What We're Watching Today is 1,550 words and a 10-minute read.
Global
North Korean and Russian military cooperation in Ukraine send political shockwaves
As thousands of North Korean troops move toward the front line in Ukraine, alarm bells are ringing in Kyiv, Brussels and South Korea.
Our Take: While North Korean troops are not likely to change the course of the Ukraine war, their deployment has broader complications. North Korean direct involvement in the Ukraine war expands the conflict beyond Europe in an escalation that risks responses from South Korea, China, the US and NATO. Tensions on the Korean peninsula will escalate as the two countries remain technically at war and North Korean military deployment risks creating new battlefield experienced fighters. China, already concerned about the growing relationship between North Korea and Russia, does not want to see fighting on the peninsula as Beijing has a military alliance with Pyongyang. But it also risks drawing China further into the Russian-North Korea axis of upheaval. Russia and North Korea also have a mutual defense pact. Hardening of these lines will increase pressure on EU's China policy, which is incoherent, and so-called non-aligned nations, to take stronger positions.
Read More: Reuters[paywall], Center for Strategic and International Studies, Council on Foreign Relations
Europe
Georgians protest "stolen election," and call for new vote under international supervision
Thousands of Georgians gathered peacefully outside parliament on Monday night to protest against the elections, which they call neither free nor fair.
Our Take: The US and EU have called for an investigation into the result of Saturday's election. European observers said the election took place in a "divisive" environment marked by intimidation and instances of vote-buying, double voting and physical violence. Moscow has rejected accusations of interference. The Georgian ruling party is unlikely to cooperate with demands for investigation or new poll, setting the South Caucus country at elevated risks of post-election violence. Moves to internationally isolate the new government have already started, with Sweden announcing an end to direct cooperation, while Canada announced it was reviewing its ties with the authorities in Tbilisi.
Read More: Euronews, Radio Free Europe, Atlantic Council
Middle East
Hizballah names successor
Lebanese Hizballah named Naim Qassem, the longtime deputy of late leader Hassan Nasrallah, as the new leader of the group. He replaced Nasrallah after his assassination in an Israeli airstrike last month.
Our Take: In recent months, Israel has decimated the Iran-backed proxy's leadership structure, including both Nasrallah and his presumed successor, his cousin Hashem Safieddine. In addition to becoming Israel's new number one target in Lebanon, Qassem now must lead the battered organization in an uphill battle: Lebanon, already on the brink of collapse pre-war, is in economic freefall with millions internally displaced, and much of Hizballah's tools to fight back – such as military infrastructure – is damaged. Hizballah still has the support of Iran and a sizeable store of munitions, however; while Hizballah is down, Israel has not dealt a decisive blow against the group.
Read More: New York Times[paywall], CNN, Times of Israel
Americas
Uruguayan election goes to runoff
Uruguay's presidential election went to a runoff after center-left challenger Yamandú Orsi won a majority of votes against incumbent Álvaro Delgado, but failed to reach a 50% threshold. Uruguayans also rejected a controversial pension reform bill.
Our Take: Unlike other countries in the region, Uruguay's political system is stable and mostly free of the division present in most other countries; both candidates were moderates, and there is no expectation that the close vote or runoff could spark political instability or post-election violence. A proposed pension reform referendum, which could have significantly increased pension payouts for the country's aging population, was thought by financial analysts to risk the country's economic future, but it did not pass.
Read More: New York Times [paywall], Voice of America, Americas Quarterly, The Guardian
Asia-Pacific
Japan's ruling LDP coalition loses majority for first time in over a decade
Japan's Liberal Democratic Party (LDP) and its ruling coalition partner, Komeito, lost their lower house majority in Sunday's election, marking the first time since 1955 that no party secured at least 200 seats.
Our Take: The LDP, led by incumbent Prime Minister Shigeru Ishiba, and Komeito won a collective 215 seats, falling short of the 233 needed for maintaining a majority in the 465-seat chamber. The outcome reflects persistent public disapproval with the LDP amid a series of scandals, which, in part, led to the resignation of Ishiba's predecessor, Fumio Kishida, in September. Ishiba, who has supported a more assertive foreign policy for Japan, including ambitions for an "Asian NATO," has vowed to stay on as prime minister despite his party's poor performance, though he will likely need to make policy compromises to form a majority coalition with the opposition.
Read More: Nikkei Asia[paywall], New York Times[paywall], Council on Foreign Relations
Africa
More than 14 million people in Sudan are displaced, according to IOM
The International Organization for Migration (IOM) this week said that over 14 million people had fled their homes in Sudan, either for internal or external refuge, including around 200,000 people fleeing since last month.
Our Take: As Sudan's civil war continues and peace talks fail to materialize a substantive solution, the humanitarian costs grow increasingly severe. The IOM notes that displacement caused by the conflict – which grows more in scale every day – has become a devastating phenomenon, having affected nearly 30 percent of Sudan's population, with more than half being women and over a quarter being children under the age of five. The overall crisis could potentially impact the country in the long term by setting back education and healthcare by decades, and the ongoing displacement trends risk spreading instability to neighboring countries as the crisis in Sudan remains largely neglected on the world stage.
Read More: Reuters [paywall], International Organization for Migration
Trade & Compliance
US finalizes ban on American investment in Chinese advanced technologies
The US Treasury Department this week issued a final rule to curb American investments in China related to artificial intelligence, computer chips, and quantum computing.
Our Take: The finalized rule derives from an August 2023 executive order issued by President Joe Biden that sought to limit access for "countries of concern" to American dollars for funding technologies that could be utilized for foreign military advancements. China (including Hong Kong and Macau) is specifically highlighted over Beijing's potential to utilize technological advancements to benefit its military. Violators of the rule can be fined up to $368,136 or twice the value of the prohibited transaction, whichever is greater, and the Treasury Department plans to establish an Office of Global Transactions to oversee the new rule. Nonetheless, political uncertainties ahead of the upcoming US presidential election and China's ability to evade the restrictions remain risk flashpoints.
Read More: Washington Post [paywall], US Department of the Treasury
Disruptive Technology
EU to invest $1.5 billion in region's deep tech sector
The European Union will invest €1.4 billion ($1.5 billion) next year to support deep tech research, aiming to compete with the United States and China.
Our Take: This recent initiative reflects Brussels is waking up to the reality that Europe has been falling behind competitors, namely the US and China, in developing new and emerging technologies, especially AI. With the fund, the EU aims to disincentivize the bloc's tech companies from using non-EU funds when expanding operations following their initial build-out, aiming to make Europe "technologically sovereign" by reducing its present reliance on other regions for technologies. Shaping up Europe's tech capabilities to compete globally will be an uphill battle, yet the EU's efforts to double down on accelerating the industry's growth in the bloc showcases Brussels' determination to brave the challenge.
Read More: Reuters [paywall], Politico
Climate Change
Scientists in Iceland study climate change and increased volcanic activity
A Reuters' special report details how scientists in Iceland are studying the rapid retreat of glaciers and the risks of triggering increased volcanic activity.
Our Take: The study has been prompted by increased seismic activity around the Askja volcano which last erupted in 1961, but since 2021 has expanded upward rapidly, caused when magma or pressurized gases accumulate under a volcano. The substantial weight of glaciers can tamp down volcanoes while their retreat, and the resulting change in pressure, may cause volcanoes to produce more magma, triggering eruptions. Around 50 volcanoes worldwide are covered by glaciers, including in Iceland, Canada, Alaska, Argentina and Chile, to name a few.
Read More: Reuters [paywall], Cornell University
ESG
Hong Kong publishes Sustainable Finance Action Agenda
The Hong Kong Monetary Authority (HKMA), Hong Kong's central banking institution, announced the launch of its Sustainable Finance Action Agenda. The agenda sets out a series of finance sector targets and planned actions to support green financing.
Our Take: Among the key priorities outlined by the HKMA's new agenda include directives for banks to reach net-zero financed emissions by 2050 and to provide disclosures on climate risks and opportunities, and for the HKMA to incentivize sustainable finance innovation and to provide sustainable-financed training programs for finance professionals. The agenda comes as Hong Kong is attempting to cast itself as a green finance hub, and just months after the HKMA's Hong Kong Taxonomy for Sustainable Finance, which sets out consistent definitions of "green" and "environmentally sustainable" economic activities – a potentially internationally useful benchmark.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
