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Commentary

Thu 14 Mar 2019 / Europe,Global

US must pay greater heed of Brexit

It is tempting for Washington to dismiss the UK’s Brexit crisis as a problem affecting a former imperial power with little relevance to the US. That would be a grave mistake. On Wednesday the House of Commons voted to rule out a no-deal Brexit, and an extension of the negotiations seems probable. A stumbling UK is the last thing that an already challenged European economy needs. At a time of considerable global financial market fragility, it would be in the US economic interest to promote a healthy UK and Europe.

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Thu 14 Mar 2019 / Europe

May's deal will never pass parliament

Assuming the opposition parties maintain their vote against Theresa May's Brexit deal because of the contemptuous way May has treated members of parliament (other than Conservative loyalists), and assuming the hardcore anti-European MPs maintain their faith, the prime minister still does not have the votes to get her deal through in the next two weeks. On 30 March, the UK will still be in the European Union.

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Wed 20 Feb 2019 / Asia Pacific,North America,Global

Keeping the peace in US-China talks

Ongoing US-China trade talks are a skirmish in what could become a protracted struggle. Not a trade war, but a wider contest – hopefully economic, not military – to realign global economic interests. One way to keep that contest peaceful is to recognise it is a long-term project that could benefit both sides if they keep communication channels open. It seems negotiators will reach some sort of agreement on the discussion of punitive tariffs to defuse that issue in the short term. Leaks about possible concessions are seeping out.

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Tue 22 Jan 2019 / Global

Proper perspective on emerging risks

You can hear the bearishness in everyone's voices. They fear a market swoon in a world of unstable politics. Risks are mounting, as indicated by recent data signalling slight economic contractions in Germany and Japan. There is plenty of room for unpleasant surprises, especially from higher debt servicing costs and continuing pressures on some emerging markets. But it is important to keep these risks in proper perspective against a global economy that is slowing, but still very strong, and political tensions that are distracting, but unlikely to trigger recession.

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Thu 17 Jan 2019 / Europe

Swiss are collateral victim of Brexit

Amid all the Brexit excitement in London, no one seems to have noticed that Switzerland is as much embroiled in a row with the EU as is the UK. Switzerland has been engaged in on-off negotiations with Brussels since 1992. The EU cannot offer a special deal that allows Switzerland access to the single market but without respecting its rules, as this would set a precedent for the UK. Equally, the Swiss government and its members of parliament find it hard to agree a deal with Brussels that risks being repudiated in a referendum.

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Fri 11 Jan 2019 / Europe

Back to Brussels on Brexit

Prime Minister Theresa May, facing a crucial House of Commons vote on 15 January on Britain's EU exit, is running down the clock until members of parliament feel they have no option but to back the government's deal over departure on 29 March. But the government will not be able to get May's deal through parliament and so will have to go back to Brussels, not just once, but maybe several times. If the EU refuses to budge, the automatic legal position is that the UK will leave on 29 March, even if there is no deal and stalemate in parliament.

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Wed 9 Jan 2019 / North America

Back to pre-1914 Fortress America

When Trump was elected in November 2016, I said he would be a unilateralist. In that spirit, he has redefined the aims of US foreign policy. We are back to pre-1914 'Fortress America'. The US entered the first world war only because of the German U-boat sinking of the RMS Lusitania. It entered the second only after the bombing of Pearl Harbor. Trump wants to confine US defence activity strictly to defend national interests. He no longer wishes to run the world, and has ended the doctrine of the US as global policeman codified by President John Kennedy in 1961.

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Wed 9 Jan 2019 / Global

Non-American should lead World Bank

Since the creation of the International Monetary Fund and World Bank at the end of the second world war, an American has led the Bank (Jim Yong Kim, who announced his resignation from the presidency on Monday, is Korean-American) and a European the IMF. This convention was logical in the post-war decades when the major advanced economies dominated the world economy, but the changing global landscape makes it outdated. To date, the duopoly has met no effective challenge. It is time for a change.

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Fri 21 Dec 2018 / Global

US-China trade war postponed

On the sidelines of the G20 meeting at the beginning of December, US President Donald Trump and Chinese President Xi Jinping agreed to suspend announced tariff increases for 90 days – from 1 January to 1 April 2019 – while undertaking negotiations to avoid a trade war. In the light of the US midterm election results, Trump is turning his attention towards retaining the presidency in 2020. It may be best for him to enter into negotiations with China, play for drama, keep focus on his 'America first' initiative and, ultimately, conclude an agreement.

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Fri 14 Dec 2018 / Europe

Power vacuum points to no-deal Brexit

With her back to the wall, Theresa May seems to have forged a strategy to achieve her goals, however lofty or improbable they seem. If the opposition parties in parliament and those Conservatives who voted against her in Wednesday's leadership challenge stand firm against May, the prime minister's deal with Europe will fail. A power vacuum seems likely to arise in London. Unless May miraculously reimposes her will over the Conservative party and convinces parliament of the value of her deal, Britain will drift towards a no-deal Brexit.

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