Weekend Box: US Chipping at China, Egypt Weather Law Causes Storm & more
Welcome to the Weekend Box, Audley’s weekly round-up of interesting or obscure political, business and cultural news from around the world.
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NI PROTOCOL: WILL UK & EU GET IT DONE?
Might there be a breakthrough on the Northern Ireland protocol, a sticking point in post-Brexit negotiations with the EU that has bedevilled the UK government for the last three years?
The Times claimed so this week, saying that the EU had accepted that goods destined for Northern Ireland would be allowed to enter without routine checks, while goods proceeding to the south would undergo customs formalities in Northern Ireland ports. The negotiated solution was, it said, based on the UK’s green and red lanes proposals, with the European Commission proposing an ‘express lane’ with random checks according to potential risk.
It also said the Commission had conceded that the European Court of Justice could rule on issues related to the protocol only if referred by Northern Ireland courts, calling it “a critical step towards ending the impasse” over the protocol.
If true, what changed? One quoted UK government source said there was a “strong agreement” that the dispute could not carry on. “The mood music has completely changed…both sides have been looking to go as far as they can to compromise to make this work.” This tallies with recent comments by Ireland’s Taoiseach, Leo Varadkar, who said he regretted that the protocol was “imposed” on Northern Ireland without the support of the nationalist and unionist communities. The unionist DUP has been consistently opposed to the protocol and blocked the resumption of power-sharing at Stormont over the issue.
A related risk has come from a Eurosceptic Conservative party faction, the European Research Group, who have previously backed the DUP. In response, Northern Ireland Minister Steve Baker recruited fellow former-ERG Chair Chris Heaton-Harris to participate in wider confidence-building discussions with the DUP, praising them for helping to create a “positive space” where a deal could be done.
The ‘deal’ remains unconfirmed. Irish channel RTE ran a story with EU sources denying a deal had been done. As The Times conceded, both sides expressed caution about when a formal deal might be announced. Good Friday would be fitting, but as another source said: “We only have one chance at this, and the most important thing is to get it right.”
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US CHIPPING AT CHINA IN TECH WAR
This week the US government tightened its rules on exports of US technology to China, in another escalation of the West’s tech war. On Tuesday, the ‘land of the free’ stopped providing US companies with licences to export to Huawei, and it has also joined forces with Japan and the Netherlands to stop the export of advanced microchips technology to China. Until this point, we have never seen a coordinated export ban like this against the country.
While the US, Dutch, and Japanese may seem like unlikely collaborators, these countries are at the forefront of manufacturing the world’s most advanced chips. In particular, the Dutch hold the jewel in the chip arms race: ASML. Critical to the Dutch economy, ASML is the only company in the world that makes a specific machine needed to make the most advanced chips. Without it, you likely wouldn’t have an iPhone in your hand.
This is a major win in President Biden’s “protect” and “promote” agenda to limit China’s ability to manufacture advanced technology and promote American competitiveness. However, with a parallel export controls regime created without the EU’s involvement, the unified posture of the bloc has undoubtedly been undermined. This is patently a deal with the Dutch, not the rest of the EU, whose members have been side-lined. Looking to the UK, the situation is no better. The government’s continued failure to produce a strategy for the semiconductor industry was criticised by tech leaders last month and despite the efforts of the National Security and Investment Act, key semiconductor assets such as the start-up Flusso have fallen into Chinese hands.
As the US unilaterally takes steps to deny China access to key technologies, the geopolitical landscape is being reshaped, and the EU and UK are being forced to play catch-up. With China making staggering technological advancements, perhaps this is the motivation Europe needs to start carving out its own role in the global tech war.
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ISRAEL-PALESTINE: TWO STATES, NO SOLUTION?
In the 1980s, riots by Palestinians broke out and were suppressed by Israeli forces in the first intifada. Less than 20 years later, the breakdown of peace processes led to the second, more violent intifada erupting. Now, not two decades on, there is fear internationally that the increasing escalation of Israeli-Palestinian violence will lead a third intifada to break out.
On Thursday, the Israel Defence Forces carried out airstrikes on the Gaza strip targeting training centres associated with the Palestinian Islamist organisation Hamas, after claiming to have intercepted a rocket fired from Palestinian territory. The Popular Front for the Liberation of Palestine maintains that the rockets were launched in retaliation.
The trading fire follows weeks of attacks and increased tension between Israelis and Palestinians, the latest developments in “the bloodiest year on record in the West Bank and Jerusalem since the end of the second intifada in 2005.” In Israel, measures have been approved allowing citizens to carry guns following two deadly attacks in Jerusalem by Palestinians in January, which were preceded by the deaths of nine Palestinians in an Israeli military raid in the West Bank.
Concerns are mounting that the ramping-up of violence portends another explosion of conflict comparable to the previous intifadas. US Secretary of State Antony Blinken, visiting the Middle East, reiterated President Biden’s commitment to “[r]estoring calm” by establishing two states for Israelis and Palestinians.
However, Prime Minister Netanyahu reportedly did not engage on the subject, while President of the Palestinian National Authority Mahmoud Abbas accused Israel of undermining the two-state solution through killings and practices “including the continued building of Jewish settlements” and “demolition of Palestinian homes.” Israel’s security agency is reportedly exploring the demolition of homes and strengthening West Bank settlements as measures in response to the shootings in Jerusalem.
As Hamas reportedly encourages Palestinian resistance in the West Bank, while Prime Minister Netanyahu’s hard-line government explores these measures, we will likely see more violence. As tensions rise, there is no clear sign ahead of how this fraught moment in Israeli-Palestinian relations will be de-escalated.
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RUSSIA BANKS ON IRAN AGREEMENT
The BBC’s new documentary series Putin vs the West details over a decade of strained relations between Western nations and the Kremlin regime, including the missteps and prevarications that seemingly led inexorably to war.
Told through the words of European leaders and diplomats themselves, it highlights how President Putin interpreted Western inaction as weakness but also explains why those same leaders so often failed to act in the face of Russian aggression.
For many, the threat of ostracising Russia and creating a coalition of authoritarian regimes was a key factor.
Such concerns came closer to reality this week as the Putin administration signed an agreement with the Iranian regime to enhance cooperation around financial transactions. While this may seem innocuous, it was a key concern of Western leaders as late as last year as they debated whether to ban Russian banks from the SWIFT payments system that dominates the flow of money around the world.
The SWIFT system (Society for Worldwide Interbank Financial Telecommunications) was created by US and European banks in the 70s as a means of accelerating international payments and establishing a common language for financial transactions. Today, the scheme underpins much of the international banking system. It was the fear of authoritarian regimes coming together to create an alternative shadow banking system that kept Russian financial institutions inside it for so long. They eventually joined their Iranian counterparts in being ejected last year as part of the crackdown on Russian roubles following the invasion of Ukraine.
Western diplomats are unlikely to be too concerned about this new agreement, however, as it only serves to highlight Russia’s isolation. Tehran was happy to boast about the deal to anyone who would listen. The Kremlin and Russia’s central bank declined to comment. Perhaps this, more than anything, tells us about the extent to which this decision was taken from a position of strength or weakness on behalf of the Russian regime.
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EGYPT WEATHER LAW CAUSES STORM
Over the last decade, fake news has become a mainstay of modern life. From Pope Francis’ declaration of support for Trump to Turkey joining the EU; from the harmless to the sinister; fake news is a product of an online world with little regulation acting as a global newsroom.
Authorities, regulators, and campaigners have long struggled to navigate this issue, with some taking more drastic action than others. In the latest legislative move to combat fake news, this week the Egyptian cabinet moved to pass a law that punishes those who talk about “meteorology, or anyone using a weather forecasting device without our consent, or anyone who raises confusion about the weather.”
On the surface, this seems a harmless prioritisation of the weather (a move many Brits will be familiar with) but Egypt’s authoritarian regime has a complex history with fake news that goes beyond the occasional viral story.
In 2018, a law to criminalise the publishing of fake news was passed, which categorised social media accounts with more than 5,000 followers as a media outlet, meaning they can be legally punished for publishing fake news. This allowed the authoritarian government to detain and publish those who do so, including accounts of several journalists being imprisoned on this basis.
The meteorology law has been greeted with much derision, but as the latest example of the government controlling the online space, it may warrant greater consideration.
And that’s it for this week. I hope you found something of interest that you might want to delve into further. If so, please get in touch at cwilkins@audley.uk.com.
For now, that’s the weekend box officially closed.