Economic
South Korea Orders Truckers Back to Work as Labor Tensions Rise Globally
South Korea has ordered more striking truck drivers to return to work, in an effort to limit damage to the economy and supply chains as governments around the world grapple with a rise in labor unrest driven by inflation. On Dec 08, South Korean President Yoon Suk-yeol widened the scope of a back-to-work order to include the steel and petrochemical industries, after issuing a similar order for the cement sector last week. South Korea is just one of many countries where workers are demanding better pay and working conditions as the costs of goods and services rise. Labor tensions have led to strikes across the energy, steel and auto industries in France, Germany, Spain and Austria. In recent weeks, the U.K. has seen walkouts in the transport and health sectors. In the U.S., President Biden signed legislation last week to prevent a strike by railway workers over wages and paid time off. Labor economists say that inflation has prompted workers worldwide to demand higher wages to compensate for the increase in food and energy costs. In the U.S. alone, the number of strikes that have taken place this year is up roughly 34% compared with the previous year, said Johnnie Kallas, director of the Labor Action Tracker project at Cornell University’s School of Industrial and Labor Relations. Click here to read...
China wants to drop dollar in oil trade – Reuters
Beijing will work to make energy purchases in yuan instead of the US dollar signalling another step towards shifting further away from the greenback, China’s President Xi Jinping has told Gulf Arab leaders as cited by Reuters. China's leader highlighted the necessity of the move while speaking at a Chinese-Arab summit that was hosted by Saudi Arabia earlier this week. Xi had held separate talks with the heads of the Persian Gulf states at the summit that reportedly brought together 30 leaders from across the region. The world's biggest crude importer, China in November ramped up purchases of oil by 12% year-on-year, marking the 10-month high despite the severe pandemic-related restrictions. Chinese state refiners stepped up purchases of US crude oil, while maintaining high imports of Russian oil prior to the December 5 European embargo and imposition of an oil price cap. China’s independent refiners also moved a record amount of deeply discounted Iranian crude passed off as oil sourced from Malaysia, which is commonly used as a transfer point for oil originating from the sanction-hit Venezuela and Iran. Saudi Arabia was China’s number one oil supplier in the first ten months of 2022, making up 18% of China’s total crude oil purchases, with imports totalling 73.54 million tons, or 1.77 million barrels per day, Chinese customs data showed. Click here to read...
Europe Cold Snap Tests Gas Reserves After Russian Supply Cut
Frigid temperatures are boosting demand for natural gas in parts of Europe, providing an early test of the continent’s readiness for winter without Russian energy. Gas demand for Europe, including the U.K., was up 44% this week compared with the middle of last month, according to data from price-reporting agency ICIS. The U.K.’s National Grid PLC, which operates the country’s energy system, said it expects demand in the country to rise to 417 million cubic meters a day by Dec 09, up 65% from the middle of last month. For policy makers, the cold weather offers an early indication of how consumers will respond to pleas by governments to conserve energy this winter. The continent has enjoyed an unseasonably warm fall, which lowered gas demand significantly and allowed European governments and utilities a few extra weeks to fill up gas inventories. Last month was the fifth-warmest November on record, according to the European Centre for Medium-Range Weather Forecasts. Earlier this year, countries embarked on a race to save and import gas to build up storage levels and avoid shortages or disruptions. The moves came after European capitals pivoted away from Russian supplies in the wake of Moscow’s invasion of Ukraine. Russia responded by largely cutting off its exports. Click here to read...
US to add more than 30 Chinese companies, including Yangtze Memory, to trade blacklist
The Biden administration plans to put Yangtze Memory Technologies and more than 30 other Chinese companies on a trade blacklist that would prevent them from buying certain American components, deepening tensions between the world’s two economic superpowers. The US Commerce Department will add China’s leading maker of memory chips and the others to the so-called Entity List as early as this week, according to a person familiar with deliberations who asked not to be named discussing a sensitive matter. Companies on the Entity List are blocked from buying technology from US suppliers unless they get a special export license from Commerce. The move would represent the latest escalation in the US-China conflict over technology. The Biden administration unveiled a sweeping set of restrictions on China’s ability to buy semiconductors and chipmaking equipment in October, putting Yangtze Memory and other companies on a list for further scrutiny at the time. At the time, the US Commerce Department added 31 organizations including Yangtze Memory to what’s known as the Unverified List, which means American authorities are not able to prove that those companies are not supporting the Chinese military. That set in motion a 60-day countdown during which the companies would have to prove their businesses were not involved in activities that jeopardised US national security. Click here to read...
Japan, Netherlands to join U.S. in China chip curbs: Report
Japan and the Netherlands have agreed in principle to join the U.S. in tightening controls over the export of advanced chipmaking machinery to China, Bloomberg News reported on Dec 12, citing people familiar with the matter. In October, the Biden administration published a series of curbs aimed at stopping the export of chipmaking technology and certain chips made through U.S. equipment anywhere in the world to China. Apart from some U.S. gear suppliers, Japan's Tokyo Electron and Dutch lithography specialist ASML Holding were the two critical players needed to make the sanctions effective, making their governments' adoption of the curbs a key milestone, the report said. The new curbs may be announced in the coming weeks, it added. Japan's Ministry of Economy, Trade and Industry as well as the Netherlands' Foreign Affairs Ministry did not immediately respond to Reuters' requests for comment. Click here to read...
China sues US in WTO over chip export control measures
China took legal action against the US in the WTO over chip export control measures on Dec 12, China's Ministry of Commerce (MOFCOM) said in a statement posted on its website. Filing a lawsuit with the WTO is a way of seeking to address Chinese concerns through legal means, and a necessary way to defend China's legitimate interests, the ministry said. "In recent years, the US has been generalizing the concept of national security and abusing export control measures, which hinders the normal international trade in chips and other products, as well as threatening the stability of the global industrial chain and supply chain," the MOFCOM statement said. It noted that the move is a typical trade protectionism practice as it disrupts the international economic and trade order, violates international economic and trade rules as well as basic economic laws, and harms the global interests of peaceful development. The ministry urged the US to give up its zero-sum game mindset, correct its wrongdoings in a timely manner, and stop disrupting trade in high-tech products such as chips, so as to maintain normal economic and trade exchanges between China and the US, and maintain the stability of the global supply chain for important industrial goods such as semiconductors. Click here to read...
China's massive older chip tech build up raises US concern
China’s largest chip maker SMIC is ramping up production of a decade-old chip technology, key to many industries' supply chains, setting off alarm bells in the United States and prompting some lawmakers to try to stop them. The United States and allied nations could further step up restrictions if China announces a trillion yuan (US$144 billion) support package for its chip industry, as Reuters exclusively reported on Dec 13, said TechInsights' chip economist Dan Hutcheson. Starting with the Trump administration, the United States has been tightening the noose around China's high-tech ambitions. It cut off the world's largest telecommunications firm Huawei Technologies from the US market and technologies, as well as cut off air supply to China's advanced chip making through a series of rules this year. But why worry about older chip technology? China, which in 2020 had 9 per cent of the global chip market, has a track record of dominating key technologies by flooding the market with cheaper products and wiping out global competition, say China watchers. “28 nanometer” refers to a chip technology commercially used since 2011. It is still widely used in automotive, weapons and the explosive category of internet of things gadgets, said Hutcheson. “The Chinese could just flood the market with these technologies,” he said. “Normal companies can't compete, because they can't make money at those levels.” Click here to read...
China GDP to surpass US around 2035, years later than previously expected, Goldman Sachs predicts
Although the pace of China’s economic rise has slowed in recent years, it appears on track to end the United States’ lengthy run as the world’s largest economy by around 2035, according to the latest projection by economists at Goldman Sachs. The new estimate is 10 years later than the investment bank had predicted in 2011. But economists Kevin Daly and Tadas Gedminas said that potential growth in China still remains significantly higher than in the US. “China has already closed most of the gap with US GDP,” they said in a report published on Dec 13, adding that China’s gross domestic product has risen from 12 per cent of the US’ in 2000 to a little under 80 per cent. China’s annual economic growth will be around 4 per cent from 2024 to 2029, compared with 1.9 per cent in the US, according to the report, which projects what the global economy will look like through 2075. Factors for predicting GDP growth potential include the number of people in the workforce, the amount of capital they have to work with, and technical progress, according to the report. “Growth is projected to slow over time in most economies, owing to a smaller contribution from labour force growth, but this decline is expected to be particularly marked in China,” the economists said. Click here to read...
During Xi’s visit to Middle East, China and Saudi Arabia sign 34 energy and investment deals
Chinese President Xi Jinping met Saudi Arabia’s rulers on Dec 08 on his first visit to the kingdom since 2016. He was received by Prince Mohammed bin Salman at the al-Yamamah Palace early on Dec 08 afternoon, before the pair sat down for talks, followed by a meeting between Xi and King Salman. The reception came after China and Saudi Arabia signed 34 energy and investment deals as Xi vowed to strengthen the comprehensive strategic partnership with Riyadh. The Saudi Press Agency reported that Chinese and Saudi Arabian companies signed dozens of agreements – covering green energy, information technology, infrastructure and health – on Dec 07 as Xi started his state visit to Saudi Arabia. The Chinese president will attend two key summits with Arab and Gulf countries over the next two days. The total value of the 34 deals was not revealed. But the agency reported earlier that the two countries had aimed to sign 20 preliminary agreements worth US$29.26 billion. Saudi Arabian energy minister Abdulaziz bin Salman also announced a plan to establish a regional centre for Chinese factories to further boost energy supply chains. “The Kingdom of Saudi Arabia has strong and close strategic relations with China in many fields, the most important of which is energy,” the Saudi Press Agency quoted him as saying. “The Kingdom of Saudi Arabia will remain China’s credible and reliable partner in this field.” Click here to read...
Kishida appeals for higher taxes to bolster Japan's defense
Japanese Prime Minister Fumio Kishida made a plea for higher taxes to strengthen the nation's defenses at a news conference on Dec 10, saying Japan faces greater uncertainty over its security, given rising geopolitical tensions in Asia. "To protect our peaceful lives and fulfill [our] responsibility to future generations, I would like to ask for the cooperation of the Japanese people," Kishida said at a news conference following the conclusion of the 69-day extraordinary parliamentary session. The session was held to pass a major economic spending program designed to shield the economy from a global economic slowdown, and another bill aimed at offering support to victims of the Family Federation for World Peace and Unification, widely known as the Unification Church. But the deliberations have been overshadowed by the Russian invasion of Ukraine and mounting tensions over Taiwan. The Kishida government is drawing up a new defense framework aimed at strengthening Japan's defense capabilities and doubling the level of defense spending to 2% of gross domestic product. Kishida ruled out issuing new debt to pay for the defense spending increase. "Funding has been identified for three quarters of the expected increase in defense spending, through the reallocation of the budget, and use of reserve funds and nontax government income," Kishida said. But he added: "I have to ask for the cooperation of the Japanese people for the remaining quarter" of the funding needs. Click here to read...
Hold the Nuclear Fusion Hype
The news Dec 13 that U.S. scientists have performed the world’s first controlled nuclear fusion reaction that generates a net energy gain is a refutation of American declinism. But don’t believe the hype that a fossil-fuel free world is near if only the government spends more. Scientists have spent decades studying how to replicate in labs the nuclear fusion reactions that power the sun and stars. The fission reactions that power today’s nuclear plants involve splitting atoms and result in radioactive waste. Fusion entails combining atoms and theoretically could provide abundant, clean energy with no hazardous waste. Hydrogen, fusion’s input, is the most abundant element in the universe, and no country dominates its supply, unlike some minerals used in lithium-ion batteries and wind turbines. The reactions also don’t generate CO2. But a stumbling block has long been figuring out how to generate more energy from the fusion reactions than is used to ignite them. In the experiment that resulted in Dec 13’s breakthrough, the Lawrence Livermore National Laboratory used 192 lasers to heat and compress hydrogen atoms at more than 180 million degrees Fahrenheit. The reaction released 3.15 megajoules of energy for every 2.05 megajoules of input—with some major caveats. The lasers are less than 1% efficient and used about 300 megajoules. Click here to read...
EU strikes deal on world-first carbon border tariff
After all-night negotiations, the European Union struck a political deal on Dec 13 to impose a carbon dioxide emissions tariff on imports of polluting goods such as steel and cement, a world-first scheme aiming to support European industries as they decarbonise. Negotiators from EU countries and the European Parliament reached a deal at around 5am in Brussels, on the law to impose CO2 emissions costs on imports of iron and steel, cement, fertilisers, aluminium and electricity. Companies importing those goods into the EU will be required to buy certificates to cover their embedded CO2 emissions. The scheme is designed to apply the same CO2 cost to overseas firms and domestic EU industries - the latter of which are already required to buy permits from the EU carbon market when they pollute. Mohammed Chahim, European Parliament's lead negotiator on the law, said the border tariff would be crucial to EU efforts to fight climate change. "It is one of the only mechanisms we have to incentivise our trading partners to decarbonise their manufacturing industry," Chahim said. The aim of the levy is to prevent European industry from being undercut by cheaper goods made in countries with weaker environmental rules. It will also apply to imported hydrogen, which was not in the original EU proposal but which EU lawmakers pushed for in the negotiations. Some details on the law, including its start date, will be determined later this week in related negotiations on a reform of the EU carbon market. Click here to read...
FX swap debt a $80 trillion 'blind spot' BIS says
Pension funds and other 'non-bank' financial firms have more than $80 trillion of hidden, off-balance sheet dollar debt in FX swaps, the Bank for International Settlements (BIS) said. The BIS, dubbed the central bank to the world's central banks, also said in its latest quarterly report that 2022's market upheaval had largely been navigated without major issues. Having repeatedly urged central banks to act forcefully to dampen inflation, it struck a more measured tone and picked over crypto market troubles and September's UK bond market turmoil. Its main warning concerned what it described as the FX swap debt "blind spot" that risked leaving policymakers in a "fog". FX swap markets, where for example a Dutch pension fund or Japanese insurer borrows dollars and lends euro or yen before later repaying them, have a history of problems. They saw funding squeezes during both the global financial crisis and again in March 2020 when the COVID-19 pandemic wrought havoc that required central banks such as the U.S. Federal Reserve to intervene with dollar swap lines. The $80 trillion-plus "hidden" debt estimate exceeds the stocks of dollar Treasury bills, repo and commercial paper combined, the BIS said. It has grown from just over $55 trillion a decade ago, while the churn of FX swap deals was almost $5 trillion a day in April, two thirds of daily global FX turnover. Click here to read...
China Props Up Belt-and-Road Borrowers Via Unusual Channel
China’s central bank has funneled billions over the past decade to around 20 countries, including Pakistan, Sri Lanka, Argentina and Laos, via swap lines that allow overseas central banks to exchange their domestic currencies for Chinese yuan. The transactions, researchers say, are part of a broad but opaque effort by Chinese authorities to prop up governments that borrowed heavily from Chinese banks as part of Beijing’s $1 trillion Belt and Road Initiative to finance infrastructure projects and win influence across the world. By replenishing other countries’ reserves, the PBOC may be helping some of the world’s most indebted countries avoid rising borrowing costs. But economists say the swaps also help paper over problems that led to their financial troubles in the first place. The transactions also represent another potential liability for borrowers as rising interest rates, rocketing inflation, slowing growth and sinking currencies squeeze countries’ ability to repay their debts. The swaps are often rolled over, sometimes for years, and researchers estimate the average interest rate for using them has been around 6% of the value drawn. That is higher than what the Federal Reserve charges other central banks to swap their currencies for dollars as well as the rate on typical International Monetary Fund loans to poor countries. Click here to read...
US commits $55 billion to Africa over next three years: White House
The White House said Dec 12 ahead of the U.S.-Africa Leaders summit that it was pledging $55 billion in economic, health and security support for Africa over the next three years. One day before President Joe Biden hosts 50 African heads of state as Washington vies for influence in the continent, White House National Security Advisor Jake Sullivan said the United States aims to help African countries achieve their own goals. "Working closely with Congress, the U.S. will commit $55 billion to Africa over the course of the next three years across a wide range of sectors to tackle the core challenges of our time," Sullivan told reporters. Sullivan declined to give details, saying they would be revealed during the coming three days of bilateral and multilateral talks and a dinner hosted by Biden at the White House for his African counterparts. He stressed that the guiding theme would be the African Union's own Agenda 2063, its plan for sustainable socio-economic development of the continent. "The entire first substantive session that the president will chair at the summit is on Agenda 2063," Sullivan told reporters. "That is not an American document. It is not an American Vision. It is the African Union's document . . . So we are lifting up African voices and African priorities in what we are doing in this summit," he said. Click here to read...
Strategic
China’s Xi on ‘epoch-making’ visit to Saudi as Riyadh chafes at U.S. censure
Chinese President Xi Jinping began a visit to Saudi Arabia on Dec 08 that Beijing said marked its biggest diplomatic initiative in the Arab world, as Riyadh expands global alliances beyond a long-standing partnership with the West. The meeting between the global economic powerhouse and Gulf energy giant comes as Saudi ties with Washington are strained by U.S. criticism of Riyadh’s human rights record and Saudi support for oil output curbs before the November midterm elections. The White House said Xi’s visit was an example of Chinese attempts to exert influence, and that this would not change U.S. policy towards the Middle East. “We are mindful of the influence that China is trying to grow around the world,” White House National Security Council spokesperson John Kirby told reporters. China, the world’s biggest energy consumer, is a major trade partner of Gulf oil and gas producers. Bilateral ties have expanded under the region’s economic diversification push, raising U.S. concerns about growing Chinese involvement in sensitive infrastructure in the Gulf. Energy Minister Prince Abdulaziz bin Salman on Dec 07 said that Riyadh would remain a “trusted and reliable” energy partner for Beijing and that the two countries would boost cooperation in energy supply chains by establishing a regional center in the kingdom for Chinese factories. Click here to read...
Xi’s China-Arab summit success in Riyadh raises temperatures in Iran
Iranian President Ebrahim Raisi has “seriously demanded compensation” for his country over last week’s meetings between Arab leaders and Chinese President Xi Jinping in Riyadh. In a meeting with Chinese Vice-Premier Hu Chunhua in Tehran on Dec 13, Raisi said some of the positions raised during Xi’s meetings with leaders from around the region “caused dissatisfaction and complaints of the nation and the government”. The statement from the Iranian presidential office did not give details of what compensation may be sought. Nor did it refer to Dec 09’s declaration by China and the Gulf Cooperation Council (GCC), which is known to have angered Tehran. Iran’s “strong dissatisfaction” over the joint statement was made clear on Dec 10, at a meeting between China’s ambassador to Tehran Chang Hua and the Iranian foreign minister’s deputy for Asia-Pacific affairs. At their summit, Xi and the Arab leaders agreed to make sure that Iran’s nuclear programme was peaceful, and also that GCC member United Arab Emirates should resolve its territorial dispute with Iran – over strategic islands in the Strait of Hormuz – by negotiation. Iran took control of the islands of Abu Musa and the Greater and Lesser Tunbs in 1971, before the governing Gulf sheikdoms gained independence from Britain to form the UAE with other sheikdoms. Tehran has maintained that its sovereign claim over the three islands is non-negotiable, while the UAE has said Iran’s control of the islands violates international law. Click here to read...
Japan is upgrading China to a defence ‘threat’. A long overdue move?
Japan will upgrade China to an “unprecedented strategic challenge” in its revised National Security Strategy, with analysts saying the move that took nearly a decade of discussions is long overdue given geopolitical changes in the region. The ruling Liberal Democratic Party and its coalition partner Komeito agreed on Dec 12 to revise the strategy document for the first time since it was drawn up in 2013. The policy paper, along with the updated National Defence Strategy and National Defence Programme Guidelines, will be submitted to the cabinet for confirmation this week before going to the Diet for approval. It coincides with the recent announcement by Prime Minister Fumio Kishida that Japan would significantly raise defence spending, to account for 2 per cent of gross domestic product by 2027. Tokyo has for many years adhered to an unofficial policy that limited defence spending to 1 per cent of GDP, although that has been creeping higher over the last decade. According to media reports, the new version of the National Security Strategy document refers to China as “a threat”, a significant escalation from the 2013 paper which described Beijing as “an issue of concern to the international community”. That phrasing prompted a debate within the ruling coalition, with Komeito apparently resisting the use of the word “threat”. The solution appears to have been to keep the term “threat” but delete the direct reference to Japan, although there is little doubt about Tokyo’s position today.Click here to read...
North Korea fires over 130 rounds after South Korea-U.S. drills
North Korea said it fired more than 130 artillery shells into the sea off its east and west coasts on Dec 05 after detecting military drills across the border in the South. Some of the shells landed in a buffer zone near the sea border in what Seoul said was a violation of a 2018 inter-Korean agreement designed to reduce tensions. The South Korean military sent several warning communications to the North over the firing, the ministry of defense said in a statement. North Korea's military conducted its firing after detecting dozens of "projectiles" fired in the South near the shared border, state news agency KCNA reported, citing a spokesperson of the General Staff of the Korean People's Army. "The enemy should immediately cease military actions that cause escalation of tensions in areas near the front lines where visual surveillance is possible," the unnamed spokesperson said, warning that the North would respond firmly and with overwhelming military action to any provocation. "We sternly warn the enemy not to stir up unnecessary escalation of tension along the front lines." South Korea and the United States were conducting a joint land-based firing drill near the border in Cheorwon County in the middle of the peninsula on Dec 12. Their drill will continue on Dec 13Click here to read...
Six Pakistanis, one Afghan soldier killed in cross-border clash
Cross-border shelling and gunfire between Afghanistan and Pakistan killed six Pakistani civilians and one Afghan soldier on Dec 11, officials on both sides of the frontier said, with each side accusing the other of starting the fighting. The Pakistan army said Afghan border forces had opened "unprovoked and indiscriminate fire of heavy weapons including artillery/mortar on to the civilian population" at the Chaman border crossing, which links Pakistan's western Balochistan province with Afghanistan's southern Kandahar province. Six civilians were killed and 17 wounded on the Pakistani side by Afghan fire, leading Pakistani troops to retaliate, the Pakistan military said in a statement. Pakistani Prime Minister Shehbaz Sharif said the killings "deserve the strongest condemnation." "The Afghan interim government should ensure that such incidents are not repeated," Sharif further said in a statement. Haji Zahid, a spokesman for Kandahar's governor, said the fighting began after Pakistan objected to Afghan forces building a new checkpoint. "They didn't want us to build these posts on our side of the border," he told Reuters, adding it led to a two-hour-long gun battle. Kandahar police spokesman Hafiz Saber said one Afghan soldier was killed and 10 people, including three civilians, were wounded. Afghanistan and Pakistan have for decades had territorial disputes at their border and the Chaman crossing was closed for several days after similar clashes in November. Click here to read...
Monk militia: The Buddhist clergy backing Myanmar’s junta
In a monastery in central Myanmar, a Buddhist monk, Wathawa, rallies his militia with a cry: “What’s our spirit like?” “The spirit of iron!” shout a group of rifle-bearing men, loyalists of the military junta that seized power last year, now fighting to crush fledgling pro-democracy groups. The scene, from a video posted online by army-linked media, would have seemed unimaginable to previous generations in the overwhelmingly Buddhist nation. Now, it underscores the close alliance the military has forged with the Buddhist hierarchy. Myanmar’s Buddhist clergy previously sought to topple successive military dictatorships that kept citizens impoverished and isolated. Monks were part of the 1988 uprising that brought Nobel laureate Aung San Suu Kyi to prominence. Thousands thronged the streets during 2007 anti-government protests known as the Saffron Revolution. Many are now supporters of the new junta. As the new junta suppresses opponents, religious leaders have been largely absent from the widespread resistance to last year’s army coup, which ended the decade-long democratic experiment that brought Suu Kyi to power. In public comments and state media broadcasts as recently as November, the military has acknowledged forming militia in some villages “based on their demands,” but has denied arming monks. Click here to read...
Bangladesh government digs in against protests as economy teeters
Political tensions in Bangladesh are boiling after a weekend that saw tens of thousands take to the streets against the government, raising fears of violence and repression as well as concerns over the impact on an already fragile economy. A series of demonstrations organized by the opposition Bangladesh Nationalist Party (BNP) in recent months culminated in a huge rally in Dhaka on Dec 10, despite extensive government efforts to keep a lid on it. The BNP's head office in the capital was cordoned off, while roads were blocked to prevent party leaders and activists from joining the protest. This came three days after at least one BNP activist was reported killed and hundreds were arrested as the party was preparing for Saturday's rally. The detainees included a number of party leaders. The BNP has put forward a 10-point list of demands and vowed to fight until the Awami League government of Prime Minister Sheikh Hasina quits to make way for a nonpartisan administration, which would see the country through a general election that is expected in January 2024. The Awami League's landslide victory in 2018 was marred by reports of violence and allegations of vote rigging -- charges denied by the government. With tempers running hot and maturing foreign loans looming over the dollar-strapped and inflation-gripped economy, Bangladesh appears to be heading into an especially treacherous period. Click here to read...
Blinken readies for first China trip in New Year
American and Chinese officials are finalizing plans for Antony Blinken to make his first visit to China as U.S. secretary of state sometime in early 2023, with priority given to finding ways to avoid accidental clashes arising from unforeseen circumstances. This follows Joe Biden's first in-person meeting as president with Chinese counterpart Xi Jinping last month in Bali, Indonesia. The leaders agreed to maintain dialogue between senior officials in such areas as climate change, global economic stability and food security. Both sides saw eye to eye on Blinken visiting China to follow up on the progress in these communications. On Dec 11, the U.S. sent Daniel Kritenbrink, assistant secretary of state for East Asian and Pacific affairs, and Laura Rosenberger, the National Security Council's senior director for China and Taiwan, on a four-day trip through Asia, with China as the first stop. Kritenbrink and Rosenberger will follow up on the Biden-Xi meeting "to continue responsibly managing the competition between our two countries and to explore potential areas of cooperation," the U.S. State Department said Dec 10. Chinese Vice Foreign Minister Xie Feng held talks with Kritenbrink and Rosenberger in Hebei Province on Dec 11-12, said Wang Wenbin, a spokesperson for China's Ministry of Foreign Affairs. Click here to read...
U.S. military bill features up to $10 billion to boost Taiwan
The U.S. Congress is expected to start voting as soon as Dec 07 on a massive military policy bill including authorization of up to $10 billion in security assistance and fast-tracked weapons procurement for Taiwan. The compromise version of the annual National Defense Authorization Act, or NDAA, does not include some controversial provisions of Taiwan legislation lawmakers proposed this year, including sanctions in the event of “significant escalation in aggression” against Taiwan by China, or a proposal that Taiwan be treated as a “major non-NATO ally.” China considers Taiwan its territory and has never renounced using force to bring it under its control. Beijing responded angrily when the Senate Foreign Relations Committee approved broader Taiwan legislation in September despite concern within President Joe Biden’s administration that the bill could go too far in heightening tensions with China. The Senate and House Armed Services committees unveiled the NDAA late on Dec 06. The $858 billion military policy bill is expected to pass Congress and be signed into law this month. The “Taiwan Enhanced Resilience Act” included in the NDAA authorizes appropriations for military grant assistance for Taiwan up to $2 billion per year from 2023 through 2027, if the U.S. secretary of state certifies that Taiwan increased its defense spending. Click here to read...
EU-Asean statement drops language about Taiwan ahead of summit
Language on Taiwan has been dropped from a joint communique on the eve of a meeting of European Union and Asean leaders in Brussels, after a sharp disagreement over how to describe Taiwan’s political status. The dispute centred on whether there was a universal “one-China principle”, with Asean negotiators pushing for text that was closer to that of Beijing’s position on the matter, EU sources said, ahead of the first summit between the European Union and the Association of Southeast Asian Nations on Dec 13. China considers Taiwan as an “inalienable part of China’s territory” that will eventually be taken back, by force if necessary. Brussels preferred to highlight that it has its own autonomous one-China policy, one that allows space for cooperation with Taiwan too. In the end, “they preferred not to have any text at all”, an EU official said. Rather than focusing on Taiwan, the communique focuses on issues pertaining to the South China Sea. “We reaffirm the importance of maintaining and promoting peace, security, stability, safety, and freedom of navigation in and overflight above the South China Sea, in accordance with international law, including Unclos,” read a draft text. Unclos stands for the United Nations Convention on the Law of the Sea. “We reaffirm the need to enhance mutual trust and confidence, exercise self-restraint in the conduct of all activities and avoid actions that could increase tensions and the risk of accidents, misunderstandings, and miscalculation,” it continued. Click here to read...
Japan to include standoff missile unit for enemy ‘counterstrikes’
The government will include a “standoff missile unit” capable of long-distance strikes against enemy bases under what it calls “counterattack capabilities” in three key national security policy documents that are now being revised. The government presented the plan to a meeting of the ruling Liberal Democratic Party on Dec. 13. The outline for the three documents said the standoff missile unit will become a core feature of the Ground Self-Defense Force for striking enemy bases that are planning to attack Japan, according to sources. The unit will comprise seven surface-to-ship missile regiments, two high-speed gliding missile battalions for island protection, and two long-range guided missile troops. Under the government’s plan, the unit will be armed with U.S.-made Tomahawk cruise missiles, Japan-made Type 12 surface-to-ship guided missiles, which are currently being upgraded, and hypersonic guided missiles. The Type 12 missiles will include those that can be fired from the ground, ships and aircraft. In addition, the GSDF and the Maritime Self-Defense Force will each have one new “information warfare unit.” Since Russia started invading Ukraine in February, Japan’s Defense Ministry has been considering establishing warfare units to deal with information spread on the internet, including through social media platforms. Click here to read...
Turkey seeks proof of insurance from Russian oil tankers
Turkey says it has started requesting proof of insurance from tankers loaded with Russian crude oil as Moscow expressed concern about a build-up of oil tankers in the Bosphorus Strait. At least 20 oil tankers queueing off Turkey face more delays to cross from Russia’s Black Sea ports to the Mediterranean as operators race to adhere to new Turkish insurance rules added in advance of a G7 price cap on Russian oil, industry sources said on Dec 06, as cited by the Reuters news agency. Russia is discussing the issue with insurance and transport companies, Russian news agency RIA cited Russian deputy foreign minister Alexander Grushko as saying on Dec 07. “We are aware of this situation. Of course, it causes us concern from the point of view of the interests of our operators. This problem is being discussed with transport and insurance companies. After all, insurance companies insure, not the state,” Grushko was quoted as saying. “If the problem is not solved, of course, there will be involvement on the political level.” Turkish maritime authorities issued a notice seen by Reuters last month asking for additional guarantees from insurers that transit through the Bosphorus would be covered starting from the beginning of this month. Disruptions in tanker traffic from Russia’s Black Sea ports to the Mediterranean are a result of a new Turkish insurance rule, not the price cap on Russian oil agreed by a coalition of G7 countries and Australia, an official with the group said on Dec 06. Click here to read...
US will send Patriot missiles to Ukraine – CNN
The administration of US President Joe Biden is finalizing plans to send Patriot missiles to Ukraine, CNN reported on Dec 13. Kiev has been requesting the American air defense systems for months, as Russia continues its strikes on Ukrainian military and infrastructure targets. The plan is in its final stages and needs approval from Defense Secretary Lloyd Austin before it can be sent to Biden’s desk for his signature, the report stated, citing three anonymous US officials. Austin’s approval is expected, and an announcement could be made as soon as this week, the officials told CNN. A single Patriot missile battery comprises a power unit, a command station, a radar unit and antennae, and up to eight truck-mounted launchers, each holding four surface-to-air missiles. Developed by US defense contractor Raytheon, the system has a range of up to 99 miles (160km), and can intercept incoming missiles or aircraft. The Patriot system was tested extensively during the Gulf War, with the Pentagon claiming it successfully intercepted 45 out of 47 Iraqi Scud missiles during the six-week conflict. However, the Israeli military later revealed that “one or possibly none” of the Scuds were actually intercepted, while a 2017 New York Times report found the Patriot system ineffective when used by Saudi Arabia against Houthi missiles fired from Yemen. It is unclear how many Patriot systems the US will send to Ukraine. Click here to read...
UN Security Council adopts resolution on humanitarian "carve-out" to UN sanctions
The UN Security Council on Dec 09 adopted a resolution on establishing a standing humanitarian exemption to the asset freeze measures imposed by the United Nations. Resolution 2664 decides that the provision, processing or payment of funds, other financial assets or economic resources, or the provision of goods and services necessary to ensure the timely delivery of humanitarian assistance or to support other activities that support basic human needs are permitted and are not a violation of the asset freezes imposed by the Security Council or its sanctions committees. The humanitarian "carve-out" applies to a wide range of entities, including UN programs, funds, agencies, humanitarian organizations having observer status with the UN General Assembly, and certain nongovernmental organizations, according to the resolution. Resolution 2664 decides that the carve-out will apply to the sanctions regime against the Islamic State and al-Qaida for a period of two years from the date of adoption of this resolution, and that the Security Council may extend the application. It requests that the UN secretary-general issue a written report on unintended adverse humanitarian consequences of Security Council sanctions measures, including travel ban and arms embargo measures, as well as those measures that are unique to particular sanctions regimes, within 9 months of the adoption of this resolution. Click here to read...
Middle East country boasts world’s most powerful passport
Citizens of the United Arab Emirates now wield the globe’s most powerful passport, enjoying easy visitor access to all but 9% of the world’s countries, according to the latest Passport Index ranking by Canadian financial advisory firm Arton Capital. The UAE-issued document surpassed the likes of those from Germany, Sweden and Luxembourg to claim the top spot, Arton reported on Dec 07. Holders of a passport from the federation of sheikhdoms in the Persian Gulf have visa-free access to 121 countries and can obtain a visa upon arrival in 59 other states, giving them a combined mobility score of 180, up from 160 a year ago, according to Montreal-based Arton. The oil-rich Emirates, which include Dubai and Abu Dhabi, previously ranked as the top Middle East nation in the Passport Index. It’s also home to the most multinational corporate headquarters in the region. The UAE has forged several key trade and diplomatic agreements in recent years, including normalization of relations with Israel in 2020. It has attracted thousands of expatriates through a new remote-worker visa program that was launched last year. European nations held 10 of the top 11 spots in the Passport Index rankings, with only the UAE slipping ahead of them. Germany and other EU states have visa-free access to more countries, but the UAE surpasses them when it comes to eligibility for visa issuance upon arrival. Click here to read...
Health
US lawmakers look to repeal Pentagon vaccine mandate
US House and Senate members are poised to force President Joe Biden’s administration to end its Covid-19 vaccine mandate for members of the military by folding the provision into an annual defense funding bill. Democrats have agreed to a compromise with Republicans under which they allowed an amendment to the National Defense Authorization Act (NDAA) requiring the Pentagon to end its jab order. The final draft of the NDAA was released on Dec 06 night and is scheduled to be voted on by the House later this week. The move comes amid a military recruiting crisis, which has been blamed at least partly on the vaccine mandate, as well as claims by Republicans that Biden has infringed on the freedoms of US troops. Representative Thomas Massie, a Kentucky Republican, previously confirmed the agreement, saying he had gained more than 90 co-sponsors for an earlier bill that would end the mandate. “Now it looks like the intent of this legislation could become a reality in the NDAA this month.” All branches of the US military have struggled to meet their recruiting quotas. In fact, the US Army missed its fiscal year 2022 hiring target by 15,000 troops, or 25%.Click here to read...
Beijing hospitals battle staff shortage and patient influx after China’s sudden zero-Covid switch
Hospitals in China’s capital Beijing are battling staff shortages and struggling to keep their doors open amid a flood of Covid-19 cases a week after the country’s sudden switch from strict pandemic controls to living with the virus. The city reported only 1,027 infections on Dec 13 morning but the true scale of cases is believed to be much greater, with residents no longer required to have PCR tests or report their antigen test results. There are big concerns whether China can safely make the shift from its former strict zero-Covid policy without rampant infections in the community crushing the health system. Since more relaxed rules were announced last week and the capital stopped trying to control growing outbreaks, hospitals in Beijing have been trudging through difficult waters. Hospitals have not yet been stretched to breaking point but staff shortages are common as healthcare workers are struck down by the virus. Some facilities have cancelled non-emergency surgery just to keep their services running. “The rapid development of the epidemic has led to greater pressure on health services in the short term,” Li Ang, deputy director of Beijing’s health commission said on Dec 12. Vice-premier Sun Chunlan, who has been in charge of Covi-19 control for the past three years, inspected several hospitals and pharmacies in Beijing on Dec 13 and said the focus of work should be changed from controlling infection to treatment. Click here to read...
