Britain: Bremainer revisited.
Also: Germany, China, Southeast Asia, India and Rwanda.
BRITAIN. Bremainer revisited.
The Tories seek the atmosphere of a better age.
Rishi Sunak on Monday appointed David Cameron, his predecessor thrice removed, as foreign secretary in a reshuffle that saw incumbent James Cleverly replace a sacked Suella Braverman as home secretary. Cameron will join the Lords.
INTELLIGENCE. Cameron has brought Brexit’s toxic memory back with him, but Sunak judges the former prime minister and member of the establishment will help conserve the blue-ribbon seats the Tories are in danger of losing to the Liberal Democrat at the next election. Shunted with the hard-right Braverman is any chance of retaining the working-class electorates Boris Johnson won in 2019. But these ‘red wall’ districts were already a lost cause.
FOR BUSINESS. Cameron’s return is less about ability (though he’ll make a good minister) than political calculus. Sunak has been stung at several by-elections and his recent populist turn, led by Braverman, has likely lost more votes than it has won. Braverman’s politics polled well nationally, but not with the middle-class Home Counties voter Sunak needs. As most of Europe swings further to the right, Britain – at least for now – is swinging to the middle.
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GERMANY. Merkel revisited.
Olaf Scholz channels his predecessor while suffering her legacy.
Germany's chancellor met his Greek counterpart on Tuesday for talks on migration and energy amid a flurry of meetings. Scholz said on Sunday Germany would double its aid to Ukraine and be open to talks with Putin, if Russia withdrew..
INTELLIGENCE. Faced with terrible polls and a worsening economy, Scholz is showing signs of awakening, but the question is whether recent attempts at leadership will be enough to fix his country’s, and continent’s, problems. Angela Merkel was not known for boldness, but unlike Scholz, she dominated the EU. Emmanuel Macron, who visited Scholz last month for a bilateral and at times awkward summit, has since sought this role and will be watching.
FOR BUSINESS. The irony of trying on the Merkel persona is most of Scholz’s challenges – decrepit infrastructure, expensive energy, loose borders – are her fault. There’s little Scholz can do to course correct without ditching one or both of his coalition partners, but this would lead to an election he’d lose. Until then, Germany will stay the sick man of Europe, while its industries move to cheaper, dirtier, less democratic but more coherent jurisdictions in the east.
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CHINA. SOUTHEAST ASIA. Thai breaker.
Beijing scores against Washington in Mainland Southeast Asia.
A suspected Chinese base in Cambodia has grown considerably, US site Naval News said Monday. On Saturday, China's security chief completed a tour of the region. On Sunday, Thailand said it would host Chinese police in tourist areas.
INTELLIGENCE. Bangkok’s military-linked government already lacks popular legitimacy, and the announcement has sparked outcry. But that it was ever under consideration shows Thailand’s predicament. Despite being a US treaty ally, Thailand increasingly depends on China, and was even set to buy a Chinese submarine, though this has been swapped for a frigate. Thai troops will join drills in China this month, alongside usual suspects Cambodia and Laos.
FOR BUSINESS. Biden met Indonesia’s Joko Widodo for tea on Monday. That the leader of the world’s biggest Muslim country – and possibly the most pivotal swing state on China – didn’t get a greater billing shows how far behind the US is on Southeast Asia. Manila’s pushback on Beijing has been welcomed in Washington, but other regional players need more cajoling, not to mention trade and investment, which even a relatively slowing China provides in spades.
INDIA. Diwali gifts.
Falling inflation and diplomatic attention come to Modi’s rescue.
Consumer prices fell to 4.87% in October, Delhi said Monday. Antony Blinken and Lloyd Austin met their counterparts on Friday, agreeing to jointly produce Stryker vehicles. Moscow on Tuesday said it would build air weapons with Delhi..
INTELLIGENCE. Five Indian states go to the polls this month in races tighter than Narendra Modi’s approval ratings suggest. That India has managed to tame inflation (though food prices are rising) and maintain a growing US partnership (in spite of ties with Russia and killing a Canadian) will thus be welcome. Modi faces a range of tests – from smog to China – ahead of next year’s national vote, but he has shown luck, plus an adept use of policy levers.
FOR BUSINESS. One area where luck could run out is India's neighbourhood, where China is making inroads. Beijing is exercising with Pakistan, sending spy ships to Sri Lanka, and cosying up to Maldives, Bhutan, and Nepal. Turmoil in Afghanistan, Bangladesh and Myanmar is also causing Delhi stress. None of this should have an immediate impact on the domestic economy, but it will distract policymakers and give ammunition to a coalescing political opposition.
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RWANDA. Great rifts.
Kigali’s history and geography catch up with it.
The UK vowed on Tuesday to continue with a deportation plan to Rwanda, lucrative to Kigali, despite the sacking of Suella Braverman. The US on Friday warned Rwanda to de-escalate tensions with the Democratic Republic of Congo.
INTELLIGENCE. Recent violence in the DRC is a continuation of the causes behind the 1994 Rwandan Genocide and Rwanda’s subsequent takeover by Paul Kagame. Unlike the DRC, where 7 million are displaced, Rwanda has enjoyed success, though Kagame has grown autocratic. Rwanda is tipped to lead regional growth this year and next, but chaos next door and risky plans with the West – from migrant deals to nuclear power – could push Kagame’s luck.
FOR BUSINESS. Rwanda wants to be the Singapore of Africa and Kagame tends to see regional troubles as a boost to his brand. But this can only work so far, particularly if, like Kenya, Rwanda is serious about visa-free access to African visitors, which it announced last week. Landlocked, it also needs reliable trade routes. Unlike the DRC to the west, Kenya and Tanzania to the east are relatively stable, but both have this year seen a rising Jihadist threat.