World must adapt Russian sanctions new norm

According to Seatrade Maritime News, the joint statement by the G-7 Finance Ministers for the month of September confirmed as much when they said, “We underscore our shared commitment to our determined and coordinated sanctions imposed in response to Russia’s war of aggression.”

Russia now faces the highest number of sanctions in the world. The figure stood at 5,581 in March, some way ahead of Iran and Syria. By August 7,750 individuals faced sanctions along with 1,452 entities, 91 vessels and six aircraft.

Even if a ceasefire in the current Ukraine war were agreed tomorrow, the sanctions would continue since it would take so long for Russia to be accepted as a normal trading partner by the G7 countries and their allies.

The important point is that everyone engaged in international trade must accept the semi-permanence of anti-Russian sanctions and ensure they take every step possible to adhere to them. Carriers, forwarders, charterers, insurers, importers and exporters and port authorities, all need to know who they are dealing with more than ever and be fully alert to the possibility of Russian proxies masquerading as legitimate entities.  

From now on, due diligence means screening all vessels and trade transactions to pick up suspicious activity by shell companies or front organizations that link back to Russia, which is capable of highly sophisticated workarounds when it comes to sanctions?

While Iran has been increasingly cunning in side-stepping sanctions, Russia is a larger economy with many more established contacts beyond its vast borders. For all organizations engaging in trade, monitoring for sanctions or trade-based money laundering is more of a necessity than ever.

In Britain, the urgency for organizations to screen and monitor for illegal Russian trading activity has increased with the introduction by OFSI (The Office of Financial Sanctions Management) of a strict liability test for sanctions breach investigations.

But around the world, more countries are taking different aspects of sanctions seriously, especially in relation to cargo-carrying vessels.

In Asia it was the Monetary Authority of Singapore that took the strongest line on such matters.

In April, in a sign that times are changing, the Central Bank of Bangladesh mandated the country’s banks to implement vessel-tracking to cut down on money laundering.

All legitimate organizations involved in trade need to increase the scope of routine and ongoing activity such as KYC and TBML monitoring and screening. They must have the ability to spot the indicators of illicit Russian activity or illegal trade with “Russian owned or affiliated” entities.

There are several areas that need close attention, which include:

Complex or changed ownership structures in companies supplying vessels for transactions: While there are often valid reasons for complex ownership, organizations need to watch out for shell companies, and questions of registration, domicile and control. This is more than simply looking at public details. Technology drawing on many sources can now see more deeply into ownership structures, which is an important first step.

Histories: Organizations need to avoid use of vessels or carriers with records of infringement or “going dark” by switching off AIS beacons, or which have a history of visits to areas or ports known for sanctions-flouting. Switches to flags of convenience or sudden changes of ownership should be warning lights in the current climate.   

Obscure supply chains: It is important to know which banks are financing transactions and who the parties and beneficiaries are. In the physical supply chain, anyone financing or participating in a transaction needs to know where the goods or commodities are coming from and where they are going. Just looking at vessels listed is not enough.

Vessel monitoring: Organizations need the end-to-end visibility to see ports of origin and ports of loading in any transaction. But they also must track vessels carrying the cargo across the oceans and be aware when they linger in areas known for illegal ship-to-ship transfers, or visit ports recognized as high-risk for sanctions flouting. Having the technology to check certificates of origin, bills of lading, consignees and so forth is vital, especially for banks financing or facilitating thousands of trade deals and shipments every day.

Vague drafting of sanctions: Knowing who or what is “Russian-owned and affiliated” can be difficult to nail down. It is understandable that port authorities, for example, do not want to make wrong moves that prove to be costly, such as impounding vessels where lawyers can make a strong case for legitimacy, or where ownership and responsibility are difficult to establish. Many ports lack sufficient screening technology, which is a deficit they need to address.

With thousands of transactions underway at any moment, the burden of ensuring continuing compliance with a mounting body of sanctions is immense.

Success will only be achievable through technology that can pull in all the relevant data at scale and analyses it in near-real time as part of an integrated monitoring and compliance solution.

Many financial organizations, for example, already have compliance technology into which they could integrate advanced sanctions-screening solutions.

Sanctions are unlikely to become any less complex and those against Russia are here to stay for years. For any organization participating in cross-border trade, it is surely worth avoiding any failure in screening or monitoring that could result in hefty fines and significant long-term reputational damage.

 

Governments urged to phase out fossil fuel

The Investors managing US$39 trillion have called on governments around the world to raise their climate ambition; including setting plans to phase out fossil fuel use and forcing companies to set out science-based transition plans.

The move by some - but not all - top fund firms comes ahead of the next round of global climate talks in Egypt in November this year.

This year's letter is the most ambitious appeal to officials yet, backers of the effort said, with additional requests for action on tackling methane pollution and scaling up finance to poorer countries.

Organized by the Investor Agenda, a group of investor-focused groups that count many of the world's largest fund managers as members, the 2022 Global Investor Statement to Governments on the Climate Crisis was the 13th one to be issued.

Investors are taking action as it is not only permitted by law but is in many cases required to ensure their ability to generate returns in the long-term as a core fiduciary duty and benefit from the opportunities associated with the shift to a net-zero emissions economy.

Other requests by the investors included scaling up low-carbon energy systems; implementing carbon pricing mechanisms that rise over time; establishing new or more ambitious plans to end deforestation.

In all, 532 investors signed the latest iteration including UBS Asset Management, Amundi SA and Federated Hermes.

However, none of the top three US index fund managers BlackRock, Vanguard and State Street Corp signed onto this letter.

The reticence comes as the process of investing with an eye on environmental, social and governance-related issues, or ESG, faces growing pressure in the United States.

Iran-Pakistan explore ways to expand trade

In a meeting between Consulate General of Iran in Karachi Hassan Nourian and Head of Tehran Chamber of Commerce, Industries, Mines and Agriculture (TCCIMA) Masoud Khansari, the officials discussed ways of expanding trade relations between Iran and Pakistan.

In this meeting, which was held at the place of TCCIMA on Monday, important issues such as the unfamiliarity of the businessmen of the two countries with the production capabilities, goods and services of each other, the existence of some communication and commercial monopolies, the decrease in the number of business delegation exchanges due to the pandemic, and the need for cooperation in holding exhibitions as well as more attention to border crossings were raised and discussed.

Referring to the volume of trade between Iran and Pakistan, Nourian said, “Informal trade between the two countries is large, and many Iranian products are traded in the Pakistani market using national currencies; trade through third countries and even smuggling also takes place, and it is estimated that the actual trade between the two countries is much higher than what is recorded in the official statistics.”

“For a long time, establishing a barter trade mechanism between the two countries has been discussed for developing mutual trade, and in this regard, a memorandum of understanding has also been signed between Zahedan Chamber of Commerce and Quetta Chamber of Commerce and Industry, but nothing special has happened in terms of implementation, and it seems that more focus and effort should be put on this issue,” the official added.

Referring to the holding of an exhibition in Karachi in late December, Nourian called on the Iranian chambers of commerce to make the necessary arrangements for the maximum presence of Iranian companies in this event.

Khansari for his part stated that TCCIMA will take the necessary measures to ensure the presence of private sector companies in the Karachi exhibition.

He further noted that TCCIMA is going to send an official invitation to Karachi Chamber of Commerce to send a business delegation to Tehran.

US Rail Strike Poses Economic and Political Risks for President Joe Biden

This week is shaping up to be a pivotal one for companies in the United States that rely on trains for transporting commodities, components and finished products.

Railroads and labor unions worked through the weekend to avoid a strike that could cost the world’s largest economy more than US$2 billion a day. Few signs of progress emerged, and the companies are advising customers of the likely service disruptions ahead of a potential walkout later this week.

On Sunday, Norfolk Southern said in an online notice that it “has begun enacting its contingency plans for a controlled shutdown of our network at 00:01 on Friday, September 16.” Union Pacific and CSX also announced contingency planning for a possible strike. BNSF urged its customers to call members of Congress to prevent any interruptions.

According to Bloomberg Intelligence analyst Lee Klaskow, BNSF and Union Pacific combine for 45% of Class I intermodal traffic. CSX and Norfolk Southern have 31%.

Trains accounted for about 28% of total US freight movements, according to government data for 2020, making it the busiest mode after trucks. Half of that traffic moves bulk commodities — particularly food, energy, chemicals, metals and wood products — as well as automobiles and industrial parts. The other 50% consists mostly of shipping containers carrying smaller consumer goods.

Strike or no strike, the nation’s freight-rail system is still dealing with imbalances. Earlier this month, for instance, the shipping line Maersk said it was suspending import bookings through Fort Worth, Texas, citing “severe congestion” around rail ramps and container yards in the region.

It’s not an isolated situation. The interlinked system that’s the lifeblood of the American economy is still recovering from the worst disruptions of the pandemic, and trains are a vital link in that chain.

Below are a few charts to help illustrate where the supply-chain snarls remain a challenge on the rails. The first one shows data from Hapag-Lloyd, Germany’s largest container-shipping line. The company reports dwell times for its intermodal boxes are staying steady or rising at key import and export junctures from Los Angeles to Savannah, Georgia.

Among the more prominent logjams continues to slow cargo movement around the twin ports of Los Angeles and Long Beach, California. There, nearly 80% of shipping containers are waiting more than five days on average to make their rail connections — a big jump from the beginning of the year, according to data from the Pacific Merchant Shipping Association.

Texas has the most miles of railroad tracks of any state but Illinois — and Chicago, in particular — has been the most important hub of US intermodal commerce for more than a century. According to the Association of American Railroads, 25% of all US freight rail traffic and 46% of all intermodal traffic starts and stops or passes through the Chicago region.

While 10 of 12 railroad workers’ unions have struck new labor deals, the two holdouts — the Brotherhood of Locomotive Engineers and Trainmen and the International Association of Sheet Metal Air, Rail, and Transportation Workers — account for more than 90,000 rail employees.

Their joint statement on Sunday didn’t hold back, accusing the railroads of scare tactics in the negotiating process that amounted to “corporate terrorism.”

The timing isn’t good for the trains to stop running. Harvest season across the farm belt is approaching, retailers are stocking up for the year-end holidays, and the economy already faces a stretch of weaker growth and high inflation.

The most immediate concern in the event of a rail strike would be for perishable goods. The American Bakers’ Association said, “Even a temporary interruption would create a devastating ripple effect that would create a shortage of materials and ingredients.

Iran turning public transport fleet dual fuel

Iran has managed to save over 370 million liters of gasoline over the past two years by turning 213,000 public transport vehicles into dual-fuel vehicles, according to the Head of National Iranian Oil Products Distribution Company (NIOPDC).

“Converting gasoline-fueled public transport vehicles into gas-powered ones has been one of the tasks of National Iranian Oil Products Distribution Company in recent years, and by converting 213,000 public transport vehicles so far, 370 million liters of gasoline have been saved and the country has earned US$126 million in revenue,” Shana quoted Ali-Akbar Nejad-Ali.

Speaking at the inauguration ceremony of some infrastructure projects in Tehran, Nejad-Ali said that the realization of NIOPDC’s development projects is dependent on the development of electronic governance.

“Based on the resolution of the Supreme Council of Information Technology, which was notified to all executive bodies in 2019, the executive bodies must put the development of electronic government on their agenda, and fortunately, in this regard, very positive and forward-looking actions have been taken over the last two years,” he said.

According to the official, NIOPDC has it on the agenda to turn 1.206 million public vehicles into dual-fuel by the Iranian calendar year 1405 (begins in March 2026).

He announced the signing of contracts with 330 workshops across the country to convert gasoline-fueled vehicles into dual-fuel ones.

Despite having abundant natural gas resources, the Islamic Republic is also one of the world’s leading gasoline consumer countries, and a great part of the country’s 100-million-liter gasoline output is used inside the country, while the exports of the mentioned fuel can be an excellent source of income for the country and less gasoline consumption would also mean less air pollution and a cleaner environment.

Tackling this issue, the Iranian government has been promoting the use of Compressed Natural Gas (CNG) as a replacement for gasoline over the past few years and has declared CNG the country’s national fuel.

Following the above-mentioned declaration, in December 2019, the National Iranian Oil Refining and Distribution Company (NIORDC) and Iran’s state-owned Iran Khodro Company (IKCO) signed a memorandum of understanding (MOU) to add new dual-fuel vehicles to the country’s public transportation fleet.

The mentioned MOU was signed following a resolution by the Government Economic Council that targeted adding 1.46 million dual-fuel vehicles to the public transportation fleet.

Pakistan Stock Exchange announces names of Top 25 Best Performing Companies

Pakistan Stock Exchange (PSX), on Monday announced the much awaited list of the recipients of the Top 25 Companies Awards for the year 2021. The Top 25 Companies Awards, initiated in the year 1978 are presented to the companies listed at PSX posting outstanding performance. 

The key pre-requisites for companies competing for this prestigious award include minimum dividend distribution of 30%, trading of shares for at least 50% of the total trading days during the year, and the company not being on the Defaulters’ Segment of the Exchange or not having trading in its shares suspended on account of violation of Listing Companies & Securities Regulations of the Exchange during the said year. Specific weightages are also included for reporting on Sustainable Development Goals (SDGs) as well as for Diversity & Inclusion to qualify for the PSX Top 25 Companies Award.

Companies which have shown outstanding performance in terms of corporate governance, financial performance, increasing shareholder value and have reported on sustainability make it to the Top 25 Companies list. Specifically, companies who have outperformed others in terms of their Profitability & Liquidity Ratios, Dividend & Solvency Payout Ratios, TSR, Free Float of Shares, Turnover of Shares, and specific quantifiers of Corporate Governance & Investors Relations, including metrics such as reporting on Corporate Social Responsibility (CSR), Sustainable Development Goals (SDGs), and Diversity & Inclusion are selected for the PSX Top 25 Companies Award.

Speaking at the occasion of announcement of the PSX Top 25 Companies Awards 2021, the Managing Director and Chief Executive officer of (PSX) Farrukh H. Khan, stated, “On behalf of Pakistan Stock Exchange, I warmly congratulate the recipients of the PSX Top 25 Companies Awards 2021. At a time when we need positive economic news and role models in Pakistan, the PSX Top 25 Companies Awards showcases the best of the best in corporate performance, profitability, governance, and reporting on sustainability in Pakistan’s industry and business world. This Award presents a positive image of Pakistan’s business and economy, both domestically and internationally. These companies are not just best in class in Pakistan but also compare with the best global companies.”

The companies that made it to the Top 25 Companies Awards list in 2021, in order of their performance ranking, are:

 

1         Fauji Fertilizer Company Limited

2         Engro Corporation Limited              

3         Systems Limited                                                              

4         Ferozsons Laboratories Limited

5         Engro Fertilizers Limited                                               

6         Security Papers Limited

7         Dawood Hercules Corporation Limited                   

8         Habib Bank Limited

9         TRG Pakistan Limited                     

10     Meezan Bank Limited

11     The Hub Power Company Limited                                            

12     MCB Bank Limited

13     Cyan Limited                                     

14     EFU Life Assurance Limited

15     Pakistan Oilfields Limited             

16     Bank Alfalah Limited

17     Jubilee Life Insurance Company Limited                                

18     International Industries Limited

19     Engro Polymer & Chemicals Limited

20     Mari Petroleum Company Limited

21     Gadoon Textile Mills Limited                      

22     International Steels Limited

23     Pakistan Cables Limited

24     Packages Limited

25     Adamjee Insurance Company Limited 

 

US arms manufacturers making fortune from Ukraine war

Since the Ukraine war on February 24, Western governments have been shipping large quantities of weapons to the country, making the arms supply an extremely lucrative trade for dealers. 

The US administration under President Joe Biden has been announcing fresh military packages on a regular basis. Weapons being sent to Ukraine that will keep the US military complexes busy for a long time to come. 

The aggregate US military aid totals at least US$25 billion committed since late February until August 03, 2022 according to the Ukraine Support Tracker.

On Thursday, Secretary of State Antony Blinken announced another US$2.2 billion military package for Ukraine and neighboring countries. Earlier President Biden had also approved a separate US$675 million in weapons to Ukraine, Defense Secretary Lloyd Austin announced. 

There is no sign the US is willing to end war; on Friday the White House said Biden will request a further US$11.7 billion in emergency funding from Congress to provide lethal aid and budget support.

The five largest companies in the world that manufacture weapons are all American namely: Lockheed Martin, Raytheon, Boeing, Northrop Grumman and General Dynamics. In fact, half of the top 100 producers of arms are based in the United States, while twenty are located in Europe. 

In the aftermath of the Ukraine conflict, these five American firms saw their stock prices soar in a sign that investors believed profitable days were ahead.

At a time when the broader stock market as measured by the S&P 500 had slumped by about 4%; Lockheed Martin’s stock price was up over 12% – with most of the gains occurring in its immediate aftermath. Northrop Grumman has jumped by 20%. 

It’s not just the dealers making profit, over the past months; reports have emerged showing how members of Congress stand to personally profit from the war with lawmakers or their spouses holding stock in arms dealers such as Lockheed Martin or Raytheon Technologies. 

Likewise, politicians in Britain such as members of the House of Lords made tens of thousands of pounds by owning shares in the largest British weapons manufacturer and sixth in the world, BAE Systems. The arms dealers’ share price rose by 23% following the outbreak of war in Ukraine. 

It’s not just politicians who benefit from the vast arms supplies to Eastern Europe; weapons dealers have many people on their payroll as well. These include the many pundits on the face of American mainstream media who discuss the war in Ukraine while having strong links with the US arms manufacturers.

It makes the job of the Biden administration much easier when trying to sell to the public the reasons to send more weapons and making announcements about new military packages. 

The US has shipped at least 5,500 Javelin anti-tank missiles manufactured jointly by Raytheon Technologies and Lockheed Martin. The two firms will be paid to replenish American stocks with the money coming from a US$40 billion package signed by Biden. 

The other weapons America has been sending include longer range missile systems, anti-ship missiles, anti-tank missiles, anti-aircraft missiles, helicopters, rockets, launchers, howitzers, radar systems, drones, aerial systems, armored vehicles, small arms, artillery and other arms. Washington has also put aside money for training, maintenance and sustainment. 

That’s a lot of arms being shipped over by the US, which is leading the Western war effort in Eastern Europe against Russia which has long blamed the US and NATO for triggering the conflict.

Moscow requested an emergency meeting of the United Nations Security Council on Thursday to discuss Western arms supplies to Ukraine. 

The Russian Ambassador, Vasily Nebenzya, told the council it was a fantasy to believe that Western powers can determine the outcome of the conflict with their weapons supplies.

A significant proportion of these weapons find itself in the hands of smugglers right from the warehouses. In the darknet, one can find all kinds of offers to buy these weapons. We’ve already seen similar situations in the Balkans and the Middle East where Western military arsenals were then re-exported to Europe and then used by criminal groups on European territory or found their way into the hands of terrorists. 

The UN disarmament chief, Izumi Nakamitsu, has also warned that the flood of weapons being sent to conflict areas such as Ukraine raises many concerns including the potential for diversion.

Campaigners have also been speaking out about the consequences of where the vast number of weapons may end up. Kristen Bayes, a spokesperson for the Campaign Against the Arms Trade, says the provision of weapons to Ukraine is not problem free. "You might think you're handing over weapons to people you know and like, but then they get sold on to people you absolutely don't”.

Campaigners say the risk of advanced and sophisticated weapons delivered to Ukraine ending up in the black market is high because authorities are not in full control of all territory. They argue it is also difficult to keep track of the arms when they have been sent so quickly.

In July, the Financial Times quoted Western officials with knowledge about talks between several NATO members and Kyiv to explore a tracking system or detailed inventory lists for weapons highlighting Western fears about missing weapons. 

“All these weapons land in southern Poland, get shipped to the border and then are just divided up into vehicles to cross in trucks, vans, sometimes private cars,” said one of the Western officials. “And from that moment we go blank on their location and we have no idea where they go, where they are used or even if they stay in the country.”

It’s not just the US; Britain has also committed at least £2.3 billion in military assistance.  Following the Britain are: Poland, Germany, Canada, the Czech Republic, Australia and France. Out of the 28 countries sending weapons, 25 are NATO members. 

Many European countries used the Ukraine conflict to announce plans for increased military spending. The additional commitments are worth at least €200 billion according to the EU.

Germany committed an extra €100 billion in the coming years, with Chancellor Olaf Scholz saying defense would make up two percent of his country’s GDP from now on. As a result of the news, German arms manufacturers can expect to see their sales grow significantly. Berlin has already announced it will be purchasing 35 American F-35 war planes, which are produced by Lockheed Martin and have an estimated lifetime cost of US$1.6 trillion. 

The French President Emmanuel Macron has pledged to expand his country's defence budget, while the British government had already planned increased spending before the conflict broke out but faces pressure from Labour to spend even more. 

Poland said that it had requested 500 HIMARS launchers and ammunition from Lockheed Martin. Estonia confirmed it has been in touch with the American manufacturer also to buy launchers and ammunition worth. Latvia and Lithuania are expected to follow suit.

Campaigners say with so much profit being made from the war, it’s not surprising that peace is not being pursued.

Why is the US avoiding penalizing 9/11 facilitators?

Today marks the anniversary of “the strangest incident” which plunged the world in turmoil. Some quarters say the US administration has kept the ‘facilitators’ immune and avoided taking any punitive measures against them.

The lack of any action by Washington in pursuing the inquiry displays utter disregard to killing of people in Afghanistan and Iraq.

This explains lack of US interest in seeking any justice for the millions of civilians killed by its bombing in          Afghanistan, Iraq, Yemen, and elsewhere. One may recall that the US had waged two wars on the pretext of fighting terrorism. 

Both of which went horribly wrong with civilians paying the price for the policies of hawks and arms manufacturers in Washington. They thrive on the US military adventures abroad or other conflicts that the US supports with constant arms supply. 

The billions of dollars spent on two invasions in the aftermath of 9/11 made the world less safe and could have been invested domestically instead to eradicate the many problems plaguing America such as homelessness, child hunger, poverty or even the country’s outdated infrastructure. 

Last year, President Joe Biden administration came under strong pressure by 9/11 family members, survivors and emergency responders to declassify an earlier FBI report, summarizing an investigation into the attacks. 

In a sign of how fed up the 9/11 families had become, Biden was told he would not be welcome at the 9/11 memorial events unless he fulfilled a pledge to be more transparent than other presidents. 

In what was an expected U-turn, the American president travelled to Saudi Arabia this year, asked for greater oil production and recently approved a multi-billion-dollar arms deal to the Kingdom. 

In 2017, the US clinched deal with the Saudis worth US$350 billion. The trade is simply too lucrative and would not be possible if ties to Saudi Arabia are broken.

America has made accusations against others over the 9/11 attacks, including Iran, something which is quite laughable and touching on borderline stupidity. However, it is not unexpected from the US officials, who have blamed Iran for just about everything. 

The accusation against Iran is more for domestic audience and aimed to make up for Washington’s failures in genuinely addressing the attacks with any tangible results.

What is even more regrettable is that people of Iraq and Afghanistan had nothing to do with the 9/11 attacks but were made to suffer for 20 years after their land was invaded and occupied by American forces. 

20 years later, the US chaotically withdrew from Afghanistan; but in a severe blow to humanitarian efforts in the country, the White House has frozen seven billion dollars of Afghan funds. 

 

 

Queen Elizabeth is dead, but her legacy will continue

Queen Elizabeth II, Britain’s longest-reigning monarch, died on Thursday at the age of 96. The Queen’s son, 73-year-old Prince Charles has succeeded her as King. Her death has garnered the condolences of world leaders, including President Joe Biden, who said that the Queen “defined an era” of “unmatched dignity” in Britain.

For many, particularly in the West, Queen’s 70-year reign was marked by stability and diplomacy. Under Elizabeth, the Royal Family has taken pains to distance itself from the country’s politics and the monarchy’s long colonial history.

But for millions of people who lived through and still suffer the consequences of the Royal Family’s colonialism and racism both abroad and at home, the Queen’s legacy will live on in the form of the violent and lasting rule that the Royal Family has overseen and still profits from.

Many defenders of the Royal Family argue that Queen Elizabeth should be shielded from such scrutiny because she distanced the family from this past and attempted to amends the past and present colonies through events like Commonwealth tours.

Critics rebut this argument, saying that the Royal Family still hasn’t confronted its past or paid reparations to the people who continue to suffer as a result of the British monarchy, decades on from direct colonial rule.

The Royal Family has also faced criticism for appearing to attempt to sweep its history under the rug, especially during the Queen’s platinum jubilee this year.

“By design as much as by the accident of her long life, her presence as head of state and head of the Commonwealth, an association of Britain and its former colonies, put a stolid traditionalist front over decades of violent upheaval,” wrote Harvard University history professor Maya Jasanoff for The New York Times.

“As such, the Queen helped obscure a bloody history of decolonization whose proportions and legacies have yet to be adequately acknowledged.”

For almost as long as the monarchy has existed, it has been a colonialist and imperialist power, colonizing and exploiting dozens upon dozens of countries and territories in particular in the global South, many of which share common consequences of poverty and continued oppression.

Over centuries, Britain has funneled trillions of dollars from its colonies to enrich itself, and it continues to profit from its racist past and present to this day. The monarchy was built on slavery, establishing a slave trade that saw the transport of millions of Africans and South and North Americans to other countries. The slave trade was so vast, in fact, that it wasn’t until 2015 that the country fully paid off its “debts” to slave owners from freeing slaves in the 19th century.

Elizabeth, whose rule began in 1952, did not, herself, enact these policies — and she did do her small part to step in when, for instance, former Prime Minister Margaret Thatcher refused to help end apartheid in South Africa.

But others, like those who directly suffered under British imperialism during her time on the throne, say that she has had a direct impact on modern decision making.

Some historians may say it’s unclear which of the British-imposed horrors that occurred under her rule — like those in places like Kenya and Ireland — were authorized by her.

Others argue that she bears responsibility that these atrocities happened to begin with. Similarly, this distance between the Crown and the country’s political decisions often does not hold for victims of Britain’s colonial rule that occurred under Elizabeth.

The symbolism of her rule does not escape those on the left, who argue that in modern days, the throne is a symbol of oppression, whiteness and vast wealth inequality in Britain — even if mainstream members of the left do not dare advocate for its abolishment.

Elizabeth was at least partially directly responsible for some of the inequalities that the country saw and perpetuated while she was on the throne.

In recent years, the Crown has resisted calls for reparations from countries like Barbados and Jamaica for their bloody and abominable exploitation in the British slave trade.

The Royal Family’s record of racism domestically over the past decades does not reflect well upon the Crown, either. These inequalities have been perpetuated within Buckingham Palace itself; royal advisers banned “coloured immigrants or foreigners” from working in the palace until at least the late 1960s, over a decade into Elizabeth’s reign.

The family’s deep-seated racism appears to persist today; in 2020, Duke and Duchess of Sussex Prince Harry and Meghan Markle outright left the Royal Family over racism within the family, despite protestations from family members like Prince William.

Courtesy: South Asia Journal

China-Israel aim to sign a free trade deal

China and Israel aim to sign a free-trade agreement by the end of 2022 in a breakthrough that would give Beijing its first deal in the Middle East plus a boost after years of trade friction with Australia and the United States.

Chinese Commerce Minister Wang Wentao and Orna Barbivay, the Israeli Minister of Economy and Industry, raised hopes in a chat earlier this year of signing their agreement within 2022, Amir Lati, Consul General of Israel in Hong Kong, told The Jerusalem Post.

The two sides have held trade talks online since the start of the pandemic to follow up on discussions that began in 2016, the consulate representative said.

Meanwhile, Esti Ayalon-Kovo, head of the Israeli economic mission to China in Beijing, said, “Both sides are conducting regular online meetings and are striving to reach an agreement as soon as possible. This agreement is expected to enhance and simplify trade between the two countries.”

Chinese state media had reported in April that negotiations toward a China-Israel trade pact were accelerated following a call between Foreign Minister Wang Yi and his then-counterpart from Israel, Yair Lapid, but no timetable was given.

China has been smarting from tariffs on US$550 billion worth of its exports to the United States since Washington launched a trade dispute in 2018. Sino-Australian relations also have soured over the past five years, especially after Canberra called for a probe into the origins of Covid-19 and Beijing imposed punitive sanctions on Australian imports.

Over the past two decades, Beijing has pursued stronger economic ties in the Middle East, landing comprehensive strategic partnerships with Iran and Saudi Arabia while trying for a trade pact with six oil-rich countries known as the Gulf Cooperation Council. China is interested in the region for its oil, gas and hi-tech investment opportunities.

The deal with Israel would show that the two sides can work together economically despite differences over Palestine, said Victor Gao, Vice-President of the Centre for China and Globalisation in Beijing. China recognized the state of Palestine in 1988. Israel occupies Palestinian land.

 “China hasn’t signed any FTAs in the Middle East, so I hope after this one it can get more in west Asia, the Middle East and Eastern Europe and hold this one up as a model” when seeking trade deals with other countries, Gao said.

A trade pact would make it easier for China to work with Middle Eastern nations on broader issues by showing it does not align only with Arab nations as in the past, said James Chin, a professor of Asian studies at the University of Tasmania in Australia.

“China has always tried to be a player in the Middle East, but the reason they haven’t gotten any traction is that they’re usually perceived as leaning toward Arab nations,” Chin said. “The signal is ‘We can talk to both sides’.”

In November 2019, the two countries discussed trade in goods, rules of origin, customs procedures and intellectual property rights, among other topics, the Ministry of Commerce in Beijing said at the time.

The ministry noted “positive progress” after that round, which was the seventh between the two countries.

Annual trade between Israel and China stood at US$250 million 30 years ago and had reached US$22.8 billion by 2021, according to China customs data, China accounts for about 11% of Israel’s international trade.

China is Israel’s biggest trade partner in Asia, accounting for 39% of its total export of goods to Asia, Lati added. Israel’s chief China-bound exports are medical devices, agricultural technology and other machinery and chemicals, including fertilizer. The trade deal would mark Israel’s second in Asia after South Korea, and would become China’s 16th bilateral trade agreement.

China might leverage the trade pact to access Israel’s hi-tech scene, which is led by innovation and venture capital, Gao said. Israeli tech firms raised US$25.6 billion in capital last year, The Times of Israel reported.

A “foothold” in Israel’s advanced hi-tech would dovetail with China’s giant tech hardware manufacturing sector, Chin said.

We see this agreement will allow new Israeli exporters to export to China, said Esti Ayalon-Kovo, Head of Israeli Economic Mission to China

Israel already has a framework to promote connections among 15 government ministries and agencies from both countries, with the intent of deepening economic cooperation.

This week, Israeli ambassador to China Irit Ben-Abba Vitale said in a speech that China values its start-up accelerators and incubators but cautioned that “academic research” should be converted to “industry research”, domestic media outlets reported.

The Chinese side could tap the trade deal as well, to adopt some of Israel’s agricultural technology, including ways of using water in an arid climate like that of the Middle East, Gao said. Parts of China have been devastated by drought this year.

If it manifests as expected, the agreement will focus largely on trade in goods rather than services, according to Ayalon-Kovo, and Israel’s tariffs are already low overall. She described the agreement as being in its last stages, with the chief hurdle being how to sign it online, rather than in person.

“We see this agreement will allow new Israeli exporters to export to China,” Ayalon-Kovo said.

United States imposes new sanctions on Iran

The United States on Friday has imposed sanctions on Iran's Ministry of Intelligence and Security and its Minister, accusing them of being tied to a disruptive July cyberattack on Albania and engaging in other cyber activities against the United States and its allies.

The move came after Albania severed diplomatic relations with Iran on Wednesday for the same incident, ordering Iranian diplomats and embassy staff to leave within 24 hours. 

The US Treasury Department in a statement said the Ministry of Intelligence and Security directs several networks of cyber threat actors, including those involved in cyber espionage and ransomware attacks in support of the Iranian government.

The Ministry was already designated under US sanctions. Iran's mission to the United Nations in New York did not immediately respond to a request for comment.

Microsoft, whose cybersecurity research team investigated the incident, said in a blog post on Thursday that the Iranian cyber operation involved a combination of digital espionage techniques, data wiping malware and online information operations. The goal of the hackers, according to researchers, appeared to be to embarrass Albanian government officials.

The July attacks temporarily disrupted government websites and other public services. Analysts say the operation was intended to punish Albania for supporting an Iranian dissident group based in the country, known as the Mujahedin-e Khalq (MEK). 

How will Russian gas shutoff affect the EU?

In early September, Russia announced that it would keep the Nord Stream 1 gas pipeline to the EU closed until sanctions are lifted.

As the lifting of sanctions appears off the table, this implies that the EU will be without a large chunk of Russian gas supply this winter.

The impact on the EU economy will be twofold. First, Russia’s decision will keep gas prices high in the coming months—prices are currently around four times higher than a year ago—and likely weigh on the euro, dampening households’ purchasing power and consumption.

Second, the move raises the risk of energy rationing this winter, which could have a significant impact on industrial output.

Even before this latest development, analysts had expressed their apprehensions that the bloc may witness sharp slowdown of the economy. These projections are now set to be revised down in their next forecast.

That said, the effect on the European economy is still highly uncertain. For one, it will vary from country to country.

Those with large industrial sectors and with heavier reliance on Russian gas, such as Germany and Italy, are the most exposed.

Moreover, while Nord Stream 1 is the main route supplying Russian gas to Europe, it is not the only one, as gas is still flowing westward from Russia via Ukraine and Turkey.

The fate of these routes, together with the EU’s efforts to source alternative supply from the North Sea, the United States and Algeria, will be crucial in determining the extent of the upcoming supply crunch.

The weather will also play an important role; a mild winter would reduce gas demand for heating.

Finally, the EU has not sat on its hands in response to the Nord Stream shutdown. Member states are mulling a range of EU-wide options, from gas price caps to a windfall tax on energy companies, and measures to reduce energy demand.

Moreover, further fiscal support is to be expected at the national level. If approved, these measures will offset the fallout from constrained gas supplies to some degree.

As such, while Russian move is certainly a blow to the EU economy, it is not yet a death knell.

“The countries most likely to face gas shortages are Germany, Austria, Italy, the Czech Republic and Slovakia. Those countries' governments are already working to reduce demand and diversify their sources of gas, on the assumption that Russia is no longer a reliable supplier.

The spillover effects will be substantial for the rest of Europe too, with external demand and confidence suffering, and inflation remaining elevated.

On the potential economic fallout, analysts at Goldman Sachs said, a full shutdown could drive European household energy costs up by about 65% to around €500 (US$512) per month.

Industries like chemicals and cement in Germany and Italy might have to cut their gas usage by as much as 80%.

The euro-area economy would likely shrink by more than 2% through March 2023, with GDP in Italy and Germany declining as much as 4% and 3% respectively.

 

Iranian export to India increases 35%YoY

The value of Iranian export to India increased by 35% in the first seven months of 2022, as compared to the same period in 2021, Tasnim news agency reported citing the data released by the Indian Ministry of Commerce and Industry.

Iran exported commodities worth US$361 million to India in the seven-month period of this year, while the figure was US$267 million in the same time span of the past year.

Fruits were the major products Iran exported to India, accounting for 26% of the total exported items. Iran exported US$96 million of fruits to India in the mentioned time span.

During January-July of 2022, Indian export to Iran increased by 54% to US$1.243 billion, while the figure was $807 million in the first seven month of 2021.

Rice was India’s major product exported to Iran in the said time, as the product accounted for 66% of the country’s total export to the Islamic Republic.

India exported US$825 million of rice to Iran in the first seven months of this year, while the figure was US$641 million in the first seven months of 2021.

According to the Indian Ministry of Commerce and Industry, the value of trade between Iran and India was reported at US$1.604 billion during January-July 2022, rising 49% from US$1.074 billion in the same period of time in 2021.

In late May, Iranian ambassador to India said that Iran and India are trying to diversify the channels of payments to expand the bilateral trade.

In an exclusive interview with Financial Express Online, Ali Chegeni said, “We are trying to diversify the channels of payments and accordingly wish to extend and expand an already existing mechanism in order to cover all of the goods and services including all of non-oil goods and to achieve this”.

During the past two years, because of Covid restrictions, we pursue the issue via virtual dialogues and currently our officials are following the matter through the exchange of delegations, the envoy stated.

“We want to develop our economic and trade relations beyond energy and petrochemical products. Since due to the complementarily of Iran and India economies, an extensive range of non-oil trade exists between two sides including trade on goods and services, investment, tourism, education, which may pave the way for multiplying our economic relations ten times more than current relations in mid and long terms”, Chegeni said.