The Economist - 9 сентября 2023

Год выпуска: сентябрь 2023

Автор: The Economist Newspaper and The Economist Group

Жанр: Экономика/Политика

Издательство: «The Economist Newspaper Ltd»

Формат: PDF (журнал на английском языке)

Качество: OCR

Количество страниц: 80

THE NEW MIDDLE EAST

The promise and the perils

• The promise and the perils of the new Middle East: leader, page 11.
• The Gulf countries want to reshape the region in their image: briefing, page 20.
• Iran's zealots have tightened their grip but its protesters await their next opportunity, unbowed, page 41.

Wealth management for the many

• How the battle to look after your savings will reshape global finance, page 63.
• Wall Street has spotted a new market. That is a good thing: leader, page 14.

China's Belt and Road at ten

• The global infrastructure plan has had mixed results. America is leading a pushback, pages 37.
• A slowing economy saps public backing for far-off megaprojects: Chaguan, page 40.

SCOTUS, reform thyself

• America's Supreme Court is a precious institution. The justices should be more careful with it: leader, page 12.
• They are burdened with few ethical rules, but some take liberties even with those, page 23.

Can Javier Milei save Argentina?

• His country needs strong medicine, not quackery: leader, page 12.
• Interview, page 29.
• His economic plan: Free exchange, page 69.

The world this week Politics

• Volodymyr Zelensky sacked Oleksii Reznikov as Ukraine’s defence minister. The president said the defence ministry needed a new approach, not least in tackling the corruption that has plagued military contracts (Mr Reznikov is not implicated in any of the allegations). Rustem Umerov was named as the new minister. As head of the State Property Fund Mr Umerov has a record of rooting out graft. He is also a Tatar from Crimea. Meanwhile Antony Blinken, America’s secretary of state, went to Kyiv to offer more American support to Ukraine.

The war grinds on

• Mr Zelensky visited front-line areas in the battle against Russia. The deputy defence minister claimed Ukraine had retaken 47 square kilometres of land around Bakhmut since launching its counter-attack in early June. At least 17 people were killed in a Russian missile attack on Kostiantynivka, a city near the front line.
• Turkey’s president, Recep Tayyip Erdogan, met Vladimir Putin in Russia’s southern city of Sochi to try to forge a new deal that would allow for the safe passage of Ukrainian grain exports across the Black Sea. Turkey was crucial in negotiating the previous agreement. Russia attacked the Ukrainian side of the Danube river again. The ports there are an alternative shipping route for Ukrainian exports amid the Russian blockade.
• Britain is to designate the Wagner Group of Russian-backed mercenaries a terrorist organisation, alongside the likes of Islamic State. As well as fighting in Ukraine, Wagner troops have been active in several African countries, where they have been accused of war crimes.
• Carles Puigdemont, the exiled former leader of Catalonia, said that any support from his Catalan independence party to keep Spain’s Socialist government in power would depend on granting an amnesty for separatists who had carried out illegal acts. Spain has been in political limbo since an election in July, which was won by the opposition People’s Party but without a majority in parliament. The pp will try to form a government this month. If it fails, as is likely, the Socialists may be asked to try, or a new election could be called.
• Mexico’s Supreme Court decriminalised abortion across the country. The procedure had been previously legalised in certain states. The ruling makes abortion available in all federal hospitals and ensures that health-care workers who provide abortions are protected from prosecution.
• American officials claimed that Kim Jong Un, North Korea’s dictator, was preparing to travel to Russia to meet Vladimir Putin. They said the purpose of the meeting was to seal an arms deal that would send North Korean artillery shells and anti-tank missiles to Russian troops fighting in Ukraine. It would be the dictator’s first trip abroad in more than four years.
• Japan told the World Trade Organisation that China’s ban on its seafood was unacceptable. China, the biggest market for Japanese fish and shellfish, imposed the ban after Japan released water from the damaged Fukushima nuclear plant into the sea. Several international studies had concluded the release was safe.
• Thousands of people took to the streets in Pakistan to protest against the rising cost of electricity, which has doubled over the past three months. The protests, which turned violent in some places, have put pressure on the country’s caretaker government. Yet any relief for suffering Pakistanis could derail Pakistan’s deal with the imf, which helped the country narrowly avoid a default in June.
• Around 170 people were injured when rival groups of Eritrean migrants fought with each other and with police in Tel Aviv. Pro- and anti-government Eritrean factions have also clashed recently in Canada, Germany and Sweden. Binyamin Netanyahu, Israel’s prime minister, said he wanted the illegal migrants to be deported immediately.
• Jihadists in Burkina Faso killed more than 50 members of the security forces as the country’s safety continues to deteriorate. The insurgents have besieged more than two dozen towns and a million people and are inching closer to the capital, Ouagadougou.
• General Brice Oligui Nguema was sworn in as the president of Gabon after leading a coup that deposed Ali Bongo. The Economic Community of Central African States suspended Gabon’s membership and called on the junta to guarantee the safety of Mr Bongo and his family.
• Abdel Fattah al-Sisi, the president of Egypt, said the country needs to sharply reduce its birth rate, from around 2m births a year to 400,000 in order to prevent a "catastrophe”. He said people should not have the freedom to decide how many children to have, pointing to China.
• Saudi Arabia and Iran exchanged ambassadors, ending a seven-year break in diplomatic relations after a rapprochement brokered by China. Separately, the European Union said that Iran has been holding an employee of its diplomatic service since April 2022. Johan Floderus, a Swede, was arrested on charges of espionage while on holiday in Tehran.
• Birmingham council, a local authority serving overim people, in effect declared bankruptcy. Britain’s second-largest city is not alone in its financial struggles; nearly half of England’s councils will have to cut spending on services. Birmingham’s immediate woes are blamed on equalpay claims (brought by female workers who were underpaid) that are estimated to cost between £650m and £760m ($817m to $954m), which the council does not have.
• Britain is rejoining the European Union's Horizon research programme as an associate member. Talks about allowing Britain to rejoin after Brexit had become bogged down in haggling over trading arrangements for Northern Ireland. British scientists say they missed out on research collaboration and funding by being excluded from the programme.
• Enrique Tarrio, the former leader of the Proud Boys, a far-right militant group in America, was sentenced to 22 years in prison for his part in organising the attack on the Capitol on January 6th 2021. It is the stiffest penalty handed down to any of the 1,100 people who have been convicted for their part in the assault.

Party pooper

• Xi Jinping’s decision not to attend the G20 summit in Delhi on September 9th and 10th was met with disappointment. America warned China not to "play the role of a spoiler” by sniping from the summit’s sidelines.

The world this week Business

• Country Garden, a big Chinese property developer, managed to make two interest payments to bondholders just before the end of a 30-day grace period, thus avoiding a technical default. The company had only recently warned that it might default on its debt after reporting a huge quarterly loss. With around $i8ybn in total liabilities, its struggles have rattled investors. However, Chinese markets rallied (albeit briefly) in response to the latest news, and to announcements from Beijing, Shanghai and other cities about easing mortgage requirements for homebuyers.
• The problems afflicting China's economy are best illustrated by the slump in its once-mighty trade prowess. The country's exports fell by 8.8% in August, year on year, the fourth month in a row of decline (in July they plunged by 14.5%). Outbound shipments from China to Japan dropped by 20%.
• Saudi Arabia and Russia surprised markets by extending their voluntary cuts in oil production until the end of 2023, rather than October, as had been expected. Prices jumped in response; a barrel of Brent crude traded at $90 for the first time since November last year. Some analysts think that Russia will try to maintain higher oil prices, and thus higher fuel prices, to put pressure on the Biden administration ahead of next year’s presidential election in America.
• The notion that Britain’s gdp is still below its pre-pandemic level was overturned by a revision to official statistics. It turns out that gdp had grown by 0.6% between the end of 2019 and the end of 2021, rather than shrinking by 1.2%. As more complete data emerged, the Office for National Statistics found that companies had been adding to their stock of goods, rather than depleting them, and that the wholesale trade and health-care sectors expanded at a much faster pace than had been thought.
• Brazil’s economy grew by 3.4% in the second quarter, year on year, a better showing than had been forecast and powered by higher household and government consumption. The news was welcomed by Luiz Inacio Lula da Silva, the country’s left-wing president, who again called on the central bank to lower interest rates in order to encourage growth.

A weaker Arm

• Arm hopes to price its forthcoming IPO on the Nasdaq exchange at between $47 and $51 a share, according to a new filing. That would give the chip designer a market value of up to $52bn, considerably less than the $64bn implied in a transaction by SoftBank, its owner, a month ago. Some analysts now wonder if Arm will even reach a valuation of $52bn, given its latest drop in quarterly revenue.
• Alan Joyce stepped down with immediate effect as chief executive of Qantas Airways. He was supposed to retire in November, but growing public anger over a series of scandals, including claims that the Australian airline sold thousands of tickets for cancelled flights, has forced him into an early departure.
• Saudi Telecom Company, which is controlled by the Saudi government, acquired a 9.9% stake in Telefonica, Spain’s leading telecoms provider. The news was a surprise for the company, and for the Spanish government, which made rumblings about defending its strategic interests.
• Novo Nordisk became Europe’s most valuable listed company, after its treatment for weight loss, Wegovy, was made available in Britain. The Danish pharmaceutical group’s market capitalisation stood at $428bn at the close of business on September 4th, putting it ahead of LVMH, the world’s biggest luxury-goods firm.
• After coping with the pandemic and a supply-chain crisis, Detroit’s big three carmakers—Ford, General Motors and Stellantis—are now confronted with a more traditional problem: a workers’ strike. Contracts with the United Auto Workers must be renewed by September 14th and the bosses and unions remain far apart on reaching a deal. The most recent UAW strike was in 2019.
• New York began enforcing new curbs on renting properties through platforms such as Airbnb. Homeowners who want to rent now have to register with the city, and the platforms must verify that registration. Hosts who repeatedly violate the rules could face fines of up to $5,000. Many have simply pulled their property from the listings. Airbnb says it has in effect been banned from the Big Apple.

Football crazy

• Lionel Messi’s debut for Inter Miami in July led to a surge in subscriptions for Major League Soccer Season Pass, Apple’s streaming package of games, according to Antenna, a data-analytics firm. More than 110,000 people signed up on the day the Argentine player took to the pitch for Miami against Cruz Azul, a Mexican team, and scored the winning goal. The "Messi effect” is also proving to be a winner for AppleTV+, as it has gained new subscribers as a result.

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