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☆ Joined-up G7 is best China deterrent
▼ + stars: | 2023-05-08 | by ( Hugo Dixon | ) www.reuters.com time to read: +7 min

The best chance of steering between these twin evils is for the G7 to agree on a strong deterrence strategy. This would make it harder for China to hold G7 countries to ransom if they came to Taiwan’s aid. The United States is also leaning on its allies to stop China from acquiring militarily useful technology such as advanced semiconductors. CONTINGENCY PLANSThe other plank of a G7 deterrence strategy is contingency planning for what the allies would do if China invaded Taiwan. This would ideally involve building consensus about how the United States would respond to escalating tensions.

☆ How US and allies can find common ground on China
▼ + stars: | 2023-04-17 | by ( Hugo Dixon | ) www.reuters.com time to read: +7 min

That said, the U.S. and its allies have many common values and interests with regards to China. Reuters GraphicsJapan, Australia and other Asian countries also need American support to counter the challenge from a more assertive China. The G7 finance ministers last week took a step to address this concern. But it is unclear how much headway the G7 will make as China has already invested heavily in many poorer countries. It is not just the group’s finance ministers who are seeking to coordinate their approach.

☆ Rich countries and India should cut a climate pact
▼ + stars: | 2023-04-10 | by ( Hugo Dixon | ) www.reuters.com time to read: +6 min

Emissions from the world’s most populous country are only 7% of greenhouse gases but are growing fast while those produced by rich countries have largely peaked. To do so, it will need policies that incentivise green investment, including accelerating its plans for carbon pricing. Rich countries can also help, even at a time when their budgets are stretched. India could then be much more ambitious in its transition plan and the G7 and other rich countries could mobilise funds, focussing on key bottlenecks. But if the central government comes up with a solution, rich countries could help fund it.

☆ How Modi can grab India’s geopolitical “moment”
▼ + stars: | 2023-04-03 | by ( Hugo Dixon | ) www.reuters.com time to read: +7 min

India is in a geopolitical sweet spot because of growing tension between the United States and China. The hard-nosed realpolitik view is that this doesn’t matter as India and the United States have a common threat. This matters for India’s economic future, as geopolitical considerations are increasingly driving global commerce. The United States is encouraging this process through what it calls “friendshoring”. Modi can do a lot to make the most of India’s geopolitical opportunity.

☆ A post-Erdogan Turkey could come in from the cold
▼ + stars: | 2023-02-27 | by ( Hugo Dixon | ) www.reuters.com time to read: +7 min

The six-party coalition challenging the ruling AK Party plans to stamp out inflation, which official figures put at 58%. The six-party coalition should probably do this pre-emptively to gain extra economic credibility, though it seems unlikely to do so. These have soared following Putin’s invasion of Ukraine, as some Western goods now go to Russia via Turkey. Nathalie Tocci, a former special adviser to two EU foreign policy supremos, shares this view. But it is not too early to think about how to bring Turkey in from the cold if he loses.

☆ Even a weak Russia is a problem for Europe
▼ + stars: | 2023-02-20 | by ( Hugo Dixon | ) www.reuters.com time to read: +7 min

TINOS, Greece, Feb 20 (Reuters Breakingviews) - Almost a year after Russia invaded Ukraine it is hard to see Vladimir Putin winning his war. After all, that would involve either Ukraine surrendering land, which it cannot accept, or Russia giving up all the territory it has occupied including Crimea, which Putin won’t do. Radoslaw Sikorski, a former Polish foreign minister who is now a member of the European Parliament, says Russia only reforms itself after military defeats like the Crimean War, the Russo-Japanese War, World War One and the Cold War. Europe, which was late to appreciate the danger posed by Putin, won’t quickly forget the lesson even if he goes. Yet even a Russia weakened by a year of war and sanctions remains a problem for Europe.

☆ Economic war with China would be MAD
▼ + stars: | 2023-02-14 | by ( Hugo Dixon | ) www.reuters.com time to read: +7 min

Hopefully, fear of the economic equivalent will do a similar trick when it comes to a showdown with China. To see whether MAD will be enough to prevent war between America and China, look at just how disastrous such a conflict – which could be triggered by a Chinese invasion of Taiwan - would be. THREE SCENARIOSA Chinese invasion of Taiwan would lead to economic repercussions of a totally different order. A Chinese invasion of Taiwan would be hellish, but some scenarios would be especially ghastly from an economic perspective. Despite all these concerns, America might run the risk of economic war.

☆ Green subsidy race may be what the world needs
▼ + stars: | 2023-02-06 | by ( Hugo Dixon | ) www.reuters.com time to read: +7 min

Elsewhere carbon taxes are low and patchy, as in China, or virtually non-existent, as in the United States. RACE TO THE TOPThat said, the prospects for combating climate change are much better now that America is throwing money at green technologies. Competition between China, the United States and the EU to supply this kit will also benefit consumers in other parts of the world. The United States could align its green subsidies with its “friendshoring” plan, which aims to build up supply chains in friendly countries. Even with such supporting policies, a global green subsidy race will remain a second-best option.

☆ Trying to bankrupt Russia could backfire
▼ + stars: | 2023-01-30 | by ( Hugo Dixon | ) www.reuters.com time to read: +7 min

Reuters GraphicsIn the initial aftermath of the invasion, Western allies mostly issued threats to stop buying Russian oil and gas. Russia could push up the global price by carrying out threats to reduce its oil exports. But if the global price rose enough, Russia might still earn similar amounts at lower volumes. But the global gas price would rise, and Russia could direct the liquefied natural gas it currently sells to Europe to other regions. With Kyiv benefiting from military support and the gains from tighter sanctions uncertain, trying to bankrupt Russia is not worth the risk.

☆ Creative green finance can go a long way in 2023
▼ + stars: | 2023-01-23 | by ( Hugo Dixon | ) www.reuters.com time to read: +7 min

PARIS, Jan 23 (Reuters Breakingviews) - Rich democracies are increasingly keen to help the Global South fight climate change. Though they will struggle to write big cheques, there are ways to make a little cash go a long way. The good news is rich countries have ways to get money flowing without dipping much into their own pockets. One plan is for multilateral development banks (MDBs) to use their balance sheets more aggressively to fight climate change. Rich countries should therefore put more capital into those MDBs that show the most enthusiasm for the task.

☆ The fog in the English Channel is clearing a bit
▼ + stars: | 2023-01-16 | by ( Hugo Dixon | ) www.reuters.com time to read: +7 min

But if the two sides can resolve a dispute over Northern Ireland there could be progress on topics such as climate change, foreign policy and financial services. Resolving the dispute over the so-called Northern Ireland Protocol is the key to unlocking cooperation on a range of topics. But a deal on Northern Ireland could be. Johnson agreed to such a forum as part of the political declaration accompanying the Brexit deal but then abandoned it. “Fog in the Channel: Continent cut off” is a mythical UK newspaper headline which supposedly summed up Britain’s disdain for its neighbours.

☆ Polycrisis may lead to polycentric world order
▼ + stars: | 2022-12-19 | by ( Hugo Dixon | ) www.reuters.com time to read: +7 min

Another scenario is possible: a “polycentric order” with multiple centres of authority, where the United States is the leading power but not the hegemonic one. Indeed, the outlines of such an order may already be emerging out of the conflagration of economic, political and other shocks often labelled the polycrisis. A polycentric order would be different from what is often called a “multipolar” system - a dog-eats-dog world where big powers have a licence to dominate their neighbours. The United States is not nearly as powerful as it was. President Joe Biden realises the United States needs allies, says Peter Engelke of the Atlantic Council think tank.

☆ Democracy remains vulnerable despite a good year
▼ + stars: | 2022-12-12 | by ( Hugo Dixon | ) www.reuters.com time to read: +7 min

PARIS, Dec 12 (Reuters Breakingviews) - Aristotle said there are three good forms of government – monarchy, aristocracy and constitutional democracy – in which the rulers act for the common benefit. Rich democracies face two main threats: an external one from autocracies, such as China; and an internal one from demagogues. Both autocrats such as Chinese President Xi Jinping and demagogues such as former U.S. President Donald Trump have had a bad year. The world economy faces a tough decade. Until democrats provide some answer to this, they will be vulnerable to new waves of autocracy and demagogy.

☆ Friendshoring makes sense if done in the right way
▼ + stars: | 2022-12-05 | by ( Hugo Dixon | ) www.reuters.com time to read: +7 min

These examples explain the enthusiasm for “friendshoring”, an idea U.S. Treasury Secretary Janet Yellen is pushing. First, it could provoke an all-out trade war – causing the kinds of disruptions that friendshoring is intended to prevent. Things would be different if China was the West’s implacable enemy in the way that Putin’s Russia is. Using friendshoring in a defensive rather than aggressive way means focusing on strategic products. While it makes sense to cut its dependency on China, that doesn’t mean going all the way to zero.

ATHENS, Nov 28 (Reuters Breakingviews) - There will be no joy if countries get help for climate damage from a fund promised at COP27, but the planet still fries. Call this a country’s “above average emissions“. When you run the numbers from 1992 to 2019, America is the biggest polluter, responsible for 44% of all the “above average emissions”. DYNAMIC FORMULAIt seems fair to look at above average emissions to date when judging who should pay for a current climate disaster, such as the flooding in Pakistan. If one froze the formula on the basis of above average emissions up to now, countries wouldn’t have an incentive to cut their pollution.

☆ The world can harness trade to save the planet
▼ + stars: | 2022-11-21 | by ( Hugo Dixon | ) www.reuters.com time to read: +7 min

But the right trade policies can also do a lot to save the planet. The first step is to have even-handed carbon tariffs. The World Trade Organization is worried that imposing carbon tariffs in an uncoordinated way could damage global trade and is working on a framework to avoid this. Global trade is struggling following the Covid-19 pandemic, Russia’s invasion of Ukraine and tension between China and America. By COP28, they and other countries should drive forward trade policies to save the planet.

☆ The shafts of light in a dark, dark world
▼ + stars: | 2022-11-14 | by ( Hugo Dixon | ) www.reuters.com time to read: +7 min

The Ukraine conflict has made inflation and debt even worse. The conflict in Ukraine and the early stages of a cold war with China mean it’s hard to get global consensus on anything. The G20, whose members include China, India and Russia, played a big role tackling the 2008 global financial crisis. Meanwhile, the war has strengthened the alliance between America, Europe and like-minded countries across the world. But there is increasing pressure on the World Bank and other multilateral development banks to perform part of this task.

☆ Don’t dump on U.S. coal plan. Make it better!
▼ + stars: | 2022-11-11 | by ( Hugo Dixon | ) www.reuters.com time to read: +4 min

SHARM EL-SHEIKH, Egypt, Nov 11 (Reuters Breakingviews) - Sceptics fear an American plan to use voluntary carbon markets to accelerate the energy transition in poor countries could amount to greenwashing. Many critics think rich countries should just fork out the cash themselves to close coal plants – or tax fossil fuel companies to get the money. This “jurisdictional” approach is designed to prevent new coal plants springing up where old ones have been closed. Why not hitch itself to the high standards already being developed by the Voluntary Carbon Markets Integrity Initiative? Another concern is that the ETA is planning to use cash not just to close coal plants but also to ramp up renewable energy.

☆ U.N., standard setter ISO launch net-zero guidelines
▼ + stars: | 2022-11-11 | by ( Virginia Furness | Hugo Dixon | ) www.reuters.com time to read: +2 min

LONDON, Nov 11 (Reuters) - The United Nations and standard setter the International Organization for Standardization launched a set of guidelines on Friday to help organisations construct net-zero emissions plans. As regulators increasingly focus on tackling weak corporate environmental claims, and investors call for harmonised global standards, the U.N. and ISO said its work would act as a core reference text on what to include in their net-zero plans. The ISO's guidelines were developed by a group of 1,200 organisations and experts from over 100 countries. While around 80% of global emissions are covered by net-zero pledges, many organisations lack a clear strategy, and the new ISO guidelines are intended to provide a practical guide. "The guidelines support clarity, we don't replace the ISSB but help companies navigate these multiple initiatives," said Emily Faint, net-zero policy manager at Our 2050 World, the group's secretariat.

☆ How Joe Biden can help save the planet at COP27
▼ + stars: | 2022-11-07 | by ( Hugo Dixon | Andre Cabette Fabio | ) www.reuters.com time to read: +7 min

States such as Pakistan will also complain that they are already suffering the consequences of climate change despite having done very little to cause it. PULL IT TOGETHERAmerica and other rich countries have a series of policies which could accelerate the just transition across the Global South. Developing and emerging economies, excluding China, need $1 trillion a year in investment, according to a new report from the Rockefeller Foundation. And they need help adapting to the ravages of climate change. If America and other rich countries negotiate a whole-economy transformation with India, they will kill two birds with one stone.

☆ What to watch on Monday at COP27
▼ + stars: | 2022-11-07 | by ( Hugo Dixon | ) www.reuters.com time to read: +2 min

But their messages will likely differ a lot on key points, and their soaring rhetoric will at times clash with performances that have lagged past promises. U.S. President Joe Biden will arrive next week, as will newly elected Brazilian President Luiz Inacio Lula da Silva. Chinese President Xi Jinping is not scheduled to attend COP27, but he will have an envoy at the conference. Other things to watch will include a World Trade Organization report expected Monday about the role of trade policy in climate change, and some expected announcements about forests as climate sinks. Reporting by Valerie Volcovici; Editing by Lisa ShumakerOur Standards: The Thomson Reuters Trust Principles.

☆ Europe’s pain will be ultimately worth it
▼ + stars: | 2022-10-31 | by ( Hugo Dixon | ) www.reuters.com time to read: +7 min

The combination of crises, caused by President Vladimir Putin’s invasion of Ukraine and hefty borrowing when interest rates were artificially low, will test the bloc. Then the European Central Bank was able to keep interest rates low and buy government debt. ENERGY SQUABBLESEU leaders congratulated themselves early in the year when they came together to condemn Putin’s invasion, impose sanctions on Russia and support Ukraine. EU leaders are already complaining about high interest rates, with Giorgia Meloni, the new Italian prime minister, criticising the ECB last week. But the central bank cannot avoid raising interest rates even if it wanted to.

☆ Breakingviews: Delusions of grandeur are root of Britain’s chaos
▼ + stars: | 2022-10-21 | by ( Hugo Dixon | ) www.reuters.com time to read: +7 min

The immediate cause of the chaos Truss unleashed was her failure to heed the advice of her hero Margaret Thatcher. Truss might have got away with large tax cuts and a big increase in spending if central banks were still flooding the global economy with cheap money. Its supporters maintained leaving the EU would put rocket boosters under the UK economy. But delusions of grandeur meant this global phenomenon played out in the UK in a specific way. BRITAIN’S MANY STRENGTHSObservers such as former U.S. Treasury Secretary Lawrence Summers have described Britain as a bit like an emerging market.

☆ Delusions of grandeur are root of Britain’s chaos
▼ + stars: | 2022-10-21 | by ( Hugo Dixon | ) www.reuters.com time to read: +7 min

☆ Xi Jinping has silver linings for rest of world
▼ + stars: | 2022-10-17 | by ( Hugo Dixon | ) www.reuters.com time to read: +7 min

LONDON, Oct 17 (Reuters Breakingviews) - A third term for Xi Jinping would risk a cold war, or even a hot one. Until recently, most analysts agreed it was only a matter of time before China’s economy, which was three-quarters the size of America’s in dollar terms last year, became the world’s largest. Register now for FREE unlimited access to Reuters.com RegisterSTUCK IN SECONDBut China’s economy is running into all sorts of problems. But Beijing-based Dimitri De Boer, of the environmental organisation Client Earth, thinks that’s very unlikely because the target is binding and China’s president has positioned himself as an environmental champion. But Germany challenged Britain in World War I when its economy was still powering ahead, according to Allison.

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