Economic
OPEC Sees Oil Demand Climbing, at Odds With Saudi-Led Production Cut
The Organization of the Petroleum Exporting Countries said it expects oil demand to climb this year, a forecast that is at odds with the recent move by some of its biggest members to slash output and suggests higher energy prices are looming. The Vienna-based cartel said it was standing by its earlier forecast that demand for crude oil is expected to rise by 2.3 million barrels a day this year. That means OPEC’s own analysts appear to see the market differently than some of the cartel’s largest members, who recently said they would cut output by more than 1 million barrels a day. The oil producers group said demand would rise to 103.27 million barrels a day in the final quarter of the year, from 101.55 million barrels a day in the first. Meanwhile, oil supplies from non-OPEC oil producers are expected to remain largely unchanged at around 67.6 million barrels a day. If that forecast proves accurate, that would leave a large shortfall that the cartel itself will have to fill if it wishes to keep pace with rising Chinese demand and prevent an uncontrolled surge in oil prices. OPEC’s own analysts said April 13 the cartel would need to increase output to around 30 million barrels a day by the final quarter, from around 28.82 million barrels a day in the first quarter, to fill the growing gap. Click here to read...
G7 pledges to quit fossil fuels faster, but no new deadline
The G7 pledged on April 16 to quit fossil fuels faster and urged other countries to follow suit, but failed to agree to any new deadlines on ending polluting power sources like coal. The language reflects the depth of disagreements among the allies on the balance between climate action and energy security, with host Japan leading a pushback against the most ambitious proposals discussed. After two days of talks in the northern city of Sapporo, the bloc's climate and environment ministers vowed to "accelerate the phase-out of unabated fossil fuels so as to achieve net zero in energy systems by 2050 at the latest... and call on others to join us in taking the same action." But they offered no new deadlines beyond last year's G7 pledge to largely end fossil fuel use in their electricity sectors by 2035. France's energy transition minister Agnes Pannier-Runacher said the "phase-out" wording was nonetheless a "strong step forward" ahead of the G20 and COP28 summits this year. "The most important progress we have made is clearly the fact that we agree to move away from non-carbon-offset fossil fuels," she told AFP. Britain and France had put forward a new goal of ending "unabated" coal power ― which does not take steps to offset emissions ― in G7 electricity systems this decade. Click here to read...
China’s central bank chief signals phasing out currency intervention
China can phase out currency intervention by gradually reducing the amount and frequency of its forays into the market, the country’s central bank governor said on April 15, underscoring Beijing’s resolve to keep up efforts to boost the yuan’s global presence. People’s Bank of China Governor Yi Gang also said the central bank will seek to guide monetary policy so that real interest rates move slightly below the potential growth rate. “We have been trying to maintain the exchange rate stable for some time. If you go on forever, then one day I would say that markets would defeat the central bank,” Yi said in a seminar during the International Monetary Fund (IMF) and World Bank spring meetings in Washington. “If you have the right monetary policy, I think you make sure the exchange rate is determined by the market and authorities intervene” as little as possible, he said. While China reserves the right to intervene in times of market turbulence, authorities must allow market forces to drive yuan moves more, Yi added. “Interest rate is the key and exchange rate is determined by market. That’s the basic message I want to get across,” he said. Yi said China has managed to keep inflation “very stable” around 2 per cent through exchange-rate and monetary policies, adding that it was pursuing a “balanced” current account rather than running a surplus. Click here to read...
Mainland China launches probe into Taiwan’s ‘trade barriers’ affecting 2,400 products
Mainland China will look into Taiwan’s restrictive measures against the import of over 2,400 mainland products after launching a “trade barrier investigation”, a rare move which will further complicate cross-strait relations ahead of a pivotal presidential election in Taipei. The mainland’s Ministry of Commerce said in a statement on April 12 that it would review complaints by three mainland Chinese trade groups spanning agricultural goods, textiles and mineral-chemical products as “the Taiwan region is working on and implementing measures to ban imports of mainland products”. “The probe should be concluded by October 12, 2023. Under special circumstances, it can be extended to January 12, 2024,” the ministry added. Taiwan will hold its next presidential election on January 13, the Central Election Commission confirmed last month. Zhu Fenglian, a spokeswoman for the Taiwan Affairs Office in Beijing, said the island “has for a long time imposed unilateral restrictive measures on over 2,400 products from the mainland, which has caused to damage to related mainland industries and companies’ interests. “The investigation result will be made public at an appropriate time,” she added. Taiwan’s Ministry of Economic Affairs said mainland officials had not formally notified Taiwan of the probe and urged them to start a dialogue. Click here to read...
Germany bids farewell to nuclear era as it powers down last 3 reactors
Germany will switch off its last three nuclear reactors on April 15, exiting atomic power even as it seeks to wean itself off fossil fuels and manage an energy crisis caused by the war in Ukraine. While many Western countries are upping their investments in atomic energy to reduce their emissions, Germany is bringing an early end to its nuclear age. Europe’s largest economy has been looking to leave behind nuclear power since 2002, but the phase-out was accelerated by former chancellor Angela Merkel in 2011 after the Fukushima nuclear disaster in Japan. The exit decision was popular in a country with a powerful anti-nuclear movement, stoked by lingering fears of Cold War conflict and atomic disasters such as Chernobyl in Ukraine. “The risks of nuclear power are ultimately unmanageable,” said Environment Minister Steffi Lemke, who this week made a pilgrimage to the ill-fated Japanese plant ahead of a G7 meeting in the country. But the challenge caused by Russia’s invasion of Ukraine, which put an end to cheap gas imports, and the need to quickly cut emissions has upped calls in Germany to delay the withdrawal from nuclear power. Greenpeace, at the heart of the anti-nuclear movement, organised a celebratory fete at the Brandenburg Gate in Berlin to mark the occasion. Click here to read...
G7 members seek to push Moscow out of nuclear energy market
Five members of the G7 group have formed an alliance aimed at blocking Russia out of the international nuclear energy market. The US, UK, Canada, Japan and France reached the agreement on the sidelines of a G7 meeting in Sapporo, according to a joint statement shared on April 16 by the British government. Under the agreement, the allied countries have vowed to use the respective resources and capabilities of each state’s civilian nuclear energy sectors to “ensure the secure supply of uranium fuel through the development of shared supply chains that isolate Russia.” The document further states that the five countries have “identified potential areas of collaboration on nuclear fuels to support the stable supply of fuels for the operating reactor fleets of today, enable the development and deployment of fuels for the advanced reactors of tomorrow, and achieve reduced dependence on Russian supply chains.” “Together, today’s G7 commitments deal a blow to Russia, demonstrating the international resolve to isolate Putin further internationally,” the British government said in a press release. British Energy Security Secretary Grant Shapps declared that the UK has been “at the very heart of global efforts to support Ukraine” and “defeat Putin,” adding that the latest agreement is “the next vital step, uniting with other countries to show Putin that Russia isn’t welcome anymore.” Click here to read...
EU should avoid China dependency as it builds ‘de-risking’ strategy with US: trade chief
The European Union should not build a strategic dependency on China as it continues to align its “de-risking” strategy with the United States to gain economic security and diversify its supply chains away from Beijing, according to the bloc’s trade chief. Valdis Dombrovskis, executive vice-president of the European Commission, gave his remarks on Wednesday after French President Emmanuel Macron sparked controversy on both sides of the Atlantic by saying the EU should avoid becoming an American “vassal” when it comes to China and must reduce its dependency on the US. That firestorm erupted as Beijing appeared to be seeking stronger ties with European nations while geopolitical eddies continued to swirl in coping with growing tension with Washington and the US-led “suppression of China”, as Chinese President Xi Jinping asserted last month. Amid debates whether Washington was moving towards a broader break-up with Beijing, Dombrovskis stated on April 12 that decoupling from China was not what Brussels intends. “We are rather heading towards de-risking and better risk management, avoiding strategic dependency,” he said at an event held by the American Enterprise Institute, a Washington-based think tank. Still, Dombrovskis believed the EU “should not develop new dependencies” after making progress in decoupling from Russia in fossil fuel supplies following the war in Ukraine. Click here to read...
Japan ranks 3rd in foreign aid spending but still below U.N. target
Japan placed third in the world for providing foreign aid in 2022 after spending $17.4 billion (2.3 trillion yen) on official development assistance (ODA), according to the Foreign Ministry. The preliminary figures released on April 13 show a drop by 0.9 percentage point from the previous year due to the weak yen. In yen terms, the figure jumped 18.7 points to 2.3 trillion yen. The increase was primarily due to high-speed railway and other projects in India and increased yen loans for reconstruction programs in Ukraine, according to the ministry. The United States and Germany topped Japan on the list, as they did the previous year, according to data released by the Organization for Economic Cooperation and Development (OECD). However, in terms of proportion of gross national income (GNI), Japan was 15th with 0.39 percent, up 0.05 point, of the country’s total income spent to support developing countries. The United Nations has set a target for nations to spend 0.7 percent of their GNI on official developmental assistance. In 2022, five nations including Germany met the goal. The government has pledged to employ ODA as a vital diplomatic tool as Japan’s security environment has become increasingly challenging due to China’s military rise and North Korea’s nuclear and missile programs. Click here to read...
ADB readies $15bn in climate financing for emerging Asia: president
The Asian Development Bank will provide an additional $15 billion in funding for emerging markets to tackle climate change under a new, faster lending model, President Masatsugu Asakawa told Nikkei. Advanced economies will provide $3 billion in guarantees, enabling the ADB to extend loans worth five times that amount. These will be used for decarbonization projects to cut greenhouse gas emissions and promote growth. The development bank will call on private-sector banks and others to join the effort to expand investment further. The new lending facility will be announced at the ADB's annual meeting in May. "The ADB will become a climate bank," Asakawa said. Demand for capital for climate projects in developing nations is vast, yet there are few lenders to meet it. The Group of 20 major economies have urged multilateral development banks to step up financing. The ADB's new leveraged climate finance model will be the first time for the bank to use government guarantees in this way. "If the ADB succeeds, [the model] could spread to other development banks," Asakawa said. One aim is to encourage countries to shut down coal power plants and transition faster to renewable energy. Such financing will be tested in Indonesia, Vietnam and the Philippines, and Pakistan has expressed interest as well, according to Asakawa. Click here to read...
Pakistan draws closer to IMF deal after UAE pledges $1bn
The United Arab Emirates has confirmed financial support of $1 billion to Pakistan, the South Asian nation's finance minister said on April 14, removing a key hurdle to securing a much-awaited bailout tranche from the International Monetary Fund (IMF). The commitment is one of the lender's last requirements before approving a staff-level pact to release a tranche of $1.1 billion, delayed for months, that is crucial for Pakistan to resolve an acute balance of payments crisis. "The State Bank of Pakistan is now engaged for needful documentation for taking the said deposit from UAE authorities," Finance Minister Ishaq Dar said on Twitter, referring to the central bank. The pledge makes the UAE the third country, after Saudi Arabia and longtime ally China, to come to Pakistan's assistance, as external financing is needed to fully fund the balance of payments gap for the fiscal year that ends in June. On April 14, the IMF's managing director, Kristalina Georgieva, said the fund was also in talks with nations friendly to Pakistan to secure financial assurances vital for the program. Last week, Saudi Arabia also told the IMF it would provide financing of $2 billion to Pakistan. Click here to read...
Asian Monetary Fund idea revived amid U.S.-China row
An ill-fated idea to create a regional mutual support mechanism in the wake of Asia's 1997 financial crisis was recently floated again. During his visit to Thailand in early February, Malaysian Prime Minister Anwar Ibrahim called for the creation of an Asian Monetary Fund (AMF) -- an Asian version of the International Monetary Fund -- as a buffer against potential economic crises in the region. "We cannot have the international infrastructure being decided by outsiders," Anwar said in Bangkok on Feb. 10. "We can work with them, but we should have our own domestic, regional and Asian strength, not necessarily to compete but to have a buffer zone." The location where he made the comment was apt, as Thailand was the epicentre of the 1997 turmoil. Japan proposed the formation of an Asia-focused platform to supplement the IMF's functions and capabilities, but the idea never materialized. "We proposed it because the IMF, which did not know much about Asia, botched its response to the crisis," said Eisuke Sakakibara, Japan's top international finance bureaucrat at the time and now head of the Institute for Indian Economic Studies. Sakakibara, once known as "Mr. Yen" for his ability to influence the currency, was the mastermind of the proposal. Click here to read...
Samsung's profit woes cast shadow over South Korea's economy
Choo Kyung-ho, South Korea's finance minister, visited an expansive Samsung Electronics facility south of Seoul April 07 to check out semiconductor production lines operated by the global tech giant, the dominant force in the country's economy and a source of pride for many of its citizens. "Semiconductors are called the rice of industry, but I think they're a lifeline beyond rice," Choo, who is also a deputy prime minister, told Samsung CEO Kyung Kye-hyun and other executives, using the country's staple food as a metaphor. "If there are no semiconductors, neither our economy, nor our industry can run." His remarks were shared by the Ministry of Economy and Finance. But the high-profile excursion was overshadowed by an announcement Samsung made the same day, saying it expects operating profit to have plunged 96% to 600 billion won ($463 million) in the first quarter from a year ago and that it is cutting production of its mainstay memory chips amid a global supply glut. The news was a blow as such a result would mark the first time in 14 years the company's quarterly operating profit has fallen below 1 trillion won. It was also unusual that the guidance figure was less than local rival LG Electronics, which said it expects to rake in 1.5 trillion won in operating profit for the three months through March. Click here to read...
Food security drives China to cut soymeal use in animal feed
China’s agriculture ministry issued a three-year action plan on April 14 to reduce soymeal use in animal feed as it continues to try to reduce its heavy reliance on soybean imports. The new plan proposes that soymeal ratios in animal feed should be reduced to under 13% by 2025, down from 14.5% in 2022. Authorities in the world’s top soybean importer already issued guidelines in 2021 to its animal feed industry recommending lower soymeal ratios. The new plan would “guide the feed industry to reduce the amount of soybean meal, promote the saving and consumption reduction of feed grains, and contribute to ensuring the stable and safe supply of grain and important agricultural products”, said the document published by the Ministry of Agriculture and Rural Affairs. The new target of under 13% by 2025 is slightly lower than an earlier target of 13.5%, but the direction is not new, said Lief Chiang, senior analyst at Rabobank. “The whole point is to build a more resilient supply chain amid geopolitical risks,” he said. China buys more than 60% of the world’s traded soybeans, well over 90 million tons a year, largely from the United States and Brazil. “On the one side, they would like to lower the absolute volume of soybean imports, but meanwhile as a contingency, they want to diversify, and lower their dependency more, particularly on the United States,” added Chiang. Click here to read...
Economy tops Erdogan’s manifesto for Turkish elections
Turkish President Recep Tayyip Erdogan has launched his re-election campaign with a party pledge to slash inflation to single digits and boost economic growth as he seeks to extend his two decades in power in the May 14 vote. Erdogan is facing the biggest political challenge since his Justice and Development (AK) Party came to power in 2002. Polls show support sagging in recent years since the Turkish lira has fallen steeply in value and inflation has skyrocketed. Opponents have blamed the president’s economic policies. Even so, the president repeated his economic mantra that investment, production, exports and an eventual current account surplus would drive up Turkey’s gross domestic product. “We will bring inflation back down to single digits and definitely save our country from this problem,” he told a crowd at an Ankara stadium on April 11. Erdogan sought aggressive interest rate cuts, which the Central Bank of Turkey carried out, sending inflation to a 24-year peak of more than 85 percent in October before it dipped to near 50 percent in March. The ensuing cost-of-living crisis has gripped Turkish households and squeezed earnings and savings, bottoming out people’s purchasing power. “We will improve the investment further with a structure based on a free-market economy integrated with the world,” the ruling party’s manifesto said. It aims for annual growth of 5.5 percent from 2024 to 2028 and GDP of $1.5 trillion by the end of 2028. GDP was just over $1 trillion in 2022. Click here to read...
Taliban Prove to Be Formidable Tax Collectors, Putting Squeeze on Afghans
The Taliban has managed to squeeze more tax revenue out of the country than the previous U.S.-backed governments, even as the economy collapses and most Afghans are struggling to afford food. The government doesn’t have much of a choice—it has been cut off from the international aid that sustained administrations in Kabul for nearly two decades. “We are creating a culture of tax paying, in spite of all our problems,” said Nooruddin Azizi, the Taliban commerce minister. “It takes effort and hardship to move the country towards self-sufficiency. Some will even sustain losses, but the person or shopkeeper who makes a loss now will enjoy a lot of benefits in future years.” Still, it isn’t an easy pitch to make to a country that has plunged deeper into poverty since the Taliban took over in 2021, as the bubble of foreign aid and security funding burst. Afghanistan has largely been cut off from the international banking system, hindering trade and remittances from overseas. The Taliban has restricted women from parts of the workforce, depriving many families of livelihoods. The World Food Program says that 92% of households are straining to meet their basic food needs, including millions on the verge of famine. There are indications that the administration has managed to stabilize the economy in recent months, around what the World Bank calls a “fragile low-level equilibrium” after shrinking 21% in 2021, the year the Taliban came to power. Click here to read...
Strategic
China stalling on Blinken visit – FT
China is refusing to fix a new date for a visit by US Secretary of State Antony Blinken due to concerns that Washington might, during the trip, publish the results of a probe into a suspected spy balloon incident, the Financial Times has reported, citing sources. Blinken was scheduled to arrive in China in early February, but the Biden administration decided to postpone the visit after a Chinese high-altitude balloon was spotted in US airspace. Washington ordered the balloon to be shot down, claiming it had been spying on defence facilities. China insisted it was merely a meteorological device blown off course by the wind. The sides have been unable to reach an agreement on a new date for Blinken’s arrival, as the Chinese authorities want clarity on what the US is planning to do with the results of an investigation by the FBI, which has been studying the debris of the destroyed balloon, the FT reported on April 15. China’s Foreign Minister Qin Gang discussed the situation surrounding the balloon with American officials attending the China Development Forum in Beijing in March, “people familiar with the meeting” told the outlet. Qin reportedly described the FBI probe as yet another example of issues that have made it hard to stabilize China-US ties. Click here to read...
Russia and China show solidarity as Chinese Defence Minister Li Shangfu heads to Moscow
Russia’s decision to give a high-profile welcome to Chinese Defence Minister Li Shangfu on his first international trip in the job is a show of solidarity in the face of geopolitical pressure from Washington and its allies, according to observers. After arriving in Moscow on April 16, Li held talks with Russian President Vladimir Putin, a meeting that had not been announced before the trip. The Chinese defence minister’s itinerary was only expected to include discussions with his Russian counterpart Sergei Shoigu and visits to Russian military academies. Although not unprecedented, it is rare for a visiting Chinese defence chief to be greeted in Moscow by Putin. During the talks with the Russian president, Li said China was willing to work with Russia to “further enhance strategic communication between the two militaries, strengthen multilateral coordination and cooperation, and make new contributions to maintaining world and regional security and stability”, according to a Chinese statement on April 16. He also said military and political ties between the two countries “outperformed” Cold War-era unions, and rested on the principles of non-alignment, according to the Kremlin. “This is my first overseas visit since taking over as minister of defence of the People’s Republic of China. I specifically chose Russia for this in order to emphasise the special character and strategic importance of our bilateral relations,” Russian authorities quoted Li as saying. Click here to read...
China’s Xi Jinping Seeks to Shake Trans-Atlantic Solidarity With Flurry of Diplomacy
For more than a year, the Western-led global order has had the sort of coherence that only a cataclysm can provide, as the U.S. and European allies focus on helping Ukraine resist Russia’s invasion. That unity faces obstacles, as concerns grow about the escalating costs of the war, and recently leaked classified documents have shown weaknesses in Ukraine’s defences and the extent to which the U.S. is willing to spy on friendly countries. Also seeking to disrupt trans-Atlantic solidarity, Chinese leader Xi Jinping has returned to the world stage after years of self-imposed isolation as China enforced strict anti-Covid policies. He has made it clear he believes the U.S. is leading an effort to suppress China’s rise. In a diplomatic flurry, Mr. Xi has met with a half-dozen world leaders in less than a month as he probes for cracks in the Western consensus and strengthens ties with old friends. “The messaging is different for different actors, but this is all essentially about finding new spaces for China to act,” said Manoj Kewalramani, a China studies fellow at the Takshashila Institution, an Indian think tank. “From all perspectives he is trying to limit what he sees as full-scale containment.” Mr. Xi has embraced old friends such as Brazilian President Luiz Inácio Lula da Silva, who visited China last week. Mr. da Silva, during his visit, denounced the global reliance on the dollar and toured a research facility run by Huawei Technologies Co., the Chinese tech company that the U.S. has deemed a threat to national security. Click here to read...
Percentage of Americans with ‘very unfavourable’ view of China rises, Pew survey finds
A political divide in the US over China again surfaced in the latest survey by the Pew Research Centre, which also showed that Americans’ perception of the country continues to be overwhelmingly negative. The report, which was released on April 12, found that Democrats and younger Americans were more open to cooperation between the US and China. Democrats were also more likely to consider China a “competitor” rather than an “enemy” compared to Republicans – though the proportion viewing China as the latter has grown in both parties. Eighty-three per cent of Americans in the March poll said they had unfavourable views of China, almost identical to last March’s figure of 82 per cent. There was also a 4 percentage point increase in people with a “very unfavourable” view compared with last year – at 44 per cent, it was the highest recorded since at least 2005. The proportion viewing tensions between Taiwan and mainland China as a “very serious” problem was the highest in over a decade, at 47 per cent. The polling was completed before Taiwanese President Tsai Ing-wen met with House Speaker Kevin McCarthy last week in California. Overall, those who saw China as an “enemy”, rather than a “partner” or “competitor”, also increased, to 38 per cent – a 13 percentage point jump from March 2022 and the highest level in the past three years. Click here to read...
U.S. defence industry plans first Taiwan trip in four years
Around 25 U.S. defence contractors plan to send representatives to Taiwan in early May to discuss joint production of drones and ammunition, US Taiwan Business Council President Rupert Hammond-Chambers told Nikkei, as Washington explores various options to help bolster the island's defences. The delegation will be led by Steven Rudder, the retired commander of the U.S. Marine Corps Forces Pacific. This would be the first large group of envoys focused specifically on the defence industry to visit Taiwan from the U.S. since 2019. In addition to talks with representatives from the Taiwanese defence industry, it is looking to meet with Taiwanese President Tsai Ing-wen. Hammond-Chambers said that Tsai is focused on bolstering Taiwan's defence industry and that the trip is meant "to promote defence industry cooperation with Taiwan." Regarding the agenda, Hammond-Chambers said the Taiwanese side is interested in drones -- airborne, surface and subsea -- as well as ammunition. The U.S. delegation will look for opportunities to provide advanced technology and jointly develop drones with Taiwanese companies. Several American defence contractors with drone expertise will take part in the upcoming trip. Drones can be used for both surveillance and armed attacks and are considered a critical tool in deterring a Chinese invasion of Taiwan. They are also relatively cheap and can easily be deployed at a large scale. U.S. companies typically require government authorization to jointly produce weapons with overseas partners. Click here to read...
Myanmar airstrike kills more than 50 as calls mount for jet fuel ban
More than 50 people attending a pro-democracy gathering were killed in an airstrike in a village in north-western Myanmar on April 11, as the international community considers tightening export restrictions on aviation fuel to the military regime. The attack took place during a ceremony that was being held at the site in the Sagaing region to inaugurate a new local administrative body opposed to military rule, according to local media. Some 150 people, including women and children, were in attendance and at least 50 people were killed, reports said. "We found the bodies of about 80 people" in rescue efforts, a villager told Nikkei. "But we are still unable to confirm the exact figure. Some families lost two or three members. Some entire families were lost. The toll can be more than 100." Around 7:40 a.m., a military fighter jet dropped bombs on the assembly and a helicopter fired at people, the villager said. Photos of the scene circulating on social media showed white smoke rising from charred huts and many people lying on the ground covered in dirt. "We had full control of our area, and that is why we held the event. But we learned that we had to worry about airstrikes," the villager added. U.N. Secretary-General Antonio Guterres condemned the attack, calling "for those responsible to be held accountable," in a statement. He also called for "those injured to be allowed urgent medical treatment and access to assistance." Click here to read...
Bangladesh deep-sea port promises strategic anchor for Japan, India
A deep-sea port under construction in southern Bangladesh is shaping up to be a strategic linchpin for Japan and India as the Quad partners aim to counter Chinese influence. Development of the port of Matarbari will put a Japan-backed facility just north of Sonadia, another prime location on the Bay of Bengal where China was expected to develop a port. That facility never materialized, and Dhaka reportedly dropped the idea a few years ago. This is leading some pundits to declare a strategic victory for India in a South Asian great game between big powers. As India's tag-team partner, Japan is also considered a winner in this scenario, though some observers see no game at all, only the Bangladeshi government wringing out financial assistance wherever it can. The geopolitical importance of Matarbari -- Bangladesh's first deep-sea port -- was evident during Japanese Prime Minister Fumio Kishida's visit to India in March. The port emerged as one of the key areas for his free and open Indo-Pacific agenda. The same month, the Japan International Cooperation Agency agreed to extend a fresh 165 billion yen ($1.2 billion) infrastructure construction loan to Bangladesh, on top of 38.8 billion yen already promised. In New Delhi, Kishida said Tokyo would promote an "industrial value chain" from the Bay of Bengal to north-eastern India in cooperation with both South Asian countries, "to foster the growth of the entire region." Click here to read...
Japan's Self-Defense Forces miss recruiting target by more than half
Japan's Self-Defense Forces recruited less than half the planned number of fixed-term personnel for fiscal 2022, Nikkei has learned, a shortfall that comes as Tokyo aims to boost the country's capacity to protect itself. The SDF aimed to enlist 9,245 such personnel for the year ended in March, but recruited only about 4,300. Reaching less than half of the goal was well below the previous low of 72% set in fiscal 2018. Weak enlistment means fewer boots on the ground and poses a challenge in filling the SDF's pool of potential officers. Some at Japan's Defense Ministry think Russia's invasion of Ukraine last year and China's military exercises around Taiwan contributed to the drop by increasing the perceived risk of war. Competition from businesses that are raising wages to combat Japan's labour shortage also may be a factor. The taxpayer-funded SDF tends to be slower in improving starting salaries. Except for fiscal 2018, Japan had recruited more than 80% of its goal every year since fiscal 2009, the earliest year for which comparable data is available. Fixed-term personnel, drawn from individuals aged 18-32, enlist for two to three years with the option to apply for continued service. The average age at the time of recruitment is around 20. Recruits spend the first three months in training. The SDF recruited 13,327 personnel in fiscal 2021, with 5,350 -- about 40% -- of them being fixed-term enlistees. Click here to read...
U.S., Philippines hold largest war drills near disputed waters
The United States and the Philippines on April 11 launch their largest combat exercises in decades that will involve live-fire drills, including a boat-sinking rocket assault in waters across the South China Sea and the Taiwan Strait that will likely inflame China. The annual drills by the longtime treaty allies called Balikatan--Tagalog for shoulder-to-shoulder--will run up to April 28 and involve more than 17,600 military personnel. It will be the latest display of American firepower in Asia, where Washington has repeatedly warned China over its increasingly aggressive actions in the disputed sea channel and against Taiwan. The Biden administration has been strengthening an arc of alliances in the Indo-Pacific to better counter China, including in a possible confrontation over Taiwan. That dovetails with efforts by the Philippines under President Ferdinand Marcos Jr. to defend its territorial interests in the South China Sea by boosting joint military exercises with the U.S. and allowing rotating batches of American forces to stay in more Philippine military camps under a 2014 defence pact. About 12,200 U.S military personnel, 5,400 Filipino forces and 111 Australian counterparts are taking part in the exercises, the largest in Balikatan’s three-decade history. America’s warships, fighter jets as well as its Patriot missiles, HIMARS rocket launchers and anti-tank Javelins, would be showcased, according to U.S. and Philippine military officials. Click here to read...
Brazil’s Lula visits China, seeking ties and Ukraine support
Brazilian President Luiz Inácio Lula da Silva arrived April 12 in China to strengthen ties with his nation’s biggest trade partner and win support for his long shot push for peace in Ukraine. Lula wants Brazil, China and other nations to help mediate the war as part of his nation’s return to the world stage, but his proposals to end the conflict have irked Ukraine and some in the West. Less controversial is the Brazilian and Chinese mutual interest in trade after a rocky period under Lula’s predecessor. China and Brazil are expected to sign at least 20 bilateral agreements during Lula’s two-day stay, according to the Brazilian government. Lula plans to visit Shanghai and Beijing, and meet with his counterpart, Xi Jinping, on April 14. The two leaders are expected to discuss trade, investment, reindustrialization, energy transition, climate change and peace agreements, the Brazilian government said. China is Brazil’s biggest export market, each year buying tens of billions of dollars’ worth of soybeans, beef, iron ore, poultry, pulp, sugar cane, cotton and crude oil. Brazil is the biggest recipient of Chinese investment in Latin America, according to Chinese state media. Former Brazilian President Jair Bolsonaro and members of his family at times caused friction with Chinese authorities during his 2019-2022 term. In 2020, when Bolsonaro’s lawmaker son Eduardo blamed the COVID-19 pandemic on the Chinese Communist Party, the Chinese ambassador to Brazil called his words “an evil insult against China and the Chinese people. Click here to read...
Kuwait announces its seventh government in three years of political crisis
Kuwait announced a new government on April 09, its seventh in three years of deep political crisis between parliament and the executive. Despite being the only Gulf Arab state to have an elected government, Kuwait remains mired in political turmoil that has stalled reforms in one of the world’s largest producers of crude oil. The previous government resigned in January, just three months after first taking office. Kuwait adopted a parliamentary system in 1962, but repeated political crises have caused state paralysis. “A decree from the Emir has been issued (to validate) the formation of the new government led by Sheikh Ahmad Nawaf al-Ahmad Al-Sabah,” the government said on its Twitter account on April 09. The son of the country’s 85-year-old ruler, this will be his fourth government since August. The key portfolios of foreign affairs, held by Salem Al-Sabah, and oil, run by Bader Al-Mulla, remain unchanged in the 14-member cabinet. Women hold the posts of public works and social affairs. Despite having large oil reserves, Kuwait’s hospitals and educational services are in decay because of the ceaseless political squabbling. The country suffers from constant stand-offs between elected lawmakers and cabinets installed by the ruling Al-Sabah family, which maintains a strong grip over political life. Click here to read...
Power Struggle between Sudan’s Top Two Generals Turns Deadly
A bitter rivalry between Sudan’s top two generals erupted into open warfare this weekend, further destabilizing a country that has been at the centre of geopolitical power competition from the Middle East, the U.S. and Russia. For Sudan’s more than 45 million people, the conflict between Lt. Gen. Abdel Fattah al-Burhan and Lt. Gen. Mohamed Hamdan Dagalo is set to deepen an already intense economic and humanitarian crisis. It will also further delay a promised transition to civilian rule. Heavy fighting between Sudan’s military, commanded by Gen. Burhan, and the Rapid Support Forces, a state-sponsored militia led by Gen. Dagalo, raged for a second day April 16 in the capital Khartoum and other parts of the country. Residents said the two factions exchanged gunfire and artillery, while the Sudanese air force bombed ground positions of the RSF, many near residential areas. Video footage showed warplanes flying at low altitude over Khartoum, with plumes of smoke rising from the ground in several locations. Clashes between the military and the RSF were also reported in the Red Sea city of Port Sudan, Al Qadarif in the east and Darfur in the west. The Committee of Sudanese Doctors, a medical union, said its members had counted at least 56 civilian deaths and nearly 600 injured by early April 16, although the full scale of the casualties was impossible to assess as many parts of the country remained inaccessible to emergency services. Click here to read...
Saudi Arabia and Syria to restore ties – media
Saudi Arabia and Syria will reopen their embassies after more than a decade of hostility, according to reports from multiple news outlets. The potential thaw comes after a landmark Chinese-brokered deal set the path for normalization of relations between the Saudi kingdom and Iran, bitter rivals who backed opposing sides in Syria’s civil war. The two nations are preparing to reopen their respective embassies after the Muslim holiday of Eid al-Fitr in April, Reuters reported on April 13, citing a “source aligned with Damascus.” A second Syria-linked source told the agency that the breakthrough came after talks in Saudi Arabia involving a senior Syrian intelligence official. Saudi sources appeared to confirm the news later on April 13 night, with a foreign-ministry official telling state TV that “discussions are underway with officials in Syria to resume consular services.” Saudi Arabia closed its embassy in Damascus and expelled the Syrian ambassador in 2012, as the kingdom sided with militias seeking to overthrow Bashar Assad’s government. The Syrian conflict drew a dividing line through the Middle East. Iran and Russia backed Assad while the US, Saudi Arabia, and most Arab states supported the opposition forces – a broad collective of militias, including hardline jihadists. Click here to read...
Saudi- U.S. Relations Sour Further On Huge OPEC+ Surprise Cut
The surprise huge new cut in oil production from ‘OPEC+’ - the Saudi Arabia-led OPEC group of countries ‘plus’ Russia - highlights that any optimism over a possible rapprochement between Saudi Arabia and its previous key superpower ally, the U.S., is ill-founded. Instead, newly emboldened by the Beijing-brokered Saudi Arabia-Iran deal to resume relations, followed by the approval of a plan to join the Shanghai Cooperation Organisation (SCO) as a ‘dialogue partner’, Saudi Arabia has now decisively shifted into the China-Russia sphere of influence. Prior to the surprise additional oil production cut by OPEC+ announced on 2 April, early February had seen Saudi Arabia lead its OPEC fellow members and OPEC+ into sticking with its previously agreed oil production cuts quota of 2 million barrels per day (bpd). This cut represented only around 2 percent of the recent historical mean average of supply in the global oil market. Additionally, it left oil prices at levels that barely helped Saudi Arabia in budgetary terms at all, with a fiscal breakeven oil price forecast of US$78 pb of Brent in 2023, compared to over US$80 pb of Brent in the previous year. Significantly as well, oil prices at that point in February were way below the level that Russia wants, with a fiscal breakeven oil price of US$114 pb of Brent this year, up from around US$64 pb before its invasion of Ukraine. It was thought then by several oil market observers that the oil production in February by OPEC+ might have been a sign that Saudi Arabia was open to thawing out frozen relations with the U.S. Click here to read...
Black Sea will never belong to NATO – Kremlin
Despite efforts from Kiev, the Black Sea will never be the domain of NATO, Kremlin spokesman Dmitry Peskov said on April 13. He was commenting on a speech by Ukrainian Foreign Minister Dmitry Kuleba, who called for the military bloc to devise a new strategy for the region. Speaking at the Black Sea Security Conference in Bucharest, Romania, Kuleba urged the West to “work out a comprehensive security network for all nations… that feel threatened.” He insisted that it is “time to turn [the] Black Sea into what the Baltic Sea has become – a sea of NATO.” At the same time, Kuleba called for the “demilitarization of the Black Sea.” On a call with journalists on April 13, Peskov said the Ukrainian diplomat’s remarks were “based on flagrant contradictions” and that “NATO and demilitarization are mutually exclusive.” The Black Sea will never be a sea of NATO. It is a sea that is common for all littoral countries. It must be a sea of cooperation, interaction... and indivisible security. In accordance with the 1936 Montreux Convention, Türkiye, a NATO member, closed access to the Black Sea through the straits of Bosphorus and Dardanelles shortly after Russia launched its military operation in the neighbouring state over a year ago. Other members of the US-led bloc in the region are Bulgaria and Romania. Click here to read...
Health
Dirty air in Laos, Thailand casts pall over health, tourism
Air pollution, mostly from forest fires and slash-and-burn farming, continues to plague Southeast Asia, with PM2.5 particulate concentrations among the highest in the world in some areas. The region's noxious air is damaging people's respiratory health and casts a pall, literally and figuratively, over the economically vital tourism industry, which is struggling to bounce back from the COVID-19 pandemic. The sky over the Laotian capital of Vientiane was enveloped in a brown haze on April 06. Neighbouring Thailand, which is normally visible across the Mekong River, was similarly enshrouded. "I have never felt so much difficulty breathing as today," Phet, a 38-year-old interpreter working in the capital, told Nikkei Asia. The pollution has been worsening in Laos since late January. On April 13, the air quality index (AQI) in the country reached 471. A reading above 300 is considered dangerous, conditions in which, according to The World Air Quality Project, "everyone should avoid all outdoor exertion." People in Vientiane wear face masks, not out of fear of catching COVID but to try to avoid breathing in the worst of the smog. The pollution in northern Thailand, near Laos, is even worse. The AQI has remained above 300 for two straight weeks in Chiang Mai, starting on March 25, with no sign of a letup. Click here to read...
Biden ends 'national emergency'
President Joe Biden on April 11 signed a measure ending the Covid-19 national emergency in the US. Though he originally planned to extend the legislation until May 11, Biden ended up signing the Republican-proposed law that Congress had approved over the objections of many of his own Democrats. The White House released a one-sentence statement about Biden’s signature around 6pm local time, indicating that the president had agreed with House Joint Resolution 7. Drafted by Congressman Paul Gosar, an Arizona Republican, the bill was approved by the House of Representatives in February (229-197), and by the Senate at the end of March (68-23). Biden’s Democrats had argued that ending the emergency would “create wide-ranging chaos and uncertainty throughout the healthcare system,” but a handful ended up voting in favour of the GOP-proposed bill in the House, and about half in the Senate. As of April 11 evening, it was unclear what effect ending the emergency would have on two major, controversial US government policies. Ahead of the 2022 midterm election, Biden had invoked the pandemic powers to justify a plan to forgive up to $20,000 in federal student debt per borrower. He also attempted to end the Title 42 policy established under the pandemic, which mandated a speedy deportation of people crossing the US border illegally. Click here to read...
The Republican opposition has challenged both policies in court, insisting on keeping Title 42 while questioning the constitutionality of the student debt plan.
