Government & Agencies

Biden’s hydrogen goals are like oil and water

4 Jun 2024

The White House wants to foster production of the abundant element as an alternative to fossil fuels, but oil and gas companies want a chance to pitch in. Environmentalists see that as a trap. Even so, there may be no choice but to extend oil majors like Exxon an olive branch.

India may no longer be Narendra Modi’s

4 Jun 2024

His party is on course to lose its majority and will be at the mercy of allies to form a government. It ends a decade of extraordinary stability in the world’s fifth-largest economy. A market selloff hints at the costs of coalition rule. Growth may slow but there are some gains.

Russian bond rout raises risk of financial crunch

4 Jun 2024

Yields on the country’s debt are at 20-year highs on worries about the budget largesse lavished on the economy. With inflation rising and interest rates at 16%, President Vladimir Putin’s desire to keep funding the conflict in Ukraine could result in lasting fiscal turmoil.

Modi 3.0 offers limited opportunities for the West

3 Jun 2024

Western leaders’ hopes for India as a bulwark against China outweigh their concerns about Narendra Modi’s authoritarian streak. They will have more scope to work with the prime minister during his expected third term. But the overlap of interests and values is limited.

South Africa avoids doomsday, remains in purgatory

3 Jun 2024

After the elections, the African National Congress will lose the grip on parliament it held since 1994. Poor results by the hard left lower the risk of a market-unfriendly ‘doomsday coalition’. But with GDP growth of just 0.9% and large deficits, the country’s future looks bleak.

EU’s wobbly budget rules can bolster shaky economy

3 Jun 2024

Eleven countries have breached Brussels’ fiscal levees, with deficits larger than 3% of GDP. But the limits come with loopholes and allow for delays. That’s good news for a bloc desperate for growth to rival the US. For Europe, weaker rules are better than misguided austerity.

Donald Trump verdict judged leniently by investors

31 May 2024

The former US president joins Italy’s Berlusconi and other politicians in the criminal hall of shame. He also may yet be re-elected, but there’s no extra risk being imputed to the country’s debt, currency or markets. However robust the system, sanctioned wrongdoing will erode it.

Aramco’s $12 bln share sale is borne of necessity

31 May 2024

Saudi Arabia is selling an extra 0.6% slice of the $1.9 trln oil giant. Riyadh needs cash because budget concerns have delayed projects to diversify its economy. The company’s low valuation versus global rivals makes the timing suboptimal. At least buyers get an attractive yield.

Tories’ obsession with French unions is obsolete

31 May 2024

UK PM Rishi Sunak accused Labour of plotting ‘French-style union laws’. But France has the lowest proportion of organised workers among big European nations. And there were fewer strikes in the last three years than in Britain. Time for the Conservatives to find another bogeyman.

Change is coming to UK’s macroeconomic policy

31 May 2024

The opposition Labour Party, the strong favourite to win the upcoming election, has promised continuity in its fiscal and monetary approach. An ugly economic inheritance at home and global challenges abroad make that ambition unrealistic. Investors should prepare for a shift.

Next UK leader will bang head against fiscal roof

30 May 2024

Britain’s election in July is likely to hand power to the opposition Labour Party. In this Viewsroom podcast, Breakingviews columnists discuss how constrained finances could mean higher taxes. For business leaders, the promise of more stability may be as good as it gets.

Failed Anglo bid is net negative for BHP CEO

29 May 2024

Mike Henry has ditched the Australian miner’s $47 bln attempt to buy its UK-listed rival. He misjudged the difficulty of pushing Anglo to divest South African assets. But he avoided upsetting investors by overpaying, and if his target’s breakup plan falters he can try again.

Royal Mail deal defies nationalist anti-M&A trend

29 May 2024

Czech tycoon Daniel Kretinsky agreed a $4.6 bln buyout of the UK postal service’s parent group. Britain’s likely next government seems OK with it despite the chance of jobs cuts and a breakup. As countries pull up the drawbridge on sensitive takeovers, there are still exceptions.

Technocrat PM will save Dutch voice inside the EU

29 May 2024

By choosing civil servant Dick Schoof, The Hague put pragmatism before politics in the premier’s slot. Far-right Geert Wilders won at the polls but elected to pass on the job. This will help the Netherlands keep its sway over key issues like EU debt and the green transition.

Fed should be independent, not untouchable

28 May 2024

Allies of Donald Trump want to blunt the Federal Reserve’s autonomy if the former US president wins a second term. That would be economically disastrous. But a mighty central bank with a $7 trln balance sheet requires better scrutiny, especially outside monetary policy.

Ethereum set to stress test US crypto deregulation

22 May 2024

Congress wants to dilute the SEC’s power over digital currencies. Its proposal could pave the way for new ETF products, which have turbocharged bitcoin. Financial wreckage from past laxity, and the industry’s own sketchy history, justify agency boss Gary Gensler’s resistance.

UK’s election gamble ends messy stalemate

22 May 2024

Prime Minister Rishi Sunak has called a national vote on July 4, much earlier than expected. His Conservative party trails Labour by 21 percentage points. The PM will point to a better economy but won’t offer more tax cuts. Still, a summer poll will provide much-needed clarity.

German consumer is poor substitute for China trade

21 May 2024

Consumption is up but won’t be enough to lift the country out of its funk, with growth of just 0.2% this year. Exports to the People’s Republic are threatened by worsening relations between Brussels and Beijing. Meanwhile a split Berlin government looks unable to launch reforms.

President’s death makes Iran even less predictable

20 May 2024

The demise of Ebrahim Raisi removes an obvious replacement for the ageing Ali Khamenei as Supreme Leader. Despite a recent attack on Israel, the Islamic Republic’s top figure is a known quantity. The risk is that Iran’s role in a febrile Middle East becomes even harder to gauge.

New Caledonia to Macron: it’s the economy, stupid

20 May 2024

Deadly riots prompted the French president to impose a state of emergency in the Pacific Ocean territory, which holds 5% of world nickel reserves and gives Paris a strategic outpost in the region. To revive the island, a new economic deal would work better than an army crackdown.