Food Prices, South Africa, Cuba Revolts, the “Green EU”, and the Week in Review
Food prices ease…sort of. The U.N. Food and Agriculture Organization’s Food Price Index declined 2.5 percent – the first decline in 12 months. The decline in vegetable oil, dairy, and cereal prices was offset by continued increases in meat and sugar prices. Poor weather continues in Canada and the U.S., however, have sent corn and soybean futures higher in the last two weeks.
What it means: We’ve warned about the geopolitical impact of rising food prices since the pandemic began, and recent political and social unrest in countries like Cuba, Lebanon, and South Africa are all linked to higher food prices.
South Africa revolts. The arrest and subsequent imprisonment of former South Africa President Jacob Zuma on charges of corruption led to widespread riots, looting, and violence, especially in Zuma’s home province of Kwazulu-Natal and Gauteng, the political and economic center of the country. To address the deteriorating security condition, the South Africa government deployed soldiers and called up 25,000 reserves in case more are needed. Supply chains inside the country ground to a halt, as did operations at some of South Africa’s ports, while the government banned mass petrol and diesel purchases.
What it means: By the end of the week, the South African government seemed to restore a modicum of order to the situation, but the situation remains unstable and perhaps even untenable.
Cuba revolts. Thousands of Cubans protested the performance of their government over the weekend, shouting slogans ranging from “Freedom” to “the people are dying of hunger!” Cuban security forces arrested hundreds of people associated with last weekend’s demonstrations. Cuban Foreign Minister Bruno Rodriguez blamed “U.S.-financed mercenaries” for instigating the protests.
What it means: Anti-government dissent is tightly policed in Cuba, so the sudden and seemingly spontaneous outburst of protests is notable, as is the fact that Díaz-Canel acknowledged them. Watch this space carefully. The Cuban government seems to have successfully cracked down, but a true shift in Cuba’s government would be a seismic shift geopolitically and a tremendous opportunity besides.
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Carbon neutral by 2050. The European Union released an ambitious blueprint for addressing climate change, aiming to become carbon neutral by 2050 and to reduce emissions by 55 percent in the next nine years. Among the most significant proposals is eliminating new gas-and-diesel powered cars in 14 years and imposing stringent tariffs and restrictions on imports from countries that don’t meet the EU’s criteria for climate protection rules.
What it means: Overnight, it makes the EU the world’s most aggressive political (sovereign?) entity when it comes to climate change and the politics of climate change. Which EU is acting here? The one that just used the pandemic to justify taking on debt in the EU’s name? Or the one that was seemingly incapable of agreeing on just about anything during the early 2010s?
Uruguayan Foreign Minister Francisco Bustillo announced that Uruguay would unilaterally and independently commence negotiating trade agreements with third parties.
The U.S. is waiting on Iran to propose a seventh round of talks to return to the JCPOA.
Nigeria’s Senate approved a law that would impose major changes on the country’s oil industry.
China’s Guangdong province announced plans to build a “data customs hub” to review and control all data that crosses provincial and national borders.
The United States is reportedly exploring the possibility of a new digital trade agreement to cover Indo-Pacific economies. (Has someone told them the TPP is waiting for them?)
Tigray rebels launched a new offensive, seizing the town of Alamata in the southern Tigray region. Ethiopian Prime Minister Abiy Ahmed, fresh off an “election” victory, ended the government’s unilateral ceasefire and said he would mobilize the Ethiopian military (again).