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EGYPT. Sissize the day
Egypt’s President starts his third term amid economic turmoil.
President Abdel-Fattah el-Sissi took his oath of office on Tuesday. He was re-elected in December for a third consecutive six-year term. By the end of his term, he will be Egypt’s second-longest serving leader in the modern era.
INTELLIGENCE. Egypt is in the doldrums, but el-Sissi is ascendant, having comprehensively won December’s election with 89.6% of the vote. Though the country’s biggest security challenge in years rages across the border in Gaza and Sudan, it didn’t hurt his chances to run against largely unknown opponents. Behind the vote is an increasingly oppressed populace, sidelined by a series of power grabs that have given the military yet more power.
FOR BUSINESS. Egypt remains in an economic crisis, mostly of its own making. Inflation is around 35%. The currency has plunged again. After Argentina, it’s the IMF’s second-biggest borrower. Meanwhile, the military has strengthened its stronghold over major businesses and assets in Egypt and continues to receive uncompetitive tax advantages. The new $58 billion administrative capital, also inaugurated on Tuesday, is a symptom of Egypt’s mismanagement.
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CHINA. UNITED STATES. Talking heads
US-China talks are more ‘checking in’ than progress.
Presidents Joe Biden and Xi Jinping held their first call Tuesday since November’s APEC summit in California. The call between the two leaders precedes a series of senior-level engagements between the two nations.
INTELLIGENCE. The talks reportedly covered Taiwan, AI, fentanyl, military cooperation, economic practices, and the South China Sea, but a US official said the call was not aimed at any policy breakthrough. Rather, it was just keeping up regular engagement, which has been a key policy position for Biden. Treasury Secretary Yellen and Secretary of State Blinken are due for visits in the upcoming weeks. Xi on Monday met with Indonesia’s president-elect.
FOR BUSINESS. Xi also met with US business leaders last week to emphasise the benefits of China to the US economy.But a tension between private and public interests is increasingly clear. As China gains ground in solar, EVs, and even social media, the list of US restrictions continues to grow. Yellen said last week that Beijing is ‘flooding the market’ with solar, EV and batteries, distorting global growth. China counters it is simply more competitive.
AFGHANISTAN. Back to the stone age
The Taliban reverts to type.
The Taliban announced it will once again start to enforce strict sharia law in Afghanistan, which includes stoning women to death for acts of adultery. The Kremlin on Tuesday said it would remove the Taliban from its list of terrorist actors.
IINTELLIGENCE. With the world’s attention now firmly elsewhere, Taliban leaders have felt emboldened to enact past practices and laws with impunity. Taliban leaders don’t even attempt to deny such practices anymore, instead defending them as consistent with sharia law. As abuses have gone largely unnoticed, the regime has been free to erode rights. Since the takeover, the constitution has been dissolved and criminal codes suspended and replaced.
FOR BUSINESS. Afghanistan has regressed into one of the poorest countries in the world. Its GDP per capita is back at 2008 levels. In FY2022, the Taliban collected around $2.2 billion in revenue – most of the money coming from border taxes. The Taliban is also attempting to move closer to Iran and Russia, limiting Pakistan’s influence. The Taliban recently asked Iran to use its Chabhar port, which would hinder Pakistan’s plans to be a Central Asian hub.
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HAITI. Ganging up
In Port-au-Prince, a complete breakdown of law and order.
Data from the United Nations showed more than 53,000 people left Port-au-Prince in the first three weeks of March. Consistent outbreaks of violence continued over Easter. Fighting near the presidential palace intensified on Tuesday.
INTELLIGENCE. The scale of devastation and violence in Haiti is unprecedented, with reports of unimpeded killings, sexual violence, kidnappings, and assault. Since the prime minister resigned on 11 March, there has been a power vacuum. The parliament remains in chaos, with no transitional leader agreed upon. Meanwhile, gangs have started to penetrate once-safe parts of the capital where political elites live, intending to intimidate and lead a revolution.
FOR BUSINESS. There has been no regional opening of arms for Haitian refugees, with all surrounding countries refusing to take in displaced Haitians. The Dominican Republic, with which Haiti shares the island of Hispaniola, has already ruled out refugee camps, instead increasing border security and deporting many thousands back to Haiti. The US is unlikely to step in either, given the upcoming election and sensitivity around migration and foreign wars.
PUERTO RICO. A budget for old and older
Statehood remains unresolved, but San Juan’s budget provides a distraction.
Puerto Rico’s governor announced the territory’s largest-ever budget, with total expenditure expected to come in at around $14 billion. The focus is on assistance for the elderly, curbing violence, and solar power programs.
INTELLIGENCE. Puerto Rico is an unincorporated US entity. Defence responsibility is outsourced to the US and Puerto Ricans are granted US citizenship, but not the right to vote in elections, or other rights such as social security or Medicare. With 25% of people being over 65 – one of the highest rates of older people in the world – access to these US programs is an ongoing source of tension. The governor again called for US statehood in his budget speech.
FOR BUSINESS. In 2017, due to severe economic mismanagement, Puerto Rico had to file for bankruptcy, as part of the largest public debt restructuring in US history. Since then, the economy has picked up slowly, though Hurricane Maria and several earthquakes in 2017 and 2019 caused significant setbacks. The plan to increase assistance for the elderly, in particular, is a clear vote-winner in Puerto Rico.