The Economist - 11 January 2025

Год выпуска: January 2025

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: 92

DONALD THE DEPORTER

• Could a man who makes ugly promises of mass expulsion actually fix America’s immigration system? Leader, page 9.
• How far will Donald Trump go to get rid of illegal immigrants? Briefing, page 16.
• The economic impact of mass deportations, page 61.

The Africa gap: a special report

• The world’s poorest continent should embrace its least fashionable idea: leader, page 10.
• The economic gap between Africa and the rest of the world is getting wider, says John McDermott, see our special report, after page 38.

Battle and the sexes

• Pete Hegseth’s culture war will weaken America's armed forces: leader, page 12.
• Donald Trump's nominee for defence secretary wants women off the battlefield, page 48.

Putting a price on Greenland

• The economics of buying territory: Free exchange, page 64.

Does meltatonin cure jet lag?

• It can help. But it depends where you’re going, page 68.

The world this week Politics

• After weeks of intense political pressure, Justin Trudeau announced his resignation as prime minister of Canada and suspended Parliament until March 24th. His Liberal Party will now start the process of choosing a new leader. Chrystia Freeland, whose resignation as finance minister in December triggered the current crisis, is one of the front-runners. Mark Carney, a former governor of both Canada’s and Britain’s central banks, is considering a bid. Support for the Liberals has dropped to around 20% amid rocketing immigration, inflation and housing costs. Under the leadership of Pierre Poilievre, the Conservatives have surged in the polls.

Back to his old tricks

• Donald Trump repeated his warning to put “very serious tariffs” on Canada and Mexico, and suggested he would shut off Canadian car exports to the United States. He also threatened to use military force to place the Panama Canal under American control and implied that he could use force to take Greenland, claiming that America needs it for national security. Donald Trump junior visited the island for a “personal day-trip”. Greenland is an autonomous Danish territory. Mette Frederiksen, Denmark’s prime minister, reiterated that it was not for sale, and that Greenlanders may opt for independence in the future.
• The certification of America’s election results in Congress, confirming Mr Trump’s victory, was a more sedate affair compared with four years ago, when his supporters rampaged through the Capitol trying to overturn the result of his loss in 2020. Mike Johnson was re-elected as the speaker of the House of Representatives, but only after Mr Trump arm-twisted a few wavering Republicans. The Republicans hold the narrowest majority in the House for nearly 100 years.
• Fast-moving wildfires fuelled by dry high winds tore though parts of Los Angeles, causing fatalities. The Hollywood Hills were ablaze; wealthy neighbourhoods, such as Pacific Palisades and around Sunset Boulevard, were evacuated. Firefighters bulldozed abandoned cars that were clogging the roads.
• Edmundo Gonzalez, whom many consider to have won Venezuela’s presidential election in 2024, met Joe Biden at the White House, just days before Nicolas Maduro was set to be sworn in for another term. Mr Gonzalez, who fled to Spain after the election, also met Mike Waltz, Mr Trump’s pick for national security adviser.
• A contingent of 150 troops from Guatemala joined the UN-backed security force in Haiti that has been tasked with trying to restore order in the country. The force has so far failed to quell the gang violence that has wracked Haiti, such as the recent murders at an event to reopen a hospital.
• Hamas released a list of 34 hostages that the Palestinian Islamists in Gaza say they would release in the first stage of a possible ceasefire deal with Israel. It is not known whether they are all still alive. The names include two Israelis held in Gaza for a decade. The body of a hostage was found in a tunnel in south Gaza by Israeli forces. The man’s son, another hostage, is also feared dead.
• The UN reported that Iran executed at least 901 people last year, up by 6% compared with 2023. About 40 were put to death in a single week in December. Most of the executions were for drugs-related offences, but some of those put to death were dissidents or connected to the wave of protests against the regime in 2022.
• Iran freed an Italian journalist who was detained in December. The authorities said that Cecilia Sala was arrested for violating the country’s laws, but foreign diplomats think there is a link to Italy’s detention of an Iranian engineer suspected of supplying drone technology that led to the deaths of American soldiers.
• Fighting in eastern Congo has displaced at least 100,000 people recently, according to the UN. M23, a rebel group supported by Rwanda, has stepped up its activities in the country’s North Kivu region since the collapse last month of talks over a peace deal.
• America said that the paramilitary Rapid Support Forces, one of the participants in Sudan’s civil war, had committed genocide. It imposed sanctions on Muhammad Hamdan Dagalo, who is the group’s leader, members of his family and several companies that the RSF owns in the United Arab Emirates.
• Ukraine launched a new offensive in Russia’s Kursk region. Russia claimed to have beaten back the attack, though reports suggested its forces had come under heavy fire. A spokesman for the Ukrainian government said “Russia is getting what it deserves.” At least 13 people were killed in a Russian attack on Zaporizhia. And Russia claimed to have taken the town of Kurakhove, though Ukraine said it had not entirely fallen.
• Following an inconclusive election in September that failed to produce a government, Austria’s president asked the hard-right Freedom Party (FPÖ) to try to form a ruling coalition for the first time. The FPÖ got the most seats at the election, but the president gave the incumbent conservative People’s Party (ÖVP) a chance to form another government. Those talks collapsed recently, and the new leader of the ÖVP, Christian Stocker, has said he is willing to work with the FPÖ.
• Nicolas Sarkozy went on trial, again, in Paris. The conservative former French president is accused of receiving illegal funding for his campaign from Muammar Qaddafi, a notorious Libyan dictator who was executed during an uprising in 2011. Mr Sarkozy denies the charges. A judge recently upheld another conviction for corruption. He has avoided prison in that case by agreeing to wear a tracking device.
• An earthquake of magnitude 7.1 struck Tibet, killing at least 126 people. Rescue workers searching for survivors had to cope with freezing conditions, as overnight temperatures plunged to -18°C (-0.4°F).
• In South Korea a court issued a new arrest warrant for the president, Yoon Suk Yeol, after he thwarted a previous attempt to haul him in for questioning by an anti-corruption agency. Mr Yoon, whose brief declaration of martial law in December has thrown the country into political turmoil, is surrounded by hundreds of bodyguards at his official residence.

Building BRICS

• Indonesia formally joined the BRICS club of developing countries that was created as a counterweight to the G7. Founded by Brazil, Russia, India and China the organisation also includes Egypt, Ethiopia, Iran, South Africa and the United Arab Emirates.

The world this week Business

• Mark Zuckerberg announced that Meta would end the factchecking system on its Facebook and Instagram platforms, and instead allow users to verify the accuracy of posts with something akin to the community notes that X has implemented. Meta ramped up its fact-checking after Donald Trump’s first election win in 2016, but Mr Zuckerberg accepts that it was responsible for “too many mistakes and too much censorship” and that the new policy marks a return to free-speech principles. Some saw the timing of the rethink as bending the knee to Mr Trump.
• Meanwhile, Meta added three new directors to its board, including Dana White, an influential media executive and vocal supporter of Mr Trump. The other two new directors are John Elkann, the boss of Exor, which part-owns The Economist's parent company, and Charlie Songhurst, who advises Meta on artificial intelligence.
• Jensen Huang, the chief executive of Nvidia, unveiled a new range of products and partnerships, and promised that his company would be at the forefront of the revolution in robotics. Nvidia has developed software that allows businesses to train robots, including humanoid ones. He also announced a venture with Toyota in autonomous cars. Nvidia’s share price fell sharply, however, as investors bet that the returns from all the shiny new investments are years away.
• Joe Biden’s decision to block a takeover of US Steel by Nippon Steel of Japan was contested in a lawsuit filed by both companies. The firms argue that Mr Biden’s order sidesteps the “constitutional guarantee of due process” and came about through “unlawful political influence”. Steel unions in America are against the deal. The companies pointed out that “No transaction involving a Japan-based company of any kind has ever been blocked by the president on national security grounds.” US Steel faces an uncertain future without the merger.

Going out with a bang

• Proving that he’s not done yet despite his imminent departure from the presidency, Mr Biden also banned offshore drilling along most of America’s coastline, though drilling in most of the areas covered by the ban is already restricted and the western Gulf of Mexico is not included. Donald Trump says he will reverse the order “immediately” upon taking office.
• Continuing the flurry of activity in the Biden administration the Pentagon added CATL, the world’s biggest maker of electric-car batteries, and Tencent, a tech giant, to its list of Chinese companies that it suspects of having military links. Both described their inclusion on the list as a mistake, and Tencent said it would make no difference to its business. The share prices of both companies swooned, however.
• Ahead of the incoming change of government in America Michael Barris to step aside from his role at the Federal Reserve as vice-chairman for banking supervision, but will stay on as one of the central bank’s governors. Mr Barr has rubbed up against Wall Street’s titans with his stricter regulatory proposals, but he was forced to water down new capital requirements in 2024 after robust opposition from the likes of JPMorgan Chase and Goldman Sachs. As Mr Barr is staying at the Fed, Mr Trump will have to name another of its governors as the new banking supervisor.
• The new year kicked off with turbulence in global bond markets, as investors fretted about high levels of government borrowing. The sell-off was worst in Britain, with the yield on ten-year government bonds touching 4.9%, the highest since 2008, during the financial crisis. Higher yields threaten the government’s fiscal-stability rules, which could result in yet higher taxes or reduced public spending. China saw the exact opposite, as bond yields plunged to their lowest level on record.
• Higher energy prices helped push up the euro zone’s annual inflation rate to 2.4% in December. Inflation has been steadily rising in the currency bloc since September, when it stood at a more than three-year low of 1.7%.
• Getty Images agreed to merge with Shutterstock, which will create the dominant player in the business of supplying photographs and other visual content to the media. Both companies are grappling with the rise of generative Al, and both offer services that allow users to create their own Al imagery.

Ready to rumble

• A host of wrestling stars turned up in Netflix’s first broadcast of wwe’s “Raw” programme. John Cena, The Rock, Hulk Hogan and the Undertaker all made appearances at Netflix’s latest foray into live streaming. It hopes to knock out other competitors vying to dominate the streaming of sports.

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