PARIS — Emmanuel Macron’s government faces several motions of no confidence in the National Assembly Monday after his government forced through a deeply unpopular pensions reform bill last week.
Protesters took to the streets in major cities over the weekend, after the government invoked a controversial constitutional maneuver to pass its pensions reform bill in what was widely seen as a move likely to inflame social unrest. Industrial action is expected to disrupt public transport, refineries, universities and waste collection this week, as trade unions hope to strong-arm the government into withdrawing the pensions reform.
On Saturday, more than 100 people were arrested in Paris after a demonstration by several thousand protesters against the reform turned violent.
The 573 lawmakers of the French National Assembly will vote on two motions of no confidence Monday which could trigger the resignation of Macron’s Prime Minister Elisabeth Borne and her government. Though the French president would not be forced to resign in case of a defeat, a successful motion of no confidence would trigger a deep political crisis for Macron.
On Saturday, Finance Minister Bruno Le Maire said the reform was “vital” for the country and called on MPs to “face their responsibilities,” in an interview with Le Parisien.
“There will be no majority to bring the government down, but it will be a moment of truth,” Le Maire said with the reference to the votes on Monday. “Is it a good idea to overthrow the government and cause political disorder over the pensions reforms? The answer is clearly no,” he added.
Macron wants to increase the legal age of retirement to 64 from 62 and extend contributions for a full pension in order to balance the accounts of the pensions system. The reform is a cornerstone of the French president’s second mandate and failure to pass it would have repercussions for the rest of his mandate.
Amid scenes of anger and rebellion in parliament, his trusted lieutenant Borne announced on Thursday the government had decided to invoke Article 49.3 of the constitution to pass legislation without a vote, putting an end to weeks of heated and acrimonious debate. Invoking Article 49.3, however, allowed lawmakers to table a motion of no confidence within 24 hours.
All eyes on the conservatives
Macron’s Renaissance party lost its majority in the National Assembly in parliamentary elections last year and has faced several motions of no confidence in recent months. In a sign of the deepening crisis in France, it is the first time that the several opposition parties have tabled a motion of no confidence together.
On Friday a small centrist opposition group submitted a cross-party motion supported by leftwing parties, which is also expected get the support of the far right National Rally, after RN leader Marine Le Pen announced that her party would vote for “all the motions of no confidence.”
“A vote on this motion will enable us to put an honorable end to a deep political crisis,” said the centrist MP Bertrand Pancher as he submitted the motion.
A police officer attempts to extinguish flames at the entrance of the town hall of the 4th arrondissement of Lyon | Jeff Pachoud/AFP via Getty Images
Macron’s opponents need the backing of 287 MPs to topple the government — a bar they are not likely to pass given the deep political divisions in parliament. The National Assembly is split between Macron’s Renaissance coalition, the far-right National Rally and the left-wing Nupes coalition.
In addition to getting the backing of the left and the far right, a cross-party motion would need the support of 27 conservative Les Républicains lawmakers to pass. But only 10 are planning to vote for the motion, said a conservative MP who wanted to remain anonymous due to the sensitivity of the topic in an interview with Playbook Paris.
MPs are also expected to vote on a second motion of no confidence submitted by the National Rally, that is widely seen as unlikely to pass.
If the government survives the votes on Monday, it will still face a wave of protests this week and the risk of more social unrest. On Friday, the hard left CGT trade union called for “visible actions” ahead of a day of nationwide protests and strikes planned for Thursday.
[ad_2]
#Macron #faces #noconfidence #votes #nationwide #protests
( With inputs from : www.politico.eu )
PARIS — French President Emmanuel Macron will face a moment of reckoning Thursday as lawmakers gear up for a final vote on the government’s deeply unpopular pension reform.
The controversial bill, a centerpiece of Macron’s second term, has sparked weeks of nationwide protests led by trade unions and faced intense criticism from both the far left and the far right in the National Assembly.
The French president wants to increase the legal age of retirement to 64 from 62 and extend contributions for a full pension in an effort to balance the accounts of France’s state pensions system — among the most generous in the world. According to projections from France’s Council of Pensions Planning, the finances of the pensions system are balanced in the short term but will go into deficit in the long term.
Despite government concessions on various aspects of the bill in recent weeks, opposition to the reform remains very high, with polls saying two-thirds of French citizens oppose it.
Speculation is running high that Macron might not have enough support in the National Assembly, and may choose a constitutional maneuver to bypass parliament — in a move that could unleash a political storm in France.
On Thursday, the French Senate and the National Assembly are expected to cast a crucial vote on the second reading of the bill, after the Senate voted in favor last week. The outcome will determine the shape of Macron’s second term and stands to bear heavily on his legacy.
The worst case: Macron loses the vote in parliament
Losing the parliamentary vote would be a stunning defeat for the French president, who pinned his bid for a second term on his promises to reform France’s pensions system. But political commentators have been speculating in recent days that Macron’s Renaissance party doesn’t have enough votes to pass the bill.
The French president lost its absolute majority in the National Assembly in parliamentary elections last June. He has since been forced into making ad-hoc deals with MPs from France’s conservative party Les Républicains. But the once-mighty conservatives appear split on the reform, despite assurances this week from their leader Olivier Marleix that there was “a clear majority” backing the bill.
A defeat in parliament would have seismic and long-term repercussions for Macron’s second term and it is likely that the president’s trusted lieutenant Prime Minister Elizabeth Borne would have to resign in such a scenario. Party heavyweights however say they will not shy away from seeking a vote.
“There will be a vote, we want a vote, everyone must take its responsibilities,” said Aurore Bergé, leader of the Renaissance group in the National Assembly.
“There can be an accident … we’ll manage it as we can,” admitted Jean-Paul Mattei, a centrist MP who belongs to Macron’s coalition, with reference to a defeat in parliament.
However, this is the most unlikely scenario as expectations are that the government will bypass a vote if they sense that they are short on votes.
Protestors hold an effigy of French President Emmanuel Macron, during a demonstration on the 8th day of strikes and protests across the country against the government’s proposed pensions overhaul in Paris on March 15, 2023 | Alain Jocard/AFP via Getty Images
Pretty bad: Macron bypasses parliament and loses credibility
In the face of a potential defeat in the National Assembly, Macron has a nuclear option: invoke article 49.3 of the French constitution. This mechanism allows the government to force through legislation without submitting it to a vote.
While the constitutional maneuver may seem like an easy way out, it’s a highly risky move as it allows lawmakers to table a motion of no confidence within 24 hours. Macron’s government has faced down motions of no confidence in the past but the stakes are much higher this time around.
Beyond surviving a motion of no-confidence, Macron and Borne will also come under fire for refusing to submit to the democratic process.
According to Frédéric Dabi, general director of the IFOP polling institute, the impact on public opinion if the government uses the 49.3 article as opposed to passing a tight vote in parliament would be “radically different.”
“Public opinions on the 49.3 article have changed … it is regarded as a tool to brutalize the National Assembly: it’s now seen as authoritarian instead of merely authoritative. People want more transparency, more democracy today,” he said.
France’s hardline unions would no doubt use this to stoke unrest and call for further strike action.
Trade union leader Laurent Berger has warned the government against using the 49.3 article, saying that it would be “incredible and dangerous.”
“Nobody can predict what will happen, the protest movement seems to be running out of steam, but if the government invokes article 49.3 it could be read as forcing the issue and may relaunch the protest movement,” said Dabi.
Still not great: Macron wins vote but faces mass protests
If the French president wins the vote in parliament, it’ll be seen as a victory but one that may completely drain his political capital, and whip up protests on the streets.
“It’ll be a victory for Macron, but it’ll only bear its fruit in the long term. In the short term, he’ll face a tense country where relations have become very strained,” said Chloé Morin, a writer and political analyst.
Trade union leader Berger has said that he would “take on board” the result of Thursday’s vote in parliament. But protests, which have been almost weekly since January, may continue nonetheless across the country in an effort to force the government into backing down and withdrawing the text.
Morin thinks it is unlikely there will be “an explosion of protests” after the vote as people are resigned to seeing it pass.
French police officers intervene during a protest by local council employees against the government’s retirement reform in front on the prefecture in Seine Saint-Denis, in Bobigny, a surburb of Paris on March 14, 2023 | Thomas Samson/AFP via Getty Images
“However, the protest movement might become more radical with lightning protests or sabotages, led by a minority in the citizens’ movement,” said Morin.
In October last year, industrial action in France’s refineries led to nationwide shortages at petrol stations, forcing the government to intervene in what was seen as Macron’s biggest challenge since his re-election last year.
There are dangerous precedents for Macron too. In December 2019, the government was forced to abandon a new green tax when faced with the explosive Yellow Vests protests that shook the political establishment.
[ad_2]
#Macron #brink #French #pensions #revolt #wreck #presidency
( With inputs from : www.politico.eu )
PARIS — French President Emmanuel Macron’s decision to bypass parliament and impose his deeply unpopular pensions reform has revealed an uncompromising and weakened leader who now faces severe backlash from emboldened opposition lawmakers and protesters.
Macron had vowed to abandon his top-down approach to politics and work with opposition parties during his second term. But when it comes to old-style politicking, Macron’s troops still have a lot to learn.
Despite intense lobbying efforts with MPs and frantic meetings at the Elysée on Thursday and in the weeks leading up to the decisive moment, the French president and his stalwart lieutenant Prime Minister Elisabeth Borne faced the likelihood of a defeat in parliament and decided instead to invoke a controversial constitutional tool — article 49.3 — to bypass a vote.
“My political interest would have been to submit to a vote … But I consider that the financial, economic risks are too great at this stage,” Macron privately told ministers according to a participant at the meeting.
Macron’s flagship pensions reform aims to increase the legal age of retirement to 64 from 62 and extend contributions for a full pension in an effort to balance the accounts of France’s state pensions system. Macron’s Renaissance party lost its absolute majority in the National Assembly in parliamentary elections last year, but the government was able to pass legislation in recent months with the support of the conservative party Les Républicains. It appears, however, that in the nail-biting run-up to the vote, there were concerns the president wasn’t able to rally enough troops in favor of the bill.
Arriving in parliament on Thursday, Borne faced scenes of anger and unrest in the National Assembly as she made her announcement triggering article 49.3. Far-left lawmakers from the France Unbowed party booed and chanted the national hymn the Marseillaise as far-right National Rally MPs shouted “Resign! Resign!” The speaker of the house was forced to suspend debates to allow Borne to make her speech.
“We can’t take the risk of seeing 175 hours of parliamentary debate come to nothing,” Borne said.
After the announcement, opposition MPs vowed to continue the battle against the reform, either in parliament, by supporting a motion of no-confidence, or in the streets.
The leader of the far-right National Rally, Marine Le Pen, slammed the move as a “personal failure” for Macron. “It’s his reform, he’s the one who proposed it and defended it during his campaign,” she told reporters at the National Assembly.
Spontaneous protests erupted Thursday evening in several cities across France, including Paris, where thousands of protestors descended on the Place de la Concorde after the move, clashing with police and setting fire to scaffolding. Trade unions called for a day of protest on March 23, undeterred by Macron’s decision to push through the legislation.
Article 49.3, ‘a denial of democracy’
Invoking article 49.3 is widely seen as a perilous move for the government as it allows MPs to put forward a motion of no-confidence within 24 hours and risks radicalizing protest movements in France. Trade unions have already shown great unity and led almost weekly marches and strikes, bringing out hundreds of thousands of citizens to the streets. In Paris, a strike by garbage collectors has seen an estimated 7,000 tons of garbage left on the street.
While the French constitution does allow governments to bypass parliament under certain conditions, its use is increasingly seen as undemocratic in France amid social tensions and the growing mistrust of politicians.
“The government’s use of the 49.3 procedure reflects the failure of this presidential minority,” Charles de Courson, a longtime independent lawmaker, told the BFMTV news channel.
“They are not just a minority in the National Assembly, they are a minority in the whole country. The denial of democracy continues,” he said.
Speaking ahead of the vote, Frédéric Dabi, general director of the IFOP polling institute, said that opinions on invoking article 49.3 — as opposed to passing a tight vote in parliament — are “radically different.”
“Public opinions on the 49.3 article have changed … it is regarded as a tool to brutalize the National Assembly: it’s now seen as authoritarian instead of merely authoritative. People want more transparency, more democracy today,” he said.
But the show of force also exposes a weakened president, who after having lost a majority in parliament and amid low popularity ratings, was unable to turn the tide of public opinion in France.
Surviving now, and later
In the short term, the government will have to survive several motions of no-confidence that are expected to be voted on Monday. Macron’s government has faced down motions of no confidence in the past but the stakes are much higher this time around.
“It’s maybe the first time that a motion of no-confidence may overthrow the government,” Green MP Julien Bayou told reporters, adding that the government was “prepared to wreak havoc” in the country.
Longer term, the move destroys prospects of a closer alliance between Macron’s Renaissance party and the conservative Les Républicains following a string of ad-hoc deals in recent months. In a worrying sign for Macron’s second term, as the debates on the pensions reform reached a climax, the leadership of the conservative party could not muster its own faithful despite concessions on the bill from the ruling party.
The great irony for Macron — needing partners and not finding them — is that he is the man who upended France’s political landscape by crushing the traditional left-wing and right-wing parties in 2017.
The dilemma for Macron is how he will get anything done in the next four yours of his presidency, given the reinvigorated opposition he is sure to face in a parliament dominated by the far left and the far right, and without reliable coalition partners.
Perhaps the only silver lining for Macron is the view from abroad.
“On the international scene, it’s a sign that France can make reforms, even if, frankly, many may think we are having a nervous breakdown over something so small, given that the government has made so many concessions [on the bill],” said Chloé Morin, a writer and political analyst ahead of the vote.
“Everybody knows that [reforming pensions] in France is difficult …That’s what’s at stake for Macron: he is a president who is building his legacy,” she said.
[ad_2]
#Macrons #defiant #show #force #parliament #exposes #weakened #president
( With inputs from : www.politico.eu )
Doubts are growing about the wisdom of holding the shattered frontline city of Bakhmut against relentless Russian assaults, but Ukrainian President Volodymyr Zelenskyy is digging in and insists his top commanders are united in keeping up an attritional defense that has dragged on for months.
Fighting around Bakhmut in the eastern region of Donbas dramatically escalated late last year, with Zelenskyy slamming the Russians for hurling men — many of them convicts recruited by the Wagner mercenary group — forward to almost certain death in “meat waves.” Now the bloodiest battle of the war, Bakhmut offers a vision of conflict close to World War I, with flooded trenches and landscapes blasted by artillery fire.
In the past weeks, as Ukrainian forces have been almost encircled in a salient, lacking shells and facing spiking casualties, there has been increased speculation both in Ukraine and abroad that the time has come to pull back to another defensive line — a retrenchment that would not be widely seen as a massive military setback, although Russia would claim a symbolic victory.
In an address on Wednesday night, however, Zelenskyy explained he remained in favor of slogging it out in Bakhmut.
“There was a clear position of the entire general staff: Reinforce this sector and inflict maximum possible damage upon the occupier,” Zelenskyy said in a video address after meeting with Ukraine’s Commander-in-Chief Valeriy Zaluzhnyy and other senior generals to discuss a battle that’s prompting mounting anxiety among Ukraine’s allies and is drawing criticism from some Western military analysts.
“All members expressed a common position regarding the further holding and defense of the city,” Zelenskyy said.
This is the second time in as many weeks that Ukraine’s president has cited the backing of his top commanders. Ten days ago, Zelenskyy’s office issued a statement also emphasizing that Zaluzhnyy and Oleksandr Syrskyi, commander of Ukraine’s ground forces, agreed with his decision to hold fast at Bakhmut.
The long-running logic of the Ukrainian armed forces has been that Russia has suffered disproportionately high casualties, allowing Kyiv’s forces to grind down the invaders, ahead of a Ukrainian counter-offensive expected shortly, in the spring.
City of glass, brick and debris
Criticism has been growing among some in the Ukrainian ranks — and among Western allies — about continuing with the almost nine-month-long battle. The disquiet was muted at first and expressed behind the scenes, but is now spilling into the open.
On social media some Ukrainian soldiers have been expressing bitterness at their plight, although they say they will do their duty and hold on as ordered. “Bakhmut is a city of glass, bricks and debris, which crackle underfoot like the fates of people who fought here,” tweeted one.
A lieutenant on Facebook noted: “There is a catastrophic shortage of shells.” He said the Russians were well dug in and it was taking five to seven rounds to hit an enemy position. He complained of equipment challenges, saying “Improvements — improvements have already been promised, because everyone who has a mouth makes promises.” But he cautioned his remarks shouldn’t be taken as a plea for a retreat. “WE WILL FULFILL OUR DUTY UNTIL THE END, WHATEVER IT IS!” he concluded ruefully.
Iryna Rybakova, a press officer with Ukraine’s 93rd brigade, also gave a flavor of the risks medics are facing in the town. “Those people who go back and forth to Bakhmut on business are taking an incredible risk. Everything is difficult,” she tweeted.
A Ukrainian serviceman gives food and water to a local elderly woman in the town of Bakhmut | Anatolii Stepanov/AFP via Getty Images
The key strategic question is whether Zelenskyy is being obdurate and whether the fight has become more a test of wills than a tactically necessary engagement that will bleed out Russian forces before Ukraine’s big counter-strike.
“Traveling around the front you hear a lot of grumblings where folks aren’t sure whether the reason they’re holding Bakhmut is because it’s politically important” as opposed to tactically significant, according to Michael Kofman, an American military analyst and director of the Russia Studies Program at the Center for Naval Analyses.
Kofman, who traveled to Bakhmut to observe the ferocious battle first-hand, said in the War on the Rocks podcast that while the battle paid dividends for the Ukrainians a few months ago, allowing it to maintain a high kill ratio, there are now diminishing returns from continuing to engage.
“Happening in the fight now is that the attrition exchange rate is favorable to Ukraine but it’s not nearly as favorable as it was before. The casualties on the Ukrainian side are rather significant and require a substantial amount of replacements on a regular basis,” he said.
The Ukrainians have acknowledged they have also been suffering significant casualties at Bakhmut, which Russia is coming ever closer to encircling. They claim, though, the Russians are losing seven soldiers for each Ukrainian life lost, while NATO military officials put the kill ratio at more like five to one. But Kofman and other military analysts are skeptical, saying both sides are now suffering roughly the same rate of casualties.
“I hope the Ukrainian command really, really, really knows what it’s doing in Bakhmut,” tweeted Illia Ponomarenko, the Kyiv Independent’s defense reporter.
Shifting position
Last week, Zelenskyy received support for his decision to remain engaged at Bakhmut from retired U.S. generals David Petraeus and Mark Hertling on the grounds that the battle was causing a much higher Russian casualty rate. “I think at this moment using Bakhmut to allow the Russians to impale themselves on it is the right course of action, given the extraordinary casualties that the Russians are taking,” retired general and former CIA director Petraeus told POLITICO.
But in the last couple of weeks the situation has shifted, said Rob Lee, a former U.S. Marine officer and now at the Foreign Policy Research Institute, and the kill ratio is no longer a valid reason to remain engaged. “Bakhmut is no longer a good place to attrit Russian forces,” he tweeted. Lee says Ukrainian casualties have risen since Russian forces, comprising Wagner mercenaries as well as crack Russian airborne troops, pushed into the north of the town at the end of February.
The Russians have been determined to record a victory at Bakhmut, which is just six miles southwest of the salt-mining town of Soledar, which was overrun two months ago after the Wagner Group sacrificed thousands of its untrained fighters there too.
U.S. Defense Secretary Lloyd Austin has hinted several times that he sees no tactical military reason to defend Bakhmut, saying the eastern Ukrainian town was of more symbolic than operational importance, and its fall wouldn’t mean Moscow had regained the initiative in the war.
Ukrainian generals have pushed back at such remarks, saying there’s a tactical reason to defend the town. Zaluzhnyy said on his Telegram channel: “It is key in the stability of the defense of the entire front.”
Volodymyr Zelensky and Sanna Marin attend a memorial service for Dmytro Kotsiubailo, a Ukrainian serviceman killed in Bakhmut | Sergei Supinsky/AFP via Getty Images
Midweek, the Washington Post reported that U.S. officials have been urging the Ukrainians since the end of January to withdraw from Bakhmut, fearing the depletion of their own troops could impact Kyiv’s planned spring offensive. Ukrainian officials say there’s no risk of an impact on the offensive as the troops scheduled to be deployed are not fighting at Bakhmut.
That’s prompted some Ukrainian troops to complain that Kyiv is sacrificing ill-trained reservists at Bakhmut, using them as expendable in much the same way the Russians have been doing with Wagner conscripts. A commander of the 46th brigade — with the call sign Kupol — told the newspaper that inexperienced draftees are being used to plug the losses. He has now been removed from his post, infuriating his soldiers, who have praised him.
Kofman worries that the Ukrainians are not playing to their military strengths at Bakhmut. Located in a punch bowl, the town is not easy to defend, he noted. “Ukraine is a dynamic military” and is good when it is able “to conduct a mobile defense.” He added: “Fixed entrenches, trying to concentrate units there, putting people one after another into positions that have been hit by artillery before doesn’t really play to a lot of Ukraine’s advantages.”
“They’ve mounted a tenacious defense. I don’t think the battle is nearly as favorable as it’s somewhat publicly portrayed but more importantly, I think they somewhat run the risk of encirclement there,” he added.
[ad_2]
#Zelenskyy #digs #calls #quit #Bakhmut
( With inputs from : www.politico.eu )
Germany and Japan agreed on Saturday to strengthen cooperation on economic security in the aftermath of tensions over global supply chains and the economic impact of the war in Ukraine.
In the first high-ministerial government consultations held between the two countries, German Chancellor Olaf Scholz reached out to Tokyo to seek to reduce Germany’s dependence on China for imports of raw materials.
“The current challenges of our time make it clear: It is important to expand cooperation with close partners and acquire new partners. We want to reduce dependencies and increase the resilience of our economies.” the German chancellor said in a tweet.
Scholz and Japanese Prime Minister Fumio Kishida said they believe the agreement will allow both countries to diversify value chains in order to be able to reduce economic risks.
In a joint statement, the two countries said they will work on establishing “a legal framework for bilateral defense and security cooperation activities,” including ways to protect critical infrastructures, trade routes and to secure future supply of sustainable energy.
Germany’s decision to prioritize consultations with Japan came after the Asian country put forward an economic security bill last year aimed at securing the uptake of technology and bolstering critical supply chains.
Japan is Germany’s second-largest trading partner in Asia after China, with a bilateral trade volume of €45.7 billion mainly based on the import and export of machinery, vehicles, electronics and chemical products.
The two leaders also exchanged views on the situation in Ukraine, cooperation in the Indo-Pacific region and the G7 meeting in Hiroshima scheduled for May.
[ad_2]
#Germany #Japan #pledge #boost #cooperation #economic #security
( With inputs from : www.politico.eu )
As U.S. banking regulators begin their post-mortem of Silicon Valley Bank, some pundits are pointing the finger at crypto markets, whose own collapse over the past year left the tech-focused lender hopelessly exposed.
The conventional wisdom about crypto is that it’s “self-referential” — a separate universe to conventional finance — and that its inherent volatility can be contained. The emerging “contagion” theory is that there are enough linkages for extreme turmoil to spill over, much as a virus can sometimes jump from one species to another.
That’s what happened here, according to Barney Frank, the former U.S. congressman who wrote sweeping new banking rules after the banking crisis in 2008, and joined the crypto-friendly Signature Bank as a board member in 2015.
“I think, if it hadn’t been for FTX and the extreme nervousness about crypto, that this wouldn’t have happened,” Frank told POLITICO this week. “That wasn’t something that could have been anticipated by regulators.”
FTX, the crypto exchange that collapsed in November amid allegations of massive fraud, capped a year of turmoil in crypto markets, as investors began withdrawing funds from riskier ventures in response to rising interest rates, which in turn exposed the shaky foundations underpinning the industry. The ensuing “crypto winter” saw the value of the industry plummet by two-thirds, from a peak of $3 trillion in 2021.
Policymakers sought to reassure the public that volatility in the crypto market, blighted by scams and charlatans who sought to profit from investors’ fear of missing out, would naturally be contained. With the collapse of SVB, that claim is facing its biggest test yet.
Patient zero
Under the contagion theory, “patient zero” could be traced back to the implosion of TerraUSD, an “algorithmic stablecoin” that relied on financial engineering to keep its value on par with the U.S. dollar. That promise fell short in May last year following a mass sell-off, creating panic among investors who had used the virtual asset as a safe haven to park cash between taking punts on the crypto market. The origin of the crash is still subject to debate but rising interest rates are often cited as one of the main culprits.
TerraUSD’s demise was catastrophic for a major crypto hedge fund called Three Arrows Capital, dubbed 3AC. The money managers had invested $200 million into Luna, a crypto token whose value was used to prop up TerraUSD, which had become the third largest stablecoin on the market. A British Virgin Islands court ordered 3AC to liquidate its assets at the end of June.
The fund’s end created even more problems for the industry. Major crypto lending businesses, such as BlockFi, Celsius Network and Voyager, had lent hundreds of millions of dollars to 3AC to finance its market bets and were now facing massive losses.
Customers who had deposited their digital assets with the industry lender were suddenly locked out of their accounts, prompting FTX — then the third largest crypto exchange — to step in and bail out BlockFi and Voyager. Meanwhile, central banks continued to raise rates.
The contagion seemed under control for a few months until revelations emerged in November that FTX had been using client cash to finance risky bets elsewhere. The exchange folded soon after, as its customers rushed to get their money out of the platform. BlockFi and Voyager, meanwhile, were left stranded.
Outbreak widens
This is the point where the outbreak of risk in the crypto industry might have jumped species into the banking sector.
Silvergate Bank and Signature Bank, two smaller banks that also failed last week, had extensive business with crypto exchanges, including FTX. Silvergate tried to downplay its exposure to FTX but ended up reporting a $1 billion loss over the last three months of 2022 after investors withdrew more than $8 billion in deposits. Signature also did its best to distance itself from FTX, which made up some 0.1 percent of its deposits.
FTX, the crypto exchange that collapsed in November amid allegations of massive fraud, capped a year of turmoil in crypto markets | Leon Neal/Getty Images
SVB had no direct link to FTX, but was not immune to the broader contagion. Its depositors, including tech startups, crypto firms and VCs, started burning their cash reserves to run their businesses after venture capital funding dried up.
“SVB and Silvergate had the same balance sheet structure and risks — massive duration mismatch, lots of uninsured runnable deposits backed by securities not marked to market, and inadequate regulatory capital because unrealized fair value losses excluded,” former Natwest banker and industry expert Frances Coppola told POLITICO.
Eventually, the deposit drain forced SVB to liquidate underwater assets to accommodate its clients, while trying to handle losses on bond portfolios and an outsized bet on interest rates. As word got out, the withdrawals turned into a bank run as frictionless and hype-driven as a crypto bubble.
Zachary Warmbrodt and Izabella Kaminska contributed reporting from Washington and London, respectively.
This article has been updated to correct the value of the crypto industry.
[ad_2]
#crypto #contagion #helped #bring #SVB
( With inputs from : www.politico.eu )
The Baltic states and Poland want to make it easier to sanction the family members and entourage of Russia’s richest men and women but are facing resistance from Hungary, several EU diplomats told POLITICO.
Under its current rules, the EU can freeze the assets and impose visa bans on “leading businesspersons operating in Russia.” Lithuania, Latvia, Estonia and Poland now want to expand this definition, according to their proposal seen by POLITICO, to include “their immediate family members, or other natural persons, benefitting from them.”
The EU has sanctioned more than 1,400 people in relation to Russia’s activities in Ukraine, many of who are Russian oligarchs. An additional 96 people could be added to the EU’s next sanctions package, draft documents seen by POLITICO indicate. Including oligarchs’ family members and other associates of oligarchs would make it possible to sanctions thousands more people without having to prove that they are directly involved in the war in Ukraine or acting in the economic interest of the Russian state.
This could, for example, apply to the ex-wife of Russian President Vladimir Putin, Lyudmila Ocheretnaya, whose daughters have been sanctioned but has not been herself, and other members of the oligarchs’ entourage.
While some countries had doubts, legal experts are on board, said one of the diplomats.
Yet, in a meeting on Tuesday, at which EU ambassadors discussed the bloc’s next round of sanctions, Hungary resisted such plans, the diplomats said. Budapest argued that this is not part of the 10th sanctions package, said one of the diplomats. Hungary has long been skeptical of including too many names on the list.
Hungary also pushed to strike four people out the already existing sanctions list, two of the diplomats said.
It was not immediately possible to learn the identity of the four individuals.
That request is igniting tensions, and will be likely subject to another heated debate during a meeting of EU ambassadors on Wednesday. During that meeting, they will not only discuss the new package of sanctions against Russia, but also the so-called rollover of the 1,400-plus names already on the list to keep them sanctioned.
That’s because the regime is subject to a six-month review, which has hitherto been more or less a formality. Now, Hungary is using this extension review as leverage by insisting that four specific people have to be struck from the EU’s existing sanctions list before it will agree to the rollover. If Hungary blocks the rollover and refuses to compromise, all 1,400 people would be de-listed, the two diplomats warned.
One of the diplomats didn’t hide his frustration: “It shows Hungary’s disregard for unity and European values that they are willing to risk this in the week where we commemorate one year since the Russian invasion,” he said.
And those aren’t the only measure that Hungary takes issue with. It also is chiefly against sanctioning personnel working in the nuclear sector.
But a Hungarian official poured water on this last point, saying that “the only open issue for Hungary is with the length of the rollover and not with the listings.”
On the oligarchs issue and the proposal of the Baltics and Poland, the same Hungarian official said that this is not part of the 10th package.
As all EU countries have to agree to the proposal, any country could veto the move even if all other 26 EU countries were in favor. Time is running out, with the EU wanting to adopt the 10th sanctions package before the one-year anniversary of Russia’s invasion of Ukraine on Friday.
[ad_2]
#Baltics #Poland #push #sanctioning #oligarchs #associates #easier
( With inputs from : www.politico.eu )
One year of war in Ukraine has left deep scars — including on the country’s natural landscape.
The conflict has ruined vast swaths of farmland, burned down forests and destroyed national parks. Damage to industrial facilities has caused heavy air, water and soil pollution, exposing residents to toxic chemicals and contaminated water. Regular shelling around the Zaporizhzhia nuclear power plant, the largest in Europe, means the risk of a nuclear accident still looms large.
The total number of cases of environmental damage tops 2,300, Ukraine’s environment minister, Ruslan Strilets, told POLITICO in an emailed statement. His ministry estimates the total cost at $51.45 billion (€48.33 billion).
Of those documented cases, 1,078 have already been handed over to law enforcement agencies, according to Strilets, as part of an effort to hold Moscow accountable in court for environmental damage.
A number of NGOs have also stepped in to document the environmental impacts of the conflict, with the aim of providing data to international organizations like the United Nations Environment Program to help them prioritize inspections or pinpoint areas at higher risk of pollution.
Among them is PAX, a peace organization based in the Netherlands, which is working with the Center for Information Resilience (CIR) to record and independently verify incidents of environmental damage in Ukraine. So far, it has verified 242 such cases.
Left: Hostomel, Ukraine, after a Russian assault. Right: Port of Mykolaiv after a Russian strike | Imagery courtesy of Planet Labs PBC
“We mainly rely on what’s being documented, and what we can see,” said Wim Zwijnenburg, a humanitarian disarmament project leader with PAX. Information comes from social media, public media accounts and satellite imagery, and is then independently verified.
“That also means that if there’s no one there to record it … we’re not seeing it,” he said. “It’s such a big country, so there’s fighting in so many locations, and undoubtedly, we are missing things.”
After the conflict is over, the data could also help identify “what is needed in terms of cleanup, remediation and restoration of affected areas,” Zwijnenburg said.
Rebuilding green
While some conservation projects — such as rewilding of the Danube delta — have continued despite the war, most environmental protection work has halted.
“It is very difficult to talk about saving other species if the people who are supposed to do it are in danger,” said Oksana Omelchuk, environmental expert with the Ukrainian NGO EcoAction.
That’s unlikely to change in the near future, she added, pointing out that the environment is littered with mines.
Before and after flooding in the Kyiv area, Ukraine | Imagery courtesy of Planet Labs PBC
Agricultural land is particularly affected, blocking farmers from using fields and contaminating the soil, according to Zwijnenburg. That “might have an impact on food security” in the long run, he said.
When it comes to de-mining efforts, residential areas will receive higher priority, meaning it could take a long time to make natural areas safe again.
The delay will “[hinder] the implementation of any projects for the restoration and conservation of species,” according to Omelchuk.
And, of course, fully restoring Ukraine’s nature won’t be possible until “Russian troops leave the territory” she said.
Azovstal steel plant in Mariupol before and after a Russian attack |Imagery courtesy of Planet Labs PBC
Meanwhile, Kyiv is banking that the legal case it is building against Moscow will become a potential source of financing for rebuilding the country and bringing its scarred landscape and ecosystems back to health.
It is also tapping into EU coffers.In a move intended to help the country restore its environment following Russia’s invasion, Ukraine in June became the first non-EU country to join the LIFE program, the EU’s funding instrument for environment and climate.
Earlier this month, Environment Commissioner Virginijus Sinkevičius announced a €7 million scheme — dubbed the Phoenix Initiative — to help Ukrainian cities rebuild greener and to connect Ukrainian cities with EU counterparts that can share expertise on achieving climate neutrality.
[ad_2]
#environmental #scars #Russias #war #Ukraine
( With inputs from : www.politico.eu )
MUNICH — China is trying to drive a fresh wedge between Europe and the United States as Russia’s invasion of Ukraine trudges past its one-year mark.
Such was the motif of China’s newly promoted foreign policy chief Wang Yi when he broke the news at the Munich Security Conference on Saturday that President Xi Jinping would soon present a “peace proposal” to resolve what Beijing calls a conflict — not a war — between Moscow and Kyiv. And he pointedly urged his European audience to get on board and shun the Americans.
In a major speech, Wang appealed specifically to the European leaders gathered in the room.
“We need to think calmly, especially our friends in Europe, about what efforts should be made to stop the warfare; what framework should there be to bring lasting peace to Europe; what role should Europe play to manifest its strategic autonomy,” said Wang, who will continue his Europe tour with a stop in Moscow.
In contrast, Wang launched a vociferous attack on “weak” Washington’s “near-hysterical” reaction to Chinese balloons over U.S. airspace, portraying the country as warmongering.
“Some forces might not want to see peace talks to materialize,” he said, widely interpreted as a reference to the U.S. “They don’t care about the life and death of Ukrainians, [nor] the harms on Europe. They might have strategic goals larger than Ukraine itself. This warfare must not continue.”
Yet at the conference, Europe showed no signs of distancing itself from the U.S. nor pulling back on military support for Ukraine. The once-hesitant German Chancellor Olaf Scholz urged Europe to give Ukraine even more modern tanks. And French President Emmanuel Macron shot down the idea of immediate peace talks with the Kremlin.
And, predictably, there was widespread skepticism that China’s idea of “peace” will match that of Europe.
“China has not been able to condemn the invasion,” NATO Secretary-General Jens Stoltenberg told a group of reporters. Beijing’s peace plan, he added, “is quite vague.” Peace, the NATO chief emphasized, is only possible if Russia respects Ukraine’s sovereignty.
Europe watches with caution
Wang’s overtures illustrate the delicate dance China has been trying to pull off since the war began.
Keen to ensure Russia is not weakened in the long run, Beijing has offered Vladimir Putin much-needed diplomatic support, while steering clear of any direct military assistance that would attract Western sanctions against its economic and trade relations with the world.
Ukrainian Foreign Minister Dmitro Kuleba is expected to hold a bilateral meeting with Wang while in Munich | Johannes Simon/Getty Images
“We will put forward China’s position on the political settlement on the Ukraine crisis, and stay firm on the side of peace and dialogue,” Wang said. “We do not add fuel to the fire, and we are against reaping benefit from this crisis.”
According to Italy’s Foreign Minister Antonio Tajani, who met Wang earlier this week, Xi will make his “peace proposal” on the first anniversary of the war, which is Friday.
Ukrainian Foreign Minister Dmitro Kuleba is expected to hold a bilateral meeting with Wang while in Munich. He said he hoped to have a “frank” conversation with the Beijing envoy.
“We believe that compliance with the principle of territorial integrity is China’s fundamental interest in the international arena,” Kuleba told journalists in Munich. “And that commitment to the observance and protection of this principle is a driving force for China, greater than other arguments offered by Ukraine, the United States, or any other country.”
EU foreign policy chief Josep Borrell is also expected to meet Wang later on Saturday.
Many in Munich were wary of the upcoming Chinese plan.
German Foreign Minister Annalena Baerbock welcomed China’s effort to use its influence to foster peace but told reporters she had “talked intensively” with Wang during a bilateral meeting on Friday about “what a just peace means: not rewarding the attacker, the aggressor, but standing up for international law and for those who have been attacked.”
“A just peace,” she added, “presupposes that the party that has violated territorial integrity — meaning Russia — withdraws its troops from the occupied country.”
One reason for Europe’s concerns is the Chinese peace plan could undermine an effort at the United Nations to rally support for a resolution condemning Russia’s invasion of Ukraine, which will be on the U.N.’s General Assembly agenda next week, according to three European officials and diplomats.
Taiwan issue stokes up US-China tension
If China was keen to talk about peace in Ukraine, it’s more reluctant to do so in a case closer to home.
When Wolfgang Ischinger, the veteran German diplomat behind the conference, asked Wang if he could reassure the audience Beijing was not planning an imminent military escalation against Taiwan, the Chinese envoy was non-committal.
Nato Secretary-General Jens Stoltenberg said “what is happening in Europe today could happen in east Asia tomorrow” | Johannes Simon/Getty Images
“Let me assure the audience that Taiwan is part of Chinese territory. It has never been a country and it will never be a country in the future,” Wang said.
The worry over Taiwan resonated in a speech from NATO Secretary-General Jens Stoltenberg, who said “what is happening in Europe today could happen in east Asia tomorrow.” Reminding the audience of the painful experience of relying on Russia’s energy supply, he said: “We should not make the same mistakes with China and other authoritarian regimes.”
But China’s most forceful attack was reserved for the U.S. Calling its decision to shoot down Chinese and other balloons “absurd” and “near-hysterical,” Wang said: “It does not show the U.S. is strong; on the contrary, it shows it is weak.
Wang also amplified the message in other bilateral meetings, including one with Pakistani Foreign Minister Bilawal Bhutto Zardari. “U.S. bias and ignorance against China has reached a ridiculous level,” he said. “The U.S. … has to stop this kind of absurd nonsense out of domestic political needs.”
It remains unclear if Wang will hold a meeting with U.S. Secretary of State Antony Blinken while in Germany, as has been discussed.
Hans von der Burchard and Lili Bayer reported from Munich, and Stuart Lau reported from Brussels.
[ad_2]
#China #talks #peace #woos #Europe #trashes #Biden #Munich
( With inputs from : www.politico.eu )
When Elon Musk bought Twitter, he promised an era of openness for the social media platform. Yet that transparency will soon come at a price.
On Thursday, the social-networking giant will shut down free and unfettered access to reams of data on the company’s millions of users. As part of that overhaul, researchers worldwide who track misinformation and hate speech will also have their access shut down — unless they stump up the cash to keep the data tap on.
The move is part of Musk’s efforts to make Twitter profitable amid declining advertising revenue, sluggish user growth and cut-throat competition from the likes of TikTok and Instagram.
But the shift has riled academics, infuriated lawmakers and potentially put Twitter at odds with new content-moderation rules in the European Union that require such data access to independent researchers.
“Shutting down or requiring paid access to the researcher API will be devastating,” said Rebekah Tromble, director of the Institute for Data, Democracy and Politics at George Washington University, who has spent years relying on Twitter’s API to track potentially harmful material online.
“There are inequities in resources for researchers around the world. Scholars at Ivy League institutions in the United States could probably afford to pay,” she added. “But there are scholars all around the world who simply will not have the resources to pay anything for access to this.”
The change would cut free access to Twitter’s so-called application program interface (API), which allowed outsiders to track what happened on the platform on a large scale. The API essentially gave outsiders direct access to the company’s data streams and was kept open to allow researchers to monitor users, including to spot harmful, fake or misleading content.
A team at New York University, for instance, published a report last month on how far wide-reaching Russia’s interference in the 2016 U.S. presidential election had been by directly tapping into Twitter’s API system. Without that access, the level of Kremlin meddling would have been lost to history, according to Joshua Tucker, co-director at New York University’s Center for Social Media and Politics.
Twitter did not respond to repeated requests to comment on whether this week’s change would affect academics and other independent researchers. The move still may not happen at all, depending on how Twitter tweaks its policies. The company’s development team said via a post on the social network last week it was committed to allowing others to access the platform via some form of API.
“We’ll be back with more details on what you can expect next week,” they said.
Yet the lack of details about who will be affected — and how much the data access will cost from February 9 — has left academics and other researchers scrambling for any details. Meanwhile, many of Twitter’s employees working on trust and safety issues have either been fired or have left the company since Musk bought Twitter for $44 billion in late October.
In Europe’s crosshairs
The timing of the change comes as the European Commission on Thursday will publish its first reports from social media companies, including Twitter, about how they are complying with the EU’s so-called code of practice on disinformation, a voluntary agreement between EU legislators and Big Tech firms in which these companies agree to uphold a set of principles to clamp down on such material. The code of practice includes pledges to “empower researchers” by improving their ability to access companies’ data to track online content.
Thierry Breton, Europe’s internal market commissioner, talked to Musk last week to remind him about his obligations regarding the bloc’s content rules, though neither discussed the upcoming shutdown of free data access to the social network.
“We cannot rely only on the assessment of the platforms themselves. If the access to researchers is getting worse, most likely that would go against the spirit of that commitment,” Věra Jourová, the European Commission’s vice president for values and transparency, told POLITICO.
“It’s worrying to see a reversal of the trend on Twitter,” she added in reference to the likely cutback in outsiders’ access to the company’s data.
While the bloc’s disinformation standards are not mandatory, separate content rules from Brussels, known as the Digital Services Act, also directly require social media companies to provide data access to so-called vetted researchers. By complying with the code of practice on disinformation, tech giants can ease some of their compliance obligations under those separate content-moderation rules and avoid fines of up to 6 percent of their revenues if they fall afoul of the standards.
Yet even Twitter’s inclusion in the voluntary standards on disinformation is on shaky ground.
The company submitted its initial report that will be published Wednesday and Musk said he was committed to complying with the rules. But Camino Rojo — who served as head of public policy for Spain and was the main person at Twitter involved in the daily work on the code since November’s mass layoffs — is no longer working at the tech giant as of last week, according to two people with direct knowledge of the matter, who spoke on the condition of anonymity to discuss internal discussions within Twitter. Rojo did not respond to a request for comment.
American lawmakers are also trying to pass legislation that would improve researcher access to social media companies following a series of scandals. The companies’ role in fostering the January 6 Capitol Hill riots has triggered calls for tougher scrutiny, as did the so-called Facebook Files revelations from whistleblower Frances Haugen, which highlighted how difficult it remains for outsiders to understand what is happening on these platforms.
“Twitter should be making it easier to study what’s happening on its platform, not harder,” U.S. Representative Lori Trahan, a Massachusetts Democrat, said in a statement in reference to the upcoming change to data access. “This is the latest in a series of bad moves from Twitter under Elon Musk’s leadership.”
Rebecca Kern contributed reporting from Washington.
This article has been updated to reflect a change in when the European Commission is expected to publish reports under the code of practice on disinformation.
[ad_2]
#Elon #Musk #war #researchers
( With inputs from : www.politico.eu )
