The World Today for March 28, 2022

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Just Business

UKRAINE/ RUSSIA

Executives at France-based energy giant TotalEnergies recently announced that they would stop all Russian oil purchases this year in protest against President Vladimir Putin’s invasion of Ukraine. Russian oil accounted for 17 percent of the $190 billion company’s production, reported CBS News and the Associated Press.

Such moves, in addition to tough sanctions, CNBC wrote, are expected to result in the Russian economy losing the benefits of about 30 years of economic growth since the collapse of the Soviet Union, the original sin that motivated Putin to attack the former Soviet republic last month.

The Russian economy is expected to shrink 15 percent this year. Still, it’s funding its war mainly because of oil and gas sales. On Friday, American President Joe Biden announced a landmark deal with the EU in which the US will increase transatlantic gas deliveries in the hope of weakening the power the Kremlin wields thanks to its status as Europe’s main supplier of gas, the Guardian wrote.

Still, all of this is just one part of a larger set of economic changes that are occurring around the world as Russian forces shell Kyiv and attempt to seize Mariupol and other cities. As the Washington Post explained, the Russian-Ukraine War, another coronavirus outbreak in China and inflation have once again upended the supply chains, energy markets and other aspects of the world economy. Management consulting firm McKinsey recently predicted Britain and the US could face recession if the war, the resulting refugee crisis or inflation keep worsening, Insider reported.

Sanctions against Russian oil are constricting supplies, driving up prices at the pump, the New York Times noted. But the fighting has also disrupted Russian and Ukrainian wheat harvests. The two countries are major world suppliers, providing Egypt and Turkey with 70 percent of their grains, for example. India imports significant amounts of sunflower and other edible oils from the region, too. Those staples are now more expensive and harder to secure due to the war, Deutsche Welle added.

In the journal Nature, experts warned of the need for concerted international action to avert a humanitarian food crisis in poorer regions of the globe due to the conflict in Eastern Europe.

The International Monetary Fund mused that such changes could result in a significant reorientation of national economies and world trade. This IMF Blog illustrated how different regions were handling the situation: For example, sub-Saharan Africa was on its way to recovering from the pandemic but the spillover effects of this war threatens that progress, the IMF wrote, especially because of higher energy and food prices, reduced tourism and potential difficulty accessing international capital markets.

“The war may fundamentally alter the global economic and geopolitical order should energy trade shift, supply chains reconfigure, payment networks fragment, and countries rethink reserve currency holdings,” Fund analysts wrote, according to Reuters.

Business is forcing politicians to ally or distance themselves from each other. Saudi Arabia’s potentates, for example, find themselves allied with Russia in preferring the price of oil to increase. But, at the same time, they must contend with their traditional friends and protectors, the Americans, Al Jazeera reported.

Peace is better for business.

THE WORLD, BRIEFLY

Realpolitik

MIDDLE EAST

Israel hosted a first-of-its-kind summit of Arab foreign ministers over the weekend in what is considered a major sign of changing geopolitical alignments in the Middle East amid regional concerns over Iran, the Wall Street Journal reported.

The foreign ministers from Bahrain, Israel, Morocco and the United Arab Emirates met Sunday for a two-day summit to discuss shared challenges in the region, including Iran, energy, water and food security.

The gathering marks the first time the top diplomats met since the three Arab nations normalized their relations with Israel in 2020 in a series of deals called the Abraham Accords.

US Secretary of State Antony Blinken also joined the summit and is expected to discuss Iran, advancing the Abraham accords and Russia’s invasion of Ukraine.

The historic meeting follows regional concerns over a deal between the US and Iran to revive the 2015 nuclear deal. Israel initially muted its criticism of the deal, until Washington proposed to remove Iran’s Revolutionary Guard from its list of terrorist organizations.

Gulf nations, such as the UAE and Saudi Arabia, have also voiced opposition to the nuclear agreement.

Apart from the weekend summit, leaders of Israel, the UAE and Egypt met in the Egyptian city of Sharm el-Sheikh to negotiate a regional military alliance and shared air defense. They also discussed rapprochement with Syrian President Bashar Assad, who was recently hosted by UAE, despite opposition from the US.

Hedging Bets

SOLOMON ISLANDS

The Solomon Islands is planning to expand its security partnership with China, amid reports of a potential agreement between the two countries that has raised concerns in neighboring Australia and the United States, CNN reported.

The Pacific nation said over the weekend that it was working on “diversifying” the country’s security partnerships. The government added that it was in the process of implementing a variety of arrangements with Beijing in the areas of civil aviation, trade and education, while signing an agreement to strengthen bilateral law enforcement cooperation.

Officials noted that the Solomon Islands will continue to uphold its existing security agreement with Australia, which allows Australian security forces and civilian personnel to deploy rapidly to the islands in the event of a security threat.

But the Australian government expressed concerns about the Pacific island’s move toward China, fearing that such a security arrangement could possibly cover Chinese military assistance. This could eventually lead to the permanent military presence of Chinese troops on the Solomon Islands, which is one of Australia’s closest neighbors.

Chinese officials dismissed the worries, saying that it was “irresponsible for some Australian politicians to talk about China’s coercion and create tension.”

The new arrangements mark another sign of deeper relations between China and the Solomon Islands, which led the island nation to recognize Beijing instead of Taiwan in 2019.

The closer friendship also comes as the US and Australia have become wary of China’s increasing influence and assertiveness in the Pacific. Analysts noted that the signing of the security deal could complicate Australia’s security position, such as making it difficult for Canberra to move submarines, ships and aircraft along the Australian east coast.

When Size Matters

EUROPEAN UNION

European Union officials agreed to clamp down on anti-trust abuses by the world’s biggest tech companies, a major step that will serve as a model for leveling the playing field in global digital markets, Politico said.

The European Parliament and Council reached an agreement on the Digital Market Act, which will implement a series of prohibitions and regulations for large technology firms, such as Google and Facebook, as well as a number of smaller platforms.

Platforms with a market value of more than $80 billion or a turnover in the European Economic Area topping $8 billion will be covered by the guidelines.

The new rules for the so-called gatekeeper platforms will include restrictions on combining private data from various sources, mandates to allow users to install apps from third-party platforms, and a restriction on self-preferencing practices.

They will also order messaging services – such as WhatsApp and iMessage – to open up and interoperate with smaller messaging platforms.

Breaching the new regulations could force companies to pay penalties up to 10 percent of annual worldwide turnover for initial infractions, and up to 20 percent afterward.

European lawmaker Andreas Schwab said the new deal will put “an end to the ever-increasing dominance of Big Tech companies.”

The Digital Market Act comes after years of long anti-trust cases against tech companies, such as Google and Facebook.

UKRAINE, BRIEFLY

• Reports of mass kidnappings and forced deportations of Ukrainians to Russia have been emerging in recent days, as Moscow’s invasion enters its second month, NBC News reported. The Ukrainian foreign ministry said Thursday that Russian soldiers had “forcibly deported” 6,000 people from the besieged city of Mariupol, stripping them of their passports and other documents and transporting them to Russia as “hostages.” Meanwhile, Russia has said it has held “evacuations” of more than 380,000 Ukrainians to its territory.

• The mayor of the besieged city of Mariupol estimated that “thousands” have died and around 90 percent of 2,600 residential buildings have been destroyed or damaged in the month-old Russian invasion, Radio Free Europe wrote.

• Russia has reacted angrily to US President Joe Biden’s comments that Russian President Vladimir Putin cannot continue in power, Al Jazeera noted. The White House has attempted to downplay the remarks, saying the US was not calling for a regime change.

• Russia is considering accepting Bitcoin as payment for oil and gas exports, BBC wrote. According to lawmaker Pavel Zavalny, “friendly” countries might be permitted to pay in cryptocurrency or local currency.

• Russian and Ukrainian officials agreed Sunday to open a number of humanitarian corridors that will allow people to flee Ukraine, according to the Hill. Individuals from the besieged city of Mariupol and the southeastern port city of Berdyansk will be able to evacuate to Zaporizhzhia via the humanitarian corridors. Meanwhile, Moscow said Sunday it had struck “military targets” in the Ukrainian city of Lviv – near the border with Poland – over the weekend, the Washington Post reported. Officials said the military “destroyed” a large depot, which it said was providing fuel to Ukrainian troops in western Ukraine and Kyiv.

DISCOVERIES

Revelations

Almost three years ago, the world watched in horror as the iconic 12-century Notre Dame Cathedral in Paris was in flames.

Out of the ashes, however, came an unusual discovery, Live Science reported.

Recently French archaeologists found a number of old tombs, including a 14th-century lead sarcophagus, below the floor, during renovation work. Specifically, the archaeological team came across the artifacts while surveying the cathedral’s transept where workers had been planning to erect scaffolding to rebuild the building’s burned spire.

The transept – a part of the cathedral where the floor runs perpendicular to the main building – was covered with a stone layer dating to the 18th century. The team found many burial sites hidden below, which suggested that the site was used as a burial ground for many years.

These tombs date back to the 14th century and possibly the 13th century. Among them was also the peculiar lead sarcophagus, which researchers described as “fully preserved.”

It’s unclear who exactly was entombed in the sarcophagus but archeologists theorized that the person was a “high dignitary.”

Along with the tombs, the team also found a pit filled with painted sculptures that were once part of Notre Dame’s rood screen – an ornate partition that divides different ends of the cathedral.

France’s ministry of culture said that the new find will likely provide new data on the rood screen and on the quality of its painted decoration.

COVID-19 Global Update

Total Cases Worldwide: 480,907,265

Total Deaths Worldwide: 6,123,529

Total Vaccinations Worldwide: 10,880,841,582

Countries with the highest number of confirmed cases worldwide as of 4 a.m. ET*

1. US: 79,954,418 (+0.01%)
2. India: 43,020,723 (+0.00%)**
3. Brazil: 29,849,740 (+0.04%)
4. France: 25,216,913 (+0.44%)
5. UK: 20,848,913 (+0.44%)
6. Germany: 19,492,672 (+0.00%)**
7. Russia: 17,504,537 (+0.00%)**
8. Turkey: 14,800,677 (+0.08%)
9. Italy: 14,364,723 (+0.42%)
10. South Korea 12,003,054 (+1.58%)

Source: Johns Hopkins University

*Numbers change over 24 hours

**Numbers have been adjusted by affected country