Weekly Recap Jan 9 to Jan 15

North America

• Former U.S. President Donald Trump was fined $1.6 million (S$2.1 million) last Friday (Jan 13) by a New York judge for tax fraud and for falsifying business records. Subsidiaries of the Trump Organization, Trump Corp as well as Trump Payroll Corp had also been found guilty by the jury of providing the company’s top executives with untaxed benefits from luxury cars to private school fees for a duration of 15 years, in which prosecutors have argued that it’s supposed to help make up for lower salaries. The Trump organisation has maintained their innocence and will be appealing the conviction.
• Classified material was found at the incumbent President Joe Biden’s Delaware home last Friday (Jan 13). This came together with the ongoing investigation of former president Donald Trump’s mishandling of classified files where over 325 classified files were discovered over the year at his Mar-a-Lago estate.  A potential leak of classified documents had the opportunity to cause “exceptionally grave damage” and this case has been coined as a “political embarrassment” for President Biden which could possibly place him in legal jeopardy.
• An investigation has been launched by Republican legislators into America’s hasty military withdrawal from Afghanistan in September 2021. Chairman of the House Foreign Affairs Committee Michael McCaul had written to the Secretary Of State Anthony Blinken to request for records ranging from intelligence assessments to communications with the Taliban. Criticising President Biden’s administration for “withholding information relating to the withdrawal”, Michael McCaul had promised to utilise the authorities available to it to enforce an investigation as necessary.
• Talks in Washington between Japanese prime minister Fumio Kishida and incumbent US President Joe Biden were underway last Friday (Jan 13) as part of diplomatic efforts to boost the alliance between the two countries amidst increasing pressure from the Chinese. The bi-lateral talks, held in Washington DC, were to reaffirm the country’s commitment to the alliance between the two countries. Topics of security issues and the global economy were expected to be mentioned in the talks, including the discussion of semiconductor-related exports to China after strict curbs were placed by the US last year. Japanese Prime Minister Fumio Kishida had also called for Japan, the United States as well as Europe to not buckle under Chinese pressure, with Kishida mentioning Japan’s concern about China’s military activities near disputed islets in the East China sea.
• Mexican government minister Genaro Garcia Luna who oversaw Mexico’s war on drugs stood trial in the US for facilitating the smuggling of narcotics last Tuesday (Jan 10). Accused of receiving large sums of bribes when he was a public security minister, a former Sinaloa cartel member had testified that he had delivered suitcases of at least $6 million (S$7.91 million) to Garcia Luna personally at a restaurant in 2005, 2006 and 2007. If convicted, Garcia Luna could potentially carry sentences of between 10 years to life in prison.
• US treasury secretary, Janet Yellen, urges congressional leaders to quickly raise the debt ceiling after mentioning that the US will likely hit the $31.4 trillion (S$41.3 trillion) statutory debt limit on January 19. The White House then responded on Friday (Jan 13) that raising the debt ceiling was non-negotiable. The Treasury might then have to resort to extraordinary cash management measures that can help to prevent default until early June. 

South America 

• Brazilian federal public prosecutors launched probes last Monday (Jan 9) into Brasília riots. Brasília governor Ibaneis Rocha had been removed from his post for 90 days pending investigation, while the Supreme Court of Brazil had ordered the arrest of ex-Justice Minister Anderson who had served under ex-President Jair Bolsonaro and had oversight of security in  government buildings on the previous Sunday’s (Jan 8) attacks. Torres is currently in Orlando, Florida, and is said to be receiving legal advice in the US before surrendering himself to Brazilian authorities.
• Peru’s interim President Dina Boluarte wins a key vote confirming her cabinet on Tuesday (Jan 10). This comes after ex-President Pedro Castillo’s failed autogolpe last December (Dec 7, 2022) that had resulted in his ousting and mass unrest. The new conservative-led congress had confirmed her cabinet with a majority of 73 out of 130.
• Peru faced its deadliest week of protests yet post-Castillo as 26 people died following clashes with law enforcement last Friday (Jan 13), bringing the total up to at least 49. Interim President Dina Boluarte now faces an inquiry from Peru’s top prosecutor for allegations of genocide as many of the victims are Castillo supporters, who are poor indigenous Peruvians. Labour minister ​​Eduardo García Birimisa has since resigned following protests.
• Paraguay’s Ex-President Horacio Cartés was sworn in as Chairman of the National Republican Association (ANR) last Tuesday (Jan 10). The ANR is the largest political party in Paraguay. The vote for the ANR Presidency had been conducted last December (Dec 18, 2022), leaving him to replace Vice-Presidential Hopeful Pedro Alliana. The Paraguayan General Elections are due to be held on 30 April 2023. Cartés had been described by US authorities as “significantly corrupt”.
• Ecuador reported monthly inflation ticking up by 0.16 per cent and annual inflation by 3.74 per cent for December 2022 last Monday (Jan 9). The biggest changes were for food and non-alcoholic drinks, standing at an increase of 0.04 per cent, with goods and diverse services at 0.041 per cent, and healthcare at 0.02 per cent.
• Argentina’s inflation hit a 30-year high, rising 94.8 per cent year-on-year in December 2022, they reported last Friday (Jan 13). Last Thursday (Jan 12), the central bank announced that they will maintain the benchmark interest rate at 75 per cent, following projections of inflation inching to 100 per cent and above.

Asia Pacific

• China reports 59,938 COVID-19 related hospital deaths since last December (Dec 8, 2022) after the dismantling of their zero-COVID system when pandemic restrictions and lockdowns were lifted after widespread protests. Predictions state that there would be an estimated 1.5 million Chinese deaths if the virus manages to spread unchecked. China’s inadequate preparation was speculated to be the cause with insufficient antiviral drug stockpiles as well as missing widespread vaccination policies.
• Suspected Abe Shooter was charged with murder last Friday (Jan 13). Assassinated by a homemade gun last July (July 8, 2022), alleged attacker Tetsuya Yamagami has now been charged with the murder of Japan’s former Prime Minister, Shinzo Abe.  Investigations have shown that the attacker was motivated to murder the prime minister due to his alleged links to the Unification Church, known for its aggressive tactics in soliciting donations. Tetsuya Yamagami’s family had gone into bankruptcy after his mom, a follower of the Unification Church donated over ¥100 million (S$1 million) to the group. This shooting had brought up intense scrutiny over the ties between religion and politics in Japan. A psychiatric evaluation had also shown that Tetsuya Yamagami was fit to stand trial. 
• The Bank of Korea raised their policy interest rates to a 14-year high of 3.5% last Friday (Jan 13). This is in direct action to Governor Rhee Chang-yong’s remarks for the central bank policy stance to focus on price stabilisation as well as to help to achieve a soft landing for the economy. The Bank of Korea has been faced with increased pressure to adjust its policy stance to a domestic consumer as global trade slows and corporate spending fades in view of external geopolitical factors.
• Japanese Prime Minister Fumio Kishida signed a defence pact with Britain’s Prime Minister Rishi Sunak during his trip to London last Wednesday (Jan 11). This allows for both countries to be able to deploy forces on each other’s soil, and has been seen as a move towards closer security ties between the two countries. Prime Minister Rishi Sunak also reaffirmed the Reciprocal Access Agreement as Britain and Japan’s commitment to the Indo-Pacific.
• The benchmark index for Asia Pacific entered into a bull market as China emerged out of its zero-COVID policy (Dec 8). Optimism of China’s re-opening had rallied Chinese stocks together with the weakening of the US dollar. With a bull market defined as a surge of over 20% from recent lows, the MSCI Asia Pacific Index hit a high of 162.33 last Tuesday (Jan 10). However, Saxo Capital Markets mentions that risks would still continue to linger despite rallies as uncertainty still persists though there is undoubtedly room for Asian markets to outperform this year. 

Europe 

• Eni and Snam, Italian multinational energy firms, announced plans to link up to build gas pipelines connecting Algeria and Italy last Thursday (Jan 12). This comes as the Russia-Ukraine war led to the energy crisis in Europe, making Algeria Rome’s biggest supplier of gas.
• The French government reported last Tuesday (Jan 10) that they plan to raise the retirement age. In a new pension reform bill tabled in parliament, the retirement age will rise from 62 to 64. Having been discussed in French President Emmanuel Macron’s government since 2019, such reforms have always faced public uproar.
• Britain looks to lay ground in preparation of the digital Pound, they announced on Tuesday (Jan 10). The financial services Minister Andrew Griffith said that they “had to get it right” given Britain’s “strong financial reputation”. The digital pound looks to be used alongside cash and bank deposits, and not displace their use.
• Polish President Andrzej Duda said that Poland will deliver a company of Leopard 2 tanks to Ukraine last Thursday (Jan 12) as the North Atlantic Treaty Organisation members coordinate efforts against Russia in the Russia-Ukraine war. The transfer of tanks is subject to approval from Germany as the tanks are German-made.
• The US applied pressure on Serbia and Kosovo to prevent “violence metastasising” last Thursday (Jan 12). Twenty years after Kosovo had seceded Serbia, continuous sparks of conflict between the two nations are cause for concern, the US mentioned, following an incident in December. The incident involved the erection of barricades and border closures by Serbs living in Kosovo, signalling heightening tensions.
• Sweden discovered Europe’s largest deposit of rare earth metals last Saturday (Jan 14). Government-owned Swedish mining firm LKAB announced the identification of 1 million tonnes of rare earth oxides, essential to the production of sensitive goods like electric vehicles, wind turbines, phones, and weapons. The European Commission announced in 2021 that 98 per cent of rare earths used in production in Europe were China imports, and urged less dependency on them.
  
  

Middle East

• Two Palestinian men were shot dead by Israeli troops in the occupied West Bank last Saturday (Jan 14) during an army raid. The victims, Ezzedine Bassem Hamamreh, 24, as well as Amjad Adnan Khaliliyeh, 23, were killed “during an assault on the village of Jaba, south of Jenin”. This brings the total death toll of Palestinians killed by Israeli forces to 12 over the past year, and is the consequence of intensified raids and killings by the Israeli army over the past year under the “Break The Wave” campaign. 
• Former Deputy Defence Ministry Official Alireza Akbari was hanged last Saturday (Jan 14) in Iran after being convicted of acting against Iran’s national security by spying for British intelligence. Accused of having received training from MI-6 and established shell companies to undermine Iranian intelligence services, the British-Iranian dual national was put on trial for getting his British citizenship as a “reward” for the betrayal of Iran’s national interest. British Prime Minister Rishi Sunak had condemned this ruling harshly, and accused the regime of being “barbaric”
• A US$3 billion (S$3.96 billion) loan was pledged by the UAE to help Pakistan’s struggling economy. After an already existing loan of US$2 billion (S$2.64 billion), an additional US$ 1 billion (S$ 1.32 billion) was topped up again as an additional loan to the South Asian country that’s struggling with an economic crisis. This funding however, comes with strings attached, and is dependent on Pakistan agreeing to UAE’s pre-existing conditions to utilise the funding to increase energy prices as well as expand the tax base.
• A protest rally was held by Israelis last Saturday (Jan 14)  against the incumbent Netanyahu government to protest plans by the government to change the legal system. More than 80,000 individuals showed up despite bad weather. Netanyahu, who is on trial for corruption charges, had proposed changes to the country’s legal system which could potentially help him evade conviction. Critics have mentioned that the country’s democracy would erode if the changes were in fact to be implemented.
• Currency for the Egyptian pound has depreciated by more than 13 per cent, almost half of its value, as the central bank in Egypt introduces a flexible exchange rate under the terms of an International Monetary Fund (IMF) financial support package. The currency had plunged to 29.7 pounds last Wednesday (Jan 11) according to the central bank with Egypt’s economy being hit hard after Russia’s invasion of Ukraine and higher global energy prices. The IMF had advised for “wide-ranging structural reforms”, and Egypt has been ranked as one of the five countries that is most at risk of defaulting on their foreign debt. 

Africa

• Six out of 36 people that had been abducted in Nigeria had been recovered, security forces announced last Monday (Jan 9). A suspect in connection with the abductions had also been arrested. Cases of kidnappings for ransom or political reasons have seen an uptick in recent years.
• Nigeria’s Electoral Commission announced last Tuesday (Jan 10) that elections in late February could be postponed or cancelled should insecurity not be solved. Insecurity refers to the widespread random acts of violence that happen. The Chairman of the commission, Abdullahi Abdu Zuru, said that insecurity could hinder the declaration of election results, precipitating a constitutional crisis. The vote is due to happen on 25 February.
• The South African electricity crisis worsens as Eskom, its largest electricity producer, extended power cuts “until further notice” last Wednesday (Jan 11). The firm is only fulfilling 23,000 megawatts of its generation capacity, out of 46,000 megawatts. The reasons for the electricity crisis are myriad and deep-rooted, with causes traceable from 2007 and beyond. Some of its causes include general financial insecurity, sabotage, corruption, neglect, crime of key electricity generation parts and more.
• The World Health Organisation (WHO) had declared last Wednesday (Jan 11) that the Ebola virus outbreak in Uganda has come to an end. Infections had broken out in Kampala and Jinja, giving cause for concern that the Ebola outbreak from 2019 could have extended well into 2023. WHO Head Tedros Adhanom Ghebreyesus had congratulated the Ugandan authorities for their robustness, and said that “Uganda has shown that Ebola can be defeated when the whole system works together”.
• Zambia and Angola agreed to expedite the development of various key infrastructure last Wednesday (Jan 11). Among those discussed were energy pipelines and a rail and road corridor. Zambian President Hakainde Hichilema decried the “huge cost” of Saudi Arabian oil, and said that importing cheaper oil from Angola was preferable. The Presidents of the two countries say that they have good relations.
• Al-Qaeda took credit for the killing of fourteen and injuring of eleven Malian soldiers last Thursday (Jan 12). A fight had taken place between Mopti and Ségou, during which the Malian army announced that they killed “31 terrorists”. Mali is known to be a hotspot for jihadist activity since 2012 amidst adverse and worsening socioeconomic, political, and humanitarian conditions.
• Tunisians protested against current President Kais Saied last Sunday (Jan 14) on the 12th anniversary of dictator Zine El Abidine Ben Ali’s fall. Saied had seized power two years prior (July 25, 2021), in which he sacked the whole of government, froze parliament, appointed a new cabinet, and announced rule by decree. This happened against the backdrop of the COVID-19 crisis as well as a deepening economic crisis.