09/11 – Internationl News Story and Update

Michel Barnier, the European Union’s former chief Brexit negotiator, was appointed as France’s prime minister on September 5th, marking the end of two months of political deadlock. 

President Emmanuel Macron made the announcement following a series of discussions with key political figures in an attempt to resolve the impasse created by the inconclusive parliamentary elections in July.

At 73 years old, Barnier is a seasoned politician from the center-right Republicans party, has held multiple positions in Gaullist governments, including foreign minister under President Jacques Chirac. As a former European commissioner, he is well known in Britain for his firm approach during the Brexit negotiations. [The Economist] 

Barnier is considered to hold a no-nonsense demeanor and a sharp sense of humor, Barnier is an experienced, traditional politician, and he is more than twice the age of Gabriel Attal, the centrist he replaced. 

Although Barnier’s name had been circulating for weeks, he was not Macron’s initial choice. No political group had a majority in the French parliament following the July elections, and Macron struggled to find someone who could garner enough support across party lines to withstand a no-confidence vote. Barnier was ultimately chosen after other contenders, like former Socialist Prime Minister Bernard Cazeneuve and center-right Xavier Bertrand, faced the risk of opposition from Marine Le Pen’s National Rally (RN), the third-largest parliamentary bloc.

Barnier will be quickly tasked with tackling the looming issue of France’s urgent need to address its public finances. Outgoing finance minister Bruno Le Maire revealed that the budget deficit could reach 5.6% of GDP this year, exceeding the 5.1% initially projected and well above the EU’s 3% limit. Le Maire has called for €16 billion in additional savings for this year alone. The new government must present next year’s budget to parliament by October 1st. [The Economist] 

In recent days, leaders of the National Rally have outlined their conditions for support, which include measures on purchasing power, security, and immigration, the introduction of proportional representation in parliament, and “respect” for far-right lawmakers. 

Marine Le Pen, leader of France’s far-right National Rally, gave her strongest indication yet of her willingness to cooperate with the new prime minister, Michel Barnier, in an interview with La Tribune on Sunday. Speaking about President Emmanuel Macron’s choice to replace Gabriel Attal after this summer’s election, Le Pen stated, “We don’t wish to cause obstructions.” [Politico 2] 

Centrist senator and Macron ally Hervé Marseille commented, “Marine Le Pen gives the kiss of death to this figure and then that one. The National Rally has 142 lawmakers, you can’t ignore them,” in an interview with Le Monde. [Politico] 

Although the National Rally failed to win the parliamentary election it had been expected to dominate, it has now emerged as a powerful influence. Le Pen played a pivotal role in the negotiations to select the next prime minister. Initially, conservative heavyweight Xavier Bertrand was a leading contender after meeting with center-right lawmakers who expressed support for a right-leaning prime minister. Macron even called Le Pen to discuss Bertrand and former Socialist Prime Minister Bernard Cazeneuve, another early frontrunner whose chances diminished by Monday. 

While the far right still has the power to topple Barnier’s government, pollster Bruno Jeanbart suggested they may hold back from doing so too quickly. “They have the fate of the government in their hands, but I’m not sure it’s in their interest to topple the government too quickly,” Jeanbart said, adding that the National Rally may prefer to let events unfold in anticipation of the next presidential election, acknowledging that “it’s difficult to run a country without winning the presidential election.” [Politico] 

Macron’s cooperation with the National Rally has raised concerns within his own camp. After dissolving parliament following the far right’s strong performance in the June European election, Macron had campaigned to prevent extreme parties from gaining power in Paris. 

Many believe he has now effectively given the National Rally significant leverage over the future government. 

A centrist lawmaker commented that recent developments do not “correspond to the spirit of the Republican front,” referencing the tradition of mainstream parties uniting to keep the far right from power. The lawmaker emphasized that Barnier’s fate is now in the hands of the National Rally. [Politico] 

“It’s undeniable that Michel Barnier seems to have the same position as we do on migration,” Le Pen told the French daily. [Politico 2] 

Another parliamentarian from Macron’s party blamed the left for failing to come up with innovative solutions. After some internal disagreements, the New Popular Front nominated 37-year-old civil servant Lucie Castets as their candidate for prime minister, arguing that their first-place finish entitled them to make the choice. However, Macron rejected Castets’ bid, citing concerns about institutional stability and predicting she wouldn’t survive a no-confidence vote in the divided National Assembly.

Marine Tondelier, leader of the Greens, criticized Macron for moving further to the right to placate the National Rally and ensure they wouldn’t bring down the next government. “He’s been constantly cozying up to the far right,” Tondelier remarked. [Politico] 

Opinion: 

Barnier, who adopted a strong stance on immigration during the Republicans’ 2021 presidential primary, seems to be less divisive among the hard-right. After his appointment, Le Pen expressed satisfaction, stating Barnier would at least show her voters respect. 

However, Barnier is not expected to be a compliant subordinate to Macron, as he has previously criticized the president, calling his leadership “solitary and arrogant.” Nonetheless, Barnier’s pro-European stance and international reputation for seriousness may reassure neighbors, financial markets, and French businesses. At his age, Barnier is also unlikely to have ambitions for the next presidential election in 2027.

Following his appointment Barnier will be forced to face political challenges right off the bat. The first of which is the fact that the left is strongly opposed to him. The New Popular Front, a left-wing coalition, holds the largest bloc in parliament with 193 of 577 seats. Jean-Luc Mélenchon, leader of the radical-left Unsubmissive France, declared that the election was “stolen” and has called for Macron’s impeachment. Although Barnier might be able to pass legislation with the support of 47 Republicans and most centrists, provided the RN does not block him, the left will likely continue to challenge him both in parliament and through protests. Mélenchon has already called for mass demonstrations on September 7th. [The Economist] 

Barnier faces quite the formidable task as he attempts to form the “unifying government” Macron hopes for, while implementing budget cuts, pacifying the left, managing the hard right, and navigating Macron’s tendency to micromanage.

Many believe that  Macron’s decision to appoint Barnier has handed the far right a significant victory. The survival of Michel Barnier’s incoming government will depend on the support of the National Rally, Marine Le Pen’s far-right party, which came third in the recent snap election. 

His stance on immigration could be key in garnering at least passive support from the far right in parliament. A member of the right-wing Republicans party, Barnier has previously called for a temporary halt to non-European immigration for three to five years—a position that closely aligns with Le Pen’s. 

The left-wing New Popular Front, despite winning the most seats, did not secure a majority and has already pledged to back no-confidence motions against Barnier. With Macron’s coalition and the conservative Republican Right only holding 213 seats, far short of the 289 needed for a majority, Barnier will require backing from the far right to avoid an immediate collapse.

Now, Barnier must find a way to balance the interests of his center-right and centrist backers while also appeasing the far right, which opposes many of the proposed budget cuts aimed at addressing France’s growing debt.

09/06 – International News Story

Chinese President Xi Jinping has committed to generating “at least” one million jobs in Africa as part of China’s effort to strengthen its role as the preferred development partner for the Global South. [Al Jazeera]

For nearly 25 years, the Forum on China-Africa Cooperation (FOCAC) has been a key diplomatic event for African leaders, serving as an indicator of the evolving relationship between Africa and its largest trading partner, China. Since its inception in 2000, analysts have looked to this triennial event to assess the state of these ties.

During the Forum on China-Africa Cooperation this week, Xi announced that China would offer African nations 360 billion yuan ($51 billion) in new financial support, along with backing for 30 infrastructure projects aimed at improving connectivity across the continent. This initiative highlights Beijing’s strategic focus on fostering development partnerships and deepening ties with Africa.

Addressing representatives from over 50 African nations in Beijing for the forum, President Xi Jinping announced that 210 billion yuan ($29.6 billion) of the pledged financing would be provided through credit lines, with at least 70 billion yuan ($9.9 billion) allocated for new investments by Chinese companies. [Al Jazeera]

Additional support would come through smaller amounts designated for military aid and other projects. Notably, the financial assistance will be given in yuan, a move likely aimed at promoting the international use of China’s currency.

Xi also advocated for the creation of a China-Africa network of land and sea routes, promoting coordinated development across the continent. He highlighted the achievements of China-Africa cooperation, mentioning joint efforts that have resulted in the construction of roads, railways, schools, hospitals, industrial parks, and special economic zones. According to Xi, these projects have significantly impacted the lives and futures of many people across Africa, as reported by the state news agency Xinhua.

President Xi Jinping expressed confidence that by working together, the Chinese and African people could achieve “new and even greater feats” and lead the “modernisation” of the Global South. 

Following the opening ceremony of the forum, delegates endorsed the Beijing Declaration, which focuses on building “a shared future in the new era.” They also adopted the Beijing Action Plan for 2025-27, outlining future cooperation initiatives, as reported by Xinhua. [Al Jazeera]

Opinion: 

China is aiming to increase its influence in Africa as it faces growing economic and diplomatic tensions with Western nations, particularly the United States. This push for greater engagement comes at a time when China’s economy is experiencing slower growth, grappling with issues such as a long-lasting property crisis and a shrinking population.

As Africa’s largest trade partner, China accounts for nearly a quarter of the continent’s exports, which primarily consist of minerals, fuels, and metals. This strong trade relationship underscores China’s strategic interest in securing resources and maintaining its foothold in the region.

As China’s economy slows and African governments face tighter budgets, few expected major financial commitments from Beijing this year. President Xi ultimately pledged $50 billion, an increase from 2021 but still below pre-pandemic levels. The relationship is less intense compared to the 2000s and 2010s, when China poured billions into African infrastructure as part of the Belt and Road Initiative (BRI). During that period, geopolitical competition in Africa was mostly seen as a contest between “China and the West.” 

China is not withdrawing from Africa, and African countries remain engaged. A senior official in Ethiopia noted that despite perceptions, China remains Africa’s largest economic partner, and maintaining good relations with Beijing is essential. 

China continues to be Africa’s biggest trade partner, with trade volumes reaching a record $282 billion in 2023, partly driven by demand for minerals crucial to green energy. This figure is more than double that of Africa’s second-largest trade partner, India. [The Economist] 

China also remains the top lender to sub-Saharan Africa. After years of declining lending, there was a resurgence in 2023, with new loans supporting both green projects, like solar farms, and large infrastructure, such as a $1 billion railway loan to Nigeria. Despite talk of a shift toward smaller, more sustainable projects, China remains involved in large-scale infrastructure development.

– P.T.

09/05 – International Economics Story

The Biden administration last weekend sent over a letter to Nippon Steel indicating that their attempted $15B purchase of U.S. Steel  poses a national security risk due to the possibility of offsetting and harming the American steel industry. 

The Committee on Foreign Investment in the United States (CFIUS) expressed in the previously undisclosed letter that the deal would harm U.S. steel production and reduce the chances of U.S. Steel continuing to actively pursue trade remedies.

 “The committee has identified risks to the national security of the United States arising as a result of the transaction,” the letter stated, as per one of the sources. [Reuters]

Spokespeople for Japan’s Nippon Steel and U.S. Steel declined to comment on the letter, instead pointing Reuters to earlier statements asserting that the deal poses no national security risks and would bolster the U.S. steel industry. 

“We fully expect to pursue all possible legal avenues to ensure that this transaction, which represents the best future for Pennsylvania, American steelmaking, and all of our stakeholders, is completed,” the U.S. Steel spokesperson added. [Reuters]

Recent developments such as these show signs that the administration is preparing to block the deal from going through. The deal has received bipartisan opposition from many Democrats and Republicans. 

Donald Trump pledged to block the deal if elected and Vice President Kamala Harris stated this week that she also wishes to see U.S. Steel remain “American owned and operated”. [Reuters]

In a 100-page response letter sent on Tuesday, Nippon Steel outlined plans to invest billions of dollars to sustain and enhance U.S. Steel facilities that would otherwise be idled, stating this would “indisputably” allow it to “maintain and potentially increase domestic steelmaking capacity in the United States.” [Reuters]

Nippon also reiterated its commitment not to transfer any U.S. Steel production capacity or jobs overseas, while pledging not to interfere with U.S. Steel’s trade-related decisions, including actions against unfair trade practices under U.S. law.

The company emphasized that the deal would “create a stronger global competitor to China grounded in the close relationship between the U.S. and Japan.”

To address CFIUS concerns, Nippon proposed a national security agreement, including a pledge that a majority of U.S. Steel’s board of directors would be non-dual U.S. citizens, with three independent directors approved by CFIUS to ensure compliance with the agreement.

The share price of U.S. Steel fell by more than 17% Thursday in response to widespread anticipation that President Joe Biden is preparing to block the steelmaker’s takeover by the Japanese firm. 

08/28 – National News Update & Story

Independent presidential candidate Robert F. Kennedy Jr. officially called an end to his campaign on Friday August 23. RFK Jr. followed up his announcement by formally  endorsing Donald Trump. 

Kennedy stated that he will  withdraw his name from ballots in 10 battleground states that are likely to determine the election outcome, while continuing to run as a candidate in other states.

Kennedy joined Trump onstage at a rally in Arizona just hours later. 

Kennedy mentioned in a news conference earlier that he had multiple meetings with Trump and his aides, during which he discovered they shared views on topics such as border security, free speech, and ending wars. 

“There are still many issues and approaches on which we continue to have very serious differences. But we are aligned on other key issues,” he told reporters. [Reuters]

He emphasized these points again when he appeared alongside Trump at the Arizona rally, where he reiterated his stance on key issues such as combating chronic illness and eliminating hazardous chemicals from the environment and food supply.

Kennedy also mentioned free speech, the war in Ukraine, and “a war on our children” as some of the reasons he would seek to withdraw his name from the ballot in key battleground states. [AP News] 

While Kennedy was on stage, the former president announced that if he were to return to the White House, he would establish a presidential commission on assassination attempts and release files related to the 1963 assassination of President John F. Kennedy.

RFK Jr. described their partnership as “a unity party,” an agreement that would “allow us to disagree publicly and privately and seriously.” Kennedy hinted that Trump had offered him a position if he returned to the White House, but neither he nor Trump provided specifics. [AP News] 

Last week, Kennedy’s running mate, Nicole Shanahan, floated the possibility that Kennedy might join Trump’s administration as Secretary of the Department of Health and Human Services.

Recent polls indicate Kennedy’s support is in the mid-single digits, with reasonable doubts about whether he could achieve even that in a general election.

There is some evidence that Kennedy remaining in the race could disadvantage Trump more than Harris. A July AP-NORC poll showed that Republicans were much more likely than Democrats to have a favorable opinion of Kennedy. Additionally, those who viewed Kennedy positively were significantly more likely to also have a favorable view of Trump (52%) compared to Harris (37%). [AP News] 

Opinion: 

Kennedy, an environmental lawyer and outspoken anti-vaccine advocate, entered the 2024 race as a challenger to President Joe Biden for the Democratic nomination. As the son and nephew of two of the Democratic party’s icons who were tragically assassinated in the 1960s, his candidacy naturally attracted initial attention. 

At the time, many voters were disillusioned with both the aging Biden and the scandal-ridden Trump, leading to a surge in Kennedy’s popularity. Eventually, he became more disillusioned by the Democratic party who seemed to be purposefully pushing him out, and chose to run as an independent. Then by November 2023, a Reuters/Ipsos poll showed him with a significant 20% support in a three-way race with Biden and Trump. [Reuters]

For a while, it seemed both Biden and Trump’s campaigns were concerned that Kennedy could pull enough votes to influence the election’s outcome. 

But, the dynamics of the race shifted dramatically in the last two months, especially after Trump survived an assassination attempt and the withering 81-year-old Biden gave way to Kamala Harris. As a result, voter interest in Kennedy declined sharply. A recent Ipsos poll revealed his national support had plummeted to just 4%, a small but potentially significant number in a tight race between Trump and Harris

There’s something to be said about Kennedy’s unexpected relevance throughout this race. His campaign was chaotic, starting as a Democrat, shifting to an Independent, and now ending by throwing his support behind the Republican candidate. Yet, his candidacy shed light on the sliver of potential for third-party candidates to build a legitimate following and challenge the dominance of the two-party system.

Kennedy’s run also highlighted the rigid, brutally structured nature of the political system, which is heavily skewed against outsiders. In a democracy where anyone is supposed to have the opportunity to rise through the ranks, the reality is that those at the top set the rules, and if they don’t want you to play, you won’t.

There’s a legitimate “lawfare” weaponized by the powerful, especially within the upper echelons of political parties. It was always a long shot for RFK Jr. to win this election, even if he had been on every state’s ballot. But the fact that it’s so difficult for an independent candidate to even get on the ballot and give voters a choice is outrageous.

For the past half-decade, Americans have grown increasingly disillusioned with their options for presidential candidates and frustrated with the two-party system, and yet, the stakes of the two-horse race make it so legitimately considering a competitive third option comes too far fetched. 

For Trump it seems seeking this endorsement at this point of the race makes sense logically. Trump needed to consolidate his base, and it seems quite clear that RFK supporters would lean toward Trump rather than Harris. This became much more coherent after Kennedy and his running mate Shanahan placed much of the blame on the Democratic Party for pushing them out of this race, and his tendency to brand himself as an outsider to the establishment.  

Trump’s polling numbers have undoubtedly taken a hit and he is in a very vulnerable place heading into this election now that Kamala has entered the race. Making sure that he can at least snatch up those extra few percentages in key swing states comes as a no-brainer at his current position. 

Whether this endorsement will ultimately influence the outcome of who will be in the White House next might be a stretch, but there’s no way to know for certain until we watch the tumultuous next few months play out.  

08/25 – International News Update & Story

Lebanese militant group Hezbollah launched over hundreds of drones and rockets into Israel on Sunday. 

Israel reportedly preemptively  fired around one hundred jets into Lebanon to prevent a larger ongoing attack from Hezbollah. [Reuters]

So far three deaths have been confirmed in Lebanon and one in Israel. 

Both sides have apparently indicated they were happy to avoid further escalation for now, but warned that there could be more strikes to come.

Hezbollah leader Sayyed Hassan Nasrallah said the Iranian-backed proxy group’s barrage, which came as retaliation for the assassination of a senior commander last month, had been completed “as planned”.

Hezbollah claimed to have struck 11 Israeli bases in what it described as the “first phase” of its retaliatory response to the assassination of its military chief, Fuad Shukr, in Beirut by an Israeli air strike on July 30th. The group asserted “total success,” disregarded the Israeli attack, and hinted at the possibility of further retaliation. [The Economist]

However, the terror group would assess the impact of its strikes and “if the result is not enough, then we retain the right to respond another time”, he said.

Israel initiated air strikes before Hezbollah launched its barrage, according to Nasrallah. Prime Minister Benjamin Netanyahu claimed these “pre-emptive” strikes thwarted a significantly larger Hezbollah attack, but Nasrallah asserted that they had minimal effect. Hezbollah’s rocket and drone attacks were aimed at an intelligence base near Tel Aviv, Nasrallah stated. Netanyahu countered that all drones targeting what he described as a strategic site in central Israel were intercepted. [Reuters]

A security source in Lebanon reported that at least 40 Israeli strikes hit various towns in the south of the country, marking one of the heaviest bombardments since the hostilities began in October.

The White House stated that U.S. President Joe Biden was closely monitoring the situation. “We will continue to support Israel’s right to defend itself, and we will keep working towards regional stability,” said National Security Council spokesperson Sean Savett. 

United Nations Secretary-General Antonio Guterres was “deeply concerned” about the escalation between Israel and Hezbollah and urged both parties to immediately return to a ceasefire, according to his spokesperson. Egypt and Jordan also issued warnings against further escalation. 

Although the United States was not directly involved in Israel’s strikes on Sunday, it did provide some intelligence regarding incoming Hezbollah attacks, a U.S. official said. [Reuters]

Israel’s foreign minister emphasized that the country is not aiming for a full-scale war, though Prime Minister Benjamin Netanyahu cautioned, “This is not the end of the story. We are determined to do everything we can to defend our country … whoever harms us – we harm him.”

Both sides have communicated their desire to avoid further escalation, with the overall sentiment being that the exchange was “done,” according to a couple diplomats. [Reuters] 

A Hezbollah official stated that the group had postponed its retaliation to allow time for ceasefire negotiations and had carefully calibrated its attack to avoid provoking a full-scale war.

Palestinian terror group Hamas announced on Sunday that it rejects the new conditions put forward by Israel in the Gaza ceasefire talks. [Reuters 2]

Months of intermittent talks have failed to reach an agreement to end Israel’s devastating military campaign in Gaza or to secure the release of the remaining hostages taken by Hamas during the militant group’s October 7 attack on Israel.

A key issue in the ongoing talks, mediated by the United States, Egypt, and Qatar, is the Israeli presence in the so-called Philadelphi Corridor, a narrow 14.5 km (nine-mile) strip of land along Gaza’s southern border with Egypt. 

Hamas has accused Israel of reneging on its commitment to withdraw troops from the Corridor and introducing new conditions, including the screening of displaced Palestinians as they return to the more densely populated northern areas of the enclave once the ceasefire begins.

“We will not accept discussions about retractions from what we agreed to on July 2 or any new conditions,” Hamas official Osama Hamdan stated on the group’s Al-Aqsa TV on Sunday. [Reuters 2]

Back in July, Hamas agreed to a U.S. proposal to initiate talks on releasing Israeli hostages, including soldiers and men, 16 days after the first phase of an agreement intended to end the Gaza war, a senior Hamas source informed Reuters.

Opinion: 

This latest rejection of the proposal adds further doubt that the recent U.S.-led breakthroughs in diplomatic talks will be able to actually achieve an end to the conflict in the Middle East. 

With the recent and largest exchanges of fire between Hezbollah and Israel on its northern border, coupled with the looming threat of a retaliatory strike from Iran, tensions in the broader conflict between Israel and its regional adversaries have flared up once again.

For about a month now, the entire region has been anticipating the promised retaliation by Hezbollah and Iran for the assassinations of Shukr and Ismail Haniyeh, the political leader of Hamas, who was killed while attending Iran’s presidential inauguration. 

The delay in this response partly highlights the challenging position Iran faces. While Iran could launch a direct retaliation, a similarly large missile and drone attack on Israel in April was mostly intercepted by Israel and its allies, showing more of Iran’s limitations than the threat it was intending to convey. Repeating such an attempt could further expose Iran’s weaknesses rather than demonstrate its strength. 

On the other hand, if Iran were to plan an even larger direct strike, it could provoke a full-scale war with severe consequences. To deter Iran, the United States has deployed two aircraft carrier strike groups to the Middle East.

Hezbollah’s rocket and drone strikes offer a somewhat safer alternative for Iran, which sponsors the Lebanese militant group. It’s also uncertain whether Hezbollah itself desires a full-scale war with Israel in Lebanon. Hezbollah likely knew that Israeli intelligence would detect its preparations and carry out pre-emptive strikes. 

Both Hezbollah, and by extension Iran, want to maintain their image by punishing Israel, but they, along with Israel, are trying to avoid military actions that could lead to a more significant conflict.

Israeli PM Benjamin Netanyahu claimed that Israel’s strike was “not the end of the story,” but Israeli officials are keen to stress that they are not looking to escalate the situation further. After a failed direct attack in April, Iran may have reverted to its earlier strategy of using proxies like Hezbollah to fight Israel. If this is the case, it could signal a surprising win for the relatively moderate approach of Iran’s new president, Masoud Pezeshkian, over the hardline generals of the Islamic Revolutionary Guards Corps, who have been advocating for severe retaliation. [The Economist]

However, whether a ceasefire in Gaza will ease the broader conflict between Iran, its proxies, and Israel remains uncertain.

There are still many variables at play: the outcome of the U.S. presidential election, the ongoing struggle between reformers and hardliners in Iran, and how long Israel will be willing to endure rocket attacks on its northern border before it becomes fed up and decides to launch a more extensive campaign against Hezbollah to eliminate its massive missile arsenal supplied by Iran. 

The latest rejection of the proposal adds further doubt that the recent U.S.-led breakthroughs in diplomatic talks will be able to actually achieve an end to the conflict in the Middle East. 

With the recent and largest exchanges of fire between Hezbollah and Israel on its northern border, coupled with the looming threat of a retaliatory strike from Iran, tensions in the broader conflict between Israel and its regional adversaries have flared up once again. 

Even if the current uptick in hostilities subsides for now, the larger conflict in the region seems far from over.

08/23 – International Economics Piece

The European Commission announced on Tuesday its plan to implement five-year import duties of up to 36% on Chinese electric vehicles (EVs), unless Beijing can offer an alternative solution to address concerns over state subsidies. 

Tesla EVs produced in China will be subject to a reduced duty of 9%, reflecting lower levels of Chinese subsidies compared to other manufacturers.

Last month, Brussels imposed provisional tariffs on Chinese EVs, in addition to the existing 10% duty, after determining they were unfairly competing with European counterparts. The Commission has now proposed making these tariffs permanent, with the rates open to review by interested parties until the end of August, and final approval expected from EU member states by October.

The proposed tariffs include 17% for BYD (adjusted from 17.4%), 19.3% for Geely (revised from 19.9%), and 36.3% for SAIC (down from 37.6%). Other Chinese producers that cooperate with Brussels will face a tariff of 21.3%, slightly up from 20.8%, while non-cooperative manufacturers would be hit with the maximum 36.3% duty. [Japan Today] 

Tesla, owned by U.S. billionaire Elon Musk, requested its own duty rate, which has been set at 9% after the Commission determined it benefited from fewer Chinese subsidies than domestic manufacturers. [Japan Today] 

China has strongly opposed these tariffs and has filed an appeal with the World Trade Organization, though Brussels believes its measures comply with WTO rules. The EU remains open to alternative solutions that align with WTO standards but emphasizes that it is up to China to propose them.

China has also hit back in response to these EU tariffs by launching a probe into some European dairy imports. China has used anti-dumping investigations into European agricultural products, most recently pork, as a tit-for-tat response in this prospective trade war. 

The provisional duties, in place since July 5, have been provided as bank guarantees but will be released once the final measures are established. This trade dispute is part of broader tensions between China and the EU concerning trade, technology, and national security.

China’s emergence as a leader in the electric vehicle (EV) industry, fueled by significant state investment, has given its manufacturers a competitive edge. In 2023, Chinese EV exports surged by 70%, reaching $34.1 billion, with nearly 40% of these exports going to the European Union, making it the largest recipient of Chinese EVs. [Japan Today] 

 The EU is now facing the challenge of protecting its automotive industry while managing its complex trade relationship with China.

Opinion: 

The next decade is critical for Europe’s automotive industry, which faces the dual challenge of decarbonizing and contending with strong competition from China.

Pedro Pacheco, vice president of automotive research at Gartner, warns that European automakers must launch competitive products to survive. The European Green Deal, initiated by the previous European Commission, aims to make the EU climate-neutral by 2050, with significant focus on reducing vehicle emissions. Initially, climate change was a top priority, but economic concerns are now generating political resistance. Despite this, the push for all-electric vehicles remains strong, though achieving zero emissions is becoming increasingly difficult. 

The European car industry is a major economic force, representing 7% of GDP and employing 13.8 million people. While Europe has long dominated internal combustion engine (ICE) technology, it lags in battery technology, a critical area for the future of electric vehicles (EVs). European carmakers like Volkswagen, Mercedes-Benz, Renault, and Stellantis are struggling to adapt to the shift towards battery-powered vehicles, especially in the face of competition from China, which has become the world’s largest EV market. [Politico]

The EU’s Green Deal includes a law banning the sale of new ICE vehicles by 2035, with milestones to ensure compliance, such as a required 15% emissions reduction by 2025. Failure to meet these targets will result in fines, pushing automakers to sell more EVs. However, EV adoption is slow due to concerns over driving range, infrastructure, and cost. Meanwhile, Chinese automakers, benefiting from lower production costs and advanced technology, are making inroads into the European market.

The EU and U.S. have imposed tariffs on Chinese EVs, but these measures may only slightly slow Chinese competition. Some Chinese companies are even setting up operations in Europe to avoid tariffs. In response, European automakers are diversifying their offerings, including hybrid models, which have seen an increase in market share.

Despite the 2035 ban on new ICE cars, existing ICE vehicles will continue to emit CO2 for years to come. Additionally, political opposition to the ban is growing, with calls for exceptions for synthetic and biofuels, potentially allowing new ICE cars to be sold after 2035. Hydrogen-powered vehicles, although discussed as an alternative, have not gained significant traction due to infrastructure challenges and low adoption rates.

Overall, Europe’s car industry faces a tough road ahead, with significant implications for the region’s economy and political landscape. Pacheco notes that European automakers could have performed better if they had prioritized EVs as much as their Chinese competitors.

– P.T.

08/22 – Political Opinion Piece

We are now less than 75 days away from the 2024 presidential election. Following a summer marked by historic political events, the stage is set for the nation to decide between Donald Trump and Kamala Harris as the 47th President of the United States.

At this moment, there is a growing likelihood that Donald Trump could face another defeat this November and here are several factors as to whyI think this could be what ultimately culminates the outcome of the presidential election to go against Trump: 

• Campaign Momentum: Trump’s campaign has lost significant momentum, particularly as Kamala Harris launched her campaign with a powerful surge, fueled by hundreds of millions in donations. This financial boost has given her a substantial advantage.

• MAGA’s Polarization: The “Make America Great Again” (MAGA) movement, once a rallying cry, has become increasingly isolating, characterized by a tone that is often perceived as attacking and negative. A sizable portion of voters neither like Trump nor see him as the most fit candidate for the presidency. However, these same voters might still be swayed to support him to prevent Kamala Harris from assuming office and continuing what they see as a declining direction for the United States.

• Rhetoric and Alienation: Trump’s harsh rhetoric, often laced with insults and attacks, alienates voters who are not die-hard MAGA supporters. To succeed, he needs to soften his approach and broaden his appeal beyond his base.

• Focus on Slander: Trump’s strategy has been heavily reliant on slandering his opponents rather than courting undecided voters. This approach could backfire if he fails to address the concerns of those who are still on the fence.

• Policy Opportunities: Policy issues, particularly those related to border security and national safety, are ripe for the taking. If Trump can address these concerns in a way that reassures single-issue voters, he may be able to regain lost ground.

• Impact of RFK: The loss of percentages to RFK could hurt Trump’s chances, as every vote siphoned away could be crucial in a tight race. As of right now Robert F. Kennedy Jr. has still not ended his election campaign and endorsed Donald Trump in exchange for a promised position in his administration, so this one will be an interesting development to keep an eye on. 

• Media Influence: The media landscape is overwhelmingly powerful, with significant backing for the Democratic campaign. This media advantage, characterized by effective priming, framing, and outreach, has so far worked in favor of Kamala Harris. 

• Polling Worries: Recent polls show troubling trends for Trump in critical battleground states. Even traditionally red states like Nevada and Arizona are now in question, adding to the campaign’s challenges.

• Unfortunate Timing: Trump’s favorability saw a boost following an assassination attempt, but this was quickly overshadowed by Biden stepping down and Kamala Harris stepping in as the Democratic nominee.

• VP Selection Issues: Trump’s choice of JD Vance as his running mate appears to be a misstep. Vance’s low favorability and inability to connect with undecided voters, particularly among younger demographics, have not helped the campaign. There’s a sense that even Trump himself regrets the pick, as Vance comes off as more conservative and, debatably, more eccentric.

With less than two months remaining, the Trump campaign must urgently address these issues if they hope to avoid an election loss that once seemed improbable. Above all, Trump needs to reignite his campaign with new energy, focus on holding rallies, and make a strong push in crucial Midwestern battleground states. The path to the Oval Office runs through these states, and without a renewed effort, the campaign may see its chances slip away.

08/20 – International News Update

U.S. Secretary of State Antony Blinken announced on Monday that Israeli Prime Minister Benjamin Netanyahu had accepted a “bridging proposal” from Washington aimed at resolving disagreements over a ceasefire deal and the release of hostages in Gaza. 

Earlier on Monday, Blinken described the situation as a “decisive moment” and “maybe the last” opportunity to free the hostages and establish a ceasefire. 

The announcement came after an intense 2 1/2-hour meeting with Netanyahu, marking Blinken’s ninth visit to the region since the war began on October 7. Blinken now urges Hamas to follow suit and also accept the proposal at this critical juncture. 

“In a very constructive meeting with Prime Minister Netanyahu today, he confirmed to me that Israel supports the bridging proposal,” Blinken told reporters, without saying what the proposal entails. “The next important step is for Hamas to say ‘yes.’” [AP News] 

Netanyahu described his meeting with Blinken as “good and important,” expressing gratitude for the “understanding that the United States has shown toward our vital security interests, along with our joint efforts to secure the release of our hostages.” He also mentioned that efforts are underway to free as many hostages as possible in the initial phase of the ceasefire agreement. [AP News] 

Despite Israel’s acceptance of the U.S.-led proposal, tensions remain high on the ground. Hamas recently announced a return to suicide bombings inside Israel, a threat realized in Tel Aviv on Sunday night. Meanwhile, Israeli military strikes reportedly killed at least 30 Palestinians across Gaza on Monday, adding to the death toll and further complicating the chances of a ceasefire. [Reuters] 

Hamas officials have criticized the U.S. for what they perceive as favoritism towards Israel. 

“When Blinken says that the Israelis agreed and then the Israelis say that there is an updated proposal, this means that the Americans are subject to Israeli pressure and not the other way around. We believe that it is a maneuver that gives the Israelis more time,” said senior Hamas official Osama Hamdan. [Reuters] 

Blinken met with Israeli President Isaac Herzog and Defense Minister Yoav Gallant on Monday. He is scheduled to continue his diplomatic efforts in Egypt and Qatar, where further ceasefire talks hinge on securing a security mechanism for the Philadelphia Corridor between Egypt and Gaza. The U.S. has suggested an international presence in the area, which could be acceptable if limited to six months, according to Egyptian sources.

As protests continue in Israel, particularly among the families of hostages, the pressure on both sides to reach an agreement is mounting. Demonstrations outside Blinken’s hotel in Tel Aviv saw Israelis holding photos of hostages and demanding an immediate deal, with some appealing directly to U.S. President Biden.

Despite the dire situation, negotiations continue. The proposed ceasefire plan, which is still under discussion, would see Hamas releasing all hostages in exchange for Israel withdrawing its forces from Gaza and releasing Palestinian prisoners. However, disputes remain over Israel’s insistence on maintaining a military presence in key areas, which Hamas views as unacceptable.

In Gaza, there is little optimism about Blinken’s visit. “They are lying just to destroy us more and more,” said Hanan Abu Hamid, a displaced resident of Rafah. “Blinken is useless, his visit will harm the Palestinian people.” [Reuters] 

Opinion: 

This development is seen as a crucial, and perhaps one of the last opportunities for de-escalating the conflict which has plunged Gaza into a humanitarian catastrophe and strained U.S. relations in the Middle East.

The U.S. Secretary of State’s visit comes at a politically charged time, as President Joe Biden faces increasing pressure over his handling of the Gaza conflict, with the Democratic Party’s national convention beginning and pro-Palestinian protests taking place across the U.S. There is growing concern about the impact on Muslim and Arab American voters in key swing states. [Reuters] 

The road to an agreement remains fraught with challenges. Months of on-and-off negotiations have stalled over key issues, including Israel’s insistence on the destruction of Hamas as a military and political entity and Hamas’s demand for a permanent ceasefire. Disagreements also persist regarding Israel’s military presence in Gaza, particularly along the Egypt border, and the specifics of a prisoner exchange deal.

The ongoing conflict continues to destabilize the region, with renewed border skirmishes between Israel and Lebanon’s Hezbollah over the weekend raising fears of a broader escalation yet again. 

Blinken emphasized the importance of avoiding any actions that could derail the fragile peace process or escalate the conflict further, particularly with the involvement of Iran and other regional powers.

As Blinken and other mediators work to finalize an agreement, the coming days will be crucial. However, with deep-seated mistrust and conflicting demands on both sides, the prospect of a peaceful resolution remains uncertain.

– P.T.

08/16 – International News Story

In a recent Reuters survey, Japanese businesses revealed they are more inclined to favor a potential Kamala Harris presidency over a second term for Donald Trump. Respondents’ opinions reflected significant concerns about protectionism and policy unpredictability. 

Japan, a close ally of the United States and deeply affected by its economic policies, is watching the outcome of the upcoming U.S. presidential election closely, especially in light of the ongoing U.S.-China trade tensions.

The survey, carried out by Nikkei Research between July 31 and August 9, reached 506 Japanese companies, with 243 firms responding. Among them, 43% expressed a preference for Harris, citing a desire for stability and continuity in U.S. policies. In contrast, only 8% preferred Trump, while 46% stated that either candidate would be acceptable, and 3% favored neither. [Reuters] 

A ceramics manufacturer highlighted the potential challenges of another Trump administration, noting that “trade war, economic friction, and security threats” could force a reevaluation of their business strategy. This sentiment was echoed by a chemicals firm official who appreciated the predictability that a Harris administration might offer, suggesting that it would provide “better visibility into the future.”

Japanese companies also expressed concerns about potential changes under a Trump administration, with 34% indicating a need to review their foreign exchange strategies, 28% considering supply chain realignments, and 21% contemplating a reduction in their China operations. [Reuters] 

The survey also shed light on the broader economic relationship between Japan and China, revealing that 13% of Japanese companies are considering reducing their operations in China, regardless of the U.S. election outcome. Economic challenges in China, including a slower-than-expected GDP growth in the second quarter and a decline in export growth, are driving these decisions. Companies like Honda Motor and Nippon Steel have already announced cutbacks in their China operations. 

The recent survey also touched on Japan’s foreign exchange market, where 24% of respondents supported recent interventions by Japanese authorities to stabilize the yen, which had reached a 38-year low against the dollar earlier this year. While opinions were mixed on whether the Bank of Japan should raise interest rates to support the yen, 51% of respondents agreed that such a move should only occur in cases of extreme exchange rate fluctuations.

As the yen continues to show volatility, Japanese companies are bracing for a range of possible outcomes by the end of the year. The survey results indicate that 32% of firms expect the yen to trade between 145 to 150 yen per dollar, while 25% predict a firmer range of 140 to 145 yen, and 22% foresee it weakening further to between 150 to 155 yen per dollar.  [Reuters] 

Overall, it seems Japanese businesses are looking to navigate a complex economic landscape influenced by both U.S. and Chinese policies, with many looking for stability and predictability in the face of potential global disruptions. Man or woman that is in the White House come 2025 will serve to influence what this uncertainty holds for Japan and the rest of global markets. 

08/15 – International News Story

In September 2022, the Nord Stream gas pipelines, a critical energy conduit running from Russia to Germany, were rocked by subsea explosions, marking the most significant attack on Germany’s energy infrastructure since World War II. 

The blasts, which crippled three of the four pipelines, sparked international controversy and a flurry of accusations as to who was responsible, with Russia, Ukraine, the United States, and the United Kingdom all being mentioned as potential culprits.

A new development has emerged in the investigation, as German authorities issued a warrant in June for the arrest of Ukrainian diving instructor Vladimir Zhuravlev. [Politico]

Zhuravlev is suspected of orchestrating the attack, which involved chartering a yacht named “Andromeda” and using diving gear to plant explosives near the pipelines under the Baltic Sea, close to the Danish island of Bornholm.

According to reports from German news program Tagesschau, Zhuravlev’s involvement has been a focal point for investigators, who are led to believe that the operation was carried out by a group of Ukrainian citizens. 

The Nord Stream pipelines have been a subject of intense debate and criticism for years, particularly from Ukraine, the United States, and Poland, who argued that Germany’s reliance on Russian gas compromised European energy security. This criticism only intensified following Russia’s full-scale invasion of Ukraine in February 2022. 

Although Nord Stream 1 had been operational since 2011, and Nord Stream 2 was completed but not yet active, the pipelines became untenable in the geopolitical climate of the time.

Despite Ukrainian President Volodymyr Zelenskyy’s firm denial of his country’s involvement—stating, “I would never act that way”—reports have surfaced suggesting that plans to attack the pipelines were in motion as early as 2014. Documents leaked online and reported by The Washington Post indicated that the U.S. had intelligence about a possible Ukrainian plan to target the Baltic Sea gas links three months before the explosions.  [Politico] 

Information is still speculative as some Western and German intelligence officials have expressed doubts about Ukraine’s culpability, suggesting the possibility of a “false flag operation” designed to disguise Russian involvement. This theory has gained traction, particularly in Polish security circles, which have even provided German intelligence with the names of Russian suspects. Yet, German investigators remained unconvinced, opting instead to pursue Zhuravlev as their primary suspect. [Politico] 

Further complicating the case, Denmark and Sweden launched their own investigations into the explosions but ultimately suspended their inquiries without naming any suspects. German authorities, however, pressed forward, eventually identifying Zhuravlev with the help of photos and witness testimonies. 

A warrant for his arrest was transmitted to Poland in June, but by then, Zhuravlev had already fled the country, returning to Ukraine in early July. Polish authorities confirmed that Zhuravlev was not apprehended due to a failure to enter his name into an international law enforcement database. [Politico] 

The case also implicated two additional suspects, Svitlana and Yevhen Uspensky, a married couple who run a diving school in Ukraine and who allegedly employed Zhuravlev. In an interview with POLITICO, Svitlana Uspenska denied any involvement, asserting that she was in Kyiv at the time of the attack and that her diving capabilities were insufficient for such an operation, which required expertise at depths of 70 to 80 meters. Uspenska, now residing in Poland, has threatened to sue German media outlets for defamation.

As the investigation continues, the attack on the Nord Stream pipelines remains shrouded in mystery, with questions about responsibility and motive still unresolved. 

The incident not only underscores the fragility of Europe’s energy infrastructure but also highlights the complexities of the geopolitical landscape in the wake of Russia’s aggression in Ukraine.