Taiwan, China: Happy families
Also: Israel, Palestine, the EU, the US, and Sudan.
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TAIWAN. CHINA. Happy families
Xi Dada meets Taipei’s Ma.
Xi Jinping said nobody could prevent the "family reunion" Wednesday as he met Taiwan’s former president Ma Ying-jeou in Beijing. Ma last met Xi in 2015 before the independence-leaning government of Tsai Ing-wen took charge.
INTELLIGENCE. Ma’s Kuomintang Party, which wants reunification, at least on paper, controls Taiwan’s parliament and is supported by many in business, which relies on Chinese labour and demand. While Ma’s visit carries no official status, for either Taipei or Beijing, it is thus a key signal of attempted rapprochement before her successor and deputy, Lai Ching-te, takes power in May. Wanting to draw attention from Ma, Lai announced his new premier on Wednesday.
FOR BUSINESS. Lai’s cabinet will led by Democratic Progressive Party chair Cho Jung-tai. Reflecting the views of Taiwanese who voted on service delivery and living costs, not claims of independence, Cho is expected to appoint moderates to key portfolios. For Taiwan’s firms, not enraging China is not just a preference, but key to their competitive advantage – a meeting place of China and the West. Everything else, including IP, can be done elsewhere.
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ISRAEL. PALESTINE. Unhappy families
For its key protagonists, the war gets personal.
Joe Biden promised "ironclad" support for Israel Wednesday despite describing its policies on Gaza Tuesday as a "mistake". Three of Hamas leader Ismail Haniyeh sons, and four of his grandchildren, were killed on Wednesday.
INTELLIGENCE. Haniyeh, who lives in the Doha Ritz-Carlton and is said to be worth $4 billion, runs Hamas's political wing. Yahya Sinwar and Mohammed Deif, located somewhere in Gaza, run the organisation's military operations. Still, the deaths will shake Hamas's leadership and colour their approach to hostage talks, if there's still any viability. A final assault on Rafah in Gaza’s south otherwise appears almost inevitable, as do Iranian reprisals on Israel.
FOR BUSINESS. Biden’s hedging on Israel can be explained by politics but makes for poor signalling. Iran is looking for signs of weakness. China is looking for how domestic debates determine strategic choices (as is also happening in Ukraine). The best solution for both Israel and Washington may be to use the political cover of Iran’s threats to justify the strategic objective of ongoing Israeli aid. But whether this helps Biden’s election chances is another thing.
EUROPE. Migrant headache
The EU votes on a border pact that will satisfy no one.
The European Parliament narrowly passed laws Wednesday to reform the bloc's migration and asylum system after years of debate. The ten legislative texts were backed by the body's chief centre-left and centre-right factions.
INTELLIGENCE. The border pact is overdue, and needed to be passed before parliamentary elections in June, but it will please few. NGOs and the left say it undermines basic human rights. Eastern European members and the right say it represents little change to the EU’s Swiss-cheese approach to migration. The move is another reason to expect a further swing to the political extremes, which will undermine pragmatic decision making for yet another decade.
FOR BUSINESS. The EU's move came as Rishi Sunak met with Rwanda's Paul Kagame, promising to begin their deportation deal within "weeks". Sunak will hope it works as Europe's border security is Britain's border security, and the EU's migration crisis is unlikely to end. Migrants have drowned in Greece and Djibouti in recent days. Cyprus has sought help to curb arrivals from Syria. Brussels last week warned troubles in Niger could lead to another wave.
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UNITED STATES. Cost management
Inflation threatens to outprice other debates.
Stocks fell Wednesday as rate cut hopes faded after a surprisingly strong acceleration in consumer prices to 3.5% year-on-year in March. Core inflation has moderated since September, but including food and energy it remains elevated.
INTELLIGENCE. With a lower chance of a pre-election rate cut, and his inflation reduction agenda in question, Joe Biden will be forced to take more drastic measures, such as wholesale tuition debt relief, to support his re-election. After seeing the political debate turn back to abortion, on which the Republicans are trailing, high prices are a talking point that supports Donald Trump. Coupled with illegal migration, which is adding to demand, it’s a heady mix.
FOR BUSINESS. A majority of polls now show Biden beating Trump, but on a swing state basis, and considering the direction of key issues, it would appear for now this is an election that is Trump's to lose. Few forecasts are ever accurate this far out from election day, but many firms and governments are preparing for a Republican White House and Republican Senate, irrespective of the former president’s legal issues and the Democrats’ fundraising advantage.
SUDAN. Iran to the rescue
Tehran is helping turn a war (slightly) in the West’s favour.
Washington said Wednesday it would seek an extra $100 million for Sudan ahead of a donor conference on 15 April. Only 5% of funds sought have been raised. Over 10 million minors have been caught in the war, Save the Children said.
INTELLIGENCE. Amid an array of humanitarian disasters and geopolitical crises, Sudan’s civil war stands out. And though there are no good guys, the less-worse side, the Sudanese Armed Forces, is receiving a boost that no amount of Western aid has matched: Iranian drones. With the opposition Rapid Support Forces backed by the UAE and the Khalifa Haftar regime in east Libya, Tehran seeks to balance the ledger, and potentially gain assets on the Red Sea.
FOR BUSINESS.Awkwardly for Tehran, Russia is fighting on the other side, though it does so at arm’s length via the remnants of Wagner Group. Moscow has meanwhile kept a level of dialogue going with the SAF in Khartoum, with whom it previously arranged to secure its own Red Sea base (and may do so again). This illustrates the reality of most wars, in that they are waged over specific and changeable interests rather than ideology, kinship, or theme.