What We're Watching Today is 1,386 words and a 9-minute read.
Global
China launches rocket from new spaceport, leaping forward in commercial space race
China launched the Long March 12 rocket last Saturday from its first dedicated commercial spaceport.
Our Take: The launch at Hainan International Aerospace Launch Center advances China's commercial challenge to rival SpaceX's Starlink. Until the opening of the Hainan site, commercial companies had to compete for launch services at government facilities. Shanghai Spacecom Satellite Technology plans to launch a network of 14,000 satellites by 2030, an ambitious program. SpaceX has launched 7,000 satellites since 2018, with aspirations for 42,000 in the future. European aerospace companies are discussing a new joint for a standalone European satellite company to compete in the commercial market. Commercial satellites provide direct-to-cell capability, so that phones can connect without needing cell towers.
Read More: SpaceNews, Nikkei [paywall], Reuters [paywall]
Europe
French government faces collapse over austerity budget
Prime Minister Michel Barnier faces a no confidence vote on Wednesday over the government's budget, which includes 60 billion euros in spending cuts and tax increases to narrow the deficit.
Our Take: The stakes are high for French Prime Minister Barnier, who forced through the social security portion of an austerity budget using a parliamentary procedure to bypass a vote in the lower house of the National Assembly, risking a no confidence vote from opposition parties. The far-right National Rally announced it will back the left wing's no-confidence bill, and if approved, the government and economy will face a new crisis, with no budget for 2025, forcing a shutdown if no temporary funding bill is passed, roiling of financial markets and risking further rating downgrades, making borrowing even more expensive. President Macron cannot call for new parliamentary elections until one year after the previous elections (July), nor are the prospects good for overcoming the divisions in the low house by a new government selected by Macron.
Read More: Euronews, Reuters [paywall], Financial Times [paywall]
Middle East
Israel-Lebanon ceasefire wavers
Israel and Lebanon's week-old ceasefire appeared on
shaky ground after both sides exchanged fire, accusing each other
of violating the truce.
Our Take: The ceasefire – which took effect just last Wednesday and is intended to be permanent – is now on shaky ground after Hizballah shelled disputed territory on the Israel-Lebanon border. Israel had launched several airstrikes and other attacks since the ceasefire began in what it said was an effort to thwart threats from the militant group and enforce the agreement, and Monday's Hizballah strike was the first retaliation. The flare-up highlights ambiguities in the enforcement of the ceasefire, and may signal deeper weakness in the agreement. Pessimists say Israel may not be committed to the deal, thinking it can get a better agreement under the Trump Administration, while optimists – including sources in the Biden Administration – say the shaky start can be overcome.
Read More: Wall Street Journal [paywall], New York Times [paywall], Institute for the Study of War
Americas
Trudeau visits Trump to get ahead of tariff threats
Over the weekend, Canadian President Trudeau visited President-elect Trump at his Florida residence, Mar-a-Lago, following a threat by Trump to impose across-the-board 25% tariffs.
Our Take: Trudeau was likely attempting to strike a deal to avert tariffs on Canadian exports to the US, which Trump has floated to address issues like the fentanyl crisis and the US' trade deficit with Canada. Separately, Canada has made moves to step up immigration enforcement on its southern border, an early attempt to align with the Trump White House's immigration concerns. No concrete agreements were announced, but both parties called the talks "positive." Since then, however, it has been leaked that Trump reportedly suggested to Trudeau that Canada become the 51ststate – potentially a joke. Beyond the bilateral relationship, Trudeau became the first G7 leader to visit Trump following his reelection – underscoring the extent to which Trump's policy projections already impact geopolitics, nearly two months ahead of his inauguration.
Read More: New York Times [paywall], Newsweek, Yahoo Finance
Asia-Pacific
South Korea's President Yoon declares martial law
South Korea President Yoon Suk Yeol declared martial law, pledging to suppress "anti-state" elements amid tensions with an opposition-controlled parliament, which he accuses of harboring communist sympathies and aligning with North Korea.
Our Take: President Yoon's declaration of martial law marked an unprecedented escalation in South Korea's domestic political tensions, evoking comparisons to the authoritarian era before democratization in 1987. The move drew sharp criticism from across the political spectrum, including opposition leaders and members of Yoon's own party. International observers, including the US, are monitoring the situation closely amid concerns about stability in a key ally in the Asia-Pacific. South Korea's parliament passed a motion early Wednesday requiring martial law to be lifted, which Yoon acquiesced to hours later. While Yoon has reversed course, the political ramifications of his action are likely to remain a stumbling block for his administration, with protestors calling for his resignation.
Read More: Associated Press, Center for Strategic and International Studies
Africa
US President Biden visits Angola in his first presidential trip to sub-Saharan Africa
President Biden arrived in Angola this week to focus on historical and economic initiatives, marking his first and likely final visit to sub-Saharan African as president.
Our Take: Though coming late in his presidency, Biden's decision to visit Angola highlights the country's increasing strategic importance in global trade and competition for critical resources. As the US endeavors to counter China's influence in Africa, Biden's itinerary in Angola includes visiting a slavery museum and promoting the $1 billion Lobito Corridor. While the trip affirms bilateral ties, its legacy may depend on the continuity of US engagement in Africa under the incoming administration and the ability to balance economic ambitions with broader geopolitical strategies.
Read More: New York Times [paywall], Al Jazeera, Atlantic Council
Trade and Compliance
US expands export control on Chinese tech companies
The US Commerce Department added 140 mostly China-based companies, including some in Japan, South Korea, and Singapore, to the Bureau of Industry and Security (BIS) Entity List, targeting firms involved in chipmaking tools, software, and equipment.
Our Take: The expanded export controls reflect US efforts to limit China's technological and military capabilities by curbing its access to advanced semiconductor tools and technologies. Further intensifying the strategic competition between the US and China, this move also highlights the global interconnectedness of supply chains as firms in third-party nations are affected. Potential economic and geopolitical repercussions could shape international trade policies and alliances, further complicating the landscape for global semiconductor development.
Read More: Associated Press, Nikkei Asia [paywall], Bureau of Industry and Security
Disruptive Technology
US Senator Cruz calls for investigation into European impact on American AI policy
United States Senator Ted Cruz called for an investigation into potential European interference in US artificial intelligence (AI) policy, following international efforts like Britain's AI safety summit and cross-border collaboration on AI regulation and expertise sharing.
Our Take: Senator Cruz's recent statements come as tensions between global cooperation on AI safety and perceived risks of foreign influence on US technology regulationfEnergy Transition continue to arise. Particularly reflecting concerns over sovereignty in AI policymaking and its implications for innovation competitiveness, a probe into foreign involvement occurring could spell broader consequences for international AI collaborations, especially with Washington's European allies. China's expanding AI capabilities remain a variable factor in this apparent fracture in trans-Atlantic alignment on AI policy, as do the policy actions of the incoming Trump administration, which may back Cruz's request in some form.
Read More:Reuters [paywall], US Senate Committee on Commerce, Science, and Transportation
Energy Transition
Airlines slow to transition to sustainable jet fuel
A new report by Brussels-based advocacy group Transport and Environment finds that SAF makes up about 1% of aviation fuel used on the global market.
Our Take: The cost of SAF is significantly higher compared to traditional jet fuel, due to limited production capacity, lack of feedstock and immature infrastructure development, creating barriers to transition. The International Air Transport Association (IATA) projected that SAF production would triple in 2024, to 1.5 million tonnes, which as of June was on track. About 140 renewable fuel projects with the capability to produce SAF have been announced, targeting production by 2030. If all of these proceed as announced, total renewable fuel production capacity could reach 51 million tonnes by 2030, with production capacity spread globally.
Read More: Reuters [paywall], IATA
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