July 25
The contest to succeed Boris Johnson moves up a gear today with the first head-to-head debate between the two candidates vying to become Conservative Party leader and UK prime minister.
It’s unlikely to be pretty.
Key reading:
- Truss Promises Low-Tax UK Investment Zones in Pitch to Tory Base
- The Pound’s Woes Run Deep, Whether It’s Truss or Sunak in No. 10
- London’s Square Mile Struggles to Find Its Way in Brexit Britain
- Liz Truss Survived a Knife-Edge Vote. Now She’s Leading the Race for No. 10
- Sunak, Truss Pledge to Crack Down on Illegal Immigration to UK
Foreign Secretary Liz Truss and Rishi Sunak, the former Chancellor of the Exchequer, will slug it out on BBC Television. But rather than the British public, it’s some 175,000 Tory party members who ultimately get to choose the winner — and that’s a problem.
Johnson remade the Tories in a similar way to Donald Trump’s takeover of the US Republican Party. Brexit was Johnson’s signature achievement, but he presided over a wholesale tack to the populist right that runs through the policies of his would-be successors.
So Truss and Sunak are competing to sound the toughest on immigration, while blaming France for traffic delays at Dover port.
Truss’s latest idea is to introduce low-tax, light-regulation investment zones, an extension of her economic plans that focus on cutting taxes and more government borrowing. Economists aren’t convinced, but she’s betting it’s popular with the party base.
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Missing texts | The committee investigating the Jan. 6 insurrection intends to “get to the bottom” of missing US Secret Service texts from the days around the attack, Representative Liz Cheney said. It may also subpoena Virginia Thomas, the conservative activist whose husband is Supreme Court Justice Clarence Thomas, about pushing false narratives on the 2020 election.
- Trump is returning to Washington to deliver a speech at the conservative America First Agenda Summit as lawmakers probe his culpability for the insurrection.
- Former Vice President Mike Pence is getting a one-day head start on rallying the Republican base in Washington before his former boss returns to the US capital.
Reputation crisis | Hong Kong’s leaders sent at least 500 letters to media in almost 30 countries since China announced it would impose a national security law in May 2020 as part of a global battle to safeguard its reputation as a liberal financial hub. About half of the letters blasted critical coverage of the law, with the Financial Times, the Wall Street Journal and the Economist receiving the most. Bloomberg got seven.
- Hong Kong plans to cut hotel quarantine for arrivals with the introduction of a two-color health code system, local media reported.
Property bust | China’s deepening property crisis is sending shock waves through its 400-million-strong middle class, upending the belief real estate is a surefire way to build wealth. As property developments stall across the country and house prices fall, many Chinese homeowners are slashing spending, postponing marriage and other life decisions, and, in a growing number of cases, withholding mortgage payments on unfinished homes.
China’s most educated generation was supposed to blaze a trail toward a more innovative and technologically advanced economy. Instead, an estimated 15 million young people are jobless, and many are lowering their ambitions. Unemployment among 16- to 24-year-old urbanites is a record 19.3%, more than twice the rate in the US — with the government’s hardline coronavirus strategy and a regulatory crackdown on certain industries hitting the private sector.
Power ballot | Tunisians vote on a new constitution today that would enshrine in law President Kais Saied’s accumulation of sweeping powers a year after dissolving parliament, as rivals accuse him of extinguishing a rare democracy in the Arab world. With some opponents calling for a boycott and only Saied loyalists enthused by the referendum, the proposals are likely to pass.
July 26
Russian Foreign Minister Sergei Lavrov might have expected a rough ride on his tour of Africa this week. Instead he’s being welcomed with open arms.
The trip by President Vladimir Putin’s chief envoy takes in countries that are among the most vulnerable to disruptions to food imports as a result of Moscow’s invasion of Ukraine. But if there have been rebukes, they haven’t been made in public.
Key reading:
- Banned in Europe, Kremlin-Backed RT Channel Turns to Africa
- Putin’s Media Blitz on Africa Food Crisis Sparks Alarm in Europe
- Russia’s Nuclear Giant Starts Building of Egypt’s First Reactors
- Long-Range Guns Given to Ukraine Open Door to New Phase of War
- Read our rolling coverage of the Russian invasion of Ukraine here.
In Egypt, one of the world’s largest grain importers, Lavrov was met with warm worlds from President Abdel-Fattah El-Sisi, who singled out state-owned Rosatom’s construction of Egypt’s first nuclear plant as a prime example of bilateral cooperation.
The Russian diplomat meets with Ugandan President Yoweri Museveni today before heading on to Ethiopia — another large grain buyer — and a visit to the African Union headquarters.
Lavrov has made much of Russia’s longstanding economic and political ties to Africa, citing Moscow’s support for national liberation movements and casting western sanctions as the real cause of food insecurity.
It’s a message that resonates, and not just in Africa.
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China’s economic slowdown is spilling over to major exporting nations in Europe and East Asia through falling demand for manufactured goods. Elevated global commodity prices meant China’s official import growth of 1% in June from a year earlier hid a worse result for hi-tech, mechanical and electrical goods.
Angry workers | Britain’s next prime minister will inherit the worst relations with unions and workers since the 1970s, with millions of public sector employees angry their pay is slipping behind inflation. As Philip Aldrick writes, discord among government workers is likely to be the most immediate legacy for Boris Johnson’s successor as unions sound out members including teachers and nurses about walking off the job this autumn.
- Liz Truss and Rishi Sunak attacked each other’s plans for the UK economy in their first head-to-head debate of the campaign to replace Johnson.
Power switch | South African President Cyril Ramaphosa turned to the private sector to end a 14-year-old electricity crisis that the government has failed to resolve. Companies will be allowed to build power plants of any size without a license to meet their own needs and to sell energy to the grid, the boldest move yet to end blackouts that have prompted stinging criticism of Ramaphosa and the ruling party.
The heat waves blasting Europe this summer have killed many people and forced thousands of others from their homes. They are also threatening an industry central to much of the continent’s way of life: wine. Vineyard owners worry that extreme weather including drought, frost and hail, and increasingly intense heat, may lower yields by 25% or more for some vintages, and signal conditions could become worse.
July 27
In the early days of the Russian invasion of Ukraine, there was a school of thought that, however the war panned out, it was unlikely to last long.
Kyiv’s allies talked about deploying a sweeping Marshall Plan to rebuild Ukraine’s industry, agriculture and businesses in the aftermath.
More than five months later, the fighting rages on, and Ukraine faces the reality that its economy is shattered.
Key reading:
- Ukraine’s Fight to Rebuild in Face of Unrelenting War
- Russia Moves to Annex Occupied Ukrainian Land by September
- EU Nations Reach Agreement to Reduce Gas Use for Next Winter
- Long-Range Guns Given to Ukraine Open Door to New Phase of War
- Read our rolling coverage of the Russian invasion of Ukraine here.
As Marc Champion and Daryna Krasnolutska discovered in tracing a section of the Dnipro River, steel plants, factories and farms along the massive trade artery that snakes through the country can’t afford to wait for the war to end. They have to find a way to operate under fire.
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July 28
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Potential breakthrough | US Senator Joe Manchin and Majority Leader Chuck Schumer have struck a deal on a tax, energy and climate bill, breaking a deadlock on the Democrats’ long-sought legislation to enact major parts of Biden’s agenda. The plan would generate an estimated $739 billion in revenue, spend $433 billion and reduce deficits by $300 billion over a decade, much less than the administration planned before Manchin’s opposition.
- The Senate passed legislation that includes $52 billion in grants and incentives for US semiconductor manufacturing, an industry that has steadily lost ground to foreign competitors in recent years.
Precarious position | Markets in Argentina are braced for more volatility after a report that President Alberto Fernandez is poised to name a new economy minister, the third person to hold the post in less than a month. If the report in the Clarin newspaper is confirmed, Sergio Massa will inherit the job as Argentina grapples with inflation forecast to hit 90% and fails to hit the targets it must meet to comply with a $44 billion IMF program.
July 29
As details of the tax, climate, and health-care pact agreed by Democrats in the US Senate emerge, one thing is clear: It’s a big deal.
If approved, it should cast doubt on the narrative of a Democratic Party too riven by ideological differences to govern. But with economic concerns grabbing the spotlight, the question is whether that will make any difference in November midterm election fight for control of Congress.
Key reading:
- Manchin-Schumer Shock Deal Began in Basement, Unfolded in Secret
- Senate Deal Puts US Back in Climate Fight With ‘Huge’ CO2 Cuts
- Manchin Wins Big Nods to Oil in Deal Ending Logjam on Climate
- Here’s What’s in Democrats’ $370 Billion Climate Spending Deal
- Senate Tax, Climate, Drugs Bill in Limbo as Sinema Reviews Text
- ‘Technical Recession’ Sets Up War of Words as US Voters Suffer
The $370 billion climate and energy spending package and $313 billion in corporate-tax increases would complement last year’s $1.2 trillion infrastructure law and a $52 billion bill to boost the US semiconductor industry.
It would lower eye-watering prices for drugs like insulin and envisions a 15% minimum tax on corporations and abolishing a workaround that billionaire fund managers use to avoid paying the same rates as average workers.
The bill would also put the US within striking distance of meeting President Joe Biden’s goal of cutting emissions by half by 2030, even if it may open the way to holding oil and gas lease sales that could undercut the climate-friendly focus.
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The UK’s heat wave this month fueled so many blazes in London that the city’s fire service was busier than any day since Nazi attacks in World War II, and more than 840 people may have died in England and Wales. As Eric Roston reports, a rapid scientific analysis of the event now concludes that without climate change those conditions would have been “extremely unlikely.”
July 30
Senate Democrats reached a landmark agreement that, if it wins approval, will cut US carbon emissions, reduce the price of drugs such as insulin and make big corporations pay more tax.
But bad news on the economic front may neutralize any assistance the deal may provide the party before midterm elections in November.
US President Joe Biden and his Chinese counterpart Xi Jinping are planning a face-to-face meeting after speaking for the first time since March, a conversation their aides did not describe as “constructive.”
Ukraine’s efforts to beat back Russia’s invasion may be shifting gears after delivery of advanced weapons from western backers, but another fight remains to rebuild an economy that is trying to muddle through even as businesses face the everyday dangers of war.
Manchin-Schumer Shock Deal Began in Basement, Unfolded in Secret
A meeting in the basement of the US Capitol was the first in a series of secretive discussions that led to Democrats’ breakthrough agreement that could be their biggest victory in the Senate after two years of struggling to manage a 50-50 split. Laura Litvan takes a look at how it all went down.
Biden Faces Fresh Showdown With Xi Despite Talk of Summit
Biden and Xi ended their call Thursday with plans to hold their first face-to-face summit. But as Rebecca Choong Wilkins and Iain Marlow report, the US and China are unlikely to halt their bickering in the months before the two leaders finally meet.
Biden Loses Bragging Rights Against China With US Economy Fading
It was a great talking point for Biden while it lasted: a forecast for the US economy to grow faster than China’s for the first time since 1976. But as Christopher Anstey explains, data showing the economy shrank last quarter makes it unlikely the US will surpass China’s expansion this year.
Ukraine’s Fight to Rebuild in Face of Unrelenting War
Ukraine’s military has been remarkably successful in stopping a vastly more powerful foe from taking control of the country. But its economy needs to rebuild under fire if the leadership in Kyiv is to end the war on its own terms, Marc Champion and Daryna Krasnolutska report.
Long-Range Guns Given to Ukraine Open Door to New Phase of War
The war in Ukraine may be entering a new stage as long-range rockets supplied by the US disrupt Russia’s grinding advance in the eastern Donbas region. Marc Champion and Alberto Nardelli look at why reasons for the leadership in Kyiv to attempt a counteroffensive are rising.
For Boris Johnson’s Successors, Brexit Is Anything But Done
Former Prime Minister Boris Johnson began his resignation speech by proudly declaring that he got “Brexit done.” The lines of vehicles backed up at the Channel ports last week served as a reminder that many of the ramifications of leaving the European Union are only now beginning to be felt, Ellen Milligan writes.
Macron Tries To Push Back Against Russia Influence in Africa
French President Emmanuel Macron is ready to step up support to African countries facing food and security concerns in a bid to stem Russia’s growing sway in the region. Samy Adghirni reports how he visited the region just as Moscow’s top diplomat did the same.
Boom-to-Bust Past Inspires Push to Diversify Iceland’s Economy
Tired of repeated economic swings caused by individual sectors growing too big too fast, Iceland is pushing to diversify. Ragnhildur Sigurdardottir looks at some of the interesting businesses that have popped up under a drive to promote innovation.
Argentina’s ‘Super’ Economy Minister Faces Mounting Crisis Ahead
President Alberto Fernandez’s appointment of a “super minister” has raised expectations the government may implement at least some painful measures to tackle Argentina’s enormous political and economic problems. They include inflation estimated at 90% this year that’s threatening his administration, Patrick Gillespie and Scott Squires write.
Some View on the World 