China, Central America: Taiwan taimado
Also: Colombia, the Netherlands, Yemen, and Afghanistan.
In addition to our daily risk monitoring brief, the team behind Geopolitical Dispatch also provides advice, risk audits, scenario planning, executive masterclasses and board briefings among other services. Click here to get in touch.
CHINA. CENTRAL AMERICA. Taiwan taimado
Guatemala eyes trade relations with Beijing.
Beijing said Guatemala should break ties with Taiwan "as soon as possible" Tuesday, after Guatemala said it wanted trade ties with the mainland. China and the US congratulated Nayib Bukele for his re-election in El Salvador on Monday.
INTELLIGENCE. Geopolitical competition in Central America has escalated as Beijing seeks to cleave off Taipei’s few remaining allies. It’s a similar picture in the Caribbean, where Haiti is on fire, but Taiwan has done little more than send rice. Firm friends of Beijing are getting attention for other reasons too. Nicaragua, isolated from the West, hopes to revive Chinese plans for a canal to rival Panama. Managua banned four Taiwan-linked organisations last month.
FOR BUSINESS. Besides wanting markets for its coffee and sugar, Guatemala’s new government is eyeing a charm offensive it has been excluded from. El Salvador has received $500 million in investment in recent years. Honduras hopes to create 7,000 China-linked jobs. Last month, a visiting Wang Yi promised to help Jamaica play a bigger role in world affairs. Visiting Beijing, Antigua's prime minister said China was the “most philanthropic country globally.”
Geopolitical Strategy is the advisory firm behind Geopolitical Dispatch. Our partners are former diplomats with vast experience in international affairs, risk management, and public affairs. We help businesses and investors to understand geopolitical developments and their impacts with clarity and concision.
COLOMBIA. An inconvenient truce
Another ceasefire may help Bogota, but not the war on drugs.
Colombia and the rebel National Liberation Army (ELN) extended their ceasefire by six months on Tuesday. Talks are ongoing with drug gang Clan del Golfo and other groups. A senior US drugs official this week visited Peru and Ecuador.
INTELLIGENCE. Bogota’s multiple peace negotiations have brought stability to much of Colombia but at the expense of higher coca production and an upset equilibrium in much of the broader region’s underworld. Ecuador and Peru have been victims of rising violence, which the US is now stepping in to manage. Yet not all this assistance is cost-free – a US deal with Ecuador to on-sell Russian military gear to Ukraine has resulted in a banana ban from Moscow.
FOR BUSINESS. Gang violence is not just a problem for investors and governments – Ecuador’s election was marred by assassinations and intimidation – but US regional influence. The heavy-handed but empirically successful response to gangs in El Salvador has given a fillip to alternative modes of governance (i.e. dictatorship). Amid its own struggles with the narcos, Bolivia is getting closer to Russia and China, which are expanding its lithium sector.
NETHERLANDS. Double Dutch
A return to the polls will be a test for the far right.
A key party in government formation talks walked on Tuesday, casting doubt on far-right politician Geert Wilders' hopes to lead a coalition. Fifteen parties have seats in the parliament. Elections will be called if no combination can be found.
INTELLIGENCE. Dutch coalitions can take time to form. After the 2021 election it took almost 300 days. A new vote is a last resort but if taken could be a test of whether Wilders' victory in November was a fluke or a trend. Far-right parties have been resurgent across Europe, but allegations of extremism in Germany have led to a recent backlash and losses in local polls. Disruption caused by right-leaning farmers across Europe have also vexed swing voters.
FOR BUSINESS. Wilders' populist Party for Freedom more than doubled its seats in November. Only the agrarian Farmer-Citizen Movement did better, going from one to seven. Yet in a febrile atmosphere, it is easy for an insurgent-turned-incumbent to become a victim of success. Nothing seems certain in European politics. The Dutch economy, however, is widely expected to remain flat in 2024, much like its larger neighbours and the Euro area as a whole.
Emailed each weekday at 5am Eastern (9am GMT), Geopolitical Dispatch goes beyond the news to outline the implications. With the brevity of a media digest, but the depth of an intelligence assessment, Geopolitical Dispatch gives you the strategic framing and situational awareness to stay ahead in a changing world.
YEMEN. Hou can say
The US offers the Houthis a ‘climbdown’.
Efforts were being made to find a "climbdown" for Yemen's Houthi rebels, Washington's special envoy said in a recording released Tuesday. The Houthis' leader said Red Sea attacks would escalate if the war in Gaza did not end.
INTELLIGENCE. Envoy Tim Lenderking indirectly admitted the strikes are part of a broader Yemen settlement rather than simply an Iran-directed reaction to Israel. Recent progress on a hostage deal with Hamas won’t hurt, but the Yemen conflict predates events in Gaza. As Lenderking visits Oman, which is hosting Yemen talks, the UN’s representative is in Tehran. Yemen’s internationally recognised government sacked its prime minister on Monday.
FOR BUSINESS. As the Houthis continue to strike at Red Sea shipping, undeterred by US and allied reprisals, the threat of telecom cable sabotage has recently been raised. The Red Sea carries almost a fifth of the world's internet traffic, with the region's cables at shallow depths and in close proximity. These cables cross to the Mediterranean over Egypt’s Sinai Peninsula, close to Gaza and the scene of a Hamas-backed insurgency that only ended last year.
AFGHANISTAN. Talibandwagon
Kabul emerges from isolation.
A Chinese oil firm has invested $49 million in Afghanistan's Amu Darya basin, Voice of America said Tuesday. Tajikistan, which shares the basin, last week said Kabul had repaid its power delivery debts, a step toward diplomatic recognition.
INTELLIGENCE. The Taliban continues to frustrate the West with its woeful human rights record and emerging signs of re-accommodation toward Al Qaeda, but to several of Afghanistan’s neighbours, the Mullahs are a more predictable interlocutor and also seem to take infrastructure and fiscal stability more seriously than the former US-backed regime in Kabul. Flights have resumed to Dubai. Beijing has seemingly accepted the Taliban’s ambassador.
FOR BUSINESS. China, India and Russia have sought pragmatic ties. Pakistan and Iran, though fellow Muslim states, are finding the Taliban harder to deal with but have met its officials in recent months. Beijing has cut the deepest swathe. Besides Xi Jinping welcoming the Taliban’s ambassador alongside other envoys last week, Chinese firms are investing in power and mines. Roads on both sides of the border now almost meet. A crossing could come soon.