Trade

Globalisation woes create new winners and losers

17 Oct 2023

After peaking at 61% of world GDP in 2008, trade is falling due to tariffs, industrial policies and geopolitical strife. That means higher wages and production costs for companies, and more inflation for consumers. Yet some countries, commodities and workers stand to gain.

Australia’s China détente is a tough one to copy

12 Oct 2023

Beijing freed an Aussie journalist and has lifted import bans on goods like coal and hay. High commodity prices propped up Canberra’s coffers, while a less bellicose administration and a scant manufacturing base helped reconciliation. The US and the EU can’t use such a blueprint.

Next EU chief will need cash more than trade wars

10 Oct 2023

Ursula von der Leyen kicked off her campaign to stay European Commission president by attacking China’s car subsidies. But what the bloc craves is a plan to grow its economy and enlarge eastwards, including finding $411 bln for Ukraine. A bigger, better Europe won’t come cheap.

Belated euro U-turn could be a winner for Sweden

6 Oct 2023

Top advocates of snubbing the single currency 20 years ago are now pushing for its adoption. The crown’s fall makes curbing inflation harder, and rate-setters are under the ECB’s spell. With low public deficit and debt levels, Stockholm may find joining late is better than never.

China is swing factor in diesel’s global squeeze

5 Oct 2023

Russia’s export ban on the fuel may prove a temporary scare. But low inventories in the US and Europe, spiking crude prices and a colder winter could keep it in short supply. The key variable, though, is whether China helps ease the pressure by raising export quotas.

Germany risks letting a good crisis go to waste

3 Oct 2023

Europe’s largest economy is on track to shrink this year. The immediate causes are lower exports to China and higher energy prices. But decades of under-investment will continue to crimp growth unless Berlin ditches its hostility to fiscal stimulus and comprehensive reforms.

India entry into geopolitical storm will be costly

19 Sep 2023

New Delhi dismissed as ‘absurd’ Canada’s allegation of its involvement in a Sikh leader’s murder. Either way, the fallout will ripple through cabinets and boardrooms in the West. For global companies and money managers, it’s a reminder that de-risking from China is complicated.

China’s next chip battle is for the bottom line

19 Sep 2023

Huawei’s new smartphone proves the country can make cutting-edge hardware despite US restrictions. But it’s unclear if semiconductor provider SMIC can scale supply. Huawei’s flashy phones have hogged the limelight: SMIC’s shrinking margins deserve the same scrutiny.

China’s EV makers would steer around EU roadblock

14 Sep 2023

A Brussels probe may mean hefty tariffs on battery-powered cars imported from the People’s Republic. BYD, Nio and peers could start making them in the bloc, which accounts for a quarter of global EV sales. Focusing on Asia and Latin America, though, would make more sense.

China is bitter medicine for Europe’s EV pivot

12 Sep 2023

Ditching EU combustion engines by 2035 requires carmakers like VW to rapidly boost sales of battery rides. That’s a challenge when electric cars are pricier than gasoline ones. Competition from China will lift take-up and force Western players to become more efficient.

Shady export leaks suggest Russian sanctions work

29 Aug 2023

A suspicious bump in European exports to countries like Kazakhstan may be helping Moscow evade Western bans. The G7 price cap on Putin’s oil is also porous. But these cracks are marginal and help demonstrate the embargoes’ effectiveness – and why they can be tightened.

India is warming up to a cooling China

28 Aug 2023

Narendra Modi’s meeting with Xi Jinping in South Africa signals some thawing of financial ties hamstrung since 2020 by border tensions. Investments from the People’s Republic into its neighbour shrivelled thanks to a screening policy. That now looks ripe for fine-tuning.

Italy faces bumpy round trip on the Silk Road

23 Aug 2023

Prime Minister Giorgia Meloni may quit Chinese President Xi Jinping’s infrastructure club. Like other European fans, Italy gained little economic benefit from signing up to the Belt and Road Initiative. Yet leaving may provoke retaliation, perhaps against its luxury industry.

India’s laptop ban hints at limits of onshoring

18 Aug 2023

Modi’s government is restricting the import of the hardware while incentivising manufacturers to make more in the giant emerging market. It’s late, though. Dell, HP and others have diversified from China to Southeast Asia. By pushing hard, India risks upsetting its neighbours.

Capital Calls: European steel

21 Jul 2023

Concise views on global finance: Sweden’s $6 bln group SSAB misses profit forecasts as Europe’s demand tanks and steel prices shrink.

West is sleepwalking off healthcare cliff

17 Jul 2023

Europe is scrambling to end its reliance on Chinese raw materials for green energy and chips. But policymakers forget the region sources 80% of ingredients for top medicines in the East. Producing them at home may prevent a crisis but it risks exacerbating public debt piles.

Old Cold War tool could help in new era of tension

17 Jul 2023

The US and allies created a committee to vet exports to the Soviet Union during their long conflict. This gave its partners a say in setting policy and ensured they stayed aligned. The G7 should set up something similar to handle the quasi-Cold War with China, says Hugo Dixon.

Germany’s China policy caps pain for its companies

14 Jul 2023

Europe’s biggest economy has a new strategy to limit exposure to China and align more with Brussels and Washington. Yet a previous version of the plan was tougher. Big China-focused corporates like BASF and Volkswagen will be relieved they can de-risk at their own pace.

China’s rare metals swipe has more bark than bite

4 Jul 2023

Beijing is imposing export controls over gallium and germanium, used in chips, fibre optics and military equipment. This confirms Western fears that the country might leverage its strategic metals dominance to push back on sanctions. Yet market realities blunt China’s edge.  

EU phase-out of Huawei, ZTE is tricky but vital

20 Jun 2023

Commissioner Thierry Breton wants EU countries to end use of Chinese telecoms gear on national security grounds. Some states have already cut Huawei and ZTE from 5G networks. The EU survived decoupling from Russian energy, and it can manage this. But it requires German buy-in.