Cuba has announced new incentives to attract Russian investment into its economy, including offering land to Russian businesses for 30-year terms and permitting the repatriation of profits. In recent months, Cuba has sought investment from politically aligned nations to help recover its economy, which has been battered by sanctions from the US and the inefficiencies of its state-run sector, as well as Covid-19. Russia has similarly sought to boost economic ties with Latin American nations opposed to what it sees as US hegemony.
As the Group of 7 summit opens today, global leaders will discuss how to keep the international economy stable amidst growing uncertainty. Two major issues on the agenda are Ukraine and China. However, the most pressing threat to the global economy may be the US economy. With less than two weeks remaining to pay its bills, a default would jolt its own economy and those of the other G7 countries. In an attempt to address the issue at home, President Biden has cancelled the second part of his planned trip, which included visits to Papua New Guinea and Australia. Analysts warn that fears of an unreliable and dysfunctional America will be revived in that region where the US has only recently started to rebuild trust and momentum.
Ukraine and Russia have agreed a two-month extension to the wartime Black Sea Grain Initiative deal, which expires on Thursday, marking a rare example of cooperation between the two nations. The agreement enables Ukraine to ship grain across the Black Sea, subject to inspection off the coast of Istanbul, along a corridor past Russian naval vessels that have blockaded Ukraine's ports since the onset of Russia's full-scale invasion 15 months ago. The deal also serves President Recep Tayyip Erdogan of Turkey who acted as an intermediary, by averting a food price spike in the run-up to the country's presidential runoff.
Air raid alerts sound across Ukraine, military warns of strikes in central regions
Reuters
23-05-18 01:49
Air raid alerts were sounded throughout Ukraine and the country was warned of possible missile strikes by Russia in some parts of central Ukraine early on Thursday. Telegram channels from the country's military issued warnings for regions including Vinnytsya, Kirovohrad, Cherkassy and Dnipropetrovsk, while other channels warned of possible strikes in Poltava in the central region and Mykolaiv in the south.
Ukraine's foreign minister has told a high-level Chinese envoy that Kyiv will not accept any proposals to end the ongoing war with Russia that could lead to Ukraine losing territory. Dmytro Kuleba also said that "just peace" could only be restored if "respect for the sovereignty and territorial integrity of Ukraine" was observed. Li Hui, China's special representative for Eurasian affairs, was in Kyiv to promote Beijing-led negotiations to resolve the conflict and is now expected to visit Moscow to discuss a possible political solution to the conflict.
Leaders of the G7 countries – the US, Japan, Germany, France, the UK, Italy and Canada – face several challenges as they gather in Hiroshima. The global economic outlook is unstable, while Russia continues its actions in Ukraine and China expands its economic and strategic growth. The G7 will need to address several issues, including enlisting middle countries such as those in Africa, and addressing China without creating undue confusion. Moreover, with concerns around nuclear proliferation and use re-emerging, the monitoring architecture of nuclear arsenals needs to be maintained to avoid future use of nuclear weapons. Finally, as global temperatures continue to rise and heatwaves become deadlier, coordinated responses and the regulation of cryptocurrency will become increasingly important.
Column: Investors favor Japan's rising sun over China's fading star: McGeever
Reuters
23-05-18 00:21
Bank of America's latest surveys, reissued Wednesday, shows investors both in favour of Japanese equities and selling off Chinese assets amid changing economic fortunes for both countries. While Japanese stocks are now at levels not seen for over 30 years, Chinese assets - particularly bonds - are falling out of favour among investors as the country's economic growth slows.
Shelling in eastern Ukraine has caused civilian casualties on both sides of the conflict. Three civilians were killed when Russia shelled a village in the Kherson region, while in the city of Donetsk, shelling by Ukrainian forces resulted in five deaths. Accusations continue to fly between the two sides as to where the strikes landed. The conflict between pro-Russian separatists and Ukrainian forces in Eastern Ukraine has been ongoing since 2014 and, over the past few weeks, there have been concerns that both sides were building up forces for a possible escalation.
Explosions were reported in central and southern Ukraine, including the capital, Kyiv, on Thursday after air raid sirens sounded across the country. Missile attacks in central Vinnytsia and the death of one person in a strike on an industrial facility in Odesa were among other incidents reported. China's special envoy for Eurasian affairs, Li Hui, has confirmed there is no remedy to the conflict and called for Kyiv and Moscow to engage in talks to end the war. Meanwhile, Joseph Borrell, the European Union's foreign policy chief, called for the amount allocated for military aid for Ukraine to be raised by $3.85bn.
The G7 will meet in Japan and there are increasing expectations that the group will tighten economic sanctions against Russia. Despite the reality that sanctions have affected Russia with a heavy toll, it is widely believed they have not succeeded in their geopolitical aims. The sanctions have instead driven Russia deeper into the embrace of emerging-market nations such as China, India and Turkey, providing leverage for Russian foreign policy and making a nonsense of western compliance efforts. There is even wider concern related to the potential that sanctions could collapse an already weak global economy. The EU has also recently announced that it was considering penalties for EU firms that help Russia evade western sanctions, such as providing financing, investing in sanctioned sectors, or sharing technologies that could aid the energy sector.
Explosions hit Kyiv on 8 April as Russia continued its bombardment of the city. Residents were urged to remain in shelters. The city was hit by falling debris but there were no reported casualties. Ukrainian officials have also rejected Russian claims that Russia has destroyed a billion-dollar Patriot air defense system donated by the West; the system remains mission-capable. Ukraine claimed it had downed six Kinzhal hypersonic missiles during a missile strike. Meanwhile, Russian scientists, who are experts in hypersonic technology, are protesting their arrest for treason amongst a surge of similar arrests.
China's special envoy for Eurasian Affairs, Li Hui, has urged all parties to create conditions for peace talks relating to the Russia-Ukraine conflict during a visit to Kyiv. Hui exchanged views with President Zelenskiy and the Ukrainian foreign minister in an effort to end the conflict through a political settlement. China is willing to promote the international community to resolve the Ukrainian crisis, making its own efforts to stop the fighting and (establish a) ceasefire and restore peace as soon as possible.
Explosions in Kyiv and Odesa caused by Russian cruise missile attacks have resulted in the loss of four lives and several injuries. Falling debris caused fires in two districts of Kyiv and the Ukrainian military said a fire broke out in Odesa due to the missile attack. Kyiv’s anti-aircraft defenses had engaged the attack, but it marks the ninth time in May that the Russian Federation has targeted the Ukrainian capital with missile attacks. The attacks come ahead of Ukrainian retaliation against Russian-backed separatist rebels in the Donbas region. The Ukrainian retaliation is expected to involve advanced Western weaponry obtained by the country through strategic partnerships such as its acquisition of Patriot missile systems from the US. On Tuesday, the commander-in-chief of Ukraine’s armed forces claimed 18 Russian missiles of various types were shot down in a concentrated attack on Kyiv.
While artificial intelligence (AI) raises some concerns over its impact on society, economists writing in the Financial Times argue that policymakers should be focusing on the distribution of the productivity gains AI could potentially bring. This issue concerns intellectual property rights, an issue which is predicated on who controls access to the technology. At one end of the spectrum there is a completely proprietary world, in which the most useful AI is the intellectual property of a monopolistic or oligopolistic company. At the other extreme, there is an open-source world where productivity gains would be earned by those who deploy the technology. Governments could legislate to increase transparency and access to such technologies.
China's Special Envoy Li Hui has urged Ukraine and Russia to stop the war and resume talks as part of his own initiative to push for a ceasefire between the two countries. He was appointed as a peace envoy to Ukraine after a phone call between Chinese President Xi Jinping and Ukrainian President Volodymyr Zelensky three weeks ago. Li met with senior Ukrainian officials to discuss a political solution to the crisis and their views on China-Ukraine relations. However, it is not known whether Beijing's peace proposal was received favourably by Kyiv.
As Norway's wealth tax rises, an increasing number of wealthy people are leaving the country with Kjell Inge Røkke and Fredrik Haga being two high-profile Norwegians who have left for Switzerland. However, this has led to the question: what is living in a tax haven actually like and is it worth it? The majority of tax havens are rather strange places to live full-time, due to their small size and limited geographical location. However, there are countries such as Switzerland, that have tax regimes that are favourable to wealthy foreigners but are sizeable and well-connected.
On 13 May Russian officials reportedly froze the bank accounts of Finnish embassies and consulates in Russia. The Kremlin claims that this move is in response to the "unfriendly acts of the collective West", which Finland is included in, following Helsinki's decision to formally join NATO on 4 April. Meanwhile, Danish diplomatic accounts in Russia have also been affected. Many Russian embassies across the continent have reportedly experienced similar issues since their country's actions in Ukraine prompted funds to be confiscated and banks to freeze in response.
The European Bank for Reconstruction and Development (EBRD) looks set to boost capital by €3bn-€5bn, potentially allowing it to sustain investment levels in Ukraine. The bank has already allocated €3bn to the war-torn state, which is currently fighting off a Russian invasion. President Odile Renaud-Basso said: “Increasing paid-in capital will give us the means to sustain such level of investment and step up our investment (in Ukraine).”
Ukrainian military and Russia’s Wagner private army have reportedly retreated on the outskirts of Bakhmut, as the Ukrainian army advanced its biggest advance for six months. Ukrainian troops had advanced over a mile in some areas; soldiers said that Russian troops were pounding supply lines to try to halt the gains. Meanwhile, Wagner boss, Yevgeny Prigozhin reported that his forces inside Bakhmut continued to advance; however, he accused commanders of Russia’s regular forces of abandoning crucial ground, leaving his troops exposed. Reports of gains for Ukraine represent a significant change of momentum in the east, where Ukrainian forces had been on the defensive for much of the past six months having weathered a winter and spring offensive by Moscow that saw only slow gains.
Ukrainian forces have made significant territorial gains against runners fighters north and south of Bakhmut in what Ukrainian commanders are calling the “first success of offensive operations during the operation for the defence of Bakhmut.” While Ukrainian troops liberated 7.7 square miles from the enemy in the north and south of the suburbs of Bakhmut, Wagner Group mercenaries continued to push through the eastern city itself, claiming much of the last Ukrainian foothold in its western suburbs. Reports circulated about whether Ukraine’s anticipated counteroffensive had begun, which were denied by Ukrainian and Western officials. Ukraine would suffer too many casualties if it launched prematurely, according to Ukrainian President Volodymyr Zelenskyy. During the week, Zelenskyy was on a whirlwind tour of European capitals in which he garnered large new promises of weapons. France told Zelenskyy that it would provide dozens more capable of an AMX-10RC light tanks. Ukraine’s UK allies said it would supply Ukraine with long-range attack drones with a range of over 200 kilometres, as well as hundreds of additional air defence missiles. Germany also promised its biggest batch of weapons yet was priced at $3bn.
