At the Intersection of Geopolitics and Geoeconomics

December 19, 2023 | Volume 6, Issue 11 | The BlackSummit Team

Here is a summary of important events that unfolded over the last month, and which may affect economic, financial, and geopolitical issues in the months ahead:

North America

• In the last month, Republican and Democrat lawmakers have been at odds over military aid, particularly for Ukraine. Republican senators blocked President Biden’s request for further Ukraine funding earlier this month, highlighting waning support for continued US funding for the country. The bill would also have provided military aid to Israel. US President Joe Biden warned Republican members of Congress that they were aiding Moscow’s ambitions in Ukraine by blocking aid. Despite pleas from Ukrainian President Volodymyr Zelenskyy during his visit to Washington, Republicans were still not convinced to support a $61 billion military aid package. Republicans have argued that further aid must be conditioned on immigration policy changes and enhanced border security. President Biden later announced he would be proceeding with a $200 million aid package that does not need Congress’s approval.

• Texas Governor Greg Abbot has signed a bill that would authorize state police to arrest people suspected of illegally crossing the border. The bill is likely to force Texas and the federal government into a legal battle, as immigration enforcement is a federal responsibility. While that has been supported by past Supreme Court decisions, Texas Republicans hope that a more conservative Supreme Court would overturn the precedent. This comes at the same time as US border officials closed international railway bridges in Eagle Pass and El Paso due to a surge of migrants traveling by train. Mexican civil society groups have criticized the closure, which they say would hamper cross-border trade. All of this has happened after the Asia-Pacific Economic Cooperation (APEC) Summit held in San Francisco this year, where Biden and Mexican President Andres Manuel Lopez Obrador met and discussed illegal immigration and fentanyl trafficking between the two countries.

• A Manhattan indictment released within the past month details an alleged plot by the Indian government to assassinate Gurpatwant Singh Pannun, general counsel for Sikhs for Justice, a group supporting Sikh separatism from India. The filing charges Indian national, Nikhil Gupta, with murder and conspiracy to commit murder for hire after the accused purportedly attempted to contract an assassin in the US. Unbeknownst to Mr. Gupta, the assassin in question was in fact an undercover law enforcement agent, whose testimony served as the backbone for Mr. Gupta’s arrest warrant. The filing comes on the heels of an assassination carried out in Canada, similarly against a Sikh separatist, and risks creating further diplomatic tension between the US and India.

Europe

• European Union (EU) members have greenlit accession talks with Moldova and Ukraine. While Hungarian Prime Minister Viktor Orban made very clear his disapproval of the measure, he nonetheless chose to leave the room rather than veto the vote, paving the way for the measure to pass. As such, the measure was voted in the affirmative by 26 of 27 EU member states. The vote is considered by EU leadership as an important victory for Ukraine against Russia.

• The EU has agreed to the A.I. Act, a first-of-its-kind, sweeping set of regulations designed to manage the risks associated with the burgeoning technology. The act focuses on what are considered the riskiest uses of AI and requires transparency from general-purpose AI systems, such as found in ChatGPT; restricts the use of facial recognition software by police and governments outside of certain national security exemptions; and requires AI-generated images to be labeled as such. Failure to comply by companies will result in a fine of 7% of global sales. The law is set to take effect 12-24 months from now, which has raised questions regarding its efficacy as AI has shown rapid advancement in the past few years. Moreover, the novel laws are expected to be tested in court, further delaying their potential impact.

• Finland has closed off its entire eastern border due to the continuing influx of migrants from Russia. In November, Finland’s government chose to close the entire 830-mile border with Russia after alleging that Moscow could be using migrants to destabilize Finland in an act of “hybrid warfare.” However, two sections of the border were previously opened less than two weeks ago on a temporary basis to assess if the “migrant phenomenon” still existed at the border. In November alone, Finnish authorities say that 900 migrants – the majority of which are from Syria, Somalia, and Yemen – had arrived at the border without proper visas or valid documentation, prompting the government to close off the entire border again late last week. Moscow has denied it is encouraging migrants to enter Finland.

• Serbia’s ruling party, the SNS party of President Aleksandar Vučić, won an outright majority in parliamentary and local elections on Sunday. However, amid widespread reports of vote-rigging, tens of thousands of Serbs protested in the capital of Belgrade on Monday and additional demonstrations are planned. Some election observers, including the Organisation for Security and Co-operation in Europe (OSCE), found irregularities in the election, prompting the EU to demand that election procedures are tightened and that all “credible reports of irregularities are followed up in a transparent manner” by Serbian authorities.

Asia, Eurasia, & the Pacific

• Armenia and Azerbaijan released a joint statement over the past month claiming that both see a “historical chance” for a “long-awaited peace,” with both countries hopeful that a peace treaty can be negotiated by the end of the year. In addition to the statement, Baku released 32 Armenian servicemen and Armenia released two Azerbaijanis. Further, Armenia has dropped its bid to host the COP29 conference in support of Azerbaijan’s. While talks between the two countries had stalled in the US and Spain due to accusations by Azerbaijan of Western bias, talks resumed in October in Iran, resulting in the current state of negotiations.

• Former British prime minister and newly-minted foreign secretary, David Cameron, met with Chinese Premier Li Keqiang in the past month to talk business. In addition to support for a proposed EU-China trade agreement, he argued that the Chinese and United Kingdom (UK) economies are deeply complementary, urged greater investment, and announced the institution of same-day business visas for visits to the UK. Meanwhile, the EU also visited China for a summit in Beijing. EU leadership pressed China on the trade imbalance between the EU and China and on Chinese support for Russia in Ukraine.

• The Philippine government and the country’s communist rebels have agreed to resume peace talks aimed at ending decades of armed conflict. The country’s Communist Party and its armed wing, the New People’s Army, have fought successive Philippine governments since 1969. The conflict has resulted in the deaths of more than 40,000 soldiers and civilians.

• Two boats filled with Rohingya refugees were found after a UN refugee agency sounded the alarm. The boats, which had 300-400 refugees including many women and children, landed in Indonesia’s northeastern Aceh province after spending weeks at sea. They had sustained significant engine damage and left the vessels adrift in the Indian Ocean for six weeks. The boats embarked from Bangladesh as part of a typical seasonal exodus of displaced Rohingya people stuck in refugee camps in Bangladesh, who are there after having fled repression in Buddhist-majority Myanmar.

Continue Reading for news from the Middle East, Latin America, and Sub-Saharan Africa