Connect with us

Global Affairs

US Federal Court Strikes Down Georgia’s Anti-BDS Law Used to Bar Journo Abby Martin From 2020 Event

Voice Of EU

Published

on

US

Get short URL

The Boycott, Divestment and Sanctions (BDS) movement was started by Palestinian activists in 2005 to build international pressure compelling Israel to abide by its human rights obligations under international law, comparing the plight of Palestinians under Israeli rule to Black Africans under South African apartheid.

On Friday, a Georgia federal court struck down a state law banning state contracts with persons or groups engaged in a boycott of Israel. It’s the fourth such ruling by a US federal court in recent years, even as state laws attempting to ban support for the BDS movement continue to proliferate.

The Partnership for Civil Justice Fund (PCJF), a First Amendment legal defense group, announced on Monday victory in their February 2020 case with the Council on American-Islamic Relations (CAIR) against a Georgia law on behalf of independent journalist Abby Martin.

​The suit stems from an International Critical Media Literacy Conference originally scheduled to take place February 28-29, 2020, at the Savannah campus of Georgia Southern University, at which Martin was to have been the keynote speaker. She is the creator of the “Empire Files” documentary series and director of the 2019 film “Gaza Fights for Freedom,” which documents Israeli violence against Palestinian protesters during the 2018 Great March of Return.

However, in her contract, Martin was required by a 2016 Georgia state law to forswear boycotting the state of Israel for the duration of the agreement. An energetic proponent of the Boycott, Divestment and Sanctions (BDS) movement aimed at putting global economic pressure on Israel to change its policies toward Palestinians under its rule, Martin told Radio Sputnik at the time that being asked to sign the agreement was “a complete violation of my right to have my personal convictions” and of “my right to engage in peaceful political protest.”

Martin refused to sign the contract and the event was eventually cancelled. In February 2020, she sued a group of six officials from the University System of Georgia and Georgia Southern University, charging that her First and Fourteenth Amendment rights had been violated.

Court Finds BDS is Protected Speech

According to the court filing viewed by Sputnik, US District Judge Mark Cohen found that Martin’s boycott of Israel is protected speech under the First Amendment and unconstitutionally compels speech by mandating she swear an oath. 

“The certification that one is not engaged in a boycott of Israel is no different that requiring a person to espouse certain political beliefs or to engage in certain political associations,” Cohen wrote, comparing the issue to a questionnaire about whether an applicant had ever been a member of a communist party.

The ruling also called into question – but did not answer – whether “Georgia’s interest in furthering foreign policy goals regarding relations with Israel is a substantial state interest” that could be protected by such a law.

Supporters of the ‘BDS’, Boycott Divestment and Sanctions movement protest for lifting the Gaza blockade and to boycott the 2019 Eurovision Song Contest, outside the venue where the contest final will take place, in Tel Aviv, Israel, Saturday, May 18, 2019.

“I am thrilled at the judge’s decision to strike down this law that so clearly violates the free speech rights of myself and so many others in Georgia,” Martin told Sputnik in a Monday statement.

“My First Amendment [right] was restricted on behalf of a foreign government, which flies in the face of the principles of freedom and democracy. The government of Israel has pushed state legislatures to enact these laws only because they know that sympathy and support for the population they brutalize, occupy, ethnically cleanse and subject to apartheid, is finally growing in popular consciousness – they want to hold back the tide of justice by preemptively restricting the right of American citizens to peacefully take a stand against their crimes,” Martin said.

“As the world watches Israeli aggression continue in Jerusalem, the West Bank and against the population it besieges in Gaza, it has never been more urgent to advance the Boycott, Divestment and Sanctions movement against the Israeli regime. The striking of this law is a necessary and timely opening to build this urgent task.”

When asked if she now plans to hold the event or to hold another event in Georgia more explicitly focused on Israel, Martin told Sputnik: “I do not have plans as of yet to reschedule.”

Widespread BDS Bans Now At Risk

Friday’s ruling joins three other federal court rulings from recent years that also found boycotts of Israel to be protected speech.

As of May 2021, 35 of 50 US states have passed bills or executive orders intended to interfere with boycotts of Israel. While some are aimed at contracts with BDS proponents, as Georgia’s law is, others target businesses that refuse to do business in Israel, including those that specifically refuse to do business in Israeli settlements in the West Bank and East Jerusalem, Israel’s occupation of which the United Nations has deemed illegal under international law.

The most recent, signed into law last month by West Virginia Governor Jim Justice, a Republican, claims the Appalachian state “has an economic and a humanitarian obligation to denounce and reject the Boycott, Divestment and Sanctions Movement against Israel, and to prevent the state or any of its instrumentalities from contracting with companies that engage in the movement.”

While proponents of such bans claim they are fighting anti-Semitism by defending a state ostensibly founded to protect the Jewish people from another genocide, supporters of BDS say their efforts are directed at the policies of the Israeli state and not against the Jewish people as a whole, and they compare BDS to the international boycott movement against South African apartheid that eventually forced the end of white Boer rule over Black Africans in that country in 1994 and the creation of a multi-ethnic democracy.

In May of last year, the British Supreme Court also ruled in favor of the Palestine Solidarity Campaign, striking down government regulations preventing Local Government Pension Schemes from divesting from companies that profit from Israel’s alleged human rights violations in the West Bank, East Jerusalem, and the Gaza Strip.



Source link

Global Affairs

Environment: Colombia and the new Latin American left | Opinion

Voice Of EU

Published

on

After the victory of president-elect Gustavo Petro and vice-president-elect Francia Márquez in Colombia, many have concluded that we are entering a new leftist wave in Latin America. But simply announcing the rise of a new left is more confusing than it is illuminating. New in what sense? In comparison to what? What distinguishes it from others? Who are its members? Without answers to these questions, Latin America’s political moment cannot be understood, and one risks stating the obvious (that the left is new because it is recent) or randomly grouping together very different movements and governments.

What is new about the new left?” is a question that surfaces from time to time. The last “new left” (which, of course, it is no longer) was the pink wave at the beginning of the century. As I wrote at the time in a book entitled, predictably, The New Latin American Left, it was the wave led by Lula’s Brazil and swelled by other governments that would follow very different paths, from the progressive democracy of Tabaré Vásquez and Pepe Mujica in Uruguay to the authoritarian disaster of Hugo Chávez and Nicolás Maduro in Venezuela, as well as governments as diverse as those of the Kirchners in Argentina, Evo Morales in Bolivia, and Rafael Correa in Ecuador.

I think that what is new and distinctive of the progressivism that won this year in Colombia and Chile is precisely what all those left-wing governments lacked: an environmental agenda and economic policies that understand that fossil fuels and extractive industries are the past. And that there is no future, neither for the left nor for anyone else, on an uninhabitable planet. Despite the profound differences among the leftist governments of the last two decades, all of them shared with right-wing governments the enthusiastic promotion of extractive industries, from oil and coal to mining and agribusiness.

In Brazil, Lula and Dilma Rousseff ended up fulfilling the military dictatorship’s dreams of opening up the Amazon to monumental hydroelectric dams like Belo Monte, to feed energy to mining projects throughout the region. In Bolivia, former vice-president Alvaro García Linera went so far as to publish a defense of extractivism in the Amazon. Rafael Correa was even more explicit: he referred to Indigenous peoples and environmentalists who opposed his policies of aggressive expansion of oil and mining in Ecuador as the “infantile left.” The aberrant case of Venezuela belongs to a different category: “21st century socialism” not only maintained oil dependence, but used it to finance what ended up being a “dictatorship of the 21st century,” as Provea, the well-known Venezuelan NGO, has called it.

The extractivism of the left was due, in part, to reasons of convenience. The pink wave overlapped with a period of record prices for commodities. The resulting hard currency financed exemplary social policies in several countries, such as the Zero Hunger and Bolsa Familia programs in Brazil. In part, however, it was due to sheer conviction. Even today, important sectors of the left, such as the López Obrador government in Mexico, tend to see oil and mining exploitation as indisputable pillars of national development and sovereignty—and environmentalism as a naïve movement, at best, or as an instrument of the rich countries, at worst.

But much has changed in the last twenty years. Today we are living the reality of climate change and know that we have less than a decade left for governments to take urgent action to avoid the most catastrophic scenarios of global warming and the irreversible destruction of vital ecosystems such as the Amazon. We understand that human health and the health of the planet depend on national policies and international agreements to protect biodiversity in at least 30% of the Earth by 2030. Finally, we know that Latin America would suffer disproportionately from the effects of environmental collapse, such as forced migrations, economic and food crises, and social conflicts.

If it is to deserve the label “new,” the left in power would have to rise to this new planetary moment. And follow the momentum of the progressive movements that embody it and that were essential to the electoral outcome in Colombia, as shown by the iconic figure of vice-president-elect Francia Márquez: the Black and Indigenous movements, the urban environmentalism of young people, ecofeminism, the small farmers’ movements.

At a time when the global right seems to bet on the destruction of the planet (Bolsonaro, Modi, Putin, etc.), the left should distinguish itself not only by its social agenda but also by its environmental agenda. Abandoning extractivism and moving towards clean economies is not irresponsible, as critics suggest, but indispensable. This seems to be the view of the environmental progressivism that is emerging in Colombia and Chile. Petro and Márquez’s proposals contemplate a gradual and fair transition to reduce the historic dependence on oil and coal, among other measures. Chilean President Gabriel Boric’s government promised a “just socio-ecological transition” and has just shut down the Ventanas copper smelter, an emblem of mining pollution.

Thus, the first leftist government in Colombia may have regional and global repercussions. An initial sign of this turn was the first conversation between Petro and President Biden, which included a possible alliance on climate change and Amazon conservation. If accompanied by a shift to the left in Brazil (where it remains to be seen whether a possible Lula government would abandon the extractivist tradition) and adequate funding from wealthy countries that have polluted the most, the proposal of Latin American environmental progressivism could contribute not only to the consolidation of a new left, but also to the preservation of life on the planet.

Source link

Continue Reading

Global Affairs

More than 5,000 people are missing in Balochistan. I want my father back | Sammi Deen Baloch

Voice Of EU

Published

on

I started protesting after my father, Dr Deen Mohammed Baloch, was abducted from his hospital in Khuzdar, Balochistan, on 28 June 2009. I became an activist, raising my voice against the heinous crime of enforced disappearances: more than 5,000 people are missing in Balochistan.

In the 13 years since my father was taken, I have spent most of my time on roads, in front of journalists’ press clubs across Pakistan – with a photograph in my hand, asking a simple question: “Where is my father? What is his crime?”

Enforced disappearances in my home province is a decades-old issue, from when the Balochistan nationalist movement began in the early 2000s.

In 2014, I, along with other relatives of missing people, marched 2,000km (1,200 miles) over 116 days from Quetta to the capital, Islamabad. As a 15-year-old, with my swollen feet, I thought going to the capital would make those in power have some mercy. I was wrong.

My mother does not know whether she is a widow or still married. We deserve to know the truth – whether my father is alive or dead.

If my father is alive, he should be released or brought to a court of law. If he has been killed, we should be given proof.

I have spent 13 years in this struggle to know the truth but I have never been as humiliated, harassed, beaten and verbally abused as I was at our recent peaceful protest in Karachi.

One police man grasped my hand forcefully and another held me by the neck. I felt as if my bones were going to be fractured.

My sister, Mehlab Baloch, was slapped three times. Bakhtawar, a fellow activist who was filming, had her phone snatched by the police. She was dragged along the road. This was all caught on camera and the video widely shared.

Police mocked us after throwing us in their van. We were warned not to protest or else they would “drag and beat us” more.

The police told me: “You think you are a leader and are at the forefront. We will teach you a lesson.”

Our headscarves were removed. The officers threatened us by saying to each other: “Once their shalwars [trousers] are removed, then they will stop protesting.”

Protesters march holding placards. One says: ‘Murder of Karima Baloch is the continuation of Baloch genocide’
A protest at the murder of Karima Baloch, a leading Pakistani human rights activist living in exile in Canada who was found dead in 2020. Photograph: Rahat Dar/EPA

They called us disgraced women, accusing us of protesting to win fame and to appear in the media.

We were released at about 2am.

The state and its security agencies have responded to the separatist movement with a “kill and dump” policy and are forcefully disappearing students, lawyers, doctors, political activists and their sympathisers.

Last year, I, along with other representatives of missing persons’ families, met the former prime minister Imran Khan, who was a critical voice on the issue before coming to power. Khan now seems to be a toothless tiger.

His human rights minister, Shireen Mazari, introduced a bill against enforced disappearances. The irony was that the bill itself went missing.

Now, after losing power, Khan’s party is once again denouncing enforced disappearances.

In the same way, Maryam Nawaz, [vice-president of the Pakistan Muslim League-Nawaz, then the main opposition party], visited us last year and criticised Imran Khan for his false promises. She assured us that action would be taken if her party came to power.

Nawaz’s uncle, Shehbaz Nawaz, is prime minister now but they seem helpless before the security agencies.

Women’s organisations in Pakistan do not raise their voices for Baloch women and the violence against us. This is saddening.

We come from respectable families and we are not happy to be demonstrating on the streets. Our men have disappeared – that’s why Baloch women, from a conservative province, are coming out of their homes to protest.

I would rather focus on my career like other young women. But how can one if your father, husband or brother is missing?

In April, there was a female suicide bomber, Shari Baloch. Since then the state has cracked down against activists, students and women, saying that we are all terrorists.

We have nothing to do with such violent activities. We don’t support violence.

I am not demanding anything unlawful – enforced disappearance is unlawful. I just want my father back.

Am I asking for something illegal? The state may portray us as terrorists after Shari’s attack but we are not. We are peaceful protesters. We suffer every moment of every day.

Sammi Deen Baloch is general secretary of the Voice for Baloch Missing Persons (VBMP), a group that formed alongside the separatist movement in Pakistan

Sign up for Her Stage to hear directly from incredible women in the developing world on the issues that matter to them, delivered to your inbox monthly:

Sign up for Her Stage – please check your spam folder for the confirmation email



Source link

Continue Reading

Global Affairs

Inflation: As the global economy deflates, here is what the coming crisis looks like | Economy and Business

Voice Of EU

Published

on

Last October, during the presentation of its World Economic Outlook, the International Monetary Fund (IMF) stated that “the global recovery is underway despite the resurgence of the pandemic.” The world’s growth was expected to be 4.9% in 2022.

In January of this year, however, the IMF’s projection for global GDP growth was lowered to 4.4%. In April, it was cut even further, leaving it at 3.6%, mostly as a result of the economic damage inflicted by the war in Ukraine.

Inflation – which already spiked at the end of 2021 due to rising employment and growing demand after the restrictions imposed by Covid-19 – has run amok to levels not seen in 40 years, mostly due to supply chain bottlenecks and the sharp rebound in energy costs. What was initially seen as a transitory situation has taken root, as the armed conflict in Ukraine stalls and second-round inflationary waves arrive.

Last year, to curb inflation by shrinking the money supply, the main central banks drew up a roadmap for the gradual withdrawal of economic stimulus, while still keeping interest rates low to give investors and borrowers breathing room in the post-pandemic years. This strategy of slowly increasing the price of money and shrinking federal balance sheets was laid to waste by Putin’s invasion. The Federal Reserve, the Bank of England and the European Central Bank have been forced to give a sharp turn and accelerate interest rate hikes to try and stifle burgeoning inflation, by slowing the levels of borrowing and consumer spending.

In a world addicted to liquidity since the response to the 2008-9 Great Recession, a much tighter monetary policy is a heavy blow to growth prospects. In addition to rising prices and interest rates, the world will now likely have to contend with higher unemployment. However, each region has its own peculiarities. In the following reports, we analyze the situation of the world’s four major economic zones.

Nord Stream 2 gas pipeline in Lubmin (Germany).
Nord Stream 2 gas pipeline in Lubmin (Germany).Michael Sohn
EUROPEAN UNION

The euro zone walks a tightrope again

LLUÍS PELLICER

The European economy is walking along a narrow tightrope, trying to maintain its balance in the face of two tumultuous forces: rising energy prices and declining growth. Both are intensifying as the invasion of Ukraine continues.

Everything indicates that Southern Europe is preparing to shine this summer, with its coastlines well-populated after two years of restrictions. However, the recovery may skid due to a number of factors: the escalation of the war, the supply-chain bottlenecks created by China’s intense lockdowns, or the tightening of monetary policy. The European recovery fund – endowed with €800 billion until 2027- will be a necessary buffer in the coming months.

“Everything indicates that we are going to have a good summer, but in September it can change. We are going [through] a stage in which we are going to have higher prices and weaker growth,” says María Jesús Valdemoros, a lecturer in economics at the University of Navarra in northern Spain.

The main risk to the recovery is if Putin cuts off the gas supply to Europe. The European Central Bank (ECB) estimates that this would weigh on economic growth in the eurozone, so that it would grow only 1.3% in 2022 and contract by 1.7% in 2023, while inflation would increase even more than the 8% currently registered. Just a week ago, the German government was forced to raise its alert level due to the forecast of not being able to fill gas tanks by autumn. And therein lies the main fear of Frankfurt and Brussels: that Germany will enter a recession and drag down the rest of its partners.

The influential Munich-based Ifo Institute for Economic Research does not foresee that this extreme will occur, but it notes that all the blows received as a result of the war in Ukraine and the lockdowns in China are going to cost Germany 1.5% of GDP. In a normal year, the agency maintains, the country would have already entered a recession.

Faced with this situation, the ECB has debated between raising rates – despite the risk of strangling growth – or maintaining a more lax policy with the threat that prices will continue to skyrocket. For now, it has decided to raise its key interest rates by 0.25% in July and probably 0.50% in September.

For the inflation “hawks,” the Eurobank is too late, especially when the rest of the central banks have been raising rates for months. The “doves,” with the memory of the ECB’s ill-timed rate hikes that curbed recovery efforts in 2011, fear that a hasty increase will cause an economic slowdown… especially if there is yet another external blow, whether it comes from Moscow or Beijing.

As a precaution, several EU governments have acted to cushion their populations from inflation. For instance, Spain has given out bonuses for the most vulnerable workers and reduced the price of transit passes. However, international institutions, from the IMF to the European Commission, are asking for financial reserves to be rebuilt. And, with Germany at the forefront, some governments are warning about overspending.

“It is time to get out of [such] policies. Inflation is high and governments should not make it continue to grow through spending,” says Clemens Fuest, president of Ifo. “It’s a bad decision.”

Forecasts indicate that there are many risks that cloud growth. “Households are seeing their income reduced. Real wage growth has been negative for two consecutive quarters,” said Christine Lagarde, president of the ECB.

There is a possibility that the clouds will dissipate, if, say, the war in Ukraine were to end. But in the event that hostilities continue and the economic battle between Brussels and Moscow persists, it remains to be seen how high energy prices will rise, how far governments can go and when the central banks will run out of cash.

Jerome Powell, Chairman of the Federal Reserve.
Jerome Powell, Chairman of the Federal Reserve.Kevin Dietsch (AFP)

UNITED STATES

Rising prices stop the country from reaching full employment

MIGUEL JIMÉNEZ

Job offers are obvious throughout the nation’s capital: in the windows of banks, clothing stores, supermarkets, movie theaters. It is estimated that, in the United States, there are twice as many vacancies as there are unemployed individuals. The country is nearing full employment. And yet, the economic situation has sunk the popularity of President Joe Biden and threatens his party’s control of the Senate and the House of Representatives in the November midterm elections. Blame it on inflation.

Prices have risen 8.6% in the past year – the biggest increase in four decades. But the daily reminder to Americans that prices are skyrocketing is the cost of fuel. Gasoline has increased in price by more than 60%. On average, it costs about $5 per gallon. There are places where it’s around $8. Furthermore, inflation has entrenched itself and spread to more and more products, from grocery aisles to hotels.

Federal Reserve Chair Jerome Powell has vowed to stabilize prices, even if it comes at the cost of a recession. What he is looking for is a so-called “soft landing,” or to control inflation without the economy contracting and unemployment skyrocketing. In his last Senate appearance, Democratic Senator Elizabeth Warren snapped at him: “You know what’s worse than high inflation and low unemployment? It’s high inflation and a recession with millions of people out of work.”

Powell himself admits that his wiggle room for a soft landing is slim. The Federal Reserve has already made three rate hikes, the last of them being 0.75 points. This is the largest increase since 1994. By the end of 2022, the rates will be between 3% and 3.5%, and next year close to 4%, according to the Fed’s projections. The withdrawal of liquidity will slow down the economy.

Will this lead to recession? “It is not what we are looking for, but it is a possibility,” was Powell’s response before the Senate.

Last week, the IMF lowered its growth forecasts for the United States from 3.7% to 2.9% this year and from 2.3% to 1.7% for the next. It is expected that in 2024, growth will be a mere 0.8%.

“The most likely outlook is very weak growth and persistently high inflation. We see about a 40% chance of a recession next year,” says Ethan S. Harris, global economist at Bank of America Securities.

Recession or not, economic malaise is already palpable. A report published in June indicated that 36% of those who earn more than $250,000 a year (four times the median salary) live paycheck-to-paycheck. If a significant part of the most privileged echelon feels that they can barely make ends meet, it is easy to imagine how the rest of Americans are doing.

Lines in London during the latest public transit strike.
Lines in London during the latest public transit strike.Chris J. Ratcliffe (Bloomberg)
UK

The City sees dark clouds

RAFA DE MIGUEL

After the Bank of England’s (BoE) warning last May that the UK economy would enter a slight recession at the end of 2022, the hard-right of the Conservative Party demanded that the Prime Minister lower taxes. This year, public sector workers have called strikes throughout the summer to demand salary increases compatible with galloping inflation nearing double digits.

Both PM Johnson and Chancellor Rishi Sunak have been trying to contain pressure from their party and the general population, to avoid further aggravating inflation with lower taxes or exorbitant wage increases.

“What is most worrying is that this inflation has been concentrated in what could be called basic goods,” said Andrew Bailey, Governor of the BoE. “Basically, energy and food.”

This is to say that the crisis, above all, affects the poorest citizens. Although the BoE suggests that there could be a modest recovery by early 2023 – thus avoiding two consecutive quarters of GDP decline, or the technical definition of a recession – it is anticipated that the UK will see growth decline next year by 0.25%.

The average price per household for gas and electricity shot up almost €800 in April, and it will reach more than €3,000 (annually) by October. In May, the government approved a 25% windfall tax on the profits of oil and gas companies. Much of this tax was intended to finance single-payment subsidies to millions of households, between €400 and €1,000, to meet the exorbitant cost of living.

The BoE, like other central banks, has reacted late, but with impetus. So far this year, interest rates have already risen to 1%. Focused on combating inflation, the looming economic storms have not been reason enough for the monetary authority to relax its drastic decision. “I am aware of the harsh consequences this will have for many people, particularly those with lower incomes and little savings,” Bailey admitted after announcing the decision. It will now be harder for small and medium-sized businesses to borrow and expand, and for consumers to pay off credit cards and loans.

Johnson now faces a three-pronged problem: voters angry with the galloping rise in prices; some MPs, desperate to keep their seats, demanding lower taxes; and exhausted public accounts after two years of pandemic spending.

A woman passes a coronavirus control in Beijing on June 28.
A woman passes a coronavirus control in Beijing on June 28.THOMAS PETER (REUTERS)
CHINA

The dragon’s ailments grow

MACARENA VIDAL LIY

Chinese Premier Li Keqiang’s meeting with officials on May 25 was unusual because of its size—nearly 100,000 local officials participated in the video call—but also because of his frankness. The head of government acknowledged that the difficulties facing the second world power’s economy are more serious than in the worst moment of the pandemic, when it contracted for the first time in 30 years.

A lethal combination of lockdowns in some of the country’s major cities – including the closure of Shanghai, its financial heart, throughout April and much of May – the war in Ukraine and the crisis in the real estate sector left alarming numbers in April. Most analysts have downgraded their growth prospects for the Asian giant this year. Few, even within official circles, believe that the government’s objective of a GDP increase of around 5.5% for 2022 will be met. The World Bank calculates 4.3%. Other entities, such as the Swiss UBS, forecast 3%.

Consumer confidence has suffered a severe blow. In April, retail sales fell by 11.1%; in May, by 6.7%. Even the consumption of cosmetics has decreased, products that have never stopped seeing their sales grow since China entered the World Trade Organization 20 years ago. Youth unemployment stands at 18.4%, well-above the average of the European Union (13.9%) or the United States (7.8%). The entry of 10.76 million recent college graduates into the market this summer will grow that number even further.

Experts say that the massive confinements, together with constant PCR testing, are mainly responsible for this economic anemia. “The only predictable thing about China right now is its unpredictability, and that is poison for the business climate,” said Bettina Schoen-Behanzin, the VP of the European Chamber of Commerce in China, at the presentation of her institution’s annual report on the confidence of European companies in the Asian country. Sixty percent of the companies included in the report said that doing business in China had become more difficult, and 49% cited Covid among the three main reasons why.

So far, Beijing has introduced relatively modest stimulus measures, including tax breaks for small and medium-sized businesses and increased spending on infrastructure. The most recent data is beginning to show some bright spots: for instance, industrial production for May grew by 0.7%, after a 3% contraction in April. But analysts from Nomura Holdings note that although the reopening of cities “has raised optimism in the short-term, we do not see it as a change in trend, given that the Covid-zero policy will continue until the beginning of 2023.” Possible risks in the coming months are new lockdowns to stem Covid outbreaks, drastic corrections to support the weakened housing market, or problems related to the high debt of local governments.

Although performing below original forecasts, and far from repeating the driving role it played in the 2008 financial crisis, the Chinese economy will continue to grow. “China is not going to enter a recession,” says Alicia García-Herrero, chief economist for Asia at the investment bank Natixis. Neither “is it going to be a source of global recession, but it will be a source of slowdown, to which it contributes to the extent that it does not grow as much as its potential.”

García-Herrero also notes that China is helping to export inflation to the rest of the world. The Beijing government has imposed restrictions on the export of items such as fertilizers and some steel products; the subsequent shortages have triggered international price increases.

“This is an additional source of tension, given that China exports a third of the world’s intermediate goods,” she warns.

Source link

Continue Reading

Trending

Subscribe To Our Newsletter

Join our mailing list to receive the latest news and updates 
directly on your inbox.

You have Successfully Subscribed!