The World Today for September 06, 2023
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Cracks in the Tent Pole
For the past 25 years, pundits in the West have been issuing dire warnings about China’s economy surpassing that of the United States, a shift that they feared would herald a new China-led global geopolitical system.
Today, however, China’s economy – the second largest in the world – is stalling. Now pundits are wondering whether it might collapse and trigger other worldwide effects. “Instead of marveling at China’s prosperity miracle, economists are now pondering whether China’s woes will bring down other parts of the global economy,” wrote Yahoo! Finance senior columnist Rick Newman.
Describing the Chinese economy as a “ticking time bomb,” the BBC noted how economic growth has slowed, youth unemployment has hit record highs, foreign investment has dropped off a cliff, exports are weak, the currency is weak, and, perhaps most importantly, the real estate sector is in crisis.
The Chinese government flooded the property sector with cash over the last few decades. Today, 70 percent of Chinese citizens’ wealth is tied up in real estate, Reuters explained.
But, as the empty, half-built apartments and commercial complexes that dot China attest, some of that money was wasted. Harsh coronavirus lockdown rules further undermined the sector. Low population growth means things won’t likely improve anytime soon. The central government recently imposed new rules that aimed to constrain lending and contain the crisis. They likely made it worse, though, in part because China’s communist-run financial system is corrupt and inflexible.
Massive real estate developer Country Garden, for example, is now facing default on its debts after suffering a $6.7 billion loss in the first half of the year, added Newsweek. Observers fear the company could become another Evergrande, which has lost 99 percent of its share value in the last three years while owing creditors almost $330 billion, as the Guardian outlined.
In early September, Chinese officials announced new measures to help. They cut minimum down payments for mortgages to 20 percent for first-time homebuyers and 30 percent for second-time homebuyers, wrote CNN. Forty percent down payments were previously the norm. Officials also slashed mortgage rates to boost lending and investment.
Publicly, however, Chinese leaders have broadcasted optimistic propaganda to push back against the sense of doom and gloom that pervades the country, reported the New York Times. They also decided not to publish new statistics on youth unemployment and other trends that might embarrass Chinese President Xi Jinping, who has accumulated more power during his rule than any other Chinese leader, according to Time magazine.
That is harming the Chinese economy, say analysts.
“The government’s pursuit of total control has set the country on a path of slower growth and created multiplying pockets of dissatisfaction,” Ian Johnson, a senior fellow at the Council on Foreign Relations, wrote in Foreign Affairs. “These economic problems are part of a broader process of political ossification and ideological hardening … it is difficult to miss the signs of a new national stasis.”
At the same time, China has become “uninvestable” for foreign investors because it is too risky, especially in light of raids on foreign businesses, exit bans of executives and “opaque” penalties, wrote the Washington Post.
“China needs to recognize that they can no longer rely on the sheer mass of their market to attract that type of foreign investment,” Naomi Wilson, vice president of policy, Asia and global trade at the Information Technology Industry Council, told the Post. “Even among Chinese companies, there have been efforts to relocate outside of China.”
The country that used to be the tent pole for the global economy is snapping.
THE WORLD, BRIEFLY
Freedom and Mischief
Canada began Tuesday a criminal trial for two key organizers of 2022’s “Freedom Convoy” protests that disrupted the country’s capital, affected US-Canada border crossings, and inspired similar actions worldwide, the Washington Post reported.
The defendants Tamara Lich and Chris Barber face a slew of charges, including mischief, obstructing police, and inciting others to commit mischief during the weeks-long protests against Covid-19 pandemic-related measures and Prime Minister Justin Trudeau’s administration.
The weeks-long demonstrations that began in January 2022 saw trucks and crowds causing gridlocks in Ottawa and serious disruptions at the border with the United States. However, they also attracted a mix of anti-government activists, far-right figures, and opponents of pandemic measures, the newspaper wrote.
Canadian authorities called the protests an “occupation” and the situation prompted Trudeau to invoke the country’s 1988 Emergencies Act – the first Canadian leader to do so. The emergency law allowed authorities to create no-go zones and temporarily freeze bank accounts without a court order.
Lich and Barber are among the most prominent of the 140 people who were charged in Ottawa.
Lich had previously alleged that her parents’ trucking business was affected by the cross-border vaccine requirement. Barber, a trucking business owner, voiced opposition to pandemic measures.
Both defendants had sought to depict the movement as peaceful and distanced themselves from its controversial figures. But a public inquiry this year – mandated by the Emergency Act – found they were reluctant to cut ties with individuals advocating violence or Trudeau’s removal, as they considered them part of the movement.
Legal observers said the trial is expected to draw significant national attention because of its implications for other defendants and the broader protest movement. While mischief charges can relate to offenses ranging from data erasure to property destruction, offenders, in most cases, don’t serve life sentences unless their actions seriously endanger others.
Canadian authorities have already prosecuted other defendants connected to the “Freedom Convoy.”
Last year, Tyson Billings, known as “Freedom George,” pleaded guilty to counseling to commit mischief, while other charges against him were withdrawn. He was sentenced to time served and six months of probation.
Cuban authorities discovered an alleged human trafficking ring aimed at recruiting Cuba’s citizens to fight for Russia in the Ukraine war, CBS News reported.
The country’s foreign ministry confirmed that the government is working to dismantle the trafficking ring operating from Russia that is being used to “incorporate Cuban citizens living there and even some living in Cuba into the forces that participate in military operations in Ukraine.”
Officials also claimed they began criminal proceedings against “those involved in these activities,” but didn’t specify the number of suspects or the charges they face.
At the same time, the ministry also accused Cuba’s unspecified “enemies” of “promoting distorted information that seeks to tarnish the country’s image and present it as an accomplice to these actions that we firmly reject.”
Russia did not comment on the matter.
The government’s announcement comes less than a week after a Miami newspaper published a series of testimonials from two teenagers, who alleged to have been tricked into working together with the Russian army on construction sites in Ukraine.
Meanwhile, another Cuban man told the outlet that he had joined Russia’s forces hoping to legalize his status in the country.
Cuba and Russia have recently boosted ties, with Cuban President Miguel Díaz-Canel formally meeting his Russian counterpart Vladimir Putin in Moscow at the end of last year.
Following its invasion of Ukraine, Russia has heavily depended on mercenary forces, primarily sourced from within its own borders through the Wagner Group. However, Wagner’s late chief, Yevgeny Prigozhin, attempted a short-lived mutiny in June.
Last month, Prigozhin and some of his top Wagner leaders died in a plane crash, an incident that was widely perceived as an assassination by the Russian government.
UNITED ARAB EMIRATES
The United Arab Emirates established a federal “commercial gaming” authority this week, a move that could see it become the first Gulf nation to allow gambling and casinos in the Muslim-majority region, the Middle East Eye reported.
State-affiliated media announced the creation of the General Commercial Gaming Regulatory Authority (GCGRA) to “introduce a world-leading regulatory framework for a national lottery and commercial gaming.”
The GCGRA will be led by Kevin Mullaly, who previously served as the executive director of the US state of Missouri’s gaming commission.
Although UAE officials have made no statement about allowing gambling, casinos have long been considered as a way for the resource-rich country to boost its revenues from its tourism industry.
Casinos are uncommon across the Middle East, where many countries forbid them along with other forms of gambling.
Last year, the emirate of Ras al-Khaimah in the UAE made a $4 billion deal with the Las Vegas-based Wynn Resorts for a new hotel resort. Although officials did not label it as a gambling hotel, Wynn Resorts mentioned that gaming would constitute “four percent” of the resort’s total assets.
Gaming analysts estimate that the Emirates’ potential annual gambling revenue could top $6 billion, according to the Telegraph.
Even so, some remain skeptical that the UAE will become a Gulf-based Las Vegas, noting that the Emirates will focus more on dining and theatre shows than on drinking and casinos.
Still, over the past few years, the UAE has moved to loosen laws on consuming alcohol.
Living with the Bomb
There is some extensive radioactive history on the backs of turtles and tortoises, New Scientist reported.
Nuclear weapon tests and accidental waste releases create radioactive isotopes – also known as radionuclides – that can spread widely and stay in the ecosystem for a very long time.
In a new study, a research team sought to test whether these radionuclides accumulate in organisms and recently found that the shells of turtles and tortoises can store decades-long records of radioactive uranium isotopes when exposed to radioactive fallout.
Scientists explained that the shells – called scutes – exhibit layer growth similar to that of nails. However, once the nail-like scale material is deposited and it becomes distinct from other bodily tissues, it essentially gets time-stamped.
The team studied the scutes from four museum specimens: Two of which lived around areas of atomic bomb tests – the Marshall Islands and Nevada’s Mojave Desert – and two others who lived near fuel processing plants that spewed out nuclear waste.
Chemical analysis of the shells showed that all turtles and tortoises had small but elevated uranium radioactive isotopes in their scutes.
The findings are significant because they could be used to reconstruct and chronicle the histories of nuclear contamination in ecosystems.
Other scientists said the study could also pioneer the field of radioecology research using zoological collections in museums to “assess the concentration of radionuclides in feathers, bones and other tissues in specimens collected before and after nuclear tests and accidents.”
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