Global Developments and Analysis: Weekly Monitor, 29 August - 04 September 2022

Economic

China population: pension burden in the spotlight as more than a third of provinces have 20 per cent of population aged above 60

Citizens aged 60 or over account for more than a fifth of residents in 13 of China’s 31 provincial-level jurisdictions, highlighting growing strain on the country’s struggling pension fund, but possible opportunities for the silver economy. The alarming figure was recently laid bare in a report by Chinese media company Yicai, and is likely to fuel concern among demographers and the government about the challenges arising from China’s rapidly ageing population. In Liaoning, 25.7 per cent or 10.94 million people are aged over 60, while Shandong has the largest elderly population with 21.51 million, equivalent to 21.15 per cent of its citizens. The provinces with the largest proportion of elderly residents are located primarily in northern China, the media report said. Guangdong, the largest province by gross domestic product, has the third lowest portion of its population aged 60 or over at 12.73 per cent, after Tibet and Xinjiang. Last year, China’s population aged over 60 rose from 264.02 million to 267.36 million, representing 18.9 per cent of the total. “Ageing is probably one of the biggest challenges China will face in the next 30 years,” said Larry Hu, chief China economist with Macquarie Capital. With fewer workers contributing to the public pension system, the fund is expected to face a shortfall within the next two decades as contributions are outweighed by payouts to retirees. Click here to read... [2]

Chinese exporters voice mixed feelings over yuan fluctuations, but depreciation ‘won’t continue’

Chinese exporters expressed mixed feelings about the impact of the yuan's depreciation against the greenback, with the most calling for a stable currency to benefit long-term trade. Experts said that the steady rebound of the Chinese economy and mature industrial and supply chains will mean the currency's exchange rate will stabilize at a reasonable level, and that yuan based assets will remain attractive to foreign investors. After the onshore Chinese yuan spot exchange rate against the dollar slid to 6.92 and the offshore rate breached 6.93 on Aug 29, the lowest in two years, the currency regained some ground to stand at 6.89 and 6.90 respectively as of 3:30pm Aug 31. Chinese exporters expressed mixed feelings over the currency fluctuations, with some saying a temporarily weakened yuan against the greenback would yield some foreign exchange earnings while some cross-border retailers saying the number of orders didn't increase as initially expected. While a weak yuan against the greenback may yield some benefits to China's exports, it may also add pressure on capital flight. In this regard, experts said that China's sound economic fundamentals, its industrial upgrade and huge market potential mean that the long-term value of yuan assets will remain attractive to global investors. Click here to read... [3]

China to strengthen state-led system in core tech breakthroughs, Xi says

China will strengthen its state-led system to achieve breakthroughs of core technologies, state media quoted President Xi Jinping as saying on Sept 06, amid tensions with the United States. China will improve its mechanism for core technology development and strengthen the ruling Communist Party's leadership in tech innovations, state media quoted Xi as saying at a top-level meeting. Top leaders at the meeting passed guidelines to improve the country's "new whole-nation system" in driving breakthroughs in core technologies, state media said. "We should give full play to the significant advantages of our country's socialist system that is able to concentrate its efforts on major affairs, strengthen the leadership of party and the state over major scientific and technological innovation," Xi was quoted as saying. China should also rely on market mechanisms, improve resource allocation and focus on national strategies, Xi said. China has unveiled a "new whole-nation system", counting on China's political system to pool national resources to support tech projects and break foreign "stranglehold", drawing on past successes in developing nuclear bombs in the 1960s. Washington has moved to ban exports of some advanced chips to China, escalating tensions between the world's two largest economies. Xi also pledged to improve the efficiency of the use of energy, water, grain, land, minerals, raw materials and other resources, and accelerate the transformation of the way resources are used, state media said. Click here to read... [4]

Big Tech’s US$95 million lobbying spree could defeat US antitrust bill as Congress deals with other legislation

A high-profile push by Congress to rein in the nation’s biggest internet companies is at risk of failing with time running out to pass major legislation ahead of midterm elections. Alphabet Inc’s Google, Apple Inc, Amazon.com Inc and Meta Platforms Inc and their trade groups have poured almost US$95 million into lobbying since 2021 as they seek to derail the American Innovation and Choice Online Act, which has advanced further than any US legislative effort to address the market power of some of the world’s richest companies. After a nearly two-year battle, the bill is now at a critical juncture as the Senate returns this week for a final stretch before the November midterms. Backers of the measure swear they have the necessary votes, yet it’s unclear if they do, and the Senate will be busy with other must-pass spending legislation. The view that momentum for the bill is slowing is based on conversations with nearly two dozen of its supporters and critics – including policy experts, lobbyists, congressional aides and advocates. One Hill staffer summed it up as a do-or-die moment. Although clipping the wings of tech giants through antitrust reform had support from both Republicans and Democrats during this Congress, a likely GOP majority in the House next year is expected to focus on allegations that internet platforms squelch conservative viewpoints. Click here to read... [5]

Russia to buy rockets, artillery shells from North Korea: US

The Russian Ministry of Defense is in the process of purchasing millions of rockets and artillery shells from North Korea for its ongoing fight in Ukraine, according to a newly downgraded U.S. intelligence finding. Brig. Gen. Pat Ryder, the Pentagon press secretary, said Sept 06 that ''the information that we have is that Russia has specifically asked for ammunition.'' He said the U.S. has seen indications Russia approached North Korea, but said he had no other details, including whether money has changed hands or any shipments are in progress. ''It does demonstrate and is indicative of the situation that Russia finds itself in, in terms of its logistics and sustainment capabilities as it relates to Ukraine,'' said Ryder, in the administration's first public comments on the intelligence assessment. ''We assess that things are not going well on that front for Russia.'' National Security Council spokesman John Kirby said there were no indications that the arms purchase had actually occurred yet or that any North Korean munitions had made it onto the Ukrainian battlefield. Still, he said the talks alone were ''just another indication of how desperate Putin's becoming.'' U.S. intelligence officials believe the Russians could look to purchase additional North Korean military equipment in the future. The intelligence finding was first reported by The New York Times. Click here to read... [6]

[ANALYSIS] 'Chip 4 aims to control Samsung-TSMC rivalry for Intel'

The most threatening factor for a tech firm is that it's not developing competitive and advanced products quickly. The CHIPS Act can help the United States increase its share in the semiconductor industry for more self-sufficiency. With federal assistance, Intel could be able to improve its advanced chip-manufacturing tech," according to the source, who is very familiar with issues related to Chip 4. Back in early 1990s, more than 35 percent of the global chips were manufactured on U.S. soil, according to Semi., an industry association. But as of last year, the U.S. global share was down to just 12 percent. All key aspects of defence, intelligence and government operations are going digital. As the critical aspects of these require the use of advanced chips, the United States is aiming to cut its reliance on foreign technology. Intel plans to surpass TSMC and Samsung by 2025. "This is why the United States doesn't want TSMC and Samsung to pursue a 'cash-bleeding' sales strategy for more market share. Like the memory chip industry, a new order would prevail in the foundry chip industry with a few rational players controlling the entire market. The United States is hoping Intel will become one of the survivors but without the painful survival contest," a top-ranking industry executive, here, said. Click here to read... [7]

‘Inflation Reduction Act is in clear violation of KORUS FTA'- Korea Times

The much-contested U.S. Inflation Reduction Act (IRA) whereby Korean Electric vehicles (EVs) and batteries will have their tax credits denied or significantly curtailed in the world's largest economy is a clear violation of international trade norms, experts said Sept 07. They say that the protectionist stimulus package seeks to boost U.S. President Joe Biden's relatively low support rate of around 40 percent in the lead-up to the November mid-term elections, a last-minute move to change the political environment in favour of the Democratic Party. The Biden administration began denying tax credits of up to $7,500 (10 million won) last month to buyers of EVs or fuel cell vehicles manufactured outside the country, as stipulated in the act. A portion of the tax credit ― $3,750 ― will be made available when EV makers use batteries made of at least 40 percent critical materials extracted or processed from the U.S. or countries that have free trade agreements with the U.S., or are recycled in North America. The percentage will increase in stages to 80 percent by 2027. "The IRA is in clear violation of Article 2.2 under Chapter 2 Section A in the Korea-U.S. Free Trade Agreement (KORUS FTA)," said Song Ki-ho, a lawyer known for his expertise in global trade norms. He led the global trade committee at Lawyers for Democratic Society before becoming the head attorney of Seoul-based law firm Suryun Asia. Click here to read... [8]

Main gas pipeline to EU will be closed until sanctions lifted – Kremlin

Technical issues with gas deliveries to Europe via the Nord Stream 1 gas pipeline will persist until the West lifts sanctions it has slapped on Russia over the ongoing Ukraine conflict, Kremlin spokesman Dmitry Peskov said on Sept 05. On August 31, Gazprom completely shut down gas deliveries via the pipeline. Although initially Nord Stream 1 was slated to resume gas transit on Sept 02, Gazprom announced that it would remain closed indefinitely due to technical issues. “Problems in [gas] deliveries arose due to sanctions that have been imposed on our country and a number of companies by Western countries, including Germany and the UK. There are no other reasons behind supply issues,” Peskov noted. The Kremlin spokesman also claimed that it is not Gazprom’s fault that “the Europeans absolutely absurdly make a decision to refuse to service their equipment,” which they are contractually obligated to do. Peskov stressed that all Nord Stream 1 operations hinge on “one piece of equipment that needs serious maintenance.” On Sept 04, his comments were echoed by Alexander Novak, Russian Deputy Prime Minister, who blamed the European Union for the problems that have prevented the resumption of gas supplies via the pipeline.

OPEC+ agrees oil output cut to prop up prices

The OPEC+ oil cartel agreed Sept 05 to cut production for the first time in more than a year as it seeks to lift prices that have tumbled due to recession fears. The move could irk the United States as it has pressed the group to increase output in order to bring down energy prices that have fuelled decades-high inflation. OPEC+, a 23-nation coalition led by Saudi Arabia and Russia, had agreed to huge cuts in output in 2020 when the COVID pandemic sent oil prices crashing, but it began to increase production modestly again last year as the market improved. Oil prices soared to almost $140 a barrel in March after Russia invaded Ukraine. But they have since receded below $100 per barrel amid recession fears, COVID lockdowns in major consumer China and Iran nuclear talks that could bring Iranian crude back into the market. While analysts had expected another modest increase at Sept 05's ministerial meeting, OPEC+ said in a statement it decided to reduce output by 100,000 barrels per day in October, returning to the production level of August. The group also left the door open to holding talks prior to its next scheduled meeting on October 5 "to address market developments, if necessary".Click here to read... [9]

Russia gives 12.5% stake in Sakhalin Energy to Mitsui unit

The Russian government on Sept 06 said it approved handing over a 12.5% stake in the operator of Russia's Sakhalin 2 liquefied natural gas plant to Dubai-based MIT SEL Investment, a subsidiary of Japanese trading house Mitsui & Co. The move comes after Russian President Vladimir Putin signed a decree in June that created a new legal entity, Sakhalin Energy LLC, to deal with for buyers and shareholders, which apart from Mitsui & Co. also include Shell and Mitsubishi Corp. The decree, which followed Western sanctions imposed on Moscow over what it calls a "special military operation" in Ukraine, indicated the Kremlin will now decide whether the foreign partners can stay. Earlier on Sept 06, Japan's biggest city gas supplier, Tokyo Gas, said it signed a long-term contract with Sakhalin Energy to buy liquefied natural gas. Click here to read... [10]

Iraq exports over 100 mln barrels of crude oil in Aug.

Iraq exported 101.85 million barrels of crude oil in August with revenues of 9.78 billion U.S. dollars, said the Iraqi Oil Ministry on Sept 01. The average price for crude oil in August was 96.05 dollars per barrel, the ministry said in a statement, citing statistics from the State Organization for Marketing of Oil. A total of 100.75 million barrels were exported from oil fields in central and southern Iraq via the Port of Basra, while about 1.10 million barrels were exported from the northern province of Kirkuk via the Turkish port of Ceyhan on the Mediterranean, the statement said. Oil prices have risen in global markets since the outbreak of the Russia-Ukraine crisis in February, benefiting Iraq and other oil exporting countries. Iraq's economy heavily relies on crude oil exports, which account for more than 90 percent of the country's revenues. Click here to read... [11]

China agrees to pay for Russian gas in roubles and yuan: Gazprom

Russia’s energy giant Gazprom says it has signed an agreement with China to start payments for gas supplies to China in yuan and roubles instead of US dollars, in a sign of warming relations between Beijing and Moscow, which is under Western sanctions. “The new payment mechanism is a mutually beneficial, timely, reliable and practical solution,” Gazprom CEO Alexei Miller was quoted as saying in a statement following a video conference meeting with the head of China’s oil group CNPC, Dai Houliang. Miller added that it will “simplify calculations” and “become an excellent example for other companies”. Miller informed his Chinese counterpart of the “status of work on the project for gas supplies via ‘the eastern route’ – the ‘Power of Siberia’ gas pipeline” which connects the Russian and Chinese gas networks, the Gazprom statement said. Gazprom did not provide further details on the scheme or say when payments would switch from dollars into roubles and yuan. The change is part of a push to reduce Russia’s reliance on the US dollar, euro and other hard currencies, which was accelerated by Western sanctions in response to the war in Ukraine. Recently, Russia has been working on building closer economic ties with China and other non-Western countries. Click here to read... [12]

Heatwave pushes California’s energy grid to its limits

California is facing the possibility of blackouts as a brutal heatwave pushes demand on the western US state’s energy grid beyond previous records, prompting authorities to urge residents to limit their electricity usage. State energy officials said the electrical load on Sept 06 afternoon could top 51,000 megawatts, the highest demand the state has ever seen. Elliot Mainzer, president of California Independent System Operator (ISO), which runs the state’s electrical grid, said it has “entered the most intense phase of this heatwave” and warned residents that “blackouts, rolling, rotating outages are a possibility”. Mainzer added that it was “absolutely essential” for people and businesses to conserve power. The heatwave has unleashed extreme heat across the Pacific coast state, straining infrastructure and highlighting the challenges that extreme weather — worsened by the climate crisis — will pose to governments and people as they struggle to adapt. ISO has urged residents to limit power use in the late afternoon and early evening as the state’s vast supply of solar-generated electricity decreases. But solar power begins to fall off in the late afternoon and into the evening, and ageing natural gas plants that the state relies on for backup become less reliable in hot weather. The National Weather Service has predicted highs between 37.7C and 46.1C (100F and 115F) across inland California, with temperatures hitting between 26.6C and 37.2C (80F and 99F) closer to the more temperate coast. Click here to read... [13]

AUKUS submarines: A burden too big for overloaded U.S. shipyards

A senior U.S. Navy official has expressed concern that assisting Australia in acquiring nuclear-powered submarines may be too much of a burden for America's overstretched nuclear shipyards. During a webinar at the Mitchell Institute for Aerospace Studies last week, U.S. Navy Rear Adm. Scott Pappano, program executive officer for strategic submarines, was asked if an arrangement under AUKUS to help Canberra acquire nuclear submarines could chip away at or pose a risk to America's own submarine plans. "If you are asking my opinion, if we were going to add additional submarine construction to our industrial base, that would be detrimental to us right now, without significant investment to provide additional capacity, capability to do that," Pappano replied. He said the same goes for the U.K. AUKUS is a new defence cooperation agreement among Australia, the U.K. and the U.S. The arrangement envisions new submarines being built in Australia. A White House fact sheet noted that the Australian government is securing additional land adjacent to Osborne North Shipyard, in Adelaide, South Australia, for a construction yard. The U.S. and U.K. were to share their highly secretive naval nuclear propulsion information. More recently, there has been talk of building some of the initial ships in the U.S. or U.K. to accelerate the process. Click here to read... [14]

EU, China trade barbs over failed G20 climate talks

The European Union and China are questioning each other's commitment to fighting climate change, following the failure of climate talks by the Group of 20 (G20) last week. At the end of last week's negotiations in Bali, Indonesia, the 20 governments failed to agree a joint communique on climate change. Diplomatic sources had said some countries, including China, were unhappy with language that had already been agreed and enshrined in past deals. The EU's climate change chief on Sept 05 accused "the biggest emitter on this planet" – a reference to China – of attempting to backtrack on the Glasgow Climate Pact, which capped two weeks of U.N. negotiations in November. "Some of the very, very big players on this planet are trying to roll back from what they had agreed in Glasgow," Frans Timmermans told a meeting in Rotterdam on climate adaptation in Africa. "And some of them, even the biggest emitter on this planet, try and hide behind developing countries in using arguments that I think, at some point, are no longer viable," said Timmermans, who is executive vice president of the European Commission. China is responsible for about 30 per cent of annual emissions, making it the world's biggest emitter today while the United States is second and the EU third. The United States, however, is the biggest emitter historically. Click here to read... [15]

Strategic

Xinjiang Rights Report Ratchets Up Standoff Between the U.S. and China

China lashed out at the United Nations’ human-rights agency, calling its assessment of possible crimes against humanity in Xinjiang an illegitimate report concocted in cahoots with the U.S., a fiery response that underscored Beijing’s deepening geopolitical fissures with Western powers. A Chinese Foreign Ministry spokesman accused the U.N. rights agency of acting as a “hired thug and accomplice” for a Washington-led conspiracy to contain China with smear tactics. The U.N. report on Xinjiang “was planned and manufactured by the U.S. and some Western forces, and is completely illegal and void,” ministry spokesman Wang Wenbin said at a Sept 01 briefing. His remarks echoed a statement issued earlier in the day by China’s Permanent Mission to the U.N. in Geneva, which denounced the U.N. report as a “politicized document that disregards facts” and “uses disinformation and lies fabricated by anti-China forces as its main sources.” The propaganda department of China’s Communist Party has instructed state media to portray the U.N. report as a concoction of anti-China forces, according to people familiar with the matter. Foreign diplomats say China would likely marshal a full response on the international stage, such as by mobilizing friendly governments to support its positions at major forums, including at the U.N. Human Rights Council in Geneva, which is due to convene this month. Click here to read... [16]

China's top legislator to start four-nation trip, attend EEF in Russia in show of firm ties

China's top legislator Li Zhanshu will start a four-nation trip later this week, which includes a visit to Russia, where he will attend the 7th Eastern Economic Forum (EEF), according to an announcement on Sept 04. The attendance at the EEF, a major Russian platform to promote global and regional cooperation, demonstrates the firm ties and close cooperation between China and Russia amid rising global geopolitical tensions, experts noted. Li, chairman of the National People's Congress Standing Committee, China's top legislative body, will also visit Mongolia, Nepal and South Korea during the trip scheduled for September 7-17, according to the Xinhua News Agency. This marks the first official overseas trip for Li since the start of the COVID-19 pandemic, though he frequently held talks with foreign leaders via video links, according to media reports. A list of official overseas visits by Li on people.com.cn showed the top legislator's last foreign trip in late September 2019 was also to Russia. The planned visit to Russia and the attendance at the EEF highlight the firm ties between China and Russia and their close cooperation on global and regional affairs as well as in economic and trade fields, experts said. The EEF is a very important economic forum for Russia, and Li's attendance at the forum fully demonstrates the importance the two countries attach to their bilateral ties, Gao Fei, a professor of Russian studies at the China Foreign Affairs University, told the Global Times on Sept 04. Click here to read... [17]

Putin approves new foreign policy doctrine based on 'Russian World'

President Vladimir Putin on Sep 5 approved a new foreign policy doctrine based around the concept of a "Russian World", a notion that conservative ideologues have used to justify intervention abroad in support of Russian-speakers. The 31-page "humanitarian policy", published more than six months into the war in Ukraine, says Russia should "protect, safeguard and advance the traditions and ideals of the Russian World". While presented as a kind of soft power strategy, it enshrines in official policy ideas around Russian politics and religion that some hardliners have used to justify Moscow's occupation of parts of Ukraine and support for breakaway pro-Russian entities in the east of the country. "The Russian Federation provides support to its compatriots living abroad in the fulfilment of their rights, to ensure the protection of their interests and the preservation of their Russian cultural identity," the policy said. It said that Russia's ties with its compatriots abroad allowed it to "strengthen on the international stage its image as a democratic country striving for the creating of a multi-polar world". Putin has for years been highlighting what he sees as the tragic fate of about 25 million ethnic Russians who found themselves living outside Russia in newly independent states when the Soviet Union collapsed in 1991, an event he has called a geopolitical catastrophe. Click here to read... [18]

Gorbachev laid to rest in Moscow

Mikhail Gorbachev has been buried alongside his wife Raisa at Novodevichy Cemetery in Moscow after a farewell ceremony attended by hundreds of mourners. The first and only president of the Soviet Union died in the Russian capital on August 30 at the age of 91. The funeral took place on Sept 03 afternoon with the participation of honour guards. The coffin with the body of the Soviet leader was covered with the Russian state flag as it was carried to the burial place. Earlier in the day, a farewell ceremony took place in Moscow’s House of the Unions where hundreds of people, including politicians and foreign diplomats, were lining up to pay their respects to Gorbachev. Russian President Vladimir Putin was not able to attend the funeral, but he paid his last tribute to the late Soviet leader before the official ceremony, on Sept 01. After becoming the leader of the Soviet Union in 1985, Gorbachev launched sweeping reforms known as “perestroika” aimed at liberalizing the country’s economy and public life. His tenure saw the fall of the Berlin Wall and the end of the Cold War. He resigned at the end of 1991 with the breakup of the Soviet Union. In 1990, he was awarded the Nobel Peace Prize. Click here to read... [19]

Japan plans to develop longer-range missiles to counter China, Russia

Japan will develop and mass produce a cruise missile and a high-velocity ballistic missile, it said on Aug 31, as it seeks the ability to strike more distant targets as part of a military expansion aimed at meeting threats from China and Russia. The procurement plan unveiled in the Ministry of Defence’s annual budget request represents a clear departure from a decades-long range limit imposed on Japan’s constitutionally constrained Self Defense Forces, that meant they could only field missiles with ranges of a few hundred kilometers. “China continues to threaten to use force to unilaterally change the status quo and is deepening its alliance with Russia,” the ministry said in its budget request. “It is also applying pressure around Taiwan with supposed military exercises and has not renounced the use of military force as a way to unite Taiwan with the rest of China,” it said. Alarm about China’s regional ambitions grew this month after it fired five ballistic missiles into waters less than 160 kilometers from Japan in a show of force after U.S. House of Representatives Speaker Nancy Pelosi’s visited Taiwan. The ministry also mentioned North Korea as a threat to Japan. The ministry did not give a range for the proposed weapons, or say how many it planned to field, but they would likely be able to reach targets in mainland China if deployed along Japan’s nearby southwest Okinawa island chain. Click here to read... [20]

Korea-Japan talks raise hopes for normalization of intelligence-sharing pact

South Korea and Japan are expected to agree to smoother operation of their intelligence-sharing pact in Sept 07's vice defence minister talks in Seoul amid the new South Korean government's efforts to better relations with its neighbour, according to experts, Sept 06. However, a 2018 radar lock-on dispute, a bigger roadblock to bilateral military cooperation, will remain a tough nut to crack, they added. Seoul's Vice Defense Minister Shin Beom-chul and Tokyo's Vice Defense Minister for International Affairs Masami Oka are scheduled to hold an in-person meeting on the sidelines of the annual Seoul Defense Dialogue that kicked off on Sept 06. The meeting will be the first in six years, raising speculation over whether or not the regional neighbours will be able to resolve pending bilateral military issues. The talks also come as the Yoon Suk-yeol administration is eager to improve bilateral ties, which have been soured for years due to territorial and historical disputes. "While a meeting of vice defense ministers may not resolve longstanding irritants in Korea-Japan relations, it is a good indicator of normalizing defence cooperation," said Leif-Eric Easley, an associate professor of international studies at Ewha Woman’s University. "The Seoul Defense Dialogue is an important mechanism for security policy coordination and Japan's participation could lead to normalizing bilateral military exchanges and intelligence sharing." Click here to read... [21]

US ready for 'all contingencies' of N. Korean provocation, envoy says in trilateral meeting with S. Korea, Japan

South Korea, the United States and Japan demonstrated a commitment Sept 07 to their shared goal of the complete denuclearization of North Korea and a united front against its provocation, as their top envoys had consultations in Tokyo. Sung Kim, Washington's special representative for Pyongyang, said the secretive Kim Jong-un regime seems to have been preparing for what would be its first nuclear test since 2017. "A nuclear test would be a grave escalation, threaten regional and international peace and security, and undermine the global non-proliferation regime," he said at the outset of the meeting with his South Korean and Japanese counterparts ― Kim Gunn and Takehiro Funakoshi. He said, "We are preparing for all contingencies in close coordination with our Japan and South Korea allies and we are prepared to make short and long-term adjustments to our military posture in responding to the DPRK provocation." DPRK is the acronym for the North's official name, the Democratic People's Republic of Korea."Our bottom line has not changed. Our goal remains a complete denuclearization of the Korean Peninsula," he added, reaffirming that Washington is willing to resume dialogue with Pyongyang "without preconditions." Kim Gunn said, "We will respond swiftly and decisively against any provocation by North Korea ... We also have serious concerns over North Korea's actions that are in violation of multiple UN Security Council resolutions." He stressed the importance of trilateral cooperation among the regional powers. Click here to read... [22]

Ex-Pentagon chiefs warn of political interference in military

Former Pentagon chiefs warned on Sep 6 that the deep divisions in US politics are putting unwanted pressure on the armed forces and expressed concern that civilian political interference in the military could worsen. Eight former defence secretaries and five ex-joint chiefs’ chairmen signed a statement on 16 "Best Practices of Civil-Military Relations" that came after several years - particularly under former president Donald Trump - in which the Pentagon became enmeshed in political machinations. "We are in an exceptionally challenging civil-military environment," they wrote. "Politically, military professionals confront an extremely adverse environment characterized by the divisiveness of affective polarisation that culminated in the first election in over a century when the peaceful transfer of political power was disrupted and in doubt," they said. "Looking ahead, all of these factors could well get worse before they get better." The statement, published by the defence-focused "War on the Rocks" website, did not cite any examples to illustrate civil-military tensions. But it did make reference to the challenge to the 2020 election results by Trump and his supporters that led to the violent Jan 6, 2021 assault on the US Capitol. The Pentagon has been accused of stalling the deployment of National Guard troops to confront the attackers. Click here to read... [23]

Myanmar junta chief makes another visit to Russia

Myanmar's junta leader was on a visit to Russia on Sep 5, his second trip there in less than two months, as Myanmar's ruling military tries to shore up one of its few diplomatic alliances as it comes under growing international pressure. Senior General Min Aung Hlaing has been barred from representing Myanmar at most international gatherings since leading a coup early last year against an elected government led by Noble laureate Aung San Suu Kyi. He first visited Moscow as leader in June last year, when both sides committed to strengthening military cooperation. He also visited in July on what Russia said was a private visit. Russia, a main source of military hardware for Myanmar, was one of the first countries to voice support for the junta after the coup, at a time when it was receiving international condemnation over its use of lethal force against opponents. Myanmar state media said he would attend an economic summit, visit landmarks, universities and factories and his ministers and senior military officials would meet counterparts and "cement friendly cooperation". Russia has been providing Myanmar with COVID-19 vaccines and Myanmar is planning to import Russian gasoline and fuel oil to ease supply concerns, as Russia looks for new sources of business amid Western sanctions over its invasion of Ukraine. Myanmar's junta has been hit by a raft of sanctions targeting the generals and the extensive business network the military operates. Click here to read... [24]

Iran says it sends 'constructive' response on nuclear deal; US disagrees

Iran has sent a "constructive" response to US proposals aimed at reviving Tehran's 2015 nuclear deal with world powers, Iran's foreign ministry said, prompting a less positive impression from the United States. "The text that was sent (by Iran) has a constructive approach aimed at finalising the negotiations," Foreign Ministry spokesperson Nasser Kanaani was quoted as saying by state broadcaster IRIB on Sep 2. But the US State Department gave a different assessment. "We can confirm that we have received Iran's response through the EU," a spokesperson said. "We are studying it and will respond through the EU, but unfortunately it is not constructive." The IRIB report said Iran's response was sent to EU foreign policy chief Josep Borrell, who has been coordinating the negotiations. It gave no further details. After 16 months of indirect talks between Tehran and Washington, Borrell said on Aug 8 the EU had laid down a final offer to overcome an impasse for the revival of the agreement. Iran needs stronger guarantees from Washington for the revival of a 2015 nuclear deal, its foreign minister said on Wednesday, adding that the UN atomic watchdog should drop its "politically motivated probes" of Tehran's nuclear work.Under the 2015 pact, Iran had curbed its nuclear programme in return for relief from US, EU and UN sanctions. Click here to read... [25]

Israel Makes Final Push to Shape Restored Iran Nuclear Deal

Israeli officials are scrambling to influence the Biden administration as the U.S. attempts to revive the Iran nuclear deal, pushing for hardened positions and no concessions to Tehran as negotiations enter a critical phase. The Israeli government has in recent days broken with its quiet approach to diplomacy, sending Mossad chief David Barnea to Washington last month to brief officials from the White House, CIA, Pentagon and lawmakers. Prime Minister YairLapid and other senior Israeli officials have begun expressing growing alarm. “This deal isn’t a good deal. It was not a good deal when it was signed back in 2015. Today, the dangers it entails are even greater,” said Mr. Lapid in a briefing to journalists last week. Israel’s views on the Iran deal carry special weight in Washington, given the country’s continuing shadow military conflict with Tehran and a view shared in Washington and Jerusalem that Iran poses a serious threat to Israel’s security. Former Israeli Prime Minister Benjamin Netanyahu unsuccessfully tried to marshal that influence in 2015, when he publicly battled the Obama administration and addressed Congress in a bid to stop the agreement. Mr. Netanyahu’s opposition to the deal helped persuade the Trump administration to exit from the agreement in 2018. Click here to read... [26]

Tunisia and Morocco recall envoys in W. Sahara row

Tunisia announced on Sept 03 the recall of its ambassador to Morocco for consultations, a day after the kingdom did the same in response to Tunisia's president hosting the Polisario movement's leader. The Polisario wants an independent state in the Western Sahara, which ­Morocco sees as a sovereign part of its own territory. Tunisian President Kais Saied on Sept 02 hosted Polisario chief Brahim Ghali who arrived to attend the Tokyo International Conference on African Development (TICAD). In response to what it called a "hostile" and "unnecessarily provocative" act, Morocco immediately withdrew its Tunis ambassador for consultations and cancelled its own participation in the high-profile conference. "Tunisia has maintained its total neutrality on the Western Sahara issue in line with international law," the Tunisian Foreign Ministry said in a statement. "This position will not change until the concerned parties find a peaceful solution acceptable to all." Saied spent much of Sept 02 welcoming African leaders arriving for the ­TICAD conference, including Ghali who is also president of the self-proclaimed Sahrawi Arab Democratic Republic (SADR). Morocco accused Tunisia of "unilaterally" inviting the Polisario chief "against the advice of Japan and in violation of the process of preparation and established rules." Click here to read... [27]

Taliban minister accuses Pakistan of providing airspace for US drones

The Taliban’s acting Defence Minister said on Aug 28 that Pakistan had allowed US drones to use its airspace to access Afghanistan, which Pakistan’s foreign minister denied. Pakistani authorities have previously denied involvement in or advanced knowledge of a drone strike the United States said it carried out in Kabul in July that killed al-Qaeda leader Ayman al-Zawahiri. Afghan acting Defence Minister Mohammad Yaqoob told a news conference in Kabul that American drones had been entering Afghanistan via Pakistan. “According to our information the drones are entering through Pakistan to Afghanistan, they use Pakistan’s airspace, we ask Pakistan, don’t use your airspace against us,” Yaqoob said. A spokesperson for the US Central Intelligence Agency (CIA) declined to comment. Pakistan’s foreign minister Bilawal Bhutto-Zardari told Reuters he had made checks after the air strike and had been told that Pakistani airspace was not used. He said he would check again after Sunday’s allegations but expected the position to be the same. “I really don’t believe that this is a time that I wish to get into a debate with anyone or to have accusations … frankly, I’m focused on the flood relief efforts,” Bhutto-Zardari said in an interview, referring to deadly floods in Pakistan that have left millions of people homeless. Click here to read... [28]

New British PM Liz Truss promises to ride out economic storm

Liz Truss has promised to “ride out the storm” of economic crisis in her first address since taking over as British prime minister, pledging immediate action to tackle a set of challenges led by soaring energy bills, looming recession and industrial strife.“I am confident that together we can ride out the storm. We can rebuild our economy, and we can become the modern brilliant Britain that I know we can be,” the 47-year-old former foreign secretary said outside her new Downing Street home and office in London on Sept 06. Truss said she had three priorities: tax cuts to boost the economy, helping with rising energy costs, and sorting out the state-run National Health Service. However, she has inherited an economy in crisis, with inflation at double digits and the Bank of England warning of a lengthy recession by the end of this year. Commenting on the challenges ahead, Truss referenced the aftermath of the coronavirus pandemic, as well as the continuing war in Ukraine. Truss was speaking after meeting Queen Elizabeth II, who asked her to form a new government in a carefully choreographed ceremony dictated by centuries of tradition. It came one day after the governing Conservative Party announced that Truss had been elected as its leader. Click here to read... [29]

Thousands in Iraq demand regime change after Shia factions clash

Angered by a months-long political crisis, thousands of Iraqis have taken to the streets of the capital, Baghdad, days after deadly clashes between rival Shia groups sparked fears of widespread unrest. The non-partisan protesters streamed into western Baghdad’s Al-Nusoor Square on Sept 01, brandishing banners and Iraqi flags to demand a complete political overhaul. “Protesters say they took to the streets today to demand the removal of all the political elite, whom they accuse of corruption,” Al Jazeera’s Mahmoud Abdelwahed said from Baghdad. “They are calling for justice for their colleagues who were killed at the hands of security forces in 2019,” Abdelwahed added, referring to the anti-government protest movement that erupted in October 2019 but has since died down. Sept 02’s mobilisation follows nearly 11 months of paralysis that has left the country without a new government, prime minister or president, with Shia factions disagreeing on forming a coalition since elections last October. Demonstrators shouted the Arab Spring slogan “People want the fall of the regime” and “Iran will not rule any more”. “They are chanting against the Iranian-backed politicians,” Abdelwahed said. “They don’t want any government to be manipulated by Iran, whom they accuse of having ruined the country for years.” Click here to read... [30]

IAEA Director General Statement on Situation in Ukraine

Ukraine’s Zaporizhzhya Nuclear Power Plant (ZNPP) has once again lost the connection to its last remaining main external power line, but the facility is continuing to supply electricity to the grid through a reserve line, the International Atomic Energy Agency (IAEA) was informed at the site today. Less than 48 hours after Director General Rafael Mariano Grossi on Sept 01 established the presence of the IAEA Support and Assistance Mission to Zaporizhzhya (ISAMZ) at the facility in southern Ukraine, the Agency’s experts were told by senior Ukrainian staff that the ZNPP’s fourth operational 750 Kilovolt (kV) power line was down. The three others were lost earlier during the conflict. However, the IAEA experts – now present at Europe’s largest nuclear power plant located in the middle of a war zone – also learnt that the 330/750 kV reserve line linking the facility to a nearby thermal power plant was delivering the electricity the ZNPP generates to the external grid. The same reserve line can also provide back-up power to the ZNPP if needed. In addition, plant management informed the IAEA team that one of the ZNPP’s two operating units was disconnected in the afternoon today due to grid restrictions. The ZNPP is held by Russian forces since early March, but its Ukrainian staff are continuing to operate the plant. Click here to read... [31]

Health

Is Xi Jinping’s trip overseas the beginning of the end for China’s zero-Covid policy?

Chinese President Xi Jinping is one of the very few – if only – state leaders in the world to have avoided overseas travel in the past two years because of Covid-19. So when Indonesian President Joko Widodo announced in mid-August that Xi and his Russian counterpart Vladimir Putin would attend the Group of 20 summit in Bali in November, observers were alert for signs that China would change its long-standing zero-Covid policy. Those prospects appeared to strengthen on Sept 05 when the government of Kazakhstan announced that Xi would travel to the central Asia country next week, bringing forward the date of Xi’s first overseas trip since the pandemic to weeks before the Communist Party’s national congress in mid-October. No official announcement has been made but Xi is also expected to go to Uzbekistan for a Shanghai Cooperation Organisation summit next week. Li Zhanshu, the third-ranking politician in the communist hierarchy, is also travelling abroad this week, making him the first Politburo Standing Committee member to do so. But while diplomatic activity is restarting, analysts say the prospects of any abrupt change in China’s zero-Covid policy – even after the party congress – are remote. Instead, they say, the restrictions are likely to be relaxed gradually. Click here to read... [32]