Diplomacy

Qatar standoff spells end of Gulf cooperation

3 Jul 2017

Saudi Arabia has granted the sheikhdom two more days to comply with its demands. Failure to reach a deal could escalate the dispute, hitting regional economies and investors in equal measure. But even if both sides back down, plans for greater economic collaboration are on hold.

Oil markets too calm over Qatar ultimatum

23 Jun 2017

Doha’s Gulf neighbours have imposed a 10-day deadline to comply with demands including reparations, closing Al Jazeera and regular inspections. Markets have assumed the standoff won’t turn violent and impact oil supply from the region. That assumption is looking less secure.

Markets call Trump’s bluff with Indian IT rally

23 Jun 2017

The value of the top outsourcing firms has risen about 9 pct, or $12 bln, since the election of U.S. President Donald Trump. Investors have reason to doubt his hard talk on immigration, and to believe Premier Narendra Modi can help his counterpart see the mutual benefits.

As Saudi’s new crown prince rises, so could oil

21 Jun 2017

Mohammed bin Salman has replaced his cousin as heir. That gives him a firmer hand to push through economic reform, but maybe less incentive to do so. Where he is likely to make a bigger mark is in squabbles with Gulf neighbours and taking firmer action over a low oil price.

Northern Ireland pact bad for peace and UK voters

12 Jun 2017

British Prime Minister Theresa May's attempt to form a government with Northern Ireland's DUP could come at a high price. True, the party is pro-Brexit and wants to avoid a UK breakup. But taxpayers can expect greater fiscal transfers and more friction in the restive region.

Qatar’s weak link in Saudi stand-off: people

9 Jun 2017

The sheikhdom has the money and resources required to withstand a cold war with its neighbours. Its economy depends on foreign expatriates, though, who account for more than three-quarters of the population. Preventing a demographic drain is the best reason to agree to a truce.

Qatar crisis points to quick but uncomfortable fix

6 Jun 2017

As Arab states and U.S. President Trump align against the emirate, the chance of leadership change is rising. Another reshuffle within the ruling family might unblock trade and diplomatic links without affecting Qatar’s economic prospects. But the precedent would be alarming.

Qatar quarrel shows limit of its sovereign wealth

6 Jun 2017

The emirate’s $300 bln-plus fund has snapped up landmark buildings and stakes in companies like Barclays and Rosneft. The spree was meant to generate returns and diplomatic clout. But Qatar’s largesse has produced few allies to help it face down its more powerful neighbours.

China can remake North Korea in its own image

6 Jun 2017

Beijing's influence over Pyongyang gets weaker daily, but it resists U.S. pressure to get tough. The alternative is for the People’s Republic to intervene and rebuild the Hermit Kingdom along its own economic model. It may be the best of a range of unattractive options.

Saudi-Qatar rift is old theme with Trumpian twist

5 Jun 2017

After the U.S. president’s whistlestop visit, the kingdom has turned on its gas-rich neighbour. Saudi has long suspected Qatar of supporting terrorism and sidling up to Iran. Deep fractures in a region that pumps a fifth of the world’s oil could spill over into markets.

Trump climate exit has bright silver lining

31 May 2017

U.S. support for anti-warming measures will be missed, if its withdrawal from the Paris accord is confirmed. But states, cities and businesses remain on board. And for nearly 200 other countries, including top polluter China, progress may be smoother free of D.C. foot-dragging.

Chinese taxpayers have most to fear on Silk Road

16 May 2017

President Xi pledged $124 bln at an international summit to build a modern version of the ancient trading route. Huge global infrastructure spending will burnish Beijing's standing. But the hype could backfire if citizens of the People's Republic fail to reap tangible benefits.

Macron faces stronger Merkel after state election

15 May 2017

France’s new president needs German support for his euro zone reform ideas. Angela Merkel’s challenger Martin Schulz is more supportive of tighter fiscal integration and more investment. The triumph for Merkel’s party in a regional poll suggests any changes will need her consent.

Moon win offers South Korea ray of sunlight

9 May 2017

The election of liberal Moon Jae-in to the presidency heralds a softer stance on North Korea and restores domestic stability. That’s welcome. But he will need to unite a polarized nation to succeed where his ousted predecessor failed in resetting South Korea's growth model.

Markets call Trump’s war bluff on North Korea

8 May 2017

Investors are ignoring the U.S. president’s war rhetoric against Pyongyang, snapping up South Korean securities and modestly buying protection against default. Optimism over the global economy and a new leader in Seoul result in a mute reaction compared to past flashpoints.

Wall Street served low-hanging China fruit basket

10 Apr 2017

Negotiators for presidents Trump and Xi have reportedly agreed to ease the U.S. financial sector's access to China. It's an easy concession as the benefits will mostly accrue to Beijing: greater inflows of foreign capital, plus help upgrading bond and equity markets.

Trump’s Syria strikes don’t justify crude worries

7 Apr 2017

Oil spiked after U.S. missiles rained on Syria. The fear isn’t that supplies will be disrupted but that Syrian ally Iran, which has been increasing its output of crude, will be hit with renewed sanctions. Even if that happens, other forces could keep markets well supplied.

China’s reformers could use tough line from Trump

5 Apr 2017

The U.S. president has threatened his Chinese counterpart with punitive trade policies. A more creative approach would target barriers to foreign investment in the People’s Republic. That would find support from U.S. corporations – and China’s frustrated pro-market faction.

Saudi will find luring May was the easy part

5 Apr 2017

The British prime minister’s charm offensive in Riyadh may help sell more planes and halal lamb. It also sends a message to EU negotiators. What Saudi really needs is investment, people and skills – which hinge on the so-called soft issues Theresa May seems happy to overlook.

Citi’s Saudi comeback hangs on friendly oil prices

23 Mar 2017

The American lender wants a new licence to do deals in a kingdom it mostly exited over a decade ago. Economic reforms and the sale of state assets like Aramco could be rich pickings. A big variable is oil. The lower its price, the more juicy mandates banks can expect.