Posts Tagged ‘Macron’

Trump, France’s Macron discuss Iran, Middle East and trade

August 11, 2018

U.S. President Donald Trump spoke on Friday with French President Emmanuel Macron and they discussed trade, Iran and the Middle East, the White House said.

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FILE PHOTO – French President Emmanuel Macron and U.S. President Donald Trump talk during a bilateral meeting on the sidelines of the NATO (North Atlantic Treaty Organization) summit in Brussels, Belgium, July 11, 2018. Ludovic Marin/Pool via REUTERS

“Had a very good phone call with @EmmanuelMacron, President of France. Discussed various subjects, in particular Security and Trade,” Trump, who is vacationing at his New Jersey golf club, said on Twitter.

The two leaders discussed “a broad range of trade and security issues, including the situation in Iran and the broader Middle East,” the White House said in a statement.

The Elysee Palace said in a brief statement the two leaders discussed Syria, Iran and the Israel-Palestinian conflict, but did not mention trade.

Trump and Macron last met at a NATO summit in Brussels in July, where the U.S. president chastised members of the alliance that have not met its defense spending targets.

At the summit, Macron said France would met the NATO goal of spending 2.0 percent of GDP on defense by 2024. Trump caused an uproar when he pressed alliance members to reach the target by January.

On trade, the United States and the European Union are embroiled in a spat after Trump imposed tariffs on imports of aluminum and steel from France and other countries. The EU responded with retaliatory tariffs on some U.S. goods.

Trump had also threatened to impose tariffs on EU auto imports but reached an agreement to hold off on taking action after meeting with European Commission President Jean-Claude Juncker at the White House last month.

Macron and Trump are at odds over the U.S. decision to withdraw from the Iran nuclear deal and reimpose sanctions on Tehran. Trump tweeted this week that companies doing business in Iran will be barred from doing business in the United States.

Among large European companies that have suspended plans to invest in Iran after the U.S. action are France’s oil major Total and its big carmakers PSA and Renault.

In the Middle East, France opposed Trump’s decision to move the U.S. Embassy to Jerusalem from Tel Aviv.


Reporting by Eric Beech in Washington and Nicolas Delame in Paris; editing by Clive McKeef


Britain seeks EU nations’ support to avoid ‘messy divorce’

August 1, 2018

 “There is a real risk of a messy divorce, which would be a geostrategic mistake”.

Britain has stepped up warnings of the risk that the Brexit talks collapse as it seeks to bypass Brussels and persuade individual European Union nations to back its plans for future economic ties.

Foreign Minister Jeremy Hunt visited Vienna on Wednesday, after talks in Paris the day before, and warned “there is a real risk of a messy divorce, which would be a geostrategic mistake”.

His trip was part of a wider European diplomatic offensive by Britain, which will see Prime Minister Theresa May meet French President Emmanuel Macron at his Mediterranean retreat on Friday.

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She will seek to sell her proposal for close economic ties with the EU after Brexit, a half-in, half-out plan that has enraged her own eurosceptics but which she insists is the only practical way forward.

The European Commission’s chief negotiator, Michel Barnier, has expressed scepticism and last week rejected a key element of the proposal relating to tariffs on the Irish border.

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But London is seeking to emphasise directly to European capitals the need for greater flexibility, warning that all sides would suffer if Britain leaves the EU next March without an agreement in place.

“The probability of no deal is increasing by the day until we see a change of approach from the European Commission,” Hunt told London’s Evening Standard newspaper in an interview published Tuesday.

He added: “France and Germany have to send a strong signal to the Commission that we need to negotiate a pragmatic and sensible outcome that protects jobs on both sides of the Channel.”

“For every job lost in the UK, there will be jobs lost in Europe as well if Brexit goes wrong,” Hunt said.

– France and EU ‘cohesion’ –

Two of May’s pro-Brexit ministers, including Hunt’s predecessor Boris Johnson, resigned over her Brexit plan last month saying it would undermine the opportunities of leaving the EU.

But May is pressing ahead, discussing it with German Chancellor Angela Merkel last month, and holding talks last week with the Austrian and Czech leaders.

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German Chancellor Angela Merkel

On Friday, May will have a meeting and private dinner with Macron at the French presidential retreat at Bregancon, the first foreign leader to be invited there.

A government source told the Times that France was “holding fire” on May’s Brexit plan.

“So we’re making the case to them. It looks like the jury’s still out on them, so that’s why she’s going,” the source said.

It follows a visit to Paris by her Brexit minister Dominic Raab on Thursday, and another last week by her business secretary Greg Clark, who also visited Italy and Portugal.

France is seen as taking a particularly hard line in the Brexit negotiations, especially on financial services, where it has openly sought to poach businesses from the City of London.

Some British officials also believe France is opposing continued British involvement in the EU’s Galileo satellite programme because of the potential benefits to its own aerospace sector.

However, Austrian Foreign Minister Karin Kneissl warned after talks with Hunt on Wednesday against attempts to divide the bloc, saying there was a “high degree of cohesion” in the EU on how to proceed.

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Austrian Foreign Minister Karin Kneissl

Kneissl, whose country currently holds the rotating EU’s presidency, added that it was “very clear” that the European Commission was leading the talks.

Barnier himself said last week that there was not a “sliver of difference” between him and the 27 EU leaders in the negotiations.

– Brexit worries –

As the government goes on the charm offensive abroad, concerns are growing in Britain itself about the practical impact of leaving the EU without a deal.

Downing Street was forced to deny on Monday that it had plans for the military to step in, but ministers have confirmed plans to stockpile food and medicines.

The impact of Britain’s decision to leave the EU is already being felt — official figures released Tuesday reveal Britain was the only G7 nation to experience a slowdown in 2017.

Meanwhile Freedom of Information requests from around 30 local authorities, lodged by Sky News, revealed their concerns about Brexit, ranging from a fall in agricultural land prices to a lack of Europeans working in the care sector.


France’s Macron under fire after aide filmed hitting street protester

July 19, 2018

One of President Emmanuel Macron’s top security officers was at the centre of a potentially damaging scandal for the French leader on Wednesday after being filmed hitting a protester.

Le Monde newspaper published a video showing Alexandre Benalla hitting and then stamping on a young man while wearing a police visor during a demonstration in central Paris on May 1.

Benalla, who is not a policeman and previously worked as bodyguard, had been given permission to “observe police operations” during a day-off on the May 1 public holiday, Macron’s office said.

The presidential palace added that Benalla had been suspended for two weeks after the incident came to light and had been transferred out of his job, which was organising security for Macron’s trips.

© Lionel Bonaventure, AFP | French presidential candidate Emmanuel Macron (C), flanked by security staff member Alexandre Benalla (R), shakes hands as he visits Paris’s international agriculture fair, March 1, 2017

“This sanction was to punish unacceptable behaviour and it was a final warning before being sacked,” presidential spokesman Bruno Roger-Petit told reporters.

Prosecutors in Paris opened a probe on Thursday into possible charges of violence by a public official, pretending to be a policeman and the illegal use of police insignia.

Benalla was a popular and ever-present member of Macron’s campaign team, usually found several steps behind the then-candidate, and transferred to the presidential staff in May 2017.

‘Double standard’

Opposition MPs immediately suggested there had been a cover up and questioned why the incident had not been referred to the police when it came to light in May.

“This video is shocking. Today, we have the feeling that in Macron’s entourage, one is above the law. It is obvious that Macron has to speak up about this,” Laurent Wauquiez, president of conservative opposition party Les Républicains told Europe 1 radio.

Socialist Party leader Olivier Faure said there was “a double standard” in how Benalla had been treated compared to any ordinary French citizen.

Alexis Corbière, an MP for the hard-left France Unbowed party, said Benalla “deserves to be punished with a prison sentence, at least a suspended sentence and with very heavy sanctions”.

Supporters of Macron claimed that the punishment handed down to Benalla – suspension without pay for two weeks and a transfer to an administrative job – was appropriate.

“Someone was found to have unacceptable behaviour and there was a sanction,” Social Cohesion Minister Julien Denormandie said on France Inter radio station on Thursday, without naming Benalla. “It was immediate… meaning a suspension and a job change.”

Richard Ferrand, a senior MP from Macron’s party and top figure in the campaign team, said, “It was not a close aide, it’s someone who was responsible for security of the president during the election campaign and then joined the Élysée.”

Benalla was suspended from May 4-19.

(FRANCE 24 with AFP and REUTERS)

With Trump strategy unclear, U.S. allies turn to Moscow to secure their interests in Syria

July 15, 2018

As President Trump began a six-day trip to Europe, due to culminate Monday in a meeting with Russian President Vladi­mir Putin, Putin was having some meetings of his own.

In Moscow on Wednesday, he hosted Israeli Prime Minister Benjamin Netanyahu, a frequent visitor, who said he wanted to talk to the Russian leader “without intermediaries.” Hours later, Putin sat down with Ali Akbar Velayati, the foreign policy adviser to Iran’s supreme leader.

The main subject of the meetings was Syria, also a top item on Trump’s agenda.

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Russian President Vladimir Putin shakes hands with Israeli Prime Minister Benjamin Netanyahu during their meeting Wednesday, July 11, at the Kremlin to discuss Syria.

“Of course I’m going to bring that up” with Putin, Trump said Friday during a stop in Britain. “I’m not going in with high expectations,” he said, “but we may come out with some surprising things.”

By Karen DeYoung and Joby Warrick
The Washington Post

As Trump and Putin prepare to meet in Helsinki, both allies and adversaries in the Middle East are turning to Putin for reassurance and understanding of how such surprises might affect them. For Iran, which has partnered with Russia to keep Syrian President Bashar al-Assad in power and decimate his U.S.-backed opposition, keeping Moscow close is a no-brainer.

But for many of America’s allies in the region, who say they have little understanding of Trump’s long-term strategy in Syria, there is growing anxiety about what he is prepared to offer Putin in exchange for help in attaining what he says is his primary goal of expelling Iran.

Russian President Vladimir Putin, center, shakes hands with Ali Akbar Velayati, a senior adviser to Iran’s Supreme Leader Ayatollah Ali Khamenei, as Russian Foreign Minister Sergey Lavrov, stands at right, at Novo-Ograyovo outside in Moscow on July 12, 2018. (Alexei Druzhinin, Sputnik, Kremlin Pool Photo via AP)

Among the possibilities raised by senior officials in a number of regional governments, some of which also concern administration officials, are that Trump will agree to a partial or complete withdrawal of U.S. forces from Syria — as both Syria and Russia have demanded — or even to recognize Russia’s annexation of Crimea and drop U.S. sanctions.

Trump signed Wednesday’s NATO communique declaring that it would never accept Russia’s “illegal and illegitimate” takeover of Crimea. If he breaks ranks, it would be his most direct slap yet at the alliance, at a moment when NATO unity already hangs in the balance.

Removing the 2,200-strong U.S. military contingent in Syria, however, is seen as a more realistic possibility. Trump’s suggestion earlier this year that the United States would withdraw troops from Syria “very soon,” widely interpreted to mean six months, continues to create confusion within the U.S. military as well as among Washington’s regional partners.

U.S. military officials see the changing dynamics in southwest Syria, as Assad strengthens his control over remaining rebel-held areas, as disconnected from their ongoing campaign against the Islamic State. But they also see the situation as a signal of Syria’s new reality — one in which Assad will remain in power, aided by Russia and Iran. Although the officials said Friday that they have seen no plans to begin to remove troops, they said they are bracing for such a decision.

Israel, Jordan, Saudi Arabia and others, according to senior Middle Eastern officials who spoke on the condition of anonymity of name and country to avoid publicly questioning Trump, agree that such a step would be disastrous, eliminating whatever leverage the United States still has to push for an acceptable outcome in Syria.

In the lead-up to the Trump-Putin summit, Russia has continued to defend Iran’s presence in Syria and demand complete U.S. withdrawal, charging that its military deployments are a sham.

“Let me remind you that they talked about defeating ISIL at first, [and] declared the prevention of ISIL’s rebirth as their goal later,” Russian Defense Minister Sergei Shoigu told an Italian newspaper on Thursday, using an acronym for the Islamic State. Now, he said, the Americans “say [their] presence in Syria should continue to deter the hypothetical ‘Iranian influence.’ ”

President Vladimir Putin with the French leader Emmanuel Macron in St. Petersburg, Russia, in May.CreditPool photo by Dmitri Lovetsky. MAcron is meeting with Putin on Sunday, July 15, 2018.

“If our American colleagues are pursuing any course of action in Syria, it is too contradictory to be called a strategy,” Shoigu said.

U.S. regional allies share the objective of preventing Iran from establishing an unhindered corridor through Syria from Tehran to Beirut. But they worry that Trump may be too willing to accept guarantees that Putin has neither the desire nor ability to deliver.

Security officials in several countries in the region are skeptical that the Russians could force an Iranian withdrawal, even if they wanted to. “Assad owes everything to Iran, and he’s playing a game between the Russians and Iranians,” said one official in the region.

At the same time, another senior official from the region said, “the Russians play good chess. Putin wouldn’t make a move without thinking 10 moves ahead.”

Confused by apparently conflicting administration messages, and doubtful that the United States has a plan for achieving its own long-term goals in Syria, regional allies have reached out to Russia. “For years, there has been a growing disappointment with the U.S. posture in the region,” a third official said. “Countries are beginning to make their own calculations.”

Assad’s recent offensive in southwestern Syria, bordered by Jordan and the Israeli-occupied Golan Heights, is a case in point. The area had been largely peaceful since last summer, when Putin and Trump endorsed a cease-fire deal that froze Russian-backed Syrian government forces and U.S.-backed opposition fighters in place along a demarcation line patrolled by Russian police.

Late last month, however, Assad’s forces, aided by Russian airstrikes and Iranian-directed militias, began heading south from Damascus for an announced takeover of the area. As the offensive got underway, the administration publicly denounced Russia for violating the cease-fire agreement, even as it privately told regional allies that it would not oppose the move and messaged opposition forces that they would get no assistance and were better off giving up.

The administration apparently asked Russia for nothing in return. As refugees from ground attacks and Russian bombing fled to nearby borders, and humanitarian organizations warned of catastrophe, Israel and Jordan turned to Moscow to ensure that their interests would be protected.

For Jordan, whose foreign minister traveled there shortly after hearing the news from Washington, Russia came through. Early this week at the Naseeb border crossing into Jordan, where days earlier tens of thousands of refugees were crowded in dire conditions against the closed border, only several hundred remained under the watch of Syrian soldiers who had arrived with a small Russian-flagged convoy.

While the Russians kept a discreet presence at the border, their impact has been palpable, and Jordan, despite its not-so-secret support for the rebel groups in the past, welcomed the outcome. “Now, I believe that even within a week, most of the [rebel] groups will agree on terms, and some will be integrated back into their communities,” Brig. Gen. Khaled Massaid, the head of Jordan’s northern military district, said in an interview at his command center a few dozen yards from the crossing.

As Syria’s civil conflict has dragged on for years, Jordan’s economy has come under increasing strain, including the costs of coping with an estimated 1.3 million refugees. “The Naseeb border has reopened, and the regime is in charge again,” Massaid said. “It is better for Jordan if Syria is able to control its own border.”

While Israel, like the United States, continues to demand Iran’s complete withdrawal from Syria, its immediate concern is keeping the Iranians at least 50 miles or more away from its border. Netanyahu left Moscow last week — his third visit in recent months — with what the Israeli media reported was a deal with Russia, both to keep Iran and its militias away from the border area and to continue turning a blind eye to Israeli airstrikes against Iranian targets in Syria — the latest of which occurred last week.

“It’s very clear that Russia and Israel are cooperating on Syria. The Saudis and Russia are cooperating,” said a senior international diplomat closely involved in the conflict, who spoke on the condition of anonymity and described those contacts as a “good thing” to the extent that they “helped cool things down.”

“The Americans,” the diplomat said, now consider “Syria . . . a Russian thing.”

But Sen. Lindsey O. Graham (R-S.C.), a strong proponent of keeping U.S. troops in Syria and a skeptic of Russia, tweeted a warning to Netanyahu. “To our friends in Israel,” he wrote, “be very careful making agreements with Russia re Syria that affect U.S. interests. I don’t trust Russia to police Iran or anyone else in Syria.”

Warrick reported from the Naseeb border crossing in Jordan. Missy Ryan in Washington contributed
to this report.


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BlackRock and Citi plan Paris expansion in Macron coup

July 9, 2018

US fund manager chooses French capital as new base for alternative investment services

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Martin Arnold and Owen Walker in London and David Keohane in Paris

French president Emmanuel Macron’s charm offensive to win business from the City of London is starting to pay off as BlackRock and Citigroup join other Wall Street groups in expanding their Paris operations ahead of Brexit.

Mr Macron has rolled out the red carpet for financial services companies, promising to cut taxes and red tape while talking up the economic prospects of the country with a “France is back” pitch.

In a victory for the French president, BlackRock has chosen Paris over London for its new base to provide alternative investment services across Europe and Asia, as the world’s biggest money manager aims to dominate markets outside its US home.

The decision by BlackRock follows months of courting by the French establishment, including a meeting between Mr Macron and Larry Fink, chief executive of the $6.3tn asset manager, at the Elysée Palace.

The French leader has also persuaded Citi to expand in the country. The US bank recently poached senior investment bankers from UBS in France as part of plans to add dozens of extra staff in Paris.

“The effect of Macron has lightened up the country — before his election it was pretty bleak,” said Luigi de Vecchi, chairman of corporate and investment banking in continental Europe at Citi, who is moving from Milan to Paris. “As you talk to French CEOs, they are all pumped up with tons of cash and aggressive plans.”

BlackRock, which already has nearly 50 staff in Paris and manages around €30bn for French clients, applied to the French markets regulator, the Autorité des Marchés Financiers, two weeks ago for a licence to set up an alternative investment fund management company in the country. This would enable it to sell products such as hedge funds, real estate and commodities funds to the global market from its Paris office.

The company hopes to receive authorisation in September. Last month it hired Henri Chabadel as chief investment officer for France, Belgium and Luxembourg, based in Paris.

London will remain BlackRock’s main European office and the company does not plan to relocate staff from the UK to Paris. Any hires will be new roles. BlackRock declined to comment.

With nine months to go before the UK leaves the EU, financiers are frustrated at the lack of progress in negotiations on the terms of Britain’s departure. Many are starting to rejig their European operations to cope with any disruption. But Brexit was not the main motivation for the French expansion of BlackRock or Citi.

“The question is whether in the long term banks will see the number of large corporate clients reduced in the UK,” said Mr de Vecchi, pointing out that Brexit had made British companies vulnerable to takeover by weakening the pound. “Whereas in France you are seeing the creation of European champions.”

Arnaud de Bresson of the business lobby group Paris Europlace said financial companies were ramping up plans to open offices in France. “The first teams are arriving,” he added. “It’s true for asset management companies — including coming from London — but also for international banks.”

Citigroup, which employs about 160 people in Paris, said in an internal memo that it had hired Gregoire Haemmerle and Pierre Drevillon from UBS to become head of its French corporate and investment banking unit and head of French M&A, respectively.

Citi plans to add 150 jobs in its sales and trading operation in Frankfurt and as many as 100 more, mostly in Paris, but also spread across Milan, Madrid, Dublin and Amsterdam.

In the immediate aftermath of the Brexit vote, most Wall Street banks opted for Frankfurt or Dublin to create their alternative EU hubs. But recently some have been unveiling plans to bulk up in Paris.

Lloyd Blankfein, chief executive of Goldman Sachs, said in a tweet last year that he was “struck by the positive energy here in Paris” before the bank announced last month that France was a priority in its plans to double its workforce in continental Europe.

Bank of America said recently it was relocating three senior investment bankers from London to Paris. JPMorgan Chase said last week it expected to “migrate or add a few hundred roles” to the EU ahead of Brexit — many of which are set to be in Paris. Morgan Stanley also plans to add about 80 jobs in Paris after Brexit. HSBC, which already has a big French operation, has said it is likely to move up to 1,000 jobs to Paris.

In addition, inter-dealer broker TP ICAP is in talks with French regulators about setting up a base in Paris in the first quarter of 2019.

France’s Nantes sees second night of protests, arrests after police shoot local man

July 5, 2018

Police in the southwestern French city of Nantes clashed again with protesters overnight. The demonstrations followed a deadly shooting by police of a man during a stop-and-search.

Riot police in Nantes (Getty Images/AFP/S. Salom Gomis)

Police arrested at least 12 people during a second night of protests in the French city of Nantes. Demonstrators clashed with riot police on Wednesday night, with the unrest lasting through the night in the districts of Breil and Garges-les-Gonesse among others.

Prime Minister Edouard Philippe, who was in Nantes on Thursday, condemned the violence. He also tweeted that “above all, it hurts the development of these districts and darkens the prospects of their residents.”

The protests followed the death of a 22-year-old man, identified by local media as Aboubakar F., who was fatally shot in Breil during a stop-and-search operation.

The man, who grew up in one of the city’s most deprived districts, was wanted for robbery and other offenses.

Edouard Philippe (Getty Images/AFP/D. Meyer)PM Edouard Philippe visited Nantes on Thursday

When he was stopped, police say he attempted to reverse the car he was in, hurting one of the police officers in the knee,. This led to another officer opening fire.

A woman who filmed the incident, has contradicted the police’s account and an investigation has been opened.

Within hours of his death, protesters gathered in several neighborhoods of Nantes. Molotov cocktails were thrown, vehicles set on fire and a shopping center attacked.

French police frequently clash with protesters in deprived areas of major French cities, with officers often accused of being heavy-handed.

A silent march has been planned for Thursday evening in Nantes over his death.

ng/jm (AFP, AP)

The China-U.S. Power Struggle Is Just Beginning

July 5, 2018
Xi’s ‘Chinese Dream’ envisions a nation less beholden to West — China economic rivalry destined to strain relations with U.S.
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Chinese President Xi Jinping has an ambitious master plan for his country’s transformation into a wealthy, technology-driven global economic power. And U.S. companies need not apply.

That’s why the current trade rumble between the U.S. and China, in which the Trump administration is threatening to slap tariffs on $34 billion of Chinese imports and Beijing promises to respond in kind, is far more than just a spat over market restrictions, intellectual property rights and the epic U.S. deficit.

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Xi Jinping Photographer: Fred Dufour-Pool/Getty Images

On a deeper level, the standoff reflects an escalating economic and military rivalry between a status quo power and one of the most remarkable growth miracles in history. It’s a clash between two divergent systems, (one state-directed, the other market-driven) with markedly divergent world views and national aspirations. That strategic tension seems likely to intensify, regardless of how the current brinkmanship over tariffs plays out.

It’s also a battle for global influence. Whereas the U.S. has long sought to spread democracy and free markets to other nations, China’s ruling Communist Party is just starting to pitch its heavy-handed growth model as an alternative for developing nations. And Xi is backing it up with hundreds of billions of dollars in loans for infrastructure projects from Asia to Europe and beyond.

In the U.S., a bipartisan consensus has begun to emerge that now is the time to stand up to China, even if many oppose President Donald Trump’s tactics. Senate Minority Leader Chuck Schumer, a Democrat, has attacked Trump for not being tougher on China, saying last week that failure to change Beijing’s behavior now could hurt the U.S. economy “for generations to come.”

With a roughly $13 trillion economy and expanding wealth, China is now going head-to-head with the U.S. in advanced manufacturing and digital technologies. It also has the wherewithal to make rapid technological progress in defense, particularly with air-to-air missile systems that pose a strategic challenge in Asia for the U.S. and its allies.

Xi is playing a long game, pursuing what he calls the “Chinese Dream,” or “the great rejuvenation of the Chinese nation.” To get there, he has set targets to double his country’s per capita gross domestic product (from 2010 levels) to $10,000 by 2021 and refashion China into a tech powerhouse, competitive in robotics, new energy-vehicles, chips, software and other bleeding-edge industries under his Made in China 2025 program. A separate development strategy envisions China ruling in artificial intelligence by 2030.

The aim is to produce global champions — not just national ones — and Xi’s government is ready to use the commanding heights of its one-party state to steer subsidies and use preferential policies and ambitious local content rules favoring Chinese companies to get there. At stake are industries that make up about 40 percent of China’s value-added industrial manufacturing sector, according to an analysis by the U.S. Chamber of Commerce, citing data by the Rhodium Group, a research firm.

Predatory Economics

China’s push for more self-reliance may reverse the trend toward deeper economic integration with the U.S. that came following China’s accession into the World Trade Organization in 2001. China is the single largest foreign purchaser of U.S.-manufactured goods — led by transportation, chemical, computer and electronics — outside of North America, according to the National Association of Manufacturers. Chinese goods have also flooded across American shores, pushing up the U.S. trade deficit with China more than fourfold to $375 billion last year.

James Mattis

Photographer: Tomohiro Ohsumi/Bloomberg

The Trump administration views such deficits as alarming and Chinese trade practices as brash mercantilism, even a national security threat. U.S. Defense Secretary Jim Mattis labeled China a “strategic competitor using predatory economics” in January as he unveiled the Pentagon’s National Defense Strategy.

Xi views his economy’s shift into higher-tech manufacturing not only as a crucial part of its development, what with surging labor costs, a rapidly aging population and high corporate debt levels — but also as a fulfillment of China’s destiny. That process is well underway: China is set to overtake the entire euro area this year, according to data compiled by Bloomberg.

Talks to avoid a trade war have stalled in part over U.S. demands that China reduce state support for high-tech industries. While China has signaled a willingness to buy more American goods to balance out the deficit, it has refused to trade away what it views as an essential part of its economic future.

How ZTE Ended Up in Middle of U.S.-China Trade War: QuickTake

Tech companies are on the front lines of this contest for global supremacy. Back in 2013, Chinese investigators started making life difficult for American tech “guardian warriors” like Google, Intel Corp., Apple Inc. and Microsoft Corp. after a magazine with ties to the Communist Party sounded the alarm about their dominant role in Chinese networks and business.

The U.S. has been just as inhospitable to Chinese tech concerns, with telecommunication makers like Huawei Technologies Co., ZTE Corp. and China Mobile Ltd. being viewed as national security risks. The Trump administration has also weighed restrictions on Chinese companies and start-ups in sectors ranging from aerospace to robotics.

This week’s tariffs, however, may show which side has the stronger hand. The first batch will take force Friday barring any last-minute deal. Trump has threatened duties on another $200 billion worth of Chinese goods if Beijing imposes countermeasures.

Xi is betting that Trump will back down as price increases in politically sensitive states make him worry about losing the next election in 2020. Xi enjoys something closer to life-time job security, thanks to the repeal of Chinese presidential term limits in February.

Donald Trump at a rally in South Carolina on June 25.

Photographer: Mandel Ngan/AFP via Getty Images

The sharp downturn in Chinese stock markets amid rising trade tensions is scarcely a threat to his rule. His party-led government has a big say over strategy and investments plans at giant state-owned enterprises, which control 40 percent of China’s industrial assets and some of the world’s biggest banks.

Still, anti-trade rhetoric underpinned Trump’s election win, and if anything the former New York real estate developer has doubled down on using tariffs in spats with both foes and allies. Although polls suggest Trump faces difficult mid-term elections in November, a fight to replace a U.S. Supreme Court justice may prompt his political base to overlook slightly higher monthly bills.

Economists and trade experts who testified in June before the U.S.-China Economic and Security Review Commission, set up by Congress to track the national security implications of trade with China, say tariffs are likely to inflict a lot of economic damage on both economies and depress global trade.

Great Unwinding

China will also return the favor — Beijing has announced plans to target U.S. auto, aircraft, plastics and chemicals sectors — and “the imposition of tariffs will not solve the underlying Chinese distortive behavior,” warned Linda Menghetti Dempsey, vice president of International Economic Affairs at the National Association of Manufacturers.

Instead of using tariffs, the U.S. could’ve sought to join with the European Union and Japan to bring a case against China at the World Trade Organization. But that’s unlikely after Trump slapped tariffs on EU nations and Japan, while also undermining the WTO. His withdrawal from the 11-nation Trans-Pacific Partnership trade deal removed another key device to alter China’s behavior.

Some prominent academics are calling for more drastic measures to undercut China’s practice of trading market access for technology transfers, such as unwinding Asian supply networks in high-end tech sectors.

Just Beginning

Harvard Business School Professor Willy C. Shih favors tax incentives, and even setting up import processing zones in the U.S. to repatriate offshore suppliers for the likes of Intel, Apple and Microsoft. “It would strengthen our ability to sustain the most advanced semiconductor fabs in the United Sates,” Shih said.

In the end, the U.S. and China economic rivalry probably won’t be decided by administrative law judges or trade negotiators, but in the global marketplace. Right now, the U.S. still enjoys a lead in many tech and manufacturing sectors, particularly aerospace and biotech.

Yet the days when China could be dismissed as merely a low-wage assembly center for Western manufacturers are long gone. This is a country on what it views as a historic mission to become a 21st century economic power, and the contest is just beginning.



Calls for calm after French police killing sparks riots

July 4, 2018

The French government called for calm Wednesday after the killing of a 22-year-old man by police sparked riots in the western city of Nantes, highlighting the simmering tensions between youths and security forces in deprived urban areas.

Rioters set fire to cars and a medical centre in the city on Tuesday night after news spread that an officer had shot dead the 22-year-old, named by local newspaper Ouest France as Bubakar, after stopping his car over an infraction.

© AFP | Cars were burned and a shopping centre partly set alight in the Breil neighbourhood of France’s Nantes as police confronted young people, some armed with molotov cocktails

Youths clashed with police in the northwestern neighbourhood of Breil where the killing took place, lobbing molotov cocktails, before the unrest spread to two other poorer districts with a history of gang violence.

Burned-out cars littered the streets on Wednesday morning.

Interior Minister Gerard Collomb condemned the violence, adding that “all the necessary resources are being mobilised” to “calm the situation and prevent any further incidents”.

Local police chief Jean-Christophe Bertrand said the youth had hit a policeman with his car, lightly injuring him, after a squad stopped the vehicle at around 8.30 pm for an alleged infraction and tried to take him to the police station for identification.

“One of his colleagues then fired, hitting the young man who unfortunately died,” Bertrand told reporters.

He was hit in the carotid artery and declared dead on arrival at hospital, police sources said.

Judicial police and a national watchdog which investigates claims of police wrongdoing are investigating to clarify “the facts and determine in what circumstances the policeman used his weapon,” said Pierre Sennes, public prosecutor for Nantes.

He said on Wednesday that the young man had been wanted by police in Creteil, near Paris, for robbery and other offences.

– ‘I saw everything burning’ –

French police have a long history of strained relations with youths in poor, immigrant-heavy suburbs — not least since the death of two teenagers, electrocuted while hiding from officers, sparked nationwide riots in 2005.

The assault of a young black man by police — which led to officers being charged, including for rape after a truncheon was shoved up the youth’s anus — sparked fresh unrest last year.

In January, the government vowed a crackdown on urban violence after shocking video footage emerged of a policewoman being beaten by a crowd of youths in the Paris suburbs on New Year’s Eve.

Breil, the Nantes neighbourhood where the young man was shot dead Tuesday, is a socially mixed district home to a large housing estate with a history of gang violence.

Police had boosted their presence in the area after a series of violent incidents on June 28.

Malakoff and Dervallieres, the other neighbourhoods hit by riots on Tuesday, have been plagued by drugs and poverty for years.

They fall into a category of problem neighbourhoods which are set to receive extra police help from next September under reforms by President Emmanuel Macron.

Steven, 24, who lives in Breil, told an AFP journalist that he had “heard explosions” and headed to investigate.

“I saw everything burning. There were fires in the bins, the cars. They were breaking everything. It lasted ages,” he said.

Neighbourhood residents were in shock on Wednesday morning at the young man’s death.

“That guy, he always had a smile on his face,” a young man who gave his name as Chris told Ouest France.

“He was a sweet guy. We have lost a friend, a brother.”

He added: “I knew him well. He was from Paris but he’d lived here for a while, he had family here. For us, he was a kid from the neighbourhood.”

Nationally, French police have complained of coming under increasing strain in recent years, with a parliamentary report released Tuesday detailing high suicide rates within the force.



France: Violent clashes in Nantes after police shoot young man

July 4, 2018

Protesters have set fire to cars and a shopping mall after police shot dead a 22-year-old man in Nantes. A French lawmaker has announced a full investigation into how the man was killed during a traffic stop.

Firefighters work to put out a fire near a burning car

French lawmaker Valerie Oppelt on Wednesday called for calm after police shot and killed a 22-year-old man in Nantes, triggering unrest in several neighborhoods across the western city.

Shortly after news of the man’s death emerged, groups of young protesters gathered in the Breil neighborhood. The protesters threw Molotov cocktails and torched at least three vehicles and a shopping center during clashes with police.

Read more: Can Emmanuel Macron’s banlieues plan reach the poor?

“Nantes was the scene of violence last night. I appeal for calm. An investigation is under way to learn the circumstances of this tragedy,” Oppelt said in a tweet. “My thoughts go out to the residents of the Breil neighborhood.”

Valérie Oppelt


a été cette nuit le théâtre de violences. J’en appelle au calme. Une enquête est en cours pour connaître les circonstances de ce drame. Lumière doit être faite.
Pensée aux habitants des quartiers

Local police chief Jean-Christophe Bertrand said the 22-year-old man was pulled over during a traffic check, but his identity was “not clear and officers received orders to bring the driver to the police station.”

The man then attempted to reverse the vehicle, in the process hitting a police officer in the knee. “One of his colleagues then fired, hitting the young man who unfortunately died,” Bertrand said.

Police secure perimeter of shopping mall as firefighters attempt to put out blazeProtesters torched a shopping mall in the Dervallieres neighborhood

Police: ‘We expect the worst’

Groups of protesters also clashed with police in the Dervallieres and Malakoff neighborhoods, known as sensitive areas in Nantes. “We expect the worst in the coming days,” police said, according to the Nantes-based Presse-Ocean newspaper.

Authorities said Nantes police will receive reinforcements to ensure security in the affected neighborhoods.

The protests resembled civil unrest that erupted in Paris’ “banlieues” – low-income migrant neighborhoods on the outskirts of the capital – in 2005 and have flared up several times since then.

Read more: Emmanuel Macron leaves France’s suburbs in the lurch

In 2005, the banlieu of Clichy-sous-Bois became a focal point of violent protests, which erupted in response to the deaths of two boys killed while fleeing police. They highlighted the country’s broader difficulties integrating minority groups and ultimately paved the way to the presidency for then-Interior Minister Nicolas Sarkozy.

ls/msh (AFP, dpa)

Austrian Chancellor Sebastian Kurz: The EU’s new power broker?

June 30, 2018

Austria takes over the EU Council presidency on July 1. Above all, its conservative new leader Kurz sees himself as a gatekeeper, with migration at the top of the agenda for his country’s mandate.

Austrian Chancellor Sebastian Kurz (picture alliance/dpa/BELGA/T. Roge)

The dispute over a common EU migration policy is far from resolved. In Germany, Chancellor Angela Merkel’s coalition has been teetering on the brink of collapse over the issue. The Visegrad countries continue to stoke tensions with fellow member states, while Italy has just sealed its ports in an effort to deter vessels of rescued migrants.

While the EU summit unanimously agreed to do more protect its external borders, the problem of how to distribute migrants within the bloc went unsolved in Brussels on Friday. The question mark continues to weigh heavily on the bloc just days before Austria takes the reigns of the EU Council presidency.

With a right-wing populist chancellor, Sebastian Kurz, at its helm, the bloc is about to be led by a country whose policies on migration in recent years have shown little willingness to compromise.

In 2017, Kurz and his conservative ÖVP (Austrian People’s Party) formed a government in a coalition in Vienna with the far-right FPÖ (Freedom Party of Austria). He was serving as foreign minister at the peak the refugee crisis in 2015, and has credited himself with having curbed migration via the Balkan route into the into the EU.

A consensus on external border protection

“I think people are justifiably fed up of hearing migration talked about at the EU level, but not seeing anything happen in practice,” said Kurz a few days ahead of his country’s ascendence to the EU Council presidency in Brussels. The six-month Austrian tenure will be governed under the motto “A Europe that protects.”

In line with the slogan, Kurz is emphasizing his agenda to reduce immigration into Europe via all routes. The recent decision by the EU to establish camps for migrants in North Africa is, in Kurz’s view, a positive development.

Kurz lauded the bloc’s shift in policy: “It wasn’t like that in 2015. Now we are seeing action, and it’s heading in the right direction.” Austria is committed to improving the protection of the EU’s external borders, and a massive expansion of the EU border protection agency Frontex is on the agenda.

Aspirations to expand Frontex are not new to EU policy. The EU Commission had beat Austria to it with a proposal set out at the previous summit of bulking up the agency with a further 10,000 personnel by 2020. But even if improved external border protection meets with broad approval, some see it as being difficult to implement. The last increase of just 1,500 staff has still not been achieved. EU governments are reluctant to send their own servants to the EU border guards.

Saskia Stachovitsch, director of the Austrian Institute for International Politics in Vienna, considers the latest and much larger increase in staff at Frontex to be unrealistic: “Knowing how difficult the last Frontex increase was to achieve, I do not think that the next one will be easy.”

Austria a new power broker?

EU leaders reach deal on migration, but questions remain

There is still little agreement on what to do with migrants who are already in the EU. Rome has been demanding for years that refugees registered in Italy be relocated to other EU states. Slovakia and Hungary unsuccessfully appealed against EU policy in 2015, both countries still took fewer refugees than is required of them by the bloc. Austria, like many other EU states, also did not fulfill its refugee intake quota.

“A presidency carries the task of bringing together fundamental positions,” said Luxembourg Foreign Minister Jean Asselborn on German national radio channel Deutschlandfunk. “I consider it not right, not good, not European, and misleading that the Austrian presidency is aligning itself so strongly with the Visegrad countries. It will damage the European Union!”

Without a common European solution to “share the burden” – a balanced distribution of migrants within Europe – the ongoing dispute over immigration plaguing the bloc will not be solved, said Asselborn.

In the run-up to the to his role presiding over the EU presidency, Kurz repeatedly emphasized that his government wanted to play a bridging role and mediate between the more hardline positions. Whether Austria will actually succeed in implementing its agenda over the next six months remains to be seen, according to Janis Emmanouilidis, the director of the European Policy Center think tank in Brussels.

Two tasks, too little time: The EU budget and Brexit

Another topic on which Austria could enjoy a key authority position on is the negotiation of the next seven-year EU budget. The financial framework is to be set for the period from 2021 to 2027 – the first EU budget without the United Kingdom, following Brexit.

In order to compensate for the financial hole left by the Brits, the EU Commission has set forth a proposal for an increase on the payments by the remaining members of the bloc.

Kurz rejects the proposed contribution increase as “unacceptable” and announced “long and tough negotiations.” The tug-of-war over the previous EU budget for the period from 2014 to 2020 took a total of two-and-a-half years.

Some member states, including Germany, are demanding a much faster turnaround this time, ideally ahead of the European elections next May, according to political scientist Emmanouilidis.

Austria’s EU presidency coincides with the final stretch of the Brexit negotiations, set to be finalized this year in order to pave the way for the UK’s exit from the bloc in early 2019. Whether such the deadlines can be met remains to be seen. There are several points of contention in Britain. The topics of border control between Northern Ireland and the Republic of Ireland, and whether Britain will remain in the single market, remain hotly contested.

The EU presidency would then have the task of ensuring that there is no disagreement among the remaining EU countries in order to conclude the negotiations as soon as possible – no small order.