Framing The World, Edizione XCIX

Framing The World, XCIX Edition

In the latest FtW we deal with the fluctuating financial situation of 2022 and the outlook for 2023. We also describe the terrorist attack that occurred in Somalia and the meeting between Xi Jinping and his Filipino counterpart. Finally we analyze the continuation of the military campaign in Ukraine.

All this and more in the 99th issue of Framing the World!

HUMAN RIGHTS

ECONOMICS AND INTERNATIONAL FINANCE

SUB-SAHARAN AFRICA

NORTH AMERICA

LATIN AMERICA

ASIA AND THE FAR EAST

WESTERN EUROPE AND EUROPEAN UNION

CENTRAL AND EASTERN EUROPE AND RUSSIA

MIDDLE EAST AND NORTH AFRICA (MENA)

TERRORISM AND INTERNATIONAL SECURITY

HUMAN RIGHTS

Saudi Arabia, women will be able to go to Mecca without a "guardian". On Thursday 5 January, the Saudi Minister for pilgrimages officially opened reservations for the 2023 Hajj season, the pilgrimage to the holy city of Mecca where all Muslims should go at least once in their lifetime. The Hajj, one of the 5 pillars of Islam (Arkān al-Islām), is one of the most important revenues of the Saudi monarchy, attributable within the religious tourism sector which also includes minor pilgrimages such as the Umrah. According to the above statements by the Saudi minister, reported by the Saudi Press Agency, female pilgrims will no longer be obliged to be accompanied by a "guardian", i.e. a family man who acts as a guardian according to what is established by Saudi law and by the interpretation of the Shari'ah. This decision is due to the partial liberalization and modernization of customs and traditions in the country under the guidelines of the crown prince Mohammed bin Salman. Human rights NGOs have described the Saudi decision as an example of women's rights washing, aimed at improving the monarchy's international standing vis-à-vis the West.

Iran, firm reaction of the regime against the satirical cartoons of Charlie Hebdo. On January 4, the famous Parisian newspaper Charlie Hebdo published a series of cartoons to discredit the regime in Tehran and support the struggle of women and demonstrators in the country. The winning cartoons of a competition - with more than 300 participants - represent Ayatollah Ali Khamenei and other Shiite clerics in caricatures or in some cases in obscene acts. Obviously, the response of the regime was not delayed. It defined the cartoons as "offensive and blasphemous" and "to be condemned". The Iranian foreign minister's spokesman closed by announcing that the country's high authorities have a French research institute and furthermore, he summoned the French ambassador to Iran, declaring that "France cannot disrespect the sacred high authorities of an Islamic country in the name of freedom of expression”.

Sara Oldani

ECONOMICS AND INTERNATIONAL FINANCE

Stock exchanges, a year to forget. Investors' 2022 ended with the first annual decline since 2018, with U.S. indices falling between 9% for the Dow Jones and 33% for the Nasdaq (the worst figure since 2008), and European indices generally containing declines (Ftse MIB -15%, Dax 30 -8%, CAC 40 -5%) or even closing higher (Ftse 100 +3%) thanks to the fall rally. However, performance is extremely varied: while the technology sector was hammered by heavy selling (Apple -27%, Amazon -50%, Meta, Tesla, and PayPal over -60%), sectors such as energy (+59% despite oil closing the year at only +6%) and aerospace and defense (Northrop and Lockheed +40%) were lifelines for investors. The fixed-income sector was also down, experiencing its fourth worst year since 1700, while a hypothetical combined portfolio of stocks and bonds scored the worst return since 1871.

Tesla, the bubble deflates. One of the worst stocks in 2022 was Tesla, which, despite expanding production capacity with new factories in Texas, China, and Germany and increasing annual sales by 40 percent, is paying heavily for rising interest rates and the resulting reassessment of future profits, as well as growing competition on EVs. In 2022, the stock dropped by 65% and the slump does not seem to have stopped in the first days of the new year with a further -8% following quarterly deliveries that came in below expectations and the announcement of a new reduction in listing prices (-$7500 on Model 3 and Y), details that raise fears of weakening demand. Elon Musk, the first man to achieve a net worth of over $300 billion (340 to be exact), also became the first to lose over $200 billion, falling to $137 billion.

Inflation, the first drop in Europe. After 4 months in double digits and thanks mainly to the drop in energy products aided by a mild winter, inflation in the eurozone is back into single digits (+9.2%) and raises hopes that the spike will be surpassed, with optimism immediately spreading to financial markets. However, the threat cannot be said to be over as the core index, which excludes volatile products such as food and energy, reached a new record high at +5.2%. The ECB takes a keen look at this figure when deciding on interest rates, and given that the target is +2%, several members of the Governing Council expect further substantial rises in February and March. President Lagarde also suggested caution given that a new burst of inflation is expected as early as January.

US, the strength of the economy. Positive data also came from the U.S., where the PCE index, the Federal Reserve's preferred index for measuring consumer prices fell on a monthly basis in November from +0.4% to +0.1%, while on an annual basis it rose from +6.1 to +5.5% and, unlike the eurozone, the core index in the U.S. also improved (from +5 to +4.7%). Positive signs also came from the University of Michigan Consumer Sentiment Index, +5% in December and +19% from June lows, a sign of newfound optimism, and from the labor market, with above-expected job creation (223,000 vs. 203,000), a drop in unemployment from 3.7 to 3.5% and a slowdown in wages (from +5 to +4.6%). All this, combined with the sharp slowdown in the ISM Services index, gives investors hope for a slowdown in interest rate hikes and boosts Wall Street (over +2% after the data release), which ended the first week of 2023 in the green.

FTX, the latest news. Sam Bankman-Fried, now extradited to the United States, appeared before a federal judge in Manhattan, who has ordered his release upon one of the highest bails in history, $250 million, only a portion of which will actually be posted, however. SBF, as he is known in the cryptocurrency world, will have to remain in his parents' home in Palo Alto and wear an electronic bracelet until his court date, set for Oct. 3. Bankman-Fried has pleaded not guilty to the eight counts on which he will go to trial, while Gary Wang, co-founder of FTX, and Caroline Ellison, co-CEO of Alameda Research (FTX's hedge fund) have pleaded guilty and agreed to testify against him. Federal authorities also began seizing FTX's assets in the U.S. to settle with creditors, including $465 million in Robinhood shares.

Leonardo Aldeghi

SUB-SAHARAN AFRICA

Somalia, double bloody bombing in the country. The number of casualties caused by the double bombing, which occurred in early 2023, in Maha locality in central Somalia, about 300 kilometers from the capital Mogadishu, has not yet been accurately ascertained. In fact, the number reported by multiple sources ranges from 20 to 40 dead, in addition to numerous wounded. The terrorists attacked the town of Maha with two vehicles loaded with explosives, which were then detonated causing death and destruction. The area affected by the attack is at the center of a large offensive carried out by the government and militias allied with it against the jihadist groups of Al-Shabaab, a terrorist organization linked to Al-Qaeda.

Tanzania, ban on demonstrations lifted. Samia Suluhu Hassa, Tanzania's president since 2021, has taken an important step in the direction of restoring broader democratic freedoms, in a country that has instead suffered from strong authoritarianism for years. In 2016, then-President John Magufuli, who died in 2021 before Hassa came to power, had in fact decreed a ban on all demonstrations by oppositions. Hassa finally lifted this decree, as she said at a gathering of opposition leaders, thus once again giving the oppositions the right to demonstrate politically.

Andrea Ghilardi

NORTH AMERICA

USA, the South Carolina Supreme Court struck down the state's six-week abortion ban. The Court defined that the law that restricted abortions after detectable fetal cardiac activity as "an unreasonable restriction upon a woman's right to privacy" and unconstitutional. The decision means that abortion in South Carolina is now legal until around 20 weeks of pregnancy. The decision comes nearly two years after the state enacted the law, known as the Fetal Heartbeat and Protection from Abortion Act, which banned abortion after six weeks - except for limited cases like pregnancies that would endanger the pregnant person's life or that were the result of rape or incest. The statement by the state's highest court comes as fierce legislative and judicial battles over abortion access are being waged across the country more than six months after the U.S. Supreme Court overturned Roe v. Wade.

(Ludovica Costantini)

USA, McCarthy elected House Speaker. Representative Kevin McCarthy of California won the elections on Saturday as House speaker, in a historic five-day, 15-ballot floor fight, after giving major concessions to the right-wing holdouts that would weaken his power as well as hand them too much influence in the new Republican majority. McCarthy clawed his way to victory by cutting a deal that won over a sizable contingent of ultraconservative lawmakers earlier on Friday, and then wearing down the remaining holdouts in a tense late-night session and spectacle of arm-twisting drama on the House floor.

(Ludovica Costantini)

Ana Montes, one of the best-known spies of the Cold War, has been released from prison. After more than 20 years in prison in the United States, Ana Montes, one of the best known spies of the Cold War, has been released from prison. The BBC reports it. The 65-year-old spied for over 20 years for Cuba while working as an analyst at the US Defense Intelligence Agency. After her arrest in 2001, the US administration said she had disclosed to Havana almost all US intelligence operations on the island and was therefore considered one of the "most harmful spies" to American security.

(Federico Pani)

FDA authorizes long-awaited Alzheimer's drug. The US Food and Drug Administration authorizes Eisai and Biogen's long-awaited Alzheimer's drug. In the studies performed, Leqembi has shown promising results for the treatment of the disease, which affects about 6.5 million Americans, with an evident slowdown of the disease. The FDA has given the drug an accelerated green light, which means the two companies will be conducting more studies.

(Federico Pani)

At least 60 victims from the extreme cold wave. In the last week of the year, an extreme cold wave raged in the United States: the death toll rose to at least 60, including 27 in New York state, with Buffalo as the most affected city and tens of thousands of people without electricity and one meter of snow. Many victims were found inside their cars, houses and in snowdrifts.

(Federico Pani)

Ludovica Costantini e Federico Pani

LATIN AMERICA

Brazil, Lula's government begins on January 1st. Luiz Inacio Lula da Silva has been sworn in as Brazil's new president, being the third time he has held the country's highest position. On the first day of 2023, politicians from all over the world met up in Brasilia to await the official inauguration ceremony of President Lula. Among the guests we find Petro from Colombia, Boric from Chile and Lasso from Ecuador. In his first speech, Lula promised to rebuild a country in "terrible ruins".

Venezuela, opposition has voted to dissolve its parallel government and remove its leader Guaidó. The move comes four years after Mr Guaidó declared himself president following the re-election of Nicolás Maduro in disputed polls. He was recognised by many Western countries, including the US, but failed to oust the left-wing president. The vote shows how most opposition politicians in Venezuela have lost faith in Mr Guaidó.

Ludovica Costantini

ASIA AND THE FAR EAST

China, Covid-19 infections continue to increase amid hospital overcapacities. According to a recent study conducted by Frontiers of Medicine, the Covid-19 infection wave that is affecting China has already reached its peak in major cities such as Shanghai and Beijing. The British medical analysis company Airfinity estimates that the daily Covid-19 infections are around 1,8 million. Despite the situation in the country appearing to be critical, due to the overcrowding and essential drugs shortages in hospitals across the country, Beijing has turned down the EU’s offer to send RMA vaccines. The EU has encouraged member states to adopt new testing rules for passengers arriving from China, following the example of other countries, like Japan.

(Laura Salvemini)

Turkmenistan, the Chinese premier Li Keqiang meets the President of Turkmenistan Serdar Berdimuhamedov in Beijing. On Friday 6 January Premier Li Keqiang held a meeting in Beijing with Serdar Berdimuhamedov, president of Turkmenistan. The meeting took place during a two-day state visit of the Turkmen President to China. During the meeting, the two sides discussed the future of Turkmenistan-China relations, and the Turkmen President said he was in favor of cooperation with China in the political, economic and energy fields. Energy cooperation is one of the most important issues addressed and in this regard, Li said that China is ready to facilitate the necessary proceedings, including the construction of the China-Central Asia Gas Pipeline, with the hope that Turkmenistan can ensure a stable supply of gas to China.

(Alessandra Tamponi)

Sri Lanka, elections to be held for the first time since the president fled the country. Sri Lanka has announced its first nationwide elections after former president Rajapaska fled the country and resigned, leaving the nation in an unprecedented economic and social chaos. The local government elections are expected to be held before the end of February while nominations from candidates will be accepted until the end of January. Around 14,000 polling centers will be established in 340 local government bodies. The local polls cannot bring down the current national administration – led by former vice-president Ranil Wickremesinghe – and the presidential election cannot be held until the last quarter of 2024 for constitutional reasons.

(Laura Salvemini)

Philippines, meeting between Xi Jinping and Ferdinand Marcos in Beijing. 2023 opened for the Philippines with the state visit of President Ferdinand Marcos to the People's Republic of China. On Tuesday 3 January Marcos junior, who succeeded his father on 30 June 2022, went to Beijing for a 3-day state trip, during which he had the opportunity to discuss the future of relations between the two countries with Xi Jinping. During Marcos' visit, the parties signed more than 14 agreements, including a joint action plan on agriculture and fisheries cooperation between the Philippine Department of Agriculture (DA) and China's Ministry of Agriculture and Rural Affairs. They have also entered into a Memorandum of Understanding on the Belt and Road Initiative. There was also talk of a possible reopening in terms of energy cooperation, including gas exploration in the South China Sea, despite existing territorial disputes.

(Alessandra Tamponi)

Laura Salvemini and Alessandra Tamponi

WESTERN EUROPE AND THE EUROPEAN UNION

Council of the European Union, Swedish presidency begins. From January 1 to June 30, 2023, Sweden will hold the presidency of the Council of the European Union. Sweden last held the presidency in 2009, since then much has changed in the political and economic dynamics of both the Union and the world. In the program of its third Council presidency, Sweden identified four priorities: security and unity, competitiveness, green and energy transition, democratic values and rule of law. More specifically, the new presidency declared that it would be committed to securing economic and military aid for Ukraine and supporting its path of accession to the European Union. Ulf Kristersson, the Swedish prime minister, also stated that attention will be given to the Union's competitiveness, the energy market and its reforms, and the green transition, with the goal of achieving a "greener, safer and freer" Europe.

The EU offers to donate Covid-19 vaccines to China. Given the resurgence of a new wave of Covid 19 infections in China, the European Union has recently offered Beijing to send free anti-Covid vaccines used in Europe. Health Commissioner Stella Kyriakides reportedly contacted China to offer, in addition to the variant-adapted vaccines, the knowledge of EU’s public health experts. The Chinese government rejected the offer, claiming that it has the capacity to produce enough vaccines for all its citizens domestically. Beijing also threatened to undertake countermeasures against countries, including Italy, that chose to impose buffers and restrictions on travelers departing from China. These rejected offers and new initiatives represent Europe's attempt to create a Europe-wide backstop to limit the impacts of the new wave of infections following the halt of China's "zero Covid" policy.

Croatia, adoption of the euro and entry into the Schengen area. On January 1 2023, Croatia, a member state of the European Union since 2013, officially adopted the euro and entered the European area of free movement, the Schengen area. Croatia had applied to adopt the euro in 2017 and to join the Schengen area in 2015. This was followed by a period of analysis on the stability of the country's economy and its security apparatus that ended in recent months with a favourable outcome from the Union's institutions. As for the single European currency, Croatia is the 20th country to adopt it and the 27th to join the Schengen area, the first after Lichtenstein in 2011.

Bianca Franzini

CENTRAL AND EASTERN EUROPE AND RUSSIA

Ukraine, shelling from both sides during truce announced by Moscow. The 36-hour cease-fire starting at 12 p.m. on Jan. 6, the same one sought by Russian President Putin on the occasion of the Orthodox Christmas celebrated on Jan. 7, did not break hostilities at the front. Although the truce had been announced unilaterally by Moscow, it was reportedly Russian forces that violated it with a series of massive bombings: one of which claimed 2 civilian lives in the town of Bakhmut. The Kiev government had sent the cease-fire proposal back to sender, describing the latter as the Kremlin's attempt to buy time and reposition its forces at the front.

(Davide Shahhosseini)

Belarus, military cooperation with Moscow continues. The Belarusian Defense Ministry said military cooperation with Russia, including division groupings and joint exercises, will be strengthened under the terms provided, in security matters, by the Treaty on 'Russian-Belarusian Union' dating back to 1999. The Minsk government then announced the arrival of military personnel, weapons and equipment from Russia in the coming weeks at training bases of the Belarusian army.

(Davide Shahhosseini)

MIDDLE-EAST AND NORTH AFRICA (MENA)

Meeting in Moscow between Turkish and Syrian defense ministers: possible mediation? The Turkish Defense Minister and Intelligence Chief met their Syrian counterparts on December 28 in Moscow. This is the first official meeting between the two Middle Eastern countries since the outbreak of the civil war in Syria in 2011. In recent weeks, the statements by President Recep Tayyip Erdogan regarding an overland operation in the Kurdistan area (Syrian and Iraqi) had raised tensions between Syria and Turkey, which sees the Kurdish issue as a national security issue. The recent meeting, declared positive by both parties involved, would instead suggest a possible diplomatic thaw. Russian mediation, whose presence in Syria is essential to guarantee it an outlet on the "warm seas", it is no coincidence that it took place precisely during a phase of slowdown in the fighting in the war in Ukraine. Furthermore, the thawing of relations between Turkey and Syria must be read in the broader context of the de-escalation taking place in the Middle East.

(Sara Oldani)

Libya, accusations against ENI: the oil minister of the Tripoli executive, Mohamed Aoun, accuses the Italian company of extortionary practices with the aim of obtaining changes in the quotas of some extractive areas. The leader of the Tobruk House-backed executive, Fathi Bashaga, seizes the opportunity to ride on these accusations by lashing out at his internal opponents. Both figures, however, are experiencing a moment of great political weakness. Aoun is now almost deprived of all authority after the compromise reached between his prime minister, Dbeibah, and General Khalifa Haftar to appoint Farhat Omar Bengadara as head of the National Oil Corporation, Libya's national oil company. Bashaga, after the failed coup to take Tripoli, sees himself increasingly isolated and powerless, General Haftar being the real ruler of Cyrenaica and part of Fezzan.

(Michele Magistretti)

Tunisia, more than 90% of the population did not vote. Legislative elections were held in Tunisia on December 17th, one year and a half after the authoritarian turn with which the President of the Republic, Kais Saïed, suspended the Parliament democratically elected in 2019. The abstention rate turned out to be extremely high, 91,2%, a slap in the face for Saïed. The electoral procedures prohibited any figure related to mainstream political parties to run for office: not surprisingly the vote was boycotted by a large part of the opposition forces to the President. The widespread disregard for the vote is nevertheless mostly the result of the disillusion of Tunisians, tired of a political quarrel regarded as sterile as opposed to a more and more difficult economic situation. The second turn of the legislative elections is envisaged between January and March 2023, with a big question marked on the political legitimacy of a round of voting flawed by such a limited participation.

(Francesco Lorenzini)

Michele Magistretti, Sara Oldani and Francesco Lorenzini

TERRORISM AND INTERNATIONAL SECURITY

Ukraine, green light for US, France and Germany to send tanks to Kiev. For the first time since the start of hostilities, Western-made armored vehicles will be deployed on the ground. In fact, to date, the Ukrainian Army has been supplied with 280 tanks, all from Poland and the Czech Republic and dating back to Soviet times. Although the government in Kiev had repeatedly denounced their inadequacy, deeming them obsolete to cope with modern Russian armored vehicles, Western forces, presumably in order to prevent a military escalation with Moscow, have long stalled before coming to this decision.

(Davide Shahhosseini)

Mexico, urban guerrilla warfare after the arrest of "El Chapo's" son. The capture of Ovidio Guzmán López, one of the sons of Joaquín Guzmán Loera a.k.a. "El Chapo," triggered a violent backlash from the Sinaloa cartel, the latter led by the Chapo himself until his final arrest in 2014 after 13 years of absconding. Ovidio Guzmán, known as "El Raton," is accused of inheriting the cartel's leadership after his father's capture. News of his arrest last Thursday in the city of Culiacán-the capital of the state of Sinaloa-was followed by violent clashes between police and the army on one side and cartel members on the other. Mexican authorities reportedly put the toll of the clashes at 29 victims, 10 of them members of the police force.

(Davide Shahhosseini)

Burkina Faso, United Nations coordinator expelled. On December 23 the Burkinabe military junta declared persona non grata Barbara Manzi, United Nations resident coordinator in Burkina Faso. She was accused of tarnishing the country's image because of the decision to unilaterally withdraw all UN non-essential personnel from Ouagadougou. Burkina Faso is experiencing a profound phase of instability, with two military coups during 2022 and a security situation more and more compromised by the advance of jihadist groups toward the capital city. Burkina Faso is not the first State in the region to throw a UN representative out recently: last July the Malian government expelled Oliver Salgado, spokesperson of the peacekeeping mission MINUSMA, guilty of having released unacceptable information about the case of the 49 Ivorian soldiers arrested in Mali since considered mercenaries.

(Francesco Lorenzini)

Mali, 49 Ivorian soldiers pardoned after six months of detention. On Friday 6th January the President of the transition government in Mali, colonel Assimi Goita, pardoned the 49 Ivorian soldiers arrested last July on charges of being mercenaries. Ivory Coast justified their presence in Mali affirming that the group was part of the UN peacekeeping mission MINUSMA. The soldiers were all sentenced to 20 years of prison last 30th of December by a Malian court. The pardon follows the visit of the Togolese President Faure Gnassingbé to both Ivory Coast and Mali, mandated by ECOWAS (Economic Community of West African States) in order to pursue a mediation. The release ends the six month tug-of-war between Bamako and Abidjan, attributable to the role and the presence of MINUSMA in Mali, considered by the ruling junta as intrusive of its sovereignty.

(Francesco Lorenzini)

Davide Shahhosseini and Francesco Lorenzini

Framing The World is a project conceived and created by the collaboration between members of the team of Mondo Internazionale associates.

Alessandra Tamponi: Asia and the Far East

Andrea Ghilardi: Sub-Saharan Africa

Bianca Franzini: Western Europe and the European Union

Chiara Giovannoni: Human Rights

Davide Shahhosseini: Terrorism and International Security

Elisa Maggiore: Latin America

Federico Pani: North America

Francesco Lorenzini: Middle East and North Africa, Terrorism and International Security

Francesco Rossi: Latin America, Central and Eastern Europe and Russia

Giulio Cofini: Sub-Saharan Africa

Laura Salvemini: Asia and the Far East

Leonardo Aldeghi: Economics and International Finance

Lorenzo Franceschetti: Human Rights

Ludovica Costantini: Latin America

Michele Magistretti: Middle-East and North Africa

Rosario Giorgio Maria Saffioti: Central and Eastern Europe and Russia

Samuele Abrami: Middle-East and North Africa

Sara Oldani: Middle-East and North-Africa