Global Developments and Analysis: Weekly Monitor (01-07 April 2024)

Economic

How the West lost control of the gold market

The first sign of an impending shift was that, in first few months after the Fed embarked on a sharp rate-hike cycle in March 2022, gold did drop but proved much more resilient to the rising rates than correlation models would have suggested. But the real breakdown in the correlation started around September of that year, when gold prices actually started climbing even as real rates remained flat. In fact, from late October 2022 through June 2023, the gold price rose 17%. Meanwhile, over 2023, US real yields rose (despite quite a bit of volatility), which, according to the old correlation, should have meant a decline in gold prices as higher yields elsewhere would make non-yielding gold less attractive. However, gold rose 15% for the year. Another notable aspect of this is that Western institutional investors have been net sellers of gold, as evidenced by declining inventory held by Western exchange-traded funds (ETFs) and falling open interest on Comex during the October 2022-June 2023 period mentioned above (when the correlation broke down). In 2023, gold ETFs posted net outflows for the year despite the rising gold price. Meanwhile, so far this year through February, the ETF outflow figure amounted to $5.7 billion, $4.7 billion of which came from North America – all while gold prices have surged to all-time highs. Click here to read… [2]

Russia Weighs Tighter Migrant Worker Rules After Moscow Attack

Russia is considering a raft of changes to tighten its immigration laws after Tajik nationals were accused of carrying out the worst atrocity in the capital in more than two decades. The attack on concert-goers at Crocus City Hall in the Moscow suburbs last month killed more than 140 people. Investigators later found that some of the alleged attackers had expired Russian immigration documents. Russian authorities have since intensified scrutiny on the legal status of migrant workers across the country, while police have raided facilities run by companies that traditionally employ immigrants, raising concern about a crackdown on citizens of Central Asian countries, according to media reports. More than 20 people were detained after a raid on a warehouse run by online marketplace Wildberries, according to Gazeta.ru. The Interior Affairs Ministry last week filed a draft law to tighten migration rules, spokeswoman Irina Volk said April 01. Under that bill, foreign workers would need to have a so-called digital profile with biometric data. The number of days that foreigners can spend in Russia without registering with authorities would be cut to 90 days per calendar year from 90 days within a 6-month period currently. Click here to read… [3]

The Explosion of Asylum Claims Driving the Global Migrant Crisis

Campo de Asilo, or Asylum Camp run by an aid group, it’s a destination for migrants planning to turn themselves in to U.S. border agents and request asylum. That simple request is the main driver of record illegal immigration in much of the Western world. People travel thousands of miles, on foot and across seas, to turn up at the land borders of rich countries to ask for asylum, a form of legal protection for people who face persecution in their home country. It’s also become a key loophole for economic migrants, who aren’t under threat but want better working opportunities. Quirks in the law and an overwhelmed processing system nearly guarantee entry, at least for a time. The U.S. received more than 920,000 applications for asylum during its 2023 fiscal year, compared with just 76,000 in 2013. Since a single application can cover multiple members of a family, the figures underestimate the actual numbers of people seeking asylum. Family groups, who now almost always ask for asylum, make up about half the roughly two million people encountered by authorities who illegally crossed the U.S. frontier with Mexico last year. Another half million came through legal ports of entry, many using a Border Patrol smartphone app that launched in January 2023 to make an appointment to cross and ask for asylum. Click here to read… [4]

Gas Glut? Not for Long.

Natural gas prices are falling all over the world. There is abundant supply, and demand has been lukewarm this northern hemisphere winter, which was relatively mild. Indeed, the global gas market is in oversupply. This prompted Morgan Stanley to recently forecast a gas glut that we have not seen in decades. It was going to materialize as a result of strong growth in LNG production capacity, the bank’s commodity analysts said. They cited numbers showing that there was 400 million tons in such capacity to date, but another 150 million tons were under construction— “a record wave of expansion”. It appears the forecast was based on an assumption of not very strong demand growth—but it may be the wrong assumption. Because natural gas demand is set to grow and grow quite robustly. At the same time, some producers, notably in the United States are already starting to withhold production, because of the low price of the commodity. Asia imported record volumes of liquefied natural gas last month, data from Kpler showed recently. The biggest buyers were China, India, and Thailand, with India’s LNG purchases up by 30% from a year earlier and China’s 22% higher than in March 2023. That record would not have been possible had prices not fallen—and prices had fallen because Europe was buying less LNG. Click here to read… [5]

Oil Surges Over $90 as UAE Cuts Diplomatic Ties with Israel

At this point Israel's ties with key Gulf countries like the UAE are near breaking point, after only a few short years ago diplomatic normalization was hailed through Trump's Abraham accords. But international and Israeli press reports are confirming the UAE has announced it is halting all coordination on humanitarian aid with Israel. Further, as Israeli media reports: "The United Arab Emirates (UAE) has announced a suspension of diplomatic coordination with Israel in the wake of the death of seven World Central Kitchen humanitarian workers in Gaza." Simultaneously, Israel is busy putting its embassies across the world on high security alert due to the "heightened Iranian response threat" in the wake of April 01's Israeli attack on the Iranian embassy in Damascus. All of this served to send Brent soaring in the last two hours, with Brent spiking above $90 for the first time since October and sending stocks tumbling to session lows. With Iran vowing that its retaliation is coming at any moment, Israel's military is scrambling for readiness, with the latest measure being to pause all home leave for all combat troops. "The IDF is at war and the issue of the deployment of forces is constantly reviewed as needed," the Israeli military said. Click here to read… [6]

China Topples US as SE Asia’s Favored Partner, Survey Shows

China has dethroned the US to become the top alignment choice for Southeast Asians as Washington loses ground on a range of key issues from regional economic engagement to the Israel-Hamas War, according to a new survey. A survey of 1,994 Southeast Asians by the ISEAS-Yusof Ishak Institute published April 02 shows China’s popularity in a head-to-head race with the US climbing from 38.9% last year to 50.5% in 2024. Among individual nations, Beijing garnered some three out of four votes in Muslim-majority Malaysia, Indonesia and Brunei. “Confidence in the US has waned,” the survey states. “This could be attributed partly to the escalating rivalry between China and the US, which led to an uptick in anxiety about the US’ growing strategic and political influence.” Southeast Asian nations have largely embraced the US as a necessary security presence as the Biden administration ramps up military-to-military cooperation in a bid to counter Bejing’s growing defense prowess. But the region also counts on China as a key financier and trading partner at a time regional leaders seek new investments to bolster their own economies. Part of the issue for the US are concerns over economic engagement. Southeast Asians are “increasingly unsure” about the effectiveness of the Indo-Pacific Economic Framework for Prosperity, a US-led endeavor to increase trade that’s been criticized for its lack of meaningful market access. Click here to read… [7]

Bond Comments by China’s Xi Hint at Possible Expansion of PBOC Toolkit

A months-old speech by China’s top leader has stoked speculation around aggressive liquidity boosts from Beijing. While economists have generally shrugged off such a possibility, some say that more trading of treasury bonds could bring the country’s central bank more in line with practices adopted by peers in developed markets. In remarks made in October but only published recently, Chinese President Xi Jinping called for the People’s Bank of China to supplement its monetary policy toolbox and gradually step up trading of treasury bonds in its open-market operations, a policy tool the bank has rarely used in the past two decades. Economists say U.S.-style “quantitative easing,” in which a central bank loads up on government bonds and other assets to push down yields, is unlikely in China, since Beijing still has relatively ample room to ease monetary policy with traditional measures, as interest rates in China are still well above zero. Also, any further monetary easing would be constrained by factors including tepid borrowing demand, softer profit margins at banks, a weak currency and the uncertain timing around any future Federal Reserve rate cuts, they say. Still, Xi’s comments represent a potential policy pivot that could help further enrich the central bank’s toolbox, some economists say, considering the shortcomings of existing tools at a time of a nascent yet fragile economic recovery. Click here to read… [8]

Scathing federal report rips Microsoft for shoddy security, insincerity in response to Chinese hack

In a scathing indictment of Microsoft corporate security and transparency, a Biden administration-appointed review board issued a report April 02 saying “a cascade of errors” by the tech giant let state-backed Chinese cyber operators break into email accounts of senior U.S. officials including Commerce Secretary Gina Raimondo. The Cyber Safety Review Board, created in 2021 by executive order, describes shoddy cybersecurity practices, a lax corporate culture and a lack of sincerity about the company’s knowledge of the targeted breach, which affected multiple U.S. agencies that deal with China. It concluded that “Microsoft’s security culture was inadequate and requires an overhaul” given the company’s ubiquity and critical role in the global technology ecosystem. Microsoft products “underpin essential services that support national security, the foundations of our economy, and public health and safety.” The panel said the intrusion, discovered in June by the State Department and dating to May “was preventable and should never have occurred,” blaming its success on “a cascade of avoidable errors.” What’s more, the board said, Microsoft still doesn’t know how the hackers got in. The panel made sweeping recommendations, including urging Microsoft to put on hold adding features to its cloud computing environment until “substantial security improvements have been made.” Click here to read… [9]

Sri Lanka's debt repayments to be suspended until 2028

Sri Lanka and a group of its creditors are in final negotiations to suspend debt repayments until 2028, Nikkei has learned, as country creditors including Japan seek to prevent China's influence from expanding in the debt-ridden island. "Negotiations [with the creditor nations] have concluded. We are hoping that it [a detailed announcement] will take place in the next few weeks," Sagala Ratnayaka, Sri Lanka's national security adviser to the president, told Nikkei in a recent interview. The repayment period will be 15 years, from 2028 to 2042, with the interest rate newly set at around 2%. He said that there will be no further debt reduction, despite a request by the island nation. Sri Lanka in April 2022 announced a temporary suspension of public external debt payments, in effect putting the country into default. A meeting of creditor nations was set up in April 2023. Japan, which is the largest creditor country after China, is serving as the chair in the talks along with India and France. Sri Lanka and the creditor nations have reached a basic agreement on a repayment moratorium and a reduction in interest. The provision of financial assistance from the International Monetary Fund, which was conditional on debt restructuring agreements being struck with major creditor countries, has also begun. Click here to read… [10]

Pakistan and Taliban to expand trade despite lingering tensions

Despite simmering tensions, recent agreements between Pakistan and the Taliban administration in Kabul to prioritize trade point toward a complex interplay among security concerns, economic ambitions and competition between key ports in the region, analysts and traders say. This shift comes after a tense period that saw Pakistan conduct rare airstrikes inside Afghanistan against suspected hideouts of Pakistani militant groups on March 18, killing eight people and prompting Afghan forces to return fire on the border. Yet a week later, a Pakistani delegation led by Commerce Secretary Muhammad Khurrum Agha met with Afghan Commerce Minister Nooruddin Azizi in Kabul to address trade issues. The two countries agreed on the "separation of business from politics" and to pursue "uninterrupted" trade activities, said Zabihullah Mujahid, the Taliban administration spokesman. Echoing this sentiment, Pakistan's Foreign Ministry expressed encouragement over the "progress made on these issues." Despite Pakistan continuing to stand as the largest importer of Afghan goods, amounting to $369 million in 2022, there has been a significant decline in bilateral trade volume over the past five years, from $2.3 billion to $1.4 billion, according to the state-run Trade Development Authority of Pakistan. Pakistani exports are dominated by textiles, pharmaceuticals, food items and construction materials, mainly cement. Afghanistan primarily exports fruits, carpets and minerals like coal, marble and gemstones. Click here to read… [11]

Thailand Leads Push for Six-Nation Visa to Lure Moneyed Tourists

Thailand is steering an initiative for a joint-visa program with countries that together hosted about 70 million tourists last year as Prime Minister Srettha Thavisin ramps up initiatives to attract more long-haul and high-spending travelers. Srettha — who’s pledged to elevate Thailand’s status as a tourism hotspot into an aviation and logistics hub — has discussed the Schengen-type visa idea with his counterparts in Cambodia, Laos, Malaysia, Myanmar and Vietnam in recent months. The facility is meant to ensure seamless mobility for travelers among the six neighboring countries. With most leaders positively responding to the single-visa concept, tourism-reliant Thailand aims to generate more revenue per traveler and cushion its economy from headwinds such as sluggish exports and weak global demand that’s hurt its manufacturing industry. The six Southeast Asian nations reported a combined 70 million foreign tourist arrivals in 2023, according to official data. Thailand and Malaysia accounted for more than half of the tally, generating about $48 billion in tourism revenue. The single-visa is the most-ambitious among Srettha’s lineup of tourism initiatives but targeted for the long-term. The industry has served the country well, accounting for about 20% of total jobs and making up about 12% to the nation’s $500 billion economy. Barring the pandemic years, tourism has flourished and provided a cushion against a slump in manufacturing and exports, the traditional bulwarks of the economy. Click here to read… [12]

‘New normal’: Chinese revenue from African projects is in decline, and the situation is unlikely to change

With lenders tightening their purse strings and the number of projects in decline, Chinese revenue earned from engineering and construction works in Africa has fallen by more than 30 per cent since 2015. Now observers say this is the “new normal”. It was a different picture almost a decade ago when Chinese companies earned more than a third of their total overseas revenue from Africa. That is certainly not the case today. According to data from the China Africa Research Initiative (CARI) at Johns Hopkins University’s School of Advanced International Studies, engineering and construction contracts in Africa earned Chinese companies US$37.84 billion in gross annual revenues in 2022, which was a 31 per cent drop from US$54.78 billion generated in 2015, the year lending to Africa was at its highest. Africa made up 19.4 per cent of global revenue for Chinese companies in 2022, CARI said, almost halved from its 2010 peak of 38.9 per cent. Excluding small businesses, it is estimated there are more than 10,000 state-owned and private Chinese companies currently operating in Africa. Most of these moved to the continent during former Chinese president Jiang Zemin’s push for businesses to “go out” in search of new markets and raw materials at the beginning of the century. Click here to read… [13]

The Fed Blocks Stricter Global ESG Rules for Banks

The US Federal Reserve has blocked an attempt led by the European Central Bank (ECB) to make climate risks a pillar of global rules for banks and require them to report their strategies on meeting climate commitments, sources with knowledge of the matter have told Bloomberg. Some members of the Basel Committee on Banking Supervision (BCBS), which includes central banks and bank supervisors from around the world, have been pushing for making climate risks and ESG commitments the center of new rules for banks everywhere in the world. Members of the Fed, however, have expressed in closed-door meetings concerns about such rules because they believe the committee might be overreaching with this particular supervision, according to some of Bloomberg’s sources. The Fed officials also feel they have a narrow mandate in this area to regulate climate risk disclosures from the Wall Street banks, the sources added. Although the Basel Committee cannot enforce its banking system standards on jurisdictions, it could set a global baseline, from which the single countries develop their own rules and procedures. The Fed’s resistance to the Europe-led climate risk disclosures highlights the rift between the two sides of the Atlantic in the ESG push, with Europe committed to implementing tougher rules. Click here to read… [14]

Zimbabwe Launches a New Currency…Again

The Reserve Bank of Zimbabwe, which gained global notoriety in 2008 for printing one-hundred-trillion-dollar notes, said April 05 it was launching a new national currency, promising, once again, to end years of monetary turbulence. John Mushayavanhu, who took over as the central bank’s new governor last week, said the new unit, Zimbabwe Gold, or ZiG, will replace the current Zimbabwe dollar, which has lost around three-fourths of its value this year. The currency most recently traded at more than 30,674 Zimbabwean dollars to the U.S. dollar, according to the central bank. When the bank relaunched the local unit in 2019, $1 bought 2.50 Zimbabwean dollars. Mushayavanhu said the new currency would initially be valued at 13.56 ZiGs for $1 and later at a rate determined by the market. All bank accounts currently denominated in Zimbabwe dollars will be converted into an equivalent amount of ZiGs, he said. To shore up confidence in the currency, Mushayavanhu said it would be fully backed by Zimbabwe’s reserves of U.S. dollars and precious metals, particularly gold. He also pledged to end a long-running practice of the bank issuing more money to finance government spending. “We want a solid and stable national currency in this country,” Mushayavanhu said. “It does not help to print money. Certainly under my watch it is not going to happen.” Click here to read… [15]

Trade Disputes and Technological Advancements Impacting Rare Earth Market

Month over month, rare earth metals witnessed new price lows not seen since September 2020. While neodymium oxide and praseodymium oxide witnessed the sharpest drop out of all of the components of the Rare Earths MMI (Monthly Metals Index), the index fell by 5.08% overall. But with price points nearing pre-pandemic lows, the index may have finally found a bottom following six straight months of declines. A recent S&P Global article shed some light on the year-over-year decline in rare earth metals prices. According to the Australian company Lynas Rare Earths, a large, rare earths producer, the average selling price for neodymium-praseodymium dropped 32% year over year to AUS $35.50 per kilogram for the July–December 2023 period. Another article on oilprice.com noted that in March 2024, terbium oxide and neodymium oxide reached their lowest levels since late 2020. Meanwhile, MetalMiner’s own MMI index showed similar data: the cost of commercial rare earth elements is nearing pre-pandemic price lows, and similarly hit their lowest price point since September 26 2023. According to UBS analysts, some cost support continues to develop at present price levels given the history of protracted periods of low prices. However, developing conviction around a durable price recovery is still difficult. Experts anticipate that rare earth prices will need to grow substantially to support the development of new rare earth projects, which usually require higher prices to be economically feasible, the recent hurdles notwithstanding. Click here to read… [16]

Strategic

Biden, Xi discuss Taiwan, AI in push to return to regular leader talks

President Joe Biden and Chinese President Xi Jinping discussed Taiwan, artificial intelligence and security issues April 02 in a call meant to demonstrate a return to regular leader-to-leader dialogue between the two powers. The call, described by the White House as “candid and constructive,” was the leaders’ first conversation since their November summit in California produced renewed ties between the two nations’ militaries and a promise of enhanced cooperation on stemming the flow of deadly fentanyl and its precursors from China. Xi told Biden that the two countries should adhere to the bottom line of “no clash, no confrontation” as one of the principles for this year. “We should prioritize stability, not provoke troubles, not cross lines but maintain the overall stability of China-U.S. relations,” Xi said, according to China Central Television, the state broadcaster. The roughly 105 minute call kicks off several weeks of high-level engagements between the two countries, with Treasury Secretary Janet Yellen set to travel to China on April 04 and Secretary of State Antony Blinken to follow in the weeks ahead. Biden has pressed for sustained interactions at all levels of government, believing it is key to keeping competition between the two massive economies and nuclear-armed powers from escalating to direct conflict. Click here to read… [17]

US should not politicise trade issues, China’s Li Qiang tells Janet Yellen in response to ‘overcapacity’ concerns

Chinese Premier Li Qiang urged Washington not to politicise economic issues but to take an objective view on industrial capacity, during talks with US Treasury Secretary Janet Yellen in Beijing on April 07. “The United States should look at the capacity issue objectively and dialectically from the point of view of the market economy and from a global perspective, and on the basis of economic laws,” Li said, according to official news agency Xinhua. Li’s comments came after Yellen, who is on a five-day visit to China, expressed concerns about the country’s industrial “overcapacity”, saying excessive Chinese exports, especially new energy vehicles and solar modules, could undercut American interests and lead to “global spillovers”. “The development of China’s new energy industry will make an important contribution to the global green and low-carbon transformation,” Li said. “We hope the US could work with China to adhere to the basic market economy norms of fair competition and open cooperation, while refraining from politicising economic and trade issues or overstretching the concept of national security,” Li said. Yellen said ahead of the meeting that the countries should not avoid “tough conversations” in managing their differences, according to the US Treasury Department, which described the talks as “frank and productive”. Click here to read… [18]

US and China hold ‘direct and clear’ military talks

American and Chinese defense officials met in Hawaii this week to discuss how both nations’ fleets can operate safely in the Pacific region. The meetings were the first of their kind since Beijing severed military relations with Washington two years ago. The Military Maritime Consultative Agreement (MMCA) working group talks were held in Honolulu on April 03 and April 04, US Indo-Pacific Command said in a statement on April 05. Some 18 officials from China’s People’s Liberation Army (PLA) took part, as did representatives of the US Indo-Pacific command, US Pacific Fleet, and US Pacific Air Forces. The MMCA is the Indo-Pacific Command’s “primary means to directly discuss air and maritime operational safety with the PLA,” US delegation head Col. Ian Francis said. “Open, direct, and clear communications with the PLA – and with all other military forces in the region – is of utmost importance to avoid accidents and miscommunication.” The Chinese Defense Ministry called the meetings “candid and constructive.” The MMCA was formed in 1998 and met annually until 2021. The following year, Beijing severed all military-to-military contact with Washington in response to a visit by then-US House Speaker Nancy Pelosi to Taiwan. However, relations between the two superpowers were strained for several years before Pelosi’s trip to Taiwan, with the South China Sea a particular flashpoint. Click here to read… [19]

New Indonesia leader visits China, promises close ties

Indonesia’s president-elect Prabowo Subianto visited Beijing on April 01 on his first foreign trip since his election and was quoted by Chinese state media as telling President Xi Jinping he aimed to continue the close ties under predecessor Joko Widodo. Prabowo “fully supports the development of closer Indonesia-China relations and wishes to continue President Joko’s policy of friendship with China,” China’s CCTV quoted Prabowo as saying. The new Indonesian government will promote the alignment of development strategies between the two countries and push for more results in cooperation in fields such as the economy, trade and poverty alleviation, he said. Prabowo, now Indonesia’s defense minister, also said that he viewed China as a key partner. “Regarding defense cooperation, I view China as one of the key partners in ensuring regional peace and stability,” he said in a statement, adding that he sought to boost defense cooperations with China. “I also commit to fulfil the needs of Indonesia’s military hardware, boost cooperation in the defense industry and establish productive dialogues,” he added. Xi described Prabowo as an “old friend of the Chinese people” and said China views its relations with Indonesia from a strategic and long-term perspective, standing ready to deepen all-round strategic cooperation. Prabowo, 72, was elected in February but will not be sworn in until October. Click here to read… [20]

Ukraine, in Need of Troops, Lowers Age of Conscription

Ukraine lowered the age of military conscription to 25 as part of an effort to bolster its depleted armed forces after two years of fighting Russia’s invasion and facing renewed assaults. The controversial bill, which President Volodymyr Zelensky signed into law on April 02, is the most significant overhaul of Ukraine’s war bureaucracy since Russia’s full-scale invasion began in February 2022. Men between 18 and 60 have been prohibited from leaving the country since the start of the war, but only those who were at least 27 were eligible to be drafted. Zelensky’s backers and some opponents said the bill had been delayed because it was unpopular. The change comes as Ukraine’s defensive lines come under heavy pressure from massive Russian assaults. Front-line commanders say they are short of personnel and ammunition, as a supplemental aid package is stuck in Congress. Ukrainian officers say they are expecting Russia to mount a significant offensive around the start of the summer, which is aimed at expanding the nearly 20% of territory the invading forces already occupy. It is unclear how many men will be added to the ranks under the new law. In December, Zelensky said the military had requested 500,000 more soldiers, but he has repeatedly questioned whether this total was feasible or necessary. Click here to read… [21]

LDP punishes 39 lawmakers; Abe faction leaders hit the hardest

The ruling Liberal Democratic Party punished 39 lawmakers, including senior Abe faction leaders, over a political fund scandal that has dealt a serious blow to the party and the Kishida administration. The disciplinary measures were decided at a meeting of the Party Ethics Committee on April 4. The LDP urged Ryu Shionoya, who heads the Abe faction’s 15-member executive board, and Hiroshige Seko, former secretary-general of the LDP’s Upper House caucus, to leave the party. That was the strictest punishment against any of the lawmakers and the second harshest, after expulsion, among the LDP’s eight disciplinary measures. Of the 39 lawmakers, 31 submitted statements to the party to express their opinions before the disciplinary measures were formalized. According to sources, Shionoya said in his statement: “I am dissatisfied because it is a heavy punishment that cannot be justified. I firmly protest the party executives’ dictatorial party management.” He said some Abe faction members were being strictly punished “like scapegoats” without concrete standards or evidence of punishable misconduct being clearly presented. Hakubun Shimomura and Yasutoshi Nishimura, former secretaries-general of the Abe faction, will have their LDP membership suspended for one year. The party will also suspend the membership of Tsuyoshi Takagi, the current faction secretary-general, for six months. Suspension of party membership is the third harshest among the eight disciplinary measures. Click here to read… [22]

First U.S.-Japan-Philippines trilateral to address China's 'gray zone' tactics

U.S. President Joe Biden will add to his collection of "minilateral" gatherings of allies and partners when he hosts Japanese Prime Minister Fumio Kishida and Philippine President Ferdinand Marcos Jr. in Washington on April 11 for their first trilateral summit. Unlike the Quad grouping of the U.S., Japan, India and Australia -- and unlike the AUKUS security partnership of Australia, the U.K. and the U.S. -- the new trilateral does not have an announced name or acronym. But Japan and the Philippines sit in arguably the most critical locations for the U.S. when it comes to defending Taiwan against a potential Chinese invasion. This means that the new trilateral grouping could grow into something even more substantial than the Quad, which has hesitated to discuss security matters, and AUKUS, which faces shipbuilding bottlenecks that make it challenging to deliver nuclear-powered submarines to Australia. However, "There is a difference in how the Philippines views its place and role were conflict to break out in the Taiwan Strait. This is something that both the U.S. and Philippines will have to continue working out," said Elina Noor, a senior fellow in the Asia Program at the Carnegie Endowment for International Peace. April's trilateral comes amid stepped-up Chinese use of water cannons in the South China Sea, attempting to block Philippine ships from resupplying a shipwreck on which a handful of Philippine marines are stationed. Click here to read… [23]

China, Japan, South Korea Looking to Hold Summit in May, Reports Say

South Korea is in talks with China and Japan to host a three-way summit in May, Japanese and South Korean media reported, restoring a process that has been on hold since 2019 due to the pandemic and political tensions. South Korea, which would likely host the long-delayed event, is looking to hold the summit in late May, the Chosun Ilbo newspaper reported April 05, citing a government source it did not name. Kyodo News of Japan reported earlier the meeting could be held next month and discussions are set to touch on economic cooperation and regional issues — citing diplomatic sources it did not name. The office of South Korean President Yoon Suk Yeol reiterated it has been in discussions for the three-way summit when asked about the reports and the Foreign Ministry in Seoul said it would release a date for the event when one has been set. South Korea has been pressing for months to resume the summit and foreign ministers from the three agreed in November to push for a meeting. But momentum has slowed since then. Japan’s top government spokesman, Yoshimasa Hayashi, told reporters April 05 that Tokyo would work with China and South Korea for a summit. Click here to read… [24]

North Korea’s Ballistic Missiles Are Getting Valuable Battlefield Testing in Ukraine

Russia’s use of North Korean missiles in its assault in Ukraine is giving Pyongyang a rare chance to test its weapons in combat and perhaps take away lessons that could improve their performance, a top US general said. “I don’t believe that in my recent memory that the North Korean military has had a battlefield laboratory quite like the Russians are affording them to have in Ukraine,” said General Charles Flynn, the US Army Pacific’s commanding general. That gives North Korea an opportunity to gain valuable information in technical matters, procedures and the munitions themselves. The US will be watching closely how this unfolds, Flynn said April 06 during a visit to the sprawling US Army Garrison Humphreys, about 80 kilometers (50 miles) south of Seoul. Flynn said a great concern for him and others is that North Korea will be able to learn things about their weapons “they would otherwise not have access to absent a conflict” like the war in Ukraine. The US will be deploying missile systems with mid-range capability to the Indo-Pacific region soon, Flynn said, without giving further details on timing or locations. Such a move could draw the ire of China, which in 2019 warned that US allies in the region risked countermeasures if they accepted the deployment of intermediate-range American missiles. Click here to read… [25]

China Providing Geospatial Intelligence to Russia, US Warns

The US is warning allies that China has stepped up its support for Russia, including by providing geospatial intelligence, to help Moscow in its war against Ukraine. Amid signs of continued military integration between the two nations, China has provided Russia with satellite imagery for military purposes, as well as microelectronics and machine tools for tanks, according to people familiar with the matter. China’s support also includes optics, propellants to be used in missiles and increased space cooperation, one of the people said. President Joe Biden raised concerns with Xi Jinping during their call this week about China’s support for the Russian defense industrial base, including machine tools, optics, nitrocellulose, microelectronics, and turbojet engines, White House National Security Council spokesperson Adrienne Watson said. China’s foreign ministry didn’t immediately respond to a request for comment during a holiday weekend. Beijing has sought to portray itself as mostly neutral in the face of Russia’s full-scale invasion of Ukraine, now into its third year, yet it’s established a deep alliance with Moscow as part of what Xi and Vladimir Putin termed a “no limits” friendship ahead of the 2022 Winter Olympic Games in Beijing. Trade between the two countries reached a record $240 billion in 2023. Click here to read… [26]

US Food Aid Group Says Workers Killed in Gaza Strike

Seven aid workers from World Central Kitchen were killed in an air strike by the Israeli military in Gaza, according to a post from the disaster relief group founded by celebrity chef José Andrés on X. The US-based group has helped oversee the construction of a pier and the delivery of aid through it to the northern Gaza Strip, where humanitarian agencies say hundreds of thousands of Palestinians are living in dire conditions, including malnutrition and hunger. “This is not only an attack against WCK, this is an attack on humanitarian organizations showing up in the most dire of situations where food is being used as a weapon of war. This is unforgivable,” said World Central Kitchen CEO Erin Gore, adding that the organization was pausing operations in the region. The seven killed are from “Australia, Poland, United Kingdom, a dual citizen of the US and Canada, and Palestine,” the group said in a statement. “Unfortunately, in the past day there was a tragic case of our forces unintentionally hitting innocent people in the Gaza Strip,” Prime Minister Benjamin Netanyahu said, without specifying further. He added that Israel “will do everything so that this does not happen again.” President Joe Biden spoke with Andrés on April 02 following the strike and called for culpability for the workers’ deaths, according to the White House. Click here to read… [27]

Planned Israeli attack threatens entire Arab world – Arab League

An Israeli attack on the Palestinian city of Rafah, located in Gaza on the Egyptian border, would be considered an attack on pan-Arab national security, the Council of the Arab League has announced, according to reports. Israeli Prime Minister Benjamin Netanyahu has repeatedly vowed to invade the refugee-packed city despite international condemnation. The decision came during an extraordinary meeting of the 22-nation council in Cairo on April 03, Al Arabiya reported. The council also declared that “invading Rafah will lead to the collapse of chances for peace and the expansion of the conflict,” the Saudi broadcaster paraphrased. The meeting was called by Palestine to address Israel’s “genocide and policies of starvation and displacement,” as well as its refusal to abide by a UN Security Council resolution demanding that it halt military operations in Gaza during the month of Ramadan. Israeli Prime Minister Benjamin Netanyahu announced on March 31 that he had approved an “operational plan” to invade Rafah, claiming that “there is no victory without entering Rafah and there is no victory without eliminating the Hamas battalions there.” Netanyahu has promised since February to send troops into Rafah, a densely packed city located in southern Gaza. As such, Netanyahu has been heavily criticized for his planned invasion. Click here to read… [28]

Israel Scrambles GPS Signals as Country Girds for Potential Retaliation From Iran

Perplexed Israelis woke up April 04 in Tel Aviv to find that map applications on their phones were placing them in Lebanon’s capital, Beirut, some 130 miles to the north. Cabdrivers couldn’t navigate. Food-delivery apps were temporarily out of service. The reason: The Israeli military was scrambling GPS signals, as the country braces for possible retaliation by Iran or one of its allied militias for a suspected Israeli airstrike April 01 on an Iranian diplomatic building in Syria. The attack killed a senior Iranian general and six other military officials and marked an escalation of the yearslong shadow war between Israel and Iran, with the potential to explode into direct conflict. “With God’s help we will make the Zionists repent for their crime of aggression against the Iranian consulate in Damascus,” Iran’s Supreme Leader Ali Khamenei said April 03 in a post in Hebrew on X. Analysts say a direct Iranian strike on Israel is unlikely. Yet, in an apparent mobilization for potential hostilities, the Israeli military on April 04 said it would pause all leave for combat units “in accordance with the situational assessment.” A day earlier, Israel drafted reservists to boost air defenses. Israel has withdrawn some of its ambassadors and evacuated its embassies in multiple locations, and some ambassadors have been asked not to appear at public events, according to a person familiar with the matter. Click here to read… [29]

How Taiwan Escaped Catastrophe in Massive Earthquake

The quake took a toll on the community of Hualien and the island as a whole, but it was far less deadly than one that struck in 1999, which killed more than 2,400 people and left more than 11,000 others injured. That 7.7-magnitude quake struck the center of the island and destroyed thousands of buildings. More than 1,000 people were injured in April 03’s quake. At least 15 people remained missing and 705 people were still trapped as of April 04 evening local time, according to Taiwanese authorities. Many of those still missing are workers and visitors at a hotel in Taroko National Park, a popular tourist destination just north of Hualien, according to officials. This week’s quake turned out to be less damaging and deadly for a variety of reasons, including its smaller magnitude and the fact that—unlike the 1999 quake—it didn’t cause a surface rupture, according to seismologists. The relatively light damage from April 03’s quake also illustrated the value of government enforcement of rigorous engineering codes, they said. When a 7.8-magnitude earthquake struck Turkey in 2023, experts blamed many of the 50,000 deaths on poorly constructed buildings. Viral images of the headquarters of the local Chamber of Civil Engineers standing intact amid the rubble in the city of Kahramanmaras helped drive home the point. Click here to read… [30]

US, UK, Australia ‘set for talks on expanding Aukus security pact’ to deter China, with Japan a likely candidate

The United States, Britain and Australia will announce talks on April 08 about bringing new members into their Aukus security pact as Washington pushes for Japan to be involved as a deterrent against China, the Financial Times reported. The announcement by the group’s defence ministers will be related to “Pillar II” of the pact, which commits the members to jointly developing quantum computing, undersea, hypersonic, artificial intelligence and cyber technology, the newspaper reported on April 06, citing people familiar with the situation. They are not considering expanding the first pillar, which is designed to deliver nuclear-powered attack submarines to Australia, the FT said. Aukus, unveiled by the three countries in 2021, is part of their efforts to push back against China’s growing power in the Indo-Pacific region. China has called the pact dangerous and warned it could spur a regional arms race. US President Joe Biden has sought to step up partnerships with American allies in Asia, including Japan and the Philippines, amid China’s historic military build-up and its growing territorial assertiveness. Rahm Emanuel, the outspoken US ambassador in Tokyo, wrote in an opinion piece in the Wall Street Journal on April 03 that Japan was “about to become the first additional Pillar II partner”. Click here to read… [31]

Health

WHO pandemic treaty talks falter as India, West clash over tech transfers

World Health Organization members' negotiations on a pandemic preparedness treaty remain rocky less than two months before the intended deadline, as industrialized and developing nations butt heads over technology access. Talks began in December 2021 with countries hoping to apply lessons from the slow COVID-19 response to prepare for the next pandemic. After two years of negotiating the contents, the plan was to reach an accord at the negotiating body's meeting last month. That meeting ended on March 28 with no agreement, after failing to bridge the gap between India and African countries pushing for greater fairness in areas such as drug distribution, and the U.S., Japan and European countries seeking to avoid heavy financial burdens and transfers of valuable technology. Global interest in the issue is also ebbing as countries focus on new crises such as the wars in Ukraine and the Middle East. "If we miss this opportunity, we risk losing momentum," WHO Director-General Tedros Adhanom Ghebreyesus said on the first day of the meeting. A major point of contention is how to handle technologies developed by drugmakers. During the COVID-19 pandemic, limited vaccine supplies left poorer nations lagging on inoculating their populations. Emerging countries called for the pandemic treaty to include provisions ensuring technology transfers and waivers of intellectual property rights by drugmakers to enable local production of vaccines and treatments when needed. Click here to read… [32]

South Korea's Yoon doubles down on contentious doctor quota plan

South Korea's president on April 01 refused to budge from his plan to annually increase by 2,000 the number of medical students in the country, signaling a continuation of a standoff with doctors that has dragged on for more than a month and disrupted the nation's healthcare system. Speaking during a televised national address, President Yoon Suk Yeol said the figure of 2,000 more doctors per year is the "minimum" South Korea needs to prevent crippling shortages of physicians and meet medical challenges posed by its aging society. Thousands of trainee doctors have submitted their resignations in protest of the plan, calling it ill-conceived and claiming the government is imposing the measure without adequately consulting the medical community. Yoon pushed back on April 01, saying the government's plan was based on "calculations" and dialogue with doctors' groups. The dispute could escalate as medical professors have said they will reduce their working hours this week to cope with overwork caused by the absences of trainee doctors. Local media have reported cases of patients needing to endure long waits for care or suffering complications caused by delays. Doctors previously told Nikkei Asia that the government had arbitrarily arrived at the decision to train more doctors and had not gathered data to identify the specific shortcomings in the country's medical coverage or how to fix them. Click here to read… [33]