Ukraine rebuilding would be small wager for Europe 16 May 2023 The Ukrainian economy shrank by 30% last year but the war didn’t break it. Reconstruction will cost $410 bln over a decade, according to the World Bank. The European Union could fund the bulk of those efforts by spending just 0.1% of annual GDP. That would be a shrewd investment.
Rich world has three ways to win over global South 15 May 2023 Leaders from the Group of Seven, who gather this week, need to develop a stronger pitch to poorer non-aligned nations. A strategy based on peace, prosperity and protecting the planet could work. It’s more effective than delivering lectures on democracy, says Hugo Dixon.
Rebuilding Ukraine depends on luring private money 10 May 2023 International agencies and allied governments are taking care of the war-torn country’s immediate needs. An estimated $400 bln reconstruction bill, however, requires additional investors. Economic incentives and new laws would help attract them even before Russia’s invasion ends.
How US and allies can find common ground on China 17 Apr 2023 Emmanuel Macron is not the only US partner wary of being drawn into a Taiwan crisis. But America and its allies will be stronger if they can agree more about dealing with the People’s Republic. Part of the answer is to focus on de-risking rather than decoupling, says Hugo Dixon.
China reluctantly keeps sanctions powder dry 12 Apr 2023 President Xi Jinping is swatting some firms like Micron but is deferring harsher retaliation against US export restrictions. If he scapegoats American capital, he risks pushing other countries into Washington’s camp. China’s soft economy means Xi can’t afford to lose his temper.
New EU debt rules have way to avoid past mistakes 4 Apr 2023 The European Union’s old stability pact was a poorly fitting straitjacket, yet recrafting it is politically fraught. The bloc now aims to replace strict diktats with medium-term goals. A successful framework can revive growth. But it will only work if countries follow it.
OPEC’s oil cut is less surprising than it looks 3 Apr 2023 The producer group’s shock call to slash output by another 1 mln daily barrels will annoy Joe Biden and spur inflation fears. But de facto leader Saudi Arabia had already shown it would ignore US wishes. And Chinese demand is sufficiently uncertain to justify pre-emptive action.
China sanctions red line has shifted westward 21 Mar 2023 President Xi Jinping’s visit to Moscow has rekindled concerns Beijing could get too cosy with Vladimir Putin. Arming Russia would likely trigger a joint Western diplomatic response even in the absence of a Chinese invasion of Taiwan. Beijing is walking a thinning tightrope.
Economic asphyxiation puts Russia in China’s orbit 20 Mar 2023 Moscow needs up to $90 bln to fund its budget deficit this year. As sanctions keep biting, financing the shortfall will slowly add to the economy’s woes. Russia’s need to use the yuan for trade and payments will also increase Vladimir Putin’s dependence on Beijing.
EU and US green arms race misses bigger picture 16 Mar 2023 The European Union’s response to Joe Biden’s Inflation Reduction Act gives member states leeway to push back with their own green subsidies. Yet plans for production targets are misguided. To decarbonise while managing China risks, it’s better to seek common ground with the US.
Middle East pivot to Asia is strategic this time 14 Mar 2023 A restoration of diplomatic ties between Saudi and Iran is a big win for its broker China. After prior false starts, the Middle East and Asia have a growing mutual interest in helping each other advance their energy and trade security. For bankers, financial deals will follow.
UK’s Brexit fix has perks for all sides 2 Mar 2023 Prime Minister Rishi Sunak agreed a trade deal with the European Union this week. In this Viewsroom podcast, Breakingviews columnists explain what the accord will mean for future relations between Britain and the 27-nation bloc and how Northern Ireland may get an economic boost.
UK begins long and uncertain road back from Brexit 27 Feb 2023 Rishi Sunak agreed a deal over Northern Ireland trade with the European Union. If the UK leader can get it past his own party, it should improve relations and collaboration. Closer links will need bigger compromises than Sunak can stomach, but his deal is symbolically important.
Ukraine’s long shadow on business and geopolitics 23 Feb 2023 It’s been 12 months since Russian President Vladimir Putin’s bloody invasion. In this Viewsroom podcast, Breakingviews columnists discuss how energy markets have changed for good, how defence companies are benefiting, and another potential conflict troubling CEOs and investors.
Ukraine yet to make defence a safe investor haven 20 Feb 2023 Kyiv’s pressing call for weapons to defeat Russia dominated a top security forum in Munich. With defence budgets rising, some investors and banks are tempted to engage more with military hardware firms. For most, however, lethal weapons will remain a no-go investment zone.
Economic war with China would be MAD 14 Feb 2023 The prospect of mutually assured destruction averted nuclear conflict during the Cold War. Hopefully, fear of the economic equivalent will stop a showdown with China. But after the shooting down of a Chinese balloon, tensions are rising and errors are possible, says Hugo Dixon.
Hydrogen is elemental to U.S.-EU green compromise 10 Feb 2023 Joe Biden’s Inflation Reduction Act has raised fears of a transatlantic subsidy spat. The sustainably produced version of hydrogen may be a way to de-escalate tensions. Because it’s a potential jobs engine rather than a current one, both sides have scope for a face-saving deal.
Europe is playing catch-up in green subsidy race 9 Feb 2023 The U.S. unveiled $369 bln of climate subsidies for consumers and manufacturers. In this Viewsroom podcast, Breakingviews columnists explain why Brussels may need to launch a similarly ambitious plan or risk losing its share of jobs of the future.
U.S.-China rewarming trade is half-full of hot air 3 Feb 2023 The United States is tracking a suspected Chinese spy balloon. That will sour any meeting between the global giants next week and rattle investors who thought the relationship had found a bottom. Beijing’s aggression is here to stay; financial risks are mostly in the White House.
Capital Calls: TikTok’s Beltway visit 30 Jan 2023 Concise views on global finance: The social media app’s CEO Shou Zi Chew is going in front of a U.S. Congressional committee. But it’s leaders outside of Washington that Chew needs to convince.