Gabon: And on and on.
Also: Russia, Turkey, Switzerland, India, Vietnam, the US, Libya and Israel.
GABON. And on and on.
Another French ally is toppled.
Gabonese President Ali Bongo was placed under house arrest by military officers on Wednesday, having claimed victory for a third term after elections on the weekend. The Bongo family, close to France, has run Gabon since 1967.
INTELLIGENCE. This is Africa’s eighth coup since 2020. Unlike the most recent putsch in Niger, however, Gabon was no democracy, though it had been a close ally of France, which has 350 troops there. Leaders in neighbouring French-speaking Cameroon and Congo, who have ruled for 40 and 38 years respectively, will be keeping watch, as will the president of nearby Chad, who since 2021 has continued his father’s 31-year French-sponsored rule.
FOR BUSINESS. French firms with assets in Gabon, like Total and Eramet, saw their stocks fall. Other investors, including China and the US Development Finance Corporation – which last month announced $500 million in political risk insurance for a marine conservation bond – will also be asking which country will be next. With oil wealth, OPEC membership and Africa’s fourth-highest per capita GDP, Gabon seemed more stable than most. No longer.
RUSSIA. TURKEY. New Deal.
A Black Sea proposal to ease prices but hurt Ukraine.
Moscow said on Wednesday it would offer an alternative grain deal when Turkish foreign minister Hakan Fidan meets his Russian counterpart Sergey Lavrov in Moscow this week. Erdogan is expected to meet Putin in Sochi next week.
INTELLIGENCE. Under the plan, Moscow would send a million tonnes of grain to Turkey to be processed at a discounted price, with financial support from Qatar. Moscow’s proposal is effectively a way of excluding Kyiv while exporting grain from parts of the country occupied by the Russian army. Meanwhile, US officials are expected to meet with counterparts from Romania and Moldova next week to increase Ukraine's grain exports via the Danube River.
FOR BUSINESS.Ukrainian exporters have been hit from all sides. Earlier this year, despite longstanding rules, the EU allowed five eastern members to impose domestic restrictions on Ukrainian grain and oilseeds to protect their farmers from increased competition. The ban expires next month but will likely be extended. And even if the Danube remains a viable route, the additional expense of shipping grain via river and rail makes it less appealing for farmers.
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SWITZERLAND. Bern the money.
A tax haven toughens anti-money laundering laws.
Swiss authorities announced new corporate transparency measures on Wednesday, including a federal register of beneficial owners, making it harder for criminals and politically exposed individuals to hide their assets there.
INTELLIGENCE. The changes are catching up with broader political shifts. In a deviation from its traditional neutrality, Switzerland joined EU sanctions against Russia last year. Swiss banks are estimated to hold over $200 billion in Russian cash. But Swiss banks have continued to help Russia evade sanctions and export controls, as intimated by US Department of Justice earlier this year when it subpoenaed several Swiss banks including its largest, UBS.
FOR BUSINESS. Despite a raft of recent changes,Switzerland has struggled to shake off its reputation as a hub for dodgy money. International scandals, such as the theft from Malaysian sovereign wealth fund 1MDB, had links to Swiss banks. The collapse of Credit Suisse further sullied the reputation of the so-called gnomes of Zurich among lawmakers. Luckily for the world’s gangsters, there are still other places to go, from the UAE to Panama to Delaware.
INDIA. Comes with the territory.
Delhi is expected to deliver a statement on Kashmir.
India’s Supreme Court on Thursday will consider petitions challenging the controversial 2019 abrogation of Article 370, which stripped Jammu and Kashmir of autonomy and divided the state into two territories under federal control.
INTELLIGENCE. Consolidating Delhi’s authority has been a key election pledge of Narendra Modi’s ruling Bharatiya Janata Party. The imposition of direct rule in 2019 saw the preventive detention of thousands across Muslim-majority Kashmir, including almost all local political leaders. Delhi has struggled to enforce its writ across far-flung and ethnically diverse territories. Beyond Kashmir, it continues to battle an insurgency in the eastern state of Manipur.
FOR BUSINESS. To accelerate Kashmir’s development, Delhi has promoted outside investment, allowing Indians from elsewhere to buy land and claim government jobs in the territory. But thus far, Delhi’s efforts have not improved Kashmir’s security or reputation. Investments have fallen 55% over the past four years. Unemployment stood at 24% at the end of 2022, three times the national average. Kashmir is also the scene of sporadic violence with Pakistan.
With the brevity of a media digest, but the depth of an intelligence assessment, Daily Assessment goes beyond the news to outline the implications.
VIETNAM. UNITED STATES. Hanoi Joe.
The US President will visit Vietnam on 10 September.
The US and Vietnam are expected to announce an upgrade in relations, analysts said after the White House announced a visit by Joe Biden on Tuesday. Vietnam is considering similar upgrades with Singapore and Australia.
INTELLIGENCE. Vietnam has historically viewed its relationship with the US through the lens of its ties with China. Recall Hanoi’s rejection of Washington’s proposal to upgrade the bilateral relationship in 2021, ostensibly to avoid angering Beijing. The US will have to demonstrate its long-term commitment to Vietnam’s security and development. Sweetening the deal with promises to develop high-tech sectors like semiconductor production and AI won’t hurt.
FOR BUSINESS.Vietnam has been seen as a beneficiary of the US-China trade war, but foreign investment has been constrained by capacity issues and many US firms have re-shored closer to home. Vietnam’s GDP rose 3.72% in the first half of 2023, the slowest pace in a decade. The economy faces critical risks, from uncertainty in real estate to delays in policy implementation following a corruption crackdown that felled former President Nguyen Xuan Phuc.
LIBYA. ISRAEL. Communications error.
The perils of backchannel diplomacy.
Libya’s foreign minister was reported to have fled to Turkey on Wednesday, having been suspended on Sunday following a secret meeting with her Israeli counterpart. Benjamin Netanyahu on Tuesday banned his ministers from secret talks.
INTELLIGENCE. The prime ministers of both countries have sought to distance themselves from the “chance and unofficial” talks, which came to light via media reports, though it is unlikely they were in the dark. Regardless, the negative reaction, including riots in Tripoli, will only discourage diplomacy, which is nice among friends, but essential among foes. It may also discourage any quick announcements of a pending deal between Israel and Saudi Arabia.
FOR BUSINESS.The reaction to the meeting, which took place in Rome, is a blow to Italy’s Giorgia Meloni, who hasbeen trying to secure a deal to stop the flow of illegal migrants from Libya to Europe. Despite Libya’s civil conflict and precarious politics, Italy maintains longstanding oil and gas investments. France – a diplomatic and commercial rival in Libya – will enjoy the backlash, particularly as it has suffered so many similar scandals in the region.
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