The Economist - 25 May 2024

Год выпуска: May 2024

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

Cash for kids

Why policies to boost birth rates don’t work

• Many governments think they can stop fertility from plunging by paying parents to have more children. It won’t work: leader, page 9.
• The truth about the rich-world baby bust, page 60.
• The economics of shrinking populations: Free exchange, page 66.

Where next for Iran?

• The death of the president changes the power dynamic, page 37.
• A vicious, vacuous leader: obituary, page 78.

Meet Nvidia’s challengers

• A new generation of rivals is trying to dethrone the world's top Al chipmaker, page 53.

How to save South Africa

• The rainbow nation is in terrible shape. It needs an alternative to decline under the ANC: leader, page 12.
• Next week's election will force the indecisive president to make a fateful choice: briefing, page 16.

Britain’s election surprise

• The British prime minister’s decision makes no sense, but it is good news all the same: leader, page 10.
• Could Labour miss an open goal? Page 48.
• An odd politician: Bagehot, page 50.

The world this week Politics

• Iran’s president, Ebrahim Raisi, and its foreign minister, Hossein Amirabdollahian, were killed in a helicopter crash. The country’s supreme leader, Ayatollah Ali Khamenei, named a caretaker president ahead of elections on June 28th. Mr Raisi was a leading contender to succeed Mr Khamenei as supreme leader. His death makesit more likely that iMr Khamenei’s son, Mojtaba, will replace his father.
• The International Criminal Court’s prosecutor announced that he was seeking arrest warrants for the Israeli prime minister, Binyamin Netanyahu, and defence minister, Yoav Gallant, as well as three leaders of Hamas. Joe Biden, the American president, called the Israeli warrants “outrageous”; his government may work with Congress to impose sanctions on the ICC. Mr Netanyahu’s opponents, who have threatened to leave his government if he does not change course in Gaza, rallied round him too.
• Ireland, Norway and Spain said that they would formally recognise a Palestinian state. Israel responded by recalling its ambassadors to the three countries and described the announcement as “a reward for terrorism”.
• South Africa’s Constitutional Court barred Jacob Zuma, a former president, from standing for office in the general election on May 29th because of a criminal conviction. This may benefit the ruling African National Congress, which had been losing support to Mr Zuma’s new party, known as MK, currently polling at 11%.
• America is to withdraw all its forces from Niger by September 15th, after its negotiators failed to secure an agreement to continue counter-terrorism operations there. Relations between the two countries have soured since a coup overthrew Niger’s elected government last year.
• Congo said it had thwarted an amateurish putsch attempt by about 50 armed men, including three Americans. The president, Felix Tshisekedi, was not harmed in the attack on the presidential palace, which was live-streamed by the alleged leader of the plot. The rebel was subsequently killed by the security forces.

A Tory wet

• In pouring rain outside 10 Downing Street, Rishi Sunak, the British prime minister, called a general election for July 4th. The Conservative Party has been in power since 2010 but a series of mishaps have left it far behind the opposition Labour Party in the polls. Mr Sunak, the fourth Tory to hold the job of prime minister within five years, is gambling that he can pull off an improbable comeback.
• The Infected Blood Inquiry, an investigation into Britain’s “worst treatment disaster in the history” of the National Health Service, presented its final report. The inquiry looked into the administration of contaminated blood products to patients in the 1970s and 1980s. More than 30,000 people contracted hepatitis C and HIV, and over 3,000 have died to date. Evidence of infections had been destroyed; repeated government assurances about the safety of treatment were wrong. Sir Brian Langstaff, who headed the inquiry, said the “disaster was no accident”.
• Georgia’s governing party lashed out at America, claiming it was disrespecting the will of the Georgian people by opposing a new law that requires NGOs and media groups that receive at least 20% of their funding from abroad to register as foreign agents. The American Congress is considering imposing sanctions for stifling democracy on the politicians behind the bill.
• Nine people were arrested in Poland for allegedly helping Russian intelligence services to plot acts of sabotage. A Polish judge recently defected to Belarus. Donald Tusk, the prime minister, has created a commission to investigate Russian and Belarusian activities in Poland.
• Marine Le Pen, the leader of the French National Rally, announced that her party was making a “clean break” from the far-right Alternative for Germany (AfD) in the European Parliament and would no longer sit with the party. This follows recent comments from Maximilian Krah, the AfD’s lead candidate for the European elections, that the Nazi SS “were not all criminals”.
• Emmanuel Macron visited New Caledonia amid an outbreak of violence over a new law that expands voting rights for French citizens who live in the Pacific-island territory. Six people have died in the rioting. Astate of emergency has been declared and hundreds of extra French security personnel deployed to tackle the unrest.
• Lai Ching-te was sworn in as the new president of Taiwan, the fifth democratically elected person to hold the job. In his inauguration speech Mr Lai called on China to “stop intimidating Taiwan politically and militarily”. China’s govern ment said Mr Lai’s remarks had sent “dangerous signals”.
• Thousands of people protested outside Taiwan’s parliament against a contentious series of proposals from opposition parties to curb the president’s powers. Mr Lai’s Democratic Progressive Party lost its majority in parliament in January’s election to the opposition Kuomintang (KMT) and Taiwan People’s Party (TPP).
• To Lam became the new president of Vietnam. Mr Lam, until recently a minister for public security, is associated with a crackdown on corruption. He faced criticism when a video of him being fed gold-leaf-garnished steak in London in 2021 went viral while Vietnam was under lockdown.
• Nine people were killed at a political rally in northern Mexico when the stage collapsed. Meanwhile the presidential candidates held their final debate before the election on June 2nd. Claudia Sheinbaum, the leftist ruling party’s candidate, is the front-runner.
• In Haiti the new governing council said the national police force would lead a security mission that will try to restore order after months of violence involving gangs, who in effect control the country. Kenya is supposed to contribute 1,000 troops to the mission. Its president, William Ruto, held talks with Joe Biden in Washington, where they discussed Haiti.

And don’t come back

• Javier Milei’s visit to Spain upset the Socialist government. The Argentine president spoke at a national-conservative rally, where he described the wife of Pedro Sanchez, the prime minister, as corrupt (there are claims of corruption against Begona Gomez, but Madrid’s public prosecutor has said there is no evidence). Mr Milei also refused to meet the king. Spain withdrew its ambassadorfrom Buenos Aires—permanently, it said.

The world this week Business

• The demand for chips to power artificial-intelligence services from the likes of Meta and Microsoft helped boost Nvidia’s revenues to $26bn in the latest quarter, a 262% increase, year on year. Net profit soared by 628% to $14.9bn. The company promises more to come. It will soon start to ship its new Blackwell chips, which cost more than $30,000 each.

Non-performance pay

• Around a third of Boeing’s shareholders voted against the pay package awarded to Dave Calhoun, who is stepping down as chief executive at the end of the year amid a litany of safety concerns about the company’s aircraft. Mr Calhoun’s total remuneration has increased by 45%, provoking anger among some investors. Boeing’s share price is down by more than 25% since the start of this year.
• A73-year-old man died and dozens of passengers were injured on a Singapore Airlines flight that encountered extreme turbulence. Deaths from turbulence are very rare (the deceased man reportedly had a heart condition) and big aircraft are unlikely to be brought down by severe weather.
• A court in St Petersburg froze assets belonging to Commerzbank, Deutsche Bank and UniCredit, three European lenders, in a lawsuit brought by a subsidiary of Gazprom, Russia’s state gas company. The assets totalled nearly €800m ($866m), more than half of which are owned by UniCredit. Europe’s banks have been slow to leave Russia, even though it is subject to heavy sanctions. The European Central Bank has urged them to speed up their departure because of the risks involved.
• Shareholders in Shell overwhelmingly backed the company’s new climate strategy, which lowers its target for reducing carbon emissions by 2030 and abandons a goal for 2045, but still aims for net-zero emissions by 2050. Some 22% of investors voted against the policy, around the same proportion as similar green rebellions in 2022 and 2023. A resolution put forward by Follow This, an NGO which co-ordinates shareholder pressure on environmental issues, was also defeated.
• America’s Justice Department readied its long-expected antitrust lawsuit against Live Nation. The department, in effect, wants to revoke the merger in 2010 between Live Nation and Ticketmaster, claiming it has created a monopoly in tickets for large entertainment events.
• Britain’s annual inflation rate fell sharply in April, to 2.3% from 3.2% in March, and is now at its lowest level in three years. But the drop was less than analysts had forecast, which dampened expectations that the Bank of England might cut interest rates in June.

This isn’t just any strategy

• Marks and Spencer reported a quarterly profit that exceeded forecasts and announced its first shareholder dividend since 2019. For years the British retailer struggled with falling sales and market scepticism about its prospects, but in 2022 it unveiled a turnaround strategy, closing failing stores and investing more in its popular food supermarkets.
• Walmart’s share price continued to climb after it reported bumper quarterly earnings and raised its annual sales and profit forecast. The retailer’s market value rose above $500bn for the first time.
• Janet Yellen, America’s treasury secretary, defended Joe Biden’s new tariffis on a range of Chinese imports, including duties of 100% on electric cars, as “strategic and targeted steps”. Speaking in Frankfurt, Ms Yellen called on the European Union to join America in curbingcheap Chinese exports in green-tech, which she said undermine Western innovation and jobs. She also denied that America’s huge subsidies for its green manufacturers amounted to protectionism. The EU has so far taken a softer approach to China, but it is expected soon to slap duties on Chinese EVs, the makers of which receive state handouts.
• Klaus Schwab is to retire as head of the World Economic Forum, which he founded in 1971. His replacement as chairman of the WEF, which organises the annual Davos summit, is expected to be Borge Brende, the WEF’s president.
• Ivan Boesky died, aged 87. As one of Wall Street’s leading investors in the 1980s Mr Boesky helped fuel a takeover boom, until it all came crashing down. He pleaded guilty to insider trading and was eventually sent to prison in 1987. The character Gordon Gekko in Oliver Stone’s film “Wall Street” was inspired in part by him, giving audiences the immortal strapline that “greed is good.” Mr Boesky’s actual words, from a speech to business-school students, were reportedly “I think greed is healthy. You can be greedy and still feel good about yourself”. By all accounts, he was loudly applauded.

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