The Economist - 12 April 2025

Год выпуска: April 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: 84

The age of chaos

• It is too late to undo the damage from Donald Trump’s chaotic trade policy: leader, page 11.
• The trade war between America and China intensifies, page 63.
• Explaining the U-turn, page 66.
• How chaotic markets took the financial system to the brink, page 67.
• America’s tariffs are the most disruptive policy shock in trade history: Free exchange, page 69.

The assault on America’s universities

• Donald Trump’s plan to remake universities threatens America’s prosperity and freedom: leader, page 12.
• He is battling the elite universities—and winning, page 20.
• Why rich Ivies depend on federal funding, page 22.

Iran and America: nuclear options

• The world should welcome America’s nuclear talks with Iran: leader, page 13.
• Donald Trump is gambling on an Iran deal, page 41.

How Al can be good for the climate

• Maximising Al’s green potential: leader, page 14.
• Assessing Al’s environmental footprint, page 71.
• From mining to steelmaking, heavy industries are cleaning up with Al, page 73.

Oh, grow up!

• “Adulting” courses are on the rise in America, page 76.

The world this week Politics

• Donald Trump pulled back from his latest and biggest round of punitive tariffs by announcing a 90-day pause for countries that did not impose retaliatory trade duties, taking them down to a 10% tariff. The American president said more than 75 countries were willing to negotiate. He did not offer any relief for China, however, instead raising the tariff rate on Chinese imports. China had earlier vowed to “fight to the end” as it imposed counter-tariffs on American imports. It described the extra duties as “a mistake on top of a mistake”.
• Mr Trump and his defence secretary, Pete Hegseth, suggested that America’s defence budget for the next fiscal year will top $itrn for the first time when it is published next month. Congress authorised around $892bn for this year.

Rasputin in the White House

• Mr Trump sacked General Timothy Haugh as director of the National Security Agency. General Haugh was reportedly ousted by Mr Trump on the advice of Laura Loomer, a 31-year-old conspiracy theorist who has been banned from most social-media sites. She is still on X, where she wrote that General Haugh had been disloyal to Mr Trump. She provided no evidence.
• Mr Hegseth became the first American defence secretary in decades to visit the Panama Canal, where he reiterated America’s intention to wrest the waterway away from what he described as Chinese influence. A deal to sell the canal’s ports operated by CK Hutchison, a company in Hong Kong, to BlackRock, an American investment firm, looks increasingly shaky; the Trump-friendly Panamanian government is opening an investigation into CK Hutchison’s port contracts.
• The legal battle over deporting alleged Venezuelan gang members to El Salvador took another twist. The Supreme Court decided that the deportations could continue, but that the migrants could challenge their removal in the legal jurisdictions where they are being held. That caused two judges in New York and Texas to delay the deportation of migrants until they received a hearing.
• The IMF announced a preliminary deal with Argentina for a funding programme worth $20bn. President Javier Milei, who has radically cut spending and reduced inflation, celebrated the announcement. It is expected to herald the beginning of a difficult but much-needed shift to a more flexible exchange rate.
• The death toll from the collapse of a roof at a nightclub in the Dominican Republic rose to almost 200. The club was hosting a concert by Rubby Perez, a popular singer, who was killed. Politicians, sportsmen and celebrities were also at the venue.
• During a visit by Binyamin Netanyahu, the Israeli prime minister, to the White House Donald Trump announced that America would start “direct” talks with Iran about its nuclear programme. Mr Netanyahu had hoped to persuade the American president that it was time instead to bomb Iran’s nuclear sites.
• A video was published of Israeli troops killing 15 Palestinian medics near Rafah last month. The Israeli army claimed the medics’ convoy was driving suspiciously, without lights or sirens. But the footage, obtained from the phone of a dead medic, showed that the ambulances had their lights and signals on. The Israeli army now says the episode is “under thorough examination”.
• Israel struck a number of military targets in Syria, escalating tensions with Turkey. Relations between the two regional powers have worsened since the war in Gaza began. They are now competing for influence in Syria.
• Amnesty International recorded more than 1,500 executions around the world in 2024, the highest level for a decade. Iran, Iraq and Saudi Arabia accounted for 1,380 of them. The figures do not cover a number of countries, including China, believed to be the world’s biggest executioner.
• Planned peace talks between Congo’s government and M23, a rebel group backed by Rwanda, were postponed indefinitely, shattering the latest hope of easing the brutal conflict in eastern Congo. Thousands of people have been killed and tens of thousands displaced in the fighting.
• Nigeria received im doses of vaccine to help contain a meningitis outbreak that has killed at least 150 people, and probably many more, in the poor north. The country suffers regular outbreaks of the disease which its underfunded health-care system struggles to control.
• Friedrich Merz, Germany’s all-but-guaranteed next chancellor, unveiled a coalition deal between his Christian Democrats and the Social Democrats (SPD). If SPD members approve the agreement Mr Merz should be sworn into office in May. His popularity has fallen since he decided to increase state borrowing, after campaigning against doing so.
• Volodymyr Zelensky said that Ukraine had captured two Chinese nationals fighting for Russia in eastern Ukraine and that at least 155 others were on the battlefield. Chinas foreign ministry said it was verifying the claims, and that it does not support Chinese nationals’ involvement “in any party’s military operations”. North Korea has sent troops to aid Russia, but they fought in Russia’s Kursk region, not on Ukrainian territory. Ukraine has been mostly pushed out of Kursk, though Mr Zelensky has confirmed that his forces are now fighting in Belgorod.
• The British government dropped plans for official inquiries in five towns where sex grooming gangs had abused young girls. The inquiries had been announced in January amid a furore over the gangs, which largely consisted of perpetrators from Pakistan or with Pakistani heritage. The government will instead make funds available to local authorities and allow them to decide where independent local inquiries are appropriate. The decision was met by claims that the victims of abuse had been betrayed.

Goodbye, Mr Yoon

• South Korea is to hold a presidential election on June 3rd. The announcement came after the Constitutional Court removed Yoon Suk Yeol from office, following his impeachment by the legislature in mid-December. Mr Yoon had briefly imposed martial law in early December, a political shock that revived memories of the country’s military dictatorships from the 1960s to the 1980s. All eight judges on the court voted to remove Mr Yoon, sharply criticising him for violating “the principles of the rule of law and democracy”.

The world this week Business

• Stockmarkets rebounded on April 9th after Donald Trump announced a 90-day pause on his far-reaching punitive tariffs, clawing back some of their earlier losses. The S&P 500 jumped by 9.5%, adding about $4.2trn to its value. Earlier in the week global markets had gone into meltdown; $5trn was wiped off the S&P 500 in two days. The tech-heavy NASDAQ Composite also soared, having its best day since 2001. It had hit bear territory earlier, having plunged by 23% from its most recent peak. Markets in Europe and Asia also recovered. Asian stocks had endured their worst sessions in decades, with Hong Kong’s Hang Seng index plunging by 13% in a day.
• The prices of America’s government bonds were battered in the market turmoil. Usually Treasuries do well in a stock-market rout, but investors such as hedge funds were said to be cashing out of them under duress. The yield on ten-year Treasuries had jumped over a few days from 3.9% to 4.5%, increasing the cost to the government of servicing its already mighty debt.
• Wall Street and business titans voiced their criticisms of Mr Trump’s trade policy, which may have been a factor in pushing him to pause his tariffs. Bill Ackman, an investor who once described the administration as the “most pro-growth’’ he’d seen, said he’d assumed that “economic rationality would be paramount. My bad”. (He then said he was “totally supportive of Mr Trump” and described him as “tough, but fair”.) Larry Fink warned of a “real downturn”. The share price of BlackRock, the firm he leads, is down by 12% this year. Jamie Dimon, the boss of JPMorgan Chase, said America First risked turning into America alone. Even Elon Musk was critical, calling Peter Navarro, Mr Trump’s trade guru, a “moron”.
• Earlier in the week the dollar fell amid fears of a recession. Speculation swirled about how far China would go in allowing the yuan to weaken in order to boost its exports. The Chinese central bank, which manages the exchange rate at which the currency is traded, had let the yuan fall to 7.2 to the dollar, its supposed soft red line. In Japan the yen rallied against the dollar as investors piled into safe-haven assets, though the greenback rebounded on Mr Trump’s tariff reversal.

How the mighty fell

• Companies that are most exposed to tariffs saw their market value slump. Among them, Apple’s share price dived by 22% over five days before bouncing back. The iPhone is assembled mostly in China and subject to the extra trade levies. Nike, which makes its sports shoes in Vietnam, saw an 18% decline in its stock. Its share price surged when Mr Trump suspended his tariffs and the Vietnamese government announced that it would hold trade talks with America.
• Reports emerged about the immediate effect of tariffs on the car industry, which remain in place at 25%. Jaguar Land Rover, a carmaker based in Britain, suspended its exports to America. American ports were filling up with cars as manufacturers held their vehicles there to stop them from becoming subject to the levy.
• In Britain the government slightly softened its rules surrounding the phasing-out of petrol cars. It said the ban on sales of new petrol and diesel car sales would still come into effect in 2030, but that new hybrid vehicles could continue to be sold until 2035. And small manufacturers, such as Aston Martin and McLaren, will now be exempt. The car industry’s association responded that given America’s car tariffs, which were not included in Mr Trump’s wider pause, more action would be needed.
• Oil prices sank to their lowest point in nearly four years, as traders bet that demand would fall amid a possible global recession. Brent crude sagged below $60 a barrel before snapping back to $65. It started the year at $75.
• India’s central bank cut its benchmark interest rate by another quarter of a percentage point, to 6%. It also indicated it would be more open to further cuts to maintain growth amid economic turmoil.
• The share price of global drugs companies fell sharply, after Mr Trump hinted that the pharmaceutical industry would be his next target for tariffs. They were not included in his recent broadside. Stocks in European and Indian drugmakers were particularly hard-hit. About a third of India’s exports of generic versions of popular drugs go to America.

Deluded

• Mr Trump signed another 75-day extension to find a way to allow TikTok to continue operating in America. The president suggested a deal had been close but fell apart over China’s objections to tariffs. He claimed that if he had cut China’s trade duties it “would have approved that deal in 15 minutes, which shows the power of tariffs”.

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