Israel, Palestine: I will repay.
Also: the US, China, Ukraine, Russia and Central Asia.
ISRAEL. PALESTINE. I will repay.
Calls for restraint miss the point.
Israel ordered a full siege of Gaza on Monday, with "no electricity, no food, no fuel." Hamas on Monday said one hostage would be executed for every Israeli strike. The UN, China, Russia and others urged both sides to "exercise restraint".
INTELLIGENCE. The tragedy is that Netanyahu must strike and strike hard. Poverty-stricken Gazans are already suffering, and further attacks will only make things worse, but no elected official – let alone one with his back to the wall – can answer the murder, kidnapping, and rape of civilians with a turn of the cheek. The UN Secretary-General's condemnation of the siege was expected, but as with most UN statements on Israel, it will be ignored.
FOR BUSINESS. Things will get worse before they get better. As Hamas intended, a cycle of recrimination has been unleashed, which will take time to burn out. The danger is whether Hezbollah in Lebanon and Iranian proxies in Syria will choose to escalate. In the meantime, flights to Ben Gurion will resume as will gas platforms. Workers are returning post-Sukkot. The TA-35 share index has stabilised. Netanyahu’s future is uncertain, but atonement will be made.
Written by former diplomats and industry specialists, Geopolitical Dispatch gives you the global intelligence for business and investing you won’t find anywhere else.
UNITED STATES. The third man.
An independent candidate who revels in third-rail issues.
Robert F Kennedy Jr, an outside Democratic challenger, said on Monday he would compete for the presidency as an independent. Despite his famous family, RFK has branded himself as an outsider known for conspiratorial views.
INTELLIGENCE. RFK practices a paranoid style of American politics more associated with the Republican fringe than his family’s establishment liberalism. His candidacy may thus syphon off more votes from Donald Trump than from Joe Biden. Yet a growing number of voters are fed up with the major parties and are clamouring for a ‘No Labels’ candidate. If RFK can break out of his social media bubble and into the mainstream, his campaign bears watching.
FOR BUSINESS. RFK has little chance of being elected, but his involvement could upset electoral college arithmetic in key states. In turn, it could force Biden to adopt more populist positions and rhetoric. Unlike Trump, who is mired in legal controversy but continues to lead in national polls (insofar as they are useful at this stage), RFK is a harder candidate to attack. So far, he has been ignored by the Democrats, but this approach may prove difficult to maintain.
With the brevity of a media digest, but the depth of an intelligence assessment, Daily Assessment goes beyond the news to outline the implications.
UNITED STATES. CHINA. Easing tiger.
Tensions cool across the Pacific and across the Strait.
Xi Jinping on Monday told Chuck Schumer and five other senators Sino-US ties would impact the “destiny of mankind”. Taiwan's president said Taipei wanted “peaceful coexistence” with the mainland, in a National Day address on Monday.
INTELLIGENCE. In contrast to Nancy Pelosi's visit to Taiwan in 2022, Schumer's delegation struck a conciliatory tone with Beijing. Mollifying remarks from Taipei are meanwhile easing tensions after last month’s escalatory military drills. Ahead of November’s APEC meetings, where Biden hopes to meet Xi, the US wants to clear the air. Ahead of January’s elections, Taiwan's ruling party is finding that separatist rhetoric is increasingly a turnoff to nervous voters.
FOR BUSINESS. With a battle to secure a third term, Taiwan's Democratic Progressive Party faces a mainland-friendly Kuomintang – which on Monday revealed talks to join up with the third-ranking Taiwan People's Party – and the billionaire owner of Foxconn, Terry Gou. Gou is the island’s biggest investor in China and has teamed up with feminist icon Lai Pei-hsia as running-mate. Buoyed by its tech sector, Taiwan's TAIEX index is outperforming most markets.
UKRAINE. RUSSIA. Setting the table.
In crisis, some see an opportunity for negotiations.
UN officials visited Moscow on Monday for talks on global access to Ukrainian and Russian grain and fertiliser. Italy's defence minister told Corriere della Sera on Sunday that Rome was actively exploring a diplomatic solution to the war.
INTELLIGENCE. Rome has made no secret of growing fatigue with the war, but a hint of peace talks is significant in that Italy, a G7 member, has more credibility with Washington than other would-be negotiators. Kyiv will resent any deal that loses it territory, but recent crises in Congress and Israel may leave it little choice. Volodymyr Zelensky replaced Ukraine's Territory Defence Force chief on Monday, a month after replacing his defence minister.
FOR BUSINESS. Kyiv claimed headway in its eastern and southern theatres on Monday, but the overall picture looks grim. Moscow too is suffering – the ruble hit an 18-month low on Monday (albeit due to a global move to greenbacks) – but its war economy appears resilient. And despite recent deals with Iran and North Korea, its defence industrial base remains strong. An armistice would be distasteful to both sides but could be the best of bad alternatives.
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CENTRAL ASIA. RUSSIA. The pipes are calling.
New Eurasian infrastructure projects take shape.
Vladimir Putin joined his Kazakh counterpart on Saturday to launch gas supplies to Uzbekistan. Azerbaijan's president on Saturday welcomed Georgia’s peace efforts with Armenia and hinted at an energy corridor to the port of Anaklia.
INTELLIGENCE. With Europe unlikely to reprise its dependence on Russian pipeline gas, irrespective of what happens to Ukraine, Moscow is examining alternative routes through which to earn revenues and cement influence. Gazprom made its first LNG shipments to China via the Arctic last month, and a multi-modal corridor has opened to the Indian Ocean via the Caspian Sea and Iran. But as with the Soviet Union, pipelines are the Kremlin's preferred carrier.
FOR BUSINESS. Plans to export and commingle Russian energy via Kazakhstan and the Caucasus are one thing, but Moscow's greater aim is to finalise the Yamal pipeline to Beijing. If built, this would have the capacity of the erstwhile Nord Stream 1 pipeline to Germany and could displace costlier LNG. Once a pipedream, the post-sanctions economics now stack up. Turkey has meanwhile begun connecting its grid to the Azeri exclave of Nakhichevan.