Global Developments and Analysis: Weekly Monitor (15-21 May)

Economic

War rooms and bailouts: How US is preparing for a default

Convening war rooms, planning speedy bailouts and raising house-on-fire alarm bells: Those are a few of the ways the biggest banks and financial regulators are preparing for a potential default on US debt. “You hope it doesn’t happen, but hope is not a strategy – so you prepare for it,” Brian Moynihan, CEO of Bank of America, the nation’s second-biggest lender, said in a television interview. The doomsday planning is a reaction to a lack of progress in talks between President Joe Biden and House Republicans over raising the US$31.4 trillion debt ceiling – another round of negotiations took place on May 16, 2023. Without an increase in the debt limit, the US can’t borrow more money to cover its bills – all of which have already been agreed to by Congress – and in practical terms that means a default. What happens if a default occurs is an open question, but economists – including me – generally expect financial chaos as access to credit dries up and borrowing costs rise quickly for companies and consumers. A severe and prolonged global economic recession would be all but guaranteed, and the reputation of the US and the dollar as beacons of stability and safety would be further tarnished. But how do you prepare for an event that many expect would trigger the worst global recession since the 1930s? Click here to read... [2]

World Leaders Warily Watch U.S. Debt-Limit Standoff

World leaders, already struggling with inflation and rising interest rates, now face the battle over raising the U.S. debt limit as the latest risk to their economic outlook. The impasse in Washington over raising the roughly $31.4 trillion borrowing limit is looming over a series of meetings of the Group of Seven advanced democracies this month. At a gathering of G-7 finance ministers along the Sea of Japan last week, officials discussed the prospects for a debt-limit deal between President Biden and House Speaker Kevin McCarthy (R., Calif.) alongside other global topics such as sanctions on Russia and ways to counter China.“It’s a very serious threat to the global economy,” U.K. Chancellor of the Exchequer Jeremy Hunt said in Niigata. “It would be absolutely devastating if America, which is one of the biggest motors of the global economy, was to have its GDP knocked off track by failure to reach agreement.” Treasury Secretary Janet Yellen has warned that the U.S. could become unable to pay all of its bills on time as soon as June 1 if Congress doesn’t act to raise the borrowing limit. Mr. Biden—who will head to Hiroshima, Japan, later this week to meet with the leaders of G-7 nations—is in negotiations with Mr. McCarthy and other congressional leaders, but so far they haven’t reached an agreement Click here to read... [3]

Global debt balloons to record highs

The global debt pile increased by $8.3 trillion in the first quarter of the year to a near-record high of $305 trillion amid an aggressive tightening of monetary policy by central banks, the Institute of International Finance (IIF) has revealed. According to its Global Debt Monitor report on May 17, the reading is the highest since the first quarter of last year and the second-highest quarterly reading ever. The IIF warned that the combination of such high debt levels and rising interest rates had pushed up the cost of servicing that debt, prompting concerns about leverage in the financial system. “With financial conditions at their most restrictive levels since the 2008-09 financial crisis, a credit crunch would prompt higher default rates and result in more ‘zombie firms’ – already approaching an estimated 14% of US-listed firms,” the IIF said. Despite concerns over a potential credit crunch following recent turmoil in the banking sectors of the United States and Switzerland, government borrowing needs to remain elevated, the finance industry body stressed. According to the report, aging populations and rising healthcare costs continue putting strain on government balance sheets, while “heightened geopolitical tensions are also expected to drive further increases in national defence spending over the medium term,” which would potentially affect the credit profile of both governments and corporate borrowers. Click here to read... [4]

Disagreements between US, Asian nations complicate IPEF negotiations

Snags in the negotiations for the US-led Indo-Pacific Economic Framework (IPEF) could impact Washington’s ability to meet the deadlines it had set for the Apec gathering it is hosting this week, trade experts and negotiators have said. Launched in May last year and hailed as a revival of the US’ economic pivot to Asia, the IPEF was set to be a centrepiece at the Asia-Pacific Economic Cooperation (Apec) meeting. But the third discussion round in Singapore last week revealed challenges between the United States and the other 13 countries in the framework to agree on complex issues such as labour laws. These roadblocks mean the US would likely not be able to offer Apec trade ministers preliminary material to endorse when they meet in Detroit at the end of this week, or to wrap up discussions by the time Apec leaders meet in November. Analyst Amitendu Palit, who had followed the Singapore discussions, said the difficulties underscored the scheme’s ambitious nature and the “great difficulty in reaching agreements on standards among a very heterogeneous group of countries”. “As of now, it does look like reaching ambitious outcomes in all pillars by the November Apec leaders’ meeting will be difficult,” said Palit, the research lead in trade and economics at the NUS Institute of South Asian Studies in Singapore. “If indeed outcomes are arrived at in haste, they might be shallow and suboptimal.” Click here to read... [5]

Asia's internet cable projects delayed by South China Sea tensions

Asia's subsea cables, which carry much of the world's data, are becoming a focal point of geopolitical tensions involving China, as leading telecoms and technology companies face delays stringing lines along the floor of the South China Sea, one of the world's data superhighways. Cable owners such as Japan's Nippon Telegraph and Telephone, Singapore Telecommunications and U.S. tech giants Meta and Google are increasingly trying to bypass the contested sea, which Beijing has claimed almost entirely for itself. This means higher costs to lay and operate cables. The disruptions are a headwind for economies in the region, as fast connectivity is now essential for modern life, especially after the coronavirus pandemic encouraged people to spend more time at home and online. Together with Meta and KDDI, Japan's second-largest telecommunications company, Singtel is part of a consortium laying a submarine cable that will link Japan and Singapore. But the 10,500-kilometer fiber-optic cable, which has branches reaching mainland China, Hong Kong and Taiwan, is far behind its scheduled 2020 completion date, set when the deal was signed in 2018. According to people involved in the project, Chinese authorities have been slow to grant permits allowing the cable, called the Southeast Asia-Japan 2 (SJC2), to traverse the South China Sea, citing national security concerns. Click here to read... [6]

G-7 communique lays out common 'de-risking' path on China

The leaders of the Group of Seven nations issued a communique May 20 that included a nine-point aligned approach to reducing risks posed by China and called for international standards that regulate artificial intelligence. The leaders noted that while members act in their own national interest, a common approach to China "underpins" their respective relations. The communique stipulates the need to de-risk, but not decouple, from the world's second-largest economy. "Our policy approaches are not designed to harm China nor do we seek to thwart China's economic progress and development," the communique says. "A growing China that plays by international rules would be of global interest." The G-7 is not turning inward, the leaders said. "At the same time, we recognize that economic resilience requires de-risking and diversifying," the statement says. "We will take steps, individually and collectively, to invest in our own economic vibrancy. We will reduce excessive dependencies in our critical supply chains." The document was released one day ahead of schedule for unspecified reasons. The distribution came just seconds before Ukrainian President Volodymyr Zelenskyy stepped off a plane in Hiroshima to join the leaders. Regarding Taiwan, the communique says: "We reaffirm the importance of peace and stability across the Taiwan Strait as indispensable to security and prosperity in the international community." Click here to read... [7]

Saudi Aramco Considers Another Stock Offering In Riyadh

Saudi oil giant Aramco is studying the feasibility of an additional stock offering in Riyadh, which could help the world’s biggest oil firm raise billions of U.S. dollars, Bloomberg reported on May 16, citing sources familiar with the plans. Aramco, which is also the world’s number-two company by market capitalization – second only to Apple – has been considering with several advisors the possibility of selling more stock on the market, according to Bloomberg’s sources. Neither the timing nor the size of a potential offering has been decided, they add. Currently, Saudi Arabia owns just over 98% of Aramco after selling 1.7% in the initial public offering (IPO) in December 2019. Of the 98% held by the Kingdom, the Saudi government owns 90% of Aramco, while the sovereign wealth fund owns the other 8%. Back in January 2021, Saudi Crown Prince Mohammed bin Salman said that Aramco plans more share offerings to the public in the coming years. “There are going to be IPOs by Aramco in the following years,” the crown prince said at the time, but did not give any details either about the timing of the new share sales or on which markets those sales could take place. The share sale that Aramco is currently considering could take place as soon as this year if the Saudi rulers give the go-ahead, according to Bloomberg’s sources. Click here to read... [8]

Iran And Russia Discuss Joint Development Of Oil And Gas Fields

Iran and Russia are considering the joint development of as many as 10 oil and gas fields in Iran, media have reported following a meeting between Iranian officials and a Russian delegation led by Deputy Prime Minister Alexander Novak. The proposal has come from the Iranian side amid talks about the development of other oil and gas resources in the country. Novak told reporters that the sides had discussed specifically the development of six oil fields and two gas deposits. Gazprom was considering taking part in the development of the Kish and North Pars gas fields and building an LNG production facility, Novak also said, as quoted by TASS. "Our oil companies are considering six oil fields, and Gazprom is considering two fields: Kish and North Pars, for joint development with the Iranian side, followed by the implementation of a natural gas liquefaction project and supplies to world markets,” he said, adding “Now, virtually all technical issues on this gas project have been settled. The evaluation of commercial conditions with Iran is currently underway.” The Iranian government is in talks with Russia’s Gazprom about investments worth as much as $40 billion, Iran’s oil minister Javad Owiji said during the visit. The amount is stipulated in a memorandum of understanding but, according to Owiji, “Some of these agreements are already turning into real contracts.” Click here to read... [9]

Indonesian state firms cutting ties with Visa and Mastercard – official

The Bank of Indonesia (BI) has launched a domestic card payment system as part of a greater strategy to reduce reliance on foreign systems and protect transactions from geopolitical disruptions, CNBC Indonesia reported on May 15. Based on Indonesia’s interbank system, Gerbang Pembayaran Nasional (GPN) or the National Payment Gateway is designed for state companies and institutions and will replace Visa and Mastercard as the country seeks more autonomy over its payment infrastructure by minimizing the role of foreign payment providers, the outlet said. According to Dicky Kartikoyono, the head of the Payment System Policy department at BI, domestic cards process users’ private data within the country and do not charge any fees. The card also provides features needed for government institutions to conduct payments such as budget spending on inventories, rent, building maintenance and official travel, Kartikoyono said. “We are launching a government payment card, which we are calling the Indonesian credit card. It will facilitate the use of the budget in an efficient manner and provides various opportunities that will encourage medium and small businesses,” he added. Indonesian President Joko Widodo earlier urged regional authorities to wean themselves off of foreign payment systems and start using cards issued by local banks. He argued that Indonesia needed to shield itself from geopolitical fallout, citing the sanctions targeting Russia’s financial sector from the US, the EU, and their allies over the conflict in Ukraine. Click here to read... [10]

The Disappearing White-Collar Job

For generations of Americans, a corporate job was a path to stable prosperity. No more. The jobs lost in a months-long cascade of white-collar layoffs triggered by over hiring and rising interest rates might never return, corporate executives and economists say. Companies are rethinking the value of many white-collar roles, in what some experts anticipate will be a permanent shift in labour demand that will disrupt the work life of millions of Americans whose jobs will be lost, diminished or revamped partly through the use of artificial intelligence. “We may be at the peak of the need for knowledge workers,” said Atif Rafiq, a former chief digital officer at McDonald’s and Volvo. “We just need fewer people to do the same thing.” Long after robots began taking manufacturing jobs, artificial intelligence is now coming for the higher-ups—accountants, software programmers, human-resources specialists and lawyers—and converging with unyielding pressure on companies to operate more efficiently. Meta Platforms CEO Mark Zuckerberg told employees after the Facebook parent’s latest round of layoffs that many jobs aren’t coming back because new technologies will allow the company to operate more efficiently. International Business Machines CEO Arvind Krishna recently said the company could pause some hiring to see what kind of back-office work can be done with AI. Click here to read... [11]

Vietnam PM approves $135 billion power plan for 2030

Vietnam's prime minister approved a long-awaited power plan for this decade that needs $134.7 billion of funding for new power plants and grids, the government said late on Monday, in a move that may help unlock billions of dollars of foreign investment. The plan, known as PDP8, is aimed at ensuring energy security for the Southeast Asian country while it begins the transition from its current heavy reliance on coal to becoming carbon-neutral by mid-century. Amid internal squabbles and work on complex reforms, the plan has been delayed for more than two years, and has seen a dozen of draft versions before the approval by Prime Minister Pham Minh Chinh, which now needs the formal green light from the rubber-stamp parliament, possibly this month, before its final adoption. The plan is important to unlock an initial investment of $15.5 billion in green-transition funds pledged to Vietnam in December by the Group of 7 (G-7) nations and other wealthier countries. Half the funds will come from the public sector and the rest from private investors. After the deal, negotiators have struggled for months to progress on preliminary work to allocate the funding, multiple officials told Reuters, as Vietnam officials maintained their reticence to accept loans, which are by far the biggest component of the promised public funds. Click here to read... [12]

Half of world’s largest lakes, reservoirs losing water: Study

More than half of the world’s large lakes and reservoirs have shrunk since the early 1990s, chiefly because of climate change, intensifying concerns about water for agriculture, hydropower and human consumption, a new study has found. A team of international researchers reported on May 18 that some of the world’s most important freshwater sources – from the Caspian Sea between Europe and Asia to South America’s Lake Titicaca – lost water at a cumulative rate of approximately 22 gigatonnes per year for nearly three decades. That is about 17 times the volume of the largest reservoir in the United States – Lake Mead. The study published in the journal Science found unsustainable human use dried up lakes, such as the Aral Sea in Central Asia and the Dead Sea in the Middle East, while lakes in Afghanistan, Egypt and Mongolia were hit by rising temperatures, which can increase water loss to the atmosphere. Water levels rose in a quarter of the lakes too, often as a result of dam construction in remote areas such as the Inner Tibetan Plateau. Natural lakes and dams store about 87 percent of the Earth’s freshwater, although they cover just 3 percent of the planet’s surface. The report was based on satellite image data collected between 1992 and 2020. Click here to read... [13]

Russia agrees to renew Ukraine Black Sea grain deal for 60 days

Russia has agreed to extend a deal that has allowed Ukraine to ship grain through the Black Sea to parts of the world struggling with hunger, a boost to global food security after the more-than-year-old war drove up prices. “I want to give good news,” Turkish President Recep Tayyip Erdogan said on May 17 in a televised speech. “With the efforts of our country, the support of our Russian friends and the contribution of our Ukrainian friends, the Black Sea Grain Initiative has been extended by another two months.” Senior officials from Russia, Ukraine, Turkey and the United Nations met in Istanbul last week and continued talks to discuss the Black Sea deal and its future. Turkey and the UN brokered the breakthrough accord with the warring sides last summer, which came with a separate agreement to facilitate shipments of Russian food and fertiliser that Moscow insists has not been applied. Russia had threatened to bow out if its concerns were not ironed out by May 18. Such brinkmanship isn’t new: With a similar extension in the balance in March, Russia unilaterally decided to renew the deal for a similar 60 days instead of the 120 days outlined in the agreement. Click here to read... [14]

US-Taiwan trade deal seen speeding up Taiwan’s shipping and boosting start-ups; Beijing quiet so far

The just-signed first phase of a trade initiative between Taiwan and the United States should make the shipping of exports faster and more transparent, though it risks an eventual backlash from Beijing, analysts say. Negotiators for Taiwan and the US reached an agreement on the first part of their 21st Century Trade Initiative, both sides said on May 19. So far, the deal streamlines customs procedures for imports, establishes support for small to medium-sized businesses, and seeks to raise trade-linked transparency. Taiwanese Premier Chen Chien-jen called the deal “fruitful and historic”. Exporters on the island should anticipate shorter delays at US customs ports in shipping goods with a set shelf life, said Darson Chiu, a research fellow with the Taiwan Institute of Economic Research in Taipei. Sometimes those shipments must wait months for clearance, pushing against their expiration dates, he said. “The costs of trade will come down because of less time in customs,” he said. The two parties will allow each other’s shippers to file import-related documents electronically and inspect shipments at ports within “reasonable hours”, the agreement text says. Speedier customs clearances will particularly help with imports of certain plastics or fibres, such as polystyrene pellets for bottles, said Danny Ho, chief executive of the DMI energy consulting firm in Taiwan. Click here to read... [15]

China is supersizing its rocket industry – and it’s coming for Starlink

China’s rocket industry is about to receive some massive thrust. The country is constructing an unprecedented rocket assembly plant capable of producing 50 Long March 8 rockets a year, according to scientists involved in the project. Once completed next year, the mega factory on the tropical island Hainan will nearly double China’s annual launch capacity – already one of the world’s largest. No other existing facility can manufacture rockets at that rate, according to openly available information. Last year, Elon Musk’s SpaceX recorded 61 launches, most of them with reusable Falcon rockets. The Long March 8 is a low-cost, non-reusable rocket that can house more than 20 Starlink-sized communication satellites. China intends to use the medium-sized launch vehicle, which has seen two successful test launches, to send more than 1,000 satellites into space every year, comparable to the current pace of SpaceX. But the new rocket is also designed to put satellites in a higher orbit than the Starlink satellites. The more advantageous altitude would allow Chinese satellites to monitor or even suppress their American rivals. The race to “build a giant satellite constellation is driving China’s space industry into a new age”, said Song Zhengyu, a senior rocket scientist with the China Academy of Launch Vehicle Technology (CALT), who is leading the Long March 8 team, in a paper published in the Chinese Journal of Astronautics last month. Click here to read... [16]

Strategic

Biden predicts China ‘thaw’

US President Joe Biden has told reporters that there will soon be a “thaw” in relations between Washington and Beijing. With US sanctions still in place and the G7 leaders accusing China of posing a military and economic threat, Beijing questioned Biden’s “sincerity.” Speaking at a press conference on May 21 after the G7 leaders’ summit in Hiroshima, Japan, Biden said that diplomatic communication between the US and China ceased after the shooting down of an alleged Chinese surveillance balloon in American airspace in February. “Everything changed in terms of talking to one another,” the US president said. However, relations have seemingly improved, with Biden adding, “I think you’re going to see that begin to thaw very shortly.” Biden followed his prediction of detente up with some mixed messages on Taiwan, however. After first stating that the US stands by the ‘One China’ policy – which recognizes, but does not endorse Beijing’s sovereignty over the island – Biden then vowed that the US would continue to sell weapons to Taipei and declared that “if China were to act unilaterally, there would be a response.” Biden did not specify whether this response would involve the US military, but he has stated on multiple occasions that he would send US troops to repel a Chinese invasion of Taiwan. Click here to read... [17]

Russia becoming China’s vassal – Macron

Russia has effectively suffered a strategic defeat in Ukraine and is becoming increasingly dependent on China, French President Emmanuel Macron said in an interview released on May 14. However, he added that any European security architecture should address not only Ukraine’s concerns but also prevent a standoff with Russia. Speaking to the newspaper l’Opinion, when asked about the ongoing Ukraine conflict, Macron claimed that “Russia has already lost geopolitically.” He argued that Moscow “has started to suspect its historical allies, its first-rank belt.” Moreover, according to the French leader, Moscow “de facto started a form of vassalization with regard to China and has lost access to the Baltic... since it precipitated the Swedish and Finnish push to join NATO.” He added that such a turn of events would have been “unthinkable” even two years ago. Macron reiterated that Moscow “must not win the military war” in Ukraine, adding that the European security architecture would have to provide full security to Ukraine. “However, it will have to envisage non-confrontation with Russia and rebuild sustainable balances. But there are still a lot of steps to get to that,” he stressed. Since the start of the Ukraine conflict, Macron has repeatedly called for peace talks while maintaining contacts with Russian President Vladimir Putin. Click here to read... [18]

Taiwan opposition picks cop-turned-mayor as presidential candidate

Taiwan's main opposition party on May 17 tapped a former cop turned city mayor with no foreign policy experience as its pick to run for the presidency amid soaring tensions with China. Hou Yu-ih, 65, will represent the Kuomintang (KMT) as he faces off against William Lai Ching-te, head of the ruling Democratic Progressive Party (DPP), in Taiwan's January 2024 leadership election. The KMT, which favours closer ties with Beijing, said the decision to pick Hou was based on opinion polls and surveys of party officials. Terry Gou, founder of major Apple supplier Foxconn, also threw his hat in the ring. But the KMT instead gave the nod to Hou, even as questions swirl about his yet-to-be-announced policy views on China and how to navigate tensions between Beijing and Washington. After his candidacy was confirmed May 17, the former head of Taiwan's National Police Agency, warned over the risk of conflict. "Internationally, our country faces fierce troops and the danger of war," Hou told reporters at the party's headquarters in Taipei. "Within the country, there are conflicts over divisions and countless things to be fixed, making it hard for young people to see their future."The announcement kicks off the race to succeed President Tsai Ing-wen, who will step down in 2024 after eight years in office. She is barred from running again due to term limits. Click here to read... [19]

Quad meeting in Australia cancelled as U.S. politics pull Biden home

The Quad summit of Australia, Japan, India and the U.S. planned in Sydney next week will not take place, as American domestic politics interrupt an opportunity for the partners to display solidarity in the Indo-Pacific region. Australian Prime Minister Anthony Albanese made the call on May 17, following a White House decision to have President Joe Biden return straight home on May 21 after attending the Group of Seven summit in Hiroshima, Japan. The Biden administration is locked in emergency talks with Republicans on raising the U.S. debt ceiling to avoid a default, with a key deadline of June 1 fast approaching. The issue not only scuttled the Quad's plans but also forced Biden to call off a planned visit to Papua New Guinea, where he had intended to show his administration's determination to counter China's presence in the region. Albanese told Australian Broadcasting Corp. on May 17 that he was hopeful the Quad leaders, all of whom will be in Hiroshima, would "be able to find a time when the four of us can sit down." Australia and India are not G-7 members but have been invited by the host, Japanese Prime Minister Fumio Kishida. Albanese added that a planned bilateral meeting with Indian Prime Minister Narendra Modi might still go ahead in Sydney. Some experts suggest that the political battle in the U.S. is proving diplomatically costly. Click here to read... [20]

Top military leaders from US, Japan, India and Australia take part in Quad meeting for Indo-Pacific security

After long playing down its significance as an informal group of like-minded maritime democracies in the Indo-Pacific region, the Washington-led Quadrilateral Security Dialogue including Japan, India and Australia, appears poised to deepen security and defence cooperation. Top military commanders from the four Quad member nations are meeting in Rancho Mirage, California, from May 15 to May 17 to discuss Indo-Pacific security. Hosted by US Indo-Pacific Commander Admiral John C Aquilino, the gathering includes Japan’s Chief of Joint Staff General Yoshihide Yoshida, Chief of the Australian Defence Force General Angus Campbell, and India’s Chief of Defence Staff General Anil Chauhan. A vice-admiral rank representative from Britain is also attending. The first session on May 15 focused on deterrence through effective partnerships, according to India’s national broadcaster. Earlier, the Quad navies agreed to schedule war games off the coast of Sydney, Australia, in August. “Quad isn’t a security alliance nor does it exclusively cover mutual security challenges. But Quad military commanders plus UK will meet next week out here in Sunnylands, California,” said Derek Grossman, a senior defence analyst, in a Twitter post. Indian news publication The Hindustan Times called the high-profile, defence-level Quad dialogue a “game changer”. It said the meeting was “a clear indication that the grouping is now taking security cooperation to the next level”. Click here to read... [21]

U.K. cements defence ties with Japan by signing Hiroshima Accord

British Prime Minister Rishi Sunak and Japanese Prime Minister Fumio Kishida agreed on a landmark new global strategic partnership called the Hiroshima Accord when they met in the western Japanese city May 18 night, ahead of the Group of Seven summit. From doubling the number of British troops participating in a Japan-based military exercise to deploying a U.K. aircraft carrier to the Indo-Pacific again in 2025, as well as promoting cooperation on semiconductors, the accord seeks to cement the countries' deepening relationship. Ahead of the announcement, Sunak went aboard Japan's helicopter carrier JS Izumo at the Japan Maritime Self-Defense's base in Yokosuka, Kanagawa Prefecture. The prime minister was received by an honour guard aboard the Izumo deck and inspected the ship, which is currently being upgraded to a light aircraft carrier that can handle F-35 fighters. The U.K. and Japan are the "closest of partners," the accord says, noting that the security and prosperity of the Euro-Atlantic and Indo-Pacific are "inseparable." "We commit to closer consultation on security issues, to carry out an ambitious programme of larger and more complex joint exercises and planning and resolve to bring our defence and security industries closer together," it says. The U.K. confirmed that its carrier strike group will return to the Indo-Pacific in 2025, following its maiden voyage to the region in 2021. Click here to read... [22]

Chinese general calls for military to prepare for ‘hybrid’ modern warfare

The Ukraine conflict has shown that wars are now waged not just in the traditional battlefield but in unconventional areas, and that modern warfare has become a contest of overall national strength, according to a senior Chinese military commander. General Wang Haijiang, commander of the People’s Liberation Army Western Theatre Command, made the remarks in an official newspaper, revealing Beijing’s thinking on the year-long war in Ukraine. Wang wrote that China needs to better integrate its strategic forces and fully prepare for “military struggle” as the country continues to face suppression and containment by Western nations that could “escalate at any time”. The article, which was almost 4,000 words long, was published on the front page of Study Times – the official newspaper of the Communist Party’s Central Party School – on May 15 and gives a glimpse into how the PLA’s top brass sees the war in Ukraine and how China’s military could prepare for future conflicts. It comes as relations between China and the United States have deteriorated and amid growing concern over potential flashpoints such as Taiwan and the South China Sea. “Since the Ukraine crisis broke out, a new form of ‘hybrid warfare’ has emerged. Military confrontations have become intertwined with battles in political, financial, technological, cyberspace and cognitive areas,” Wang wrote. Click here to read... [23]

Sahel ‘at a crossroads’ as armed groups gain sway in Africa: UN

Efforts to combat armed groups linked to ISIL (ISIS), al-Qaeda, and others have failed to stop their expansion in Africa’s Sahel region, a senior United Nations official has warned. Without greater international support and regional cooperation, the instability will increase towards West African coastal countries, UN Assistant Secretary-General for Africa Martha Pobee told a Security Council meeting on May 16.“Resolute advances in the fight against terrorism, violent extremism, and organised crime in the Sahel desperately need to be made,” said Pobee. “The devastating effects of the continuing destabilisation of the Sahel would be felt far beyond the region and the African continent.”A counterterrorism force – now comprised of Burkina Faso, Chad, Mauritania and Niger – lost Mali a year ago when its ruling generals decided to pull out. Pobee said the force has not conducted any big military operations since January. She said the force is adjusting to new realities: France moving its counterterrorism force from Mali to Niger because of tensions with the military government, and Mali’s decision to allow Russian mercenaries from Wagner Group to deploy on its territory. Burkina Faso and Niger have recently strengthened military cooperation with Mali to counter a surge in attacks, but “despite these efforts, insecurity in the tri-border area continues to grow”, she said. Click here to read... [24]

No escape, no aid as fighting intensifies in Sudan’s West Darfur

As Sudan’s civil war enters its second month, ethnic killings are terrorising civilians in the troubled West Darfur region. Residents told Al Jazeera that no place is safe and that Sudanese Arab fighters stormed a hospital to execute 12 wounded non-Arab civilians on May 14. Government buildings, food markets, schools and internally displaced camps have also been attacked, looted and burned. “They are killing all residents … and committing crimes against humanity,” said Jamal Khamis, a human rights monitor in el-Geneina, the capital of West Darfur. “The militants especially know who the political and human rights activists are,” he added, suggesting that he could be targeted. Since a conflict erupted between the Sudanese Armed Forces (SAF) and the paramilitary Rapid Support Forces (RSF) on April 15, the two sides have redeployed thousands of fighters from across the country to try to consolidate control over Khartoum, Sudan’s capital. That has left a power vacuum in West Darfur where Arab militias have reportedly killed hundreds of people in el-Geneina. The region has long been a source of tension between Arab and non-Arab communities because of disputes over land and water resources. The grievances date back to 2003, when non-Arab armed groups rebelled against the central government for neglecting and exploiting Darfur. Click here to read... [25]

China’s Xi Mimics Mao’s Crisis Response in Sweeping Indoctrination Drive

Chinese leader Xi Jinping is taking a page out of Mao Zedong’s crisis playbook to contain the damage caused by the tumultuous final months of his zero-tolerance Covid controls.In recent months, Xi has launched indoctrination drives, including a mass-study campaign to propagate his political doctrine. The campaign has swept through schools, hospitals, banks, courts, police stations, military bases and places of worship in what he describes as a “spiritual baptism” for all members of the Communist Party. To deliver on its mission of rejuvenating the Chinese nation, “the entire party must unify its thinking, unify its will and unify its actions,” Xi told officials at an April meeting. In parallel, Xi has commanded officials at every level to conduct on-the-ground “investigation and research,” echoing a program that Mao directed in the early 1960s in what historians say was an attempt to shift blame for the disastrous consequences of the Great Leap Forward.The fervor of Xi’s campaigns reflects the extent to which recent events have battered the Chinese leader’s image, said Wu Qiang, an independent political analyst in Beijing. Xi’s aim, he said, is “reassert control over public narratives and mask his failings.” Click here to read... [26]

China-Central Asia Summit: long game paying off

Over the next two days (May 18-19), Presidents Xi Jinping of China, Kassym-Jomart Tokayev of Kazakhstan, SadyrJaparov of Kyrgyzstan, Emomali Rahmon of Tajikistan, Gurbanguly Berdimuhamedov of Turkmenistan and Shavkat Mirziyoyev of Uzbekistan will meet in person for the first time. They are attending the first China-Central Asia Summit in Xian, Shaanxi province, China. The summit follows on the heels of the fourth China-Central Asia Foreign Ministers’ Meeting and the first China-Central Asia Meeting of the Ministers of Economy and Trade held last month. To be sure, it represents the beginning of an even deeper collaboration among the countries rather than, as some might assume, just one more diplomatic engagement with little significance. The six leaders are expected to sign several “big-ticket” political agreements in anticipation of future cooperation across the entire geopolitical and economic landscape of the region. What’s more, the summit reaffirms that regional multilateralism is full-bodied and that Middle Eurasia has created a working collective diplomatic platform with downstream delivery networks. Over the past years, the six countries have materialized their respective interests for closer integration, meeting separately and together on multiple occasions on a wide spectrum of socio-developmental and sticky geo-economic issues, including resolution of boundary disputes.Click here to read... [27]

Biden endorses plan to train Ukrainian pilots on F-16 fighter jets -officials

President Joe Biden told G-7 leaders on May 19 that Washington supports joint allied training programs for Ukrainian pilots on F-16 fighter jets, senior U.S. officials said, a significant endorsement as Kyiv seeks to boost its air power against Russia. Training on the U.S.-made jets will take place in Europe and will require months to complete, one of the officials said. U.S. officials have estimated the most expeditious time needed for training and delivery of F-16s at 18 months. "As the training takes place over the coming months, our coalition of countries participating in this effort will decide when to actually provide jets, how many we will provide, and who will provide them," the official said. Although the official did not say which countries would participate, British Prime Minister Rishi Sunak said the UK would work with the Netherlands, Belgium and Denmark "to get Ukraine the combat air capability it needs." Denmark's defence ministry said it was ready to support the training. The U.S. hopes to begin the training, which will be conducted on fourth-generation fighters including F-16s, in the coming weeks, the official added. Ukraine is seeking the jets, made by Lockheed Martin, as it presses on with its biggest advance for months against invading Russian troops before a planned counteroffensive. Click here to read... [28]

Syria’s Assad wins warm welcome at Arab summit after years of isolation

Syrian President Bashar al-Assad was given a warm welcome at an Arab summit on May 19, winning a hug from Saudi Arabia's crown prince at a meeting of leaders who had shunned him for years, in a policy shift opposed by the U.S. and other Western powers. Saudi Crown Prince Mohammed bin Salman shook hands with a beaming Assad as the summit got underway in Jeddah, turning the page on enmity towards a leader who drew on support from Shi'ite Iran and Russia to beat back his foes in Syria's civil war. The summit showcased redoubled Saudi efforts to exercise sway on the global stage, with Ukrainian President Volodymyr Zelenskiy in attendance and Crown Prince Mohammed restating Riyadh's readiness to mediate in the war with Russia. Oil powerhouse Saudi Arabia, once heavily influenced by the United States, has taken the diplomatic lead in the Arab world in the past year, re-establishing ties with Iran, welcoming Syria back to the fold, and mediating in the Sudan conflict. With many Arab states hoping Assad will now take steps to distance Syria from Shi'ite Iran, Assad said the country's "past, present, and future is Arabism", but without mentioning Tehran - for decades a close Syrian ally. Click here to read... [29]

North Korea shows Kim Jong Un examining a military spy satellite that may be launched soon

North Korean leader Kim Jong Un examined a finished military spy satellite, which his country is expected to launch soon, during a visit to his country's aerospace agency where he described space-based reconnaissance as crucial for countering the U.S. and South Korea. Kim during May 16’s visit approved an unspecified “future action plan” in preparations for launching the satellite, North Korea’s official Korean Central News Agency said Wednesday. North Korea hasn't disclosed a target date for the launch, which some analysts say may be in the next few weeks. That launch would use long-range missile technology banned by past U.N. Security Council resolutions, although previous missile and rockets tests have demonstrated North Korea's ability to deliver a satellite into space. There are more questions, however, about the satellite's capability. Some South Korean analysts say the satellite shown in North Korean state media photos appears too small and crudely designed to support high-resolution imagery. Photos that North Korean media released from past missile launches were low-resolution. Photos released by the Rodong Sinmun newspaper of May 17's visit showed Kim and his daughter – dressed in white lab coats – talking with scientists near an object that looked like the main component of a satellite. The newspaper did not identify the object, which was surrounded by a perimeter of red tape. Click here to read... [30]

How Move Forward shocked Thailand's old guard

Thai voters delivered a surprise victory to the progressive Move Forward Party on May 14, a stunning rebuke of not only the country's incumbent military-linked rulers but also to a political establishment that ran elections based on personal patronages. Move Forward's campaign challenged conventional wisdom about Thai politics and won in provinces previously thought to be impenetrable. The vote-rich north and northeast were long known to be loyal to the Pheu Thai party, while the conservative south was a stronghold for the Democrat Party and others in the ruling coalition. On May 14, Move Forward swept 32 of 33 seats in Bangkok, long a Democrat stronghold. Up north, it won 19 districts including the hometown of Pheu Thai founder Thaksin Shinawatra. And in the south, it broke the conservative grip on Phuket to win all three seats. "There are several strategies linking to the winning results," said Decharut Sukkumnoed, director of the Move Forward's policy center. "First, very clear and distinct political positions. Second, comprehensive policy design and detailed plans." Now the campaign to win over the military-appointed Senate begins. In addition to the 500 lower house members, the constitution allows 250 senators to vote for the prime minister. Move Forward's planned pro-democracy coalition would control 310 seats in the House. If its 42-year-old leader, Pita Limjaroenrat, is to win the prime minister's post, the party must find around 70 more votes from either the House or Senate. Click here to read... [31]

Health

25% of COVID-19 patients still have symptoms after 18 months

One in four people in Japan who contracted COVID-19 still suffered from side effects 18 months after their infection was confirmed, researchers found. A study of 1,148 individuals aged 20 to 70 who were infected between February 2020 and November 2021 found that many former patients were affected mildly at the onset of the disease but became aware of lingering symptoms afterward. The findings by the Center Hospital of the National Center for Global Health and Medicine underscore the fact that health problems can persist long after a person has caught the virus. Shinichiro Morioka, a physician at the hospital who is part of the research team, noted that the novel coronavirus was downgraded May 8 to category 5 under the infectious disease prevention law “meaning that special attention will no longer be paid to the disease.” However, he said the emergence of symptoms after the onset of the infection may suggest “it still continues to require special care.” Of the 1,148 who were surveyed in the study, 502 responded to an online or paper questionnaire in March 2022. Those mildly affected accounted for 393, or 78.3 percent of those who responded. It emerged that as many as 212 people experienced aftereffects for two months or longer within three months of contracting COVID-19. The problems included lower levels of concentration at 20.1 percent and reduced olfactory sense, also at 20.1 percent. Click here to read... [32]

Shares of China’s Covid-19 vaccine makers surge as health authorities are set to approve jabs for Omicron variants

Chinese pharmaceutical stocks that slumped after Beijing lifted its stringent zero-Covid policy are gaining traction again, as health authorities said new vaccines for coronavirus variants are in the pipeline to tackle future outbreaks. A gauge tracking 55 Covid-19-treatment related stocks listed on the mainland rallied 2.8 per cent on May 23, the most since mid-December when Covid cases surged after the nation abandoned the anti-pandemic policies and reopened the economy, according to data provider Eastmoney. Shenzhen-listed Hybio Pharmaceutical surged by the 20 per cent daily limit to 12.88 yuan, its best showing since April last year, while peers Guangdong Zhongsheng Pharmaceutical and Shandong Xinhua Pharmaceutical gained by the maximum 10 per cent limit permitted in Shanghai. In Hong Kong, Hansoh Pharmaceutical jumped 4.7 per cent to HK$13.76, while Wuxi Biologics rose 0.7 per cent to HK$44.85. The gains come after Zhong Nanshan, one of the nation’s top respiratory disease experts, said on May 22 that the vaccines targeting Omicron sub-variant XBB had received preliminary approval and were expected to be available soon. Health authorities in China are bracing for another wave of Covid-19 cases, which is expected to reach 40 million cases per week by the end of this month and climb to 65 million cases per week in late June, he said. Click here to read... [33]