Government & Agencies

Gulf’s World Cup love-in has uncertain shelf life

25 Nov 2022

Egypt and Turkey used the tournament to smooth over old differences, and ex-rivals Saudi Arabia and Qatar are getting along. Riyadh may even use its new oil heft to put $5 bln in cash-strapped Ankara’s central bank. The risk is new tensions, perhaps over Iran, upend the goodwill.

UK and EU’s new goodwill could be significant

23 Nov 2022

British PM Rishi Sunak wants to improve trade relations with the EU. Progress will only be piecemeal and slow, even if the two sides agree on how to implement their 2019 deal on Ireland. In the meantime small deals are possible, and they could normalise the path to closer ties.

EU gas cap is indirect signal to cut power demand

23 Nov 2022

The bloc’s proposed brake on natural gas prices at 275 euros per megawatt hour is a fig leaf. The ceiling is so high and with such stringent conditions that it may never be activated. Its main use may be to remind EU states their best option is to use energy more efficiently.

The world can harness trade to save the planet

21 Nov 2022

Trade is a major cause of global warming. The solution is to tax commerce in carbon-intensive goods and remove tariffs on clean ones, to support low-carbon technologies, and to do all this fairly. It’s a priority for next year’s COP28 conference in Dubai, says Hugo Dixon.

Capital Calls: ABB, Italian budget

21 Nov 2022

Concise views on global finance: The $57 bln Swiss engineering group is selling a minority stake in its car charging unit, as a fallback to volatile IPO markets; premier Giorgia Meloni’s hard-right government targets a budget deficit of 4.5% of GDP in 2023.

COP27 deal is a blessing in a very good disguise

21 Nov 2022

The premier forum for fighting climate change ended in Egypt with a largely inadequate agreement to reduce global greenhouse gas emissions. But it did feature a small show of goodwill by rich countries. That might incentivise the big emitters of tomorrow to up their game.

Indonesia’s green step not yet a leap for mankind

18 Nov 2022

Jakarta will get $20 bln of overseas public and private cash to help it decarbonise. The deal struck at the COP27 summit paves the way to channel capital to poor countries at the required scale. But big foreign transfers are fraught. Lenders have plenty of reason to hesitate.

Capital Calls: Ticketmaster and Taylor Swift

18 Nov 2022

Concise views on global finance: A meltdown involving the pop star’s upcoming “Eras” concert tour is attracting an audience on Capitol Hill and risks an unwanted corporate fight with the artist herself.

Investors ignore China Covid spike at their peril

18 Nov 2022

Shares have rallied on signs President Xi Jinping is embracing pragmatism and easing up on crackdowns in real estate and tech. Shaking hands with U.S. President Joe Biden helped, too. However, Beijing might also be losing control of the virus. Policy relaxations may be moot.

UK’s new fiscal plan narrowly navigates recession

17 Nov 2022

As the economy shrinks, new finance chief Jeremy Hunt intends to raise taxes and cut spending. The 55 bln pound package goes some way to rebuilding Britain’s cracked credibility with investors. Delaying the pain by a few years could also help his party’s electoral prospects.

Capital Calls: Nexperia’s UK woes

17 Nov 2022

Concise views on global finance: The British government’s order to the Chinese group to sell its Welsh chip factory may prove an empty gesture without a plan to go forward.

COP28 may make up for COP27’s shortcomings

17 Nov 2022

The global climate meeting has mostly failed to lure the same corporate big hitters as Glasgow did last year. In this Viewsroom podcast, Breakingviews columnists discuss how even if the gathering in Egypt’s Sharm El-Sheikh yields little progress, 2023 in the UAE could be better.

It’s the wrong time for Trumponomics

16 Nov 2022

The former U.S. president is trying to reclaim the job in 2024. He oversaw years of economic strength with tax cuts and deficit spending. But such policies put him at odds with the Federal Reserve even more now than before, and they don't meet today's challenges.

Fiscal “black hole” obsession adds to UK problems

16 Nov 2022

Prime Minister Rishi Sunak’s government is set to tighten the public finances by about 50 bln pounds, equivalent to 2% of GDP. Yet the case for such a large package is based on dubious logic. If it’s front-loaded and overly reliant on spending cuts, it will also hurt growth.

The shafts of light in a dark, dark world

14 Nov 2022

As the G20 kicks off, there are many negatives: a frying planet, economic crisis, conflict in Ukraine, and maybe a cold war with China. But there are positives too, says Hugo Dixon: Putin is losing, autocrats are struggling, and carbon emissions may peak earlier than expected.

Capital Calls: Twitter ads, Supervoting stock

11 Nov 2022

Concise views on global finance: Elon Musk is giving big brands an easy out – and a drain on advertising is harder for Twitter to overcome than Facebook; a dual-class share structure enabled the ousted CEO of TuSimple to team up with his co-founder and sack the board.

Stubborn inflation puts Fed on deadline

10 Nov 2022

Consumer prices in the U.S. have slowed their pace of increase, but are still rising too fast for comfort. The question now isn’t whether higher interest rates will work, but whether they’ll do so before Americans become inured to inflation. That would hand the Fed a new crisis.

U.S. cannabis movement can learn from Canada

9 Nov 2022

Maryland and Missouri voters look set to expand the country's legalized recreational weed usage. Up north, too much hype contributed to a costly glut. As the business keeps getting bigger in the United States, it would do well to learn from its neighbor's growing pains.

UK market watchdogs rely on kindness of foreigners

9 Nov 2022

The Bank of England has intervened in government bond trading twice in less than three years. Both times, selling by overseas funds was partly to blame. British regulators have limited oversight of the $2.4 trln gilts market. Their best hope is help from counterparts elsewhere.

Republican victory paves road to softer dollar

9 Nov 2022

A split Congress will lock the U.S. government in gridlock through 2024. President Joe Biden's spending ambitions are doomed, simplifying the Fed's battle against inflation. Throw in a possible renewed fight over debt, and investors have reason to rethink the strong greenback.