The Economist - 25 May 2025

Год выпуска: May 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: 80

THE ASSAULT ON AMERICAN SCIENCE

• America’s assault on science is an act of self-harm: leader, page g, and analysis, page 66.
• Cuts to science funding will hurt ordinary Americans, page 68.
• The risk of a brain drain, page 69.
• The threat to Cambridge, Mass, page 23.

Can Jamie Dimon create a $1trn bank?

• He wants JPMorgan Chase to be the first bank in America to be worth the magic number, page 60.

Golden Dome and the battle for space

• Protecting America by shooting down missiles is not as outlandish as it sounds: leader, page 12.
• The president’s quest for orbital dominance, page 51.
• Years of neglect have left GPS vulnerable, giving China an edge, page 52.

Poland’s remarkable rise

• If it turns inward, the country will lose along with all of Europe: leader, page 13.
• Poland’s presidential election can cement or ruin its standing, page 43.
• Europe’s mayors are islands of liberalism in a sea of populists: Charlemagne, page 47.

The man with a plan for Vietnam

• To Lam, a Communist Party hard man, must rescue a great Asian success: leader, page 10.
• The economy is booming, but the country’s new leader is worried: briefing, page 16.

The world this week Politics

• After an 11-week total blockade Israel announced that it would allow a minimal amount of food into Gaza under pressure from America. A small amount of aid has since entered the strip but the UN said it was “a drop in the ocean”. Meanwhile Binyamin Netanyahu, the Israeli prime minister, said the Israel Defence Forces would be “taking control of all of Gaza”. Israel ordered residents of Khan Younis to evacuate as it prepared to unleash an “unprecedented attack”.
• Britain suspended talks on a trade deal with Israel and imposed new sanctions on Israeli settlers in the occupied West Bank. Britain, France and Canada told Israel they would take “concrete actions” if it continues an “egregious” expansion of military operations.
• Ayatollah Ali Khamenei, Iran’s supreme leader, said he was doubtful that talks with America would lead to a nuclear deal and that America had made “outrageous” demands about Iran’s uranium enrichment.
• Marco Rubio, the American secretary of state, warned that Syria could be weeks away from “potential collapse and a full-scale civil war of epic proportions”, and that its new leaders needed support.
• Cyril Ramaphosa, South Africa’s president, went to the White House, where Donald Trump claimed falsely that white Afrikaner farmers were being targeted in a genocide. In front of TV cameras, Mr Trump forced Mr Ramaphosa and his entourage to watch a video that included incendiary comments from opposition black nationalists in South Africa. The scene was reminiscent of the treatment given to Volodymyr Zelensky when he visited the Oval Office in February.
• Agunman shot dead two Israelis who worked at Israel’s embassy in Washington as they left an event at a Jewish museum. The suspect was taken into custody and shouted “Free, free Palestine”. Israel’s ambassador said the victims, a man and a woman, were a couple who were about to get engaged. The FBI is considering whether to treat the killings as terrorism.
• Donald Trump went to Capitol Hill to persuade Republicans to vote for his One Big Beautiful Bill Act, a sweeping piece of tax-and-spending legislation. The bill would increase the federal deficit. Citing a “decline in fiscal metrics”, Moody’s downgraded America’s credit rating from AAA to AA1, meaning that for the first time America does not hold a top-notch score from any of the three big credit-rating agencies. Amid worries about America’s growing debt, the yield on 30-year government bonds jumped to over 5%, the highest in 18 months. And stockmarkets and the dollar suffered, too.
• America’s Supreme Court allowed the Trump administration to end protections against deportation for 350,000 Venezuelans who have settled in the country under the Temporary Protected Status programme. The court is still open to appeals against the government in the matter.

Brexity things

• Britain’s prime minister, Sir Keir Starmer, achieved a reset in relations with the European Union at the first uk-eu summit since Brexit in 2020. The agreement highlighted defence, agri-food products, the movement of younger people and use of e-gates at airports. The deal was welcomed by many businesses and trade groups as it will reduce some trade frictions. But its detractors, notably the British fishing industry (worth less than 0.1% of British GDP), claimed it was a sell-out. Public opinion has warmed to closer ties with the EU since Brexit.
• A phone call between Donald Trump and Vladimir Putin that was supposed to press the Russians into peace talks with Ukraine amounted to no more than puffery. Mr Putin kept to the status quo, repeating his insistence that Ukraine make concessions. Mr Trump seemed to suggest he would not make any further effort to find peace and would leave Russia and Ukraine to it. The day before the phone call Russia launched one of its biggest drone attacks of the war, which mostly targeted Kyiv. Ukraine and Russia recently held their first direct talks in three years. They lasted for just two hours.
• The first round of Poland’s presidential election saw Rafal Trzaskowski, the liberal mayor of Warsaw, take 31% of the vote, followed closely by Karol Nawrocki, the candidate of the hard right, on 29.5%. Mr Trzaskowski is backed by Donald Tusk, the prime minister. The closeness of the result was a surprise; Mr Trzaskowski had a bigger lead in opinion polls. If he loses in a run-off on June 1st it would complicate Mr Tusk’s efforts to pass reforming legislation. The current hard-right president, Andrzej Duda, has blocked some two dozen bills.
• In Romania a presidential election run-off was won by Nicusor Dan, the centrist mayor of Bucharest, who defeated George Simion, the hard-right nationalist candidate. In the first round Mr Simion had secured twice as many votes as Mr Dan, but in its wake Mr Simion scared voters away with his hostility to NATO and Ukraine. The previous presidential election in December was cancelled amid claims of Russian interference.
• The centre-right government in Portugal was returned to power in a general election, though it again fell short of a majority. The hard-right Chega (“Enough”) party, which campaigned on a platform of slashing illegal immigration, surged in the poll, coming only slightly behind the Socialists in the tally of votes and equalling their seats in parliament.
• In Argentina the libertarian party of President Javier Milei won the mid-term election for the Buenos Aires city legislature. The leftist Peronists came second and the centre-right pro party came a humiliating third in its traditional stronghold. Markets cheered. Mr Milei now looks better positioned politically ahead of national mid-terms in October.

The relationship is over

• The conservative Liberal-National coalition in Australia split, ending a pact that had lasted for decades. The coalition was last in government in 2022, suffering another defeat at a recent election. The Liberals, who dominated the pact, take most of their support from urban areas and will now be the sole party in opposition. The smaller National Party gets most of its support from rural areas.
• Japan’s government, which has seen its approval ratings sink to record lows, was shaken by the resignation of the farming minister for claiming he has never had to buy rice because his supporters donate it to him. His comments sparked fury among voters who are having to fork out record prices for the staple food.

The world this week Business

• Britain’s consumer prices soared by 1.2% in April, pushing the annual rate of inflation to 3.5%. One factor behind the jump was a more than 26% rise in water utility bills. Households also felt the pinch from higher energy costs. Rachel Reeves, the chancellor of the exchequer, described the figures as “clearly disappointing”. Traders pared their bets on further interest-rate cuts from the Bank of England.
• America’s Senate moved a bill forward that would create the first regulatory framework for stablecoins, digital currencies that are tied to the value of an asset, usually the dollar. The Democrats had initially blocked the bill over concerns about consumer protections, but in the end enough of them joined Republicans on a procedural vote to advance the legislation to its final stage.
• An outage of Bloomberg’s terminals affected markets for 90 minutes. The terminals are widely used in financial trading and carry data on live pricing. Users pay around $28,000 a year for each terminal.
• Novo Nordisk announced that its chief executive was stepping down. Investors have expressed concerns that the pharmaceutical giant is losing its competitive edge in the weight-loss market to rivals such as Eli Lilly. Novo Nordisk makes the Ozempic and Wegovy drugs. Its share price has slimmed down by 30% this year.
• CATL made a successful debut on the Hong Kong stock exchange, with its share price rising by 16% on the first day of trading. The Chinese maker of electric-car batteries raised $4.6bn, which could rise to $53bn if the underwriting banks exercise their options. It is the biggest stock offering in the world so far this year, and the second listing for CATL, which first went public in Shenzhen in 2018.

In reverse

• Honda became the latest carmaker to cut back its investment in pure electric vehicles because of slowing demand. It also scrapped a target to achieve 30% of its sales in EVs by 2030. The Japanese company is instead ramping up its forecasts for sales of hybrid vehicles.
• The member countries of the World Health Organisation formally adopted the first ever pandemic agreement, which sets out the tools to combat a global outbreak of disease, including the sharing of vaccines. Once an annex covering data-sharing is agreed on the treaty will be sent to member states for ratification.
• In an announcement that could potentially undermine its partnership with OpenAl, Microsoft said that it would add Grok’s artificial-intelligence models to its Azure cloud-computing platform for developers. Grok is a generative Ai created by Elon Musk’s startup, xai, a potential rival to OpenAl. Microsoft is OpenAl’s biggest investor and has integrated its models with Azure. But it wants to add other models to the platform so that it eventually becomes the dominant hub for developers.
• OpenAl shrugged off the news from Microsoft by announcing it was buying IO in a $6.5bn deal. IO is a startup founded by Sir Jony Ive, best known for his work on designing Apple’s iPhone. OpenAl will work with Sir Jony’s team to develop new devices built specifically for Ai technology. We can “completely reimagine what it means to use a computer”, said Sam Altman, OpenAl’s boss.
• In Spain the backlash against mass tourism continued apace, as the government ordered Airbnb to take 66,000 rental listings off its website for breaking various regulations, such as not identifying whether the property is owned by a person or a company. A court in Madrid agreed that 5,000 listings must be removed immediately. Protests have been held across Spain claiming that holiday rentals are making local housing unaffordable.
• A recent cyber-attack on Marks & Spencer could cost the company £300m ($400m) in profit, it said, and operations won’t return to normal until July. The British retailer’s digital logistics system has been crippled, forcing staff to use pen and paper to replenish its shelves. M&S insists that it has not underinvested in its cybersecurity systems and that the incident was a result of human error. It has not said whether it paid the attackers a ransom.

Shopping baskets

• Home Depot bucked a trend among big American retailers and pledged not to raise prices in response to higher tariffs. Around half the goods that the diy chain sells are produced in America and so it is less exposed to the duties than other companies. Target cut its sales forecast but said that raising prices because of tariffs would be a “last resort”. Donald Trump recently told Walmart to “EAT THE TARIFFS” after it suggested it would have to increase prices. “I’ll be watching,” he said ominously.

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