What We're Watching Todayis 1,398 words and a 9-minute read.
Global: Mark Rutte takes over as NATO Secretary General amid expanding geopolitical tension
Mark Rutte assumed the position of NATO Secretary General, replacing Jens Stoltenberg, whose term ended after ten years.
Our Take:Stoltenberg's tenure was extended three times as he presented a steady hand in leading NATO as Russia invaded first the Crimea and the Donbas, before the 2022 full assault on Ukraine. His strong record of achievements and lack of consensus on who could fill his shoes kept him in place for a period far longer than normal for NATO. Mark Rutte, the longest-serving prime minister in Dutch history, is seen as a "continuation candidate," likely guide NATO military policy in support for Ukraine and develop a new Russia strategy of rollback and containment. He is also known as an adept negotiator and may play a key role in future negotiations with Ukraine and Russia to end the war.
Read More:NATO, The Royal United Services for Defence and Security
Europe: The EU agrees to impose tariffs on Chinese electric vehicles
The EU will impose anti-subsidy tariffs up to 35.3% in addition to an existing 10% duty, on Chinese electric vehicles after the commission found subsidies to Chinese carmakers created unfair trade conditions.
Our Take:This decision to impose hefty tariffs is controversial, dividing the EU into three camps. The Baltic States, Bulgaria, Denmark, France, Ireland, Italy, the Netherlands and Poland voted for the tariffs, while Germany, Hungary, Malta, Slovakia and Slovenia voted no. Twelve member states abstained. Beijing has already warned it will retaliate, but will likely calibrate its response because it still believes that through diplomatic engagement, it can convince the EU to adopt policies independent of the expanding hardline of the US. While talks between the EU and China are continuing over the tariffs, the EU-China Comprehensive Agreement on Investment, negotiated in December 2020, and frozen in May 2021, unratified by the European Parliament, has little to no prospects of being revived in the current political environment.
Read More: Reuters, Reuters, Financial Times[paywall], Center for Strategic and International Studies
Middle East: Israel and Hizballah trade airstrikes
Israel and Hizballah traded major airstrikes over the end of the week, with Israeli strikes targeting a likely Nasrallah successor in Beirut and Iranian missiles overwhelming Israeli defenses and causing damage at some targets.
Our Take:The attacks represent continued business-as-usual retaliation, although risks for further escalation in air attacks remain a very realistic possibility. Iran's attacks were made up of much faster ballistic missiles than in previous attacks with slower cruise missiles, but targeted mostly defense infrastructure. Iran's success in hitting some Israeli targets raises risks that further Iranian attacks using these ballistic missiles could hit civilian areas or more crucial defense infrastructure. However, despite the benefit of the speed, Iran also relies on high-volume attacks that overwhelm Israeli defenses – a tactic it cannot keep up forever.
Read More: Wall Street Journal[paywall], Reuters
Americas: US Supreme Court will hear Mexico's case against US gunmakers
The US Supreme Court agreed Friday to decide whether Mexico can sue US gun manufacturers for aiding in the trafficking of weapons used by drug cartels. Mexico had sued seven gun makers and one distributor in 2021, kicking off a complex legal and geopolitical battle over the validity of the suit.
Our Take:Mexico is facing unprecedented cartel violence, and is struggling to stem the flow of weapons to the groups that de facto control growing swaths of the country. Mexico contends in its suit that over a half million firearms a year made in the US wind up in Mexico, often reaching drug trafficking cartels, as gunmakers encourage sales to "straw buyers" who bring the guns to Mexico. The industry has asked the Supreme Court to take up the case, arguing that it amounts to a backdoor effort to impose gun regulations Congress hasn't passed.
Read More: Politico, Council on Foreign Relations, The Conversation
Asia-Pacific: Indian Foreign Minister Jaishankar to travel to Pakistan for SCO summit
India on Friday revealed that External Affairs Minister S. Jaishankar will travel to Pakistan to participate in the Shanghai Cooperation Organization (SCO) summit this month, marking the first visit from an Indian external affairs minister to Pakistan since 2015.
Our Take:Jaishankar's upcoming trip to Pakistan for the SCO summit this month signals a notable moment in recent years of India-Pakistan relations. Although expected to focus on multilateral engagement rather than bilateral talks, the visit may provide subtle diplomatic opportunities for both nations amid their strain ties. While significant breakthroughs are unlikely, this move underscores India's strategic commitment to multilateralism in regional security and economic forums like the SCO. A potential de-escalation in Indo-Pakistani tensions could also result in a more stable business environment in South Asia, a region otherwise marked by political turbulence this year.
Read More: NDTV,BBC, United States Institute of Peace
Trade & Compliance: Slovakia states its interest in continuing transit of Russian oil and gas through Ukraine
Slovak Prime Minister Robert Fico on Thursday declared that Slovakia is interested in maintaining the flow of Russia oil and gas to Europe through Ukraine, adding that his country faced pressure from the European Commission for those energy flows to end.
Our Take:Slovakia's decision to advocate for the continued transit of Russia oil and gas through Ukraine highlights a divergence from broader European efforts to reduce reliance on Russian energy. Fico's stance reflects Slovakia's economic vulnerabilities, particularly regarding expensive alternatives to Russian supplies. This announcement risks straining Slovakia's relationship with the European Commission and other EU member states, while potentially reinforcing alignment with pro-Russian narratives in Central Europe. Businesses tied to energy stability in the region may face risks as a result of this decision, potentially complicating broader EU energy policy objectives.
Read More: Reuters, Politico, German Marshall Fund of the United States
Disruptive Technology: Irish regulator opens probe into Ryanair's usage of facial recognition technology
Ireland's Data Protection Commission (DPC) on Friday opened an EU-wide probe into whether Irish budget airline Ryanair's use of facial recognition technology to verify the identity of customers who book through third-party sites violates the bloc's privacy laws, namely the General Data Protection Regulation (GDPR).
Our Take:The DPC's probe into Ryanair's use of facial recognition technology demonstrates the growing scrutiny of biometric data use under the GDPR. The investigation could set a precedent for how facial recognition is handled across industries, especially in cases involving third-party services. While Ryanair insists that its practices are GDPR-compliant, the outcome of this inquiry stands to significantly impact the airline's operational processes and privacy standards across Europe. Companies using similar technologies may find use in monitoring this ongoing development closely, as stricter enforcement in EU countries could result in compliance challenges or costly penalties.
Read More: Reuters, Stimson Center
Climate Change: As states dig out from damage from Hurricane Helene, costs of climate change mount
Moody's Analytics estimates that Hurricane Helene could cost upwards of $34 billion and further stress private insurers.
Our Take:A group of scientists from Lawrence Berkeley National Laboratory assessed that the rainfall over the 24 hours Helene moved through was made "up to 20 times more likely in these areas because of global warming." The rain, which began flooding the Appalachia Mountains ahead of and during the hurricane, was unprecedented. Because most of the damage from Helene was from storm surges and river flooding, flood insurance is supposed to cover the damage and many of the hardest-hit areas have low flood insurance take-up rates because of their expense.
Read More: CNBC, USA Today, Business Insider
ESG: Carbon credit executives charged with fraud
The two executives of carbon-credit developer CQC Impact Investors were charged with manipulating data to obtain fraudulent carbon credits for a CQC project.
Our Take:The charge is the latest in a series of blows to the credibility of carbon markets, which have struggled with questions of transparency and effectiveness since their inception. While a crucial element of net-zero targets, these continued setbacks threaten consumer confidence in the mechanism. CQC itself has not been charged due to its quick disclosures and agreement to cancel or void voluntary carbon credits equal to the number of credits CQC obtained through the scheme. Member countries are set to discuss formalizing better carbon markets under Article 6 of the Paris Agreement at the upcoming COP29 in Baku, Azerbaijan.
Read More: WSJ Pro[paywall], MarketWatch
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