseases said, with the largest outbreaks in the prefectures of Mie and Osaka.

It is the fastest Japan has reached that many cases at the beginning of the year since 2008.

The flare-up of the highly contagious disease comes as the United States is grappling with measles outbreaks in Texas, New York and Washington, with more than 120 cases reported so far this year. Those outbreaks have prompted a rush to vaccinate children in some places where parents have broader choice over such decisions.

In Japan, almost all of the 49 reported cases in Mie Prefecture were people connected to Miroku Community Kyusei Shinkyo, a religious group that promotes alternative healing.

The group said it emphasized avoiding medicines and vaccines and eating naturally farmed foods. But after some members became infected, the group apologized and said it was changing its practices.

“Given the unexpected situation, we will follow the health care center’s advice to get vaccine shots for measles or other highly infectious diseases so that we don’t cause concern to others,” the group said in a statement posted on its website.

Some of the patients in the Mie Prefecture outbreak were not adequately vaccinated, said Masaya Yamato, a doctor at Rinku General Medical Center in Osaka.

“Many of the patients were young and they did not receive enough shots, maybe due to their parents’ philosophy, and the outbreak spread at their meeting,” Dr. Yamato said.

Another large cluster of measles infections is centered on a complex in Osaka that includes Japan’s tallest building, Abeno Harukas, where 21 customers and workers at a Valentine’s Day fair contracted the virus.

A handful of cases were linked to children who returned to Japan from the Philippines. The Philippines has reported a steadily growing number of measles cases and deaths this year, with the virus spreading beyond Manila, the capital, to other parts of Luzon, the country’s most populous island. In the first six weeks of 2019, more than 9,000 cases were reported, including 146 deaths, the Philippine Department of Health said.

Measles is caused by a virus, and symptoms include rashes, fevers and ear infections that in some cases can lead to permanent hearing loss. Children are particularly susceptible to the disease, with some infections leading to complications such as pneumonia or encephalitis, a swelling of the brain. The disease kills one or two children out of every 1,000 who get it, according to the Centers for Disease Control and Prevention.

While Japan is one of the world’s richest countries, with a strong health system, researchers have noted that among developed countries it has high levels of infections of diseases that could be prevented by vaccines. A vaccine for measles, mumps and rubella was discontinued in the early 1990s after it was linked to aseptic meningitis. Since then, the government has had a wary attitude toward promoting vaccines.

That has changed somewhat in recent years though, and in 2006, Japanese health officials began recommending a second measles vaccination shot for children to increase immunization rates.

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NCSS launches inclusive campaign with music video featuring people with disabilities

SINGAPORE – The National Council of Social Service (NCSS) launched its annual campaign to promote an inclusive society on Friday (Feb 22), with this year’s edition focused on working with corporate and community partners to provide more opportunities for people with disabilities.

The “See The True Me” campaign, now into its third year, will also feature a music video, directed by celebrated local director Royston Tan, with performers with disabilities.

Among the 10 partners NCSS is working with to adopt inclusive hiring practices are LiHo, McDonald’s and People’s Association Water-Venture.

For instance, LiHo is opening a concept store at Cathay Cineleisure in late March that will be entirely managed by people with disabilities.

People’s Association Water-Venture is working with NCSS to organise a series of disability-friendly sports carnivals this year. The first carnival in January saw more than 500 participants take part in activities such as dragon boating, hansa sailing and wheelchair basketball.

NCSS deputy chief executive officer Tina Huang said: “It takes an ecosystem approach to sustain inclusivity, and it is our hope that persons with disabilities today are more empowered and given opportunities to participate meaningfully in the community.”

For the music video, the song Fire In The Rain was composed by singer-songwriter Don Richmond, with rap lyrics by local rapper ShiGGa Shay.

Ms Adelyn Koh, an 18-year-old who is visually impaired due to a rare eye disease called Peter Anomaly, is the lead singer.

Mr Tan said: “(The project was) very important for me because I believe persons with disabilities have so many talents to offer.

“I hope that through the music video, we are able to celebrate their abilities and talents. I was very honoured and touched by their passion.”

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Over 2,000 jobs available at Jewel Changi Airport

A recruitment fair offering over 2,000 jobs at Jewel Changi Airport was launched yesterday at Our Tampines Hub.

The two-day career fair features job openings from 50 tenants and agencies comprising various sectors such as food and beverage services, retail and cleaning.

BreadTalk Group will be setting up a BreadTalk outlet and a Toast Box branch at Jewel Changi Airport. Its senior vice-president of Group HR, Admin & Training, Mr Chan Wing Git, said it is looking to hire front-line and back-of-house staff like cashiers, service crew and bakers.

Careers @ Jewel Changi Airport was organised by the North East Community Development Council and Workforce Singapore, with support from Jewel Changi Airport Devt and its partners. North East District Mayor Desmond Choo, who launched Careers @ Jewel Changi Airport, said: “Through this career fair, our residents will have a one-stop platform to find or be trained for good jobs close to their homes.”

Jewel Changi Airport will comprise retail and dining outlets, gardens, play attractions, a hotel and aviation facilities.

Interested people who did not pre-register for the career fair online can do a walk-in today. Those who are unable to attend the career fair can participate in WSG’s Virtual Career Fair at vcf.mycareersfuture.sg/jewel from tomorrow to March 15.

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