Our editors give us a breakdown of the week’s biggest news stories
United Kingdom: Lucy Wright
Following the Treasury’s confirmation on Wednesday, the scrapping of the Autumn Budget has dominated this week’s headlines, as Rishi Sunak’s recovery strategy has been blown off course. Instead of moving into the rebuilding phase of the pandemic, the treasury has had to rapidly change plans following the resurgence in Covid-19 cases and the reimposition of nationwide restrictions this week. Plans for six months of new nationwide measures are expected to undermine economic recovery.
In an attempt to phase out the furlough scheme, Sunak announced the Emergency Job Support Scheme on Thursday. Under the scheme, employers have a greater financial burden to bear, and employees must be working a third of their normal hours. Designed to support ‘viable’ jobs in a post pandemic world, the scheme is based on an incentive structure that leading economists worry will fail to prevent another million workers losing their jobs by the middle of next year. Young workers and those at the bottom end of the income scale will be the hardest hit.
Europe: Peter Hourston
Two journalists from the French news agency Premières Lignes were stabbed outside the former offices of the satirical magazine Charlie Hebdo in Paris on Friday 25 September. The French counter-terrorism prosecutor confirmed that the main suspect, an 18 year old man from Pakistan, had been arrested and a second man, a 33 year old Algerian, had also been detained in order to investigate his relationship with the first. The chief suspect who had been living in France illegally. The French Security Services were braced for an Islamist terror attack following the start of the trial of the suspects for the orginial January 2015 shootings at Charlie Hebdo last month. The French authorities claimed this week that they had foiled at least half a dozen terrorist attacks this year alone. The injuries to the victims were not thought to be life threatening.
Voters in Switzerland go to the polls today to take part in five referendums, the most important of which concerns the neutral state’s relationship with its large neighbour, the European Union. The proposal on offer who allow the Swiss Government to decide who could come into the country, suspending several Brussels-Bern bilateral agreements across measures on air and land freight, standards in medical and scientific equipment, rules on public procurement, as well as halting negotiations with the EU over the “framework agreement”. The framework agreement is the set of over 210 separate deals which govern Switzerland’s relationship with the EU.
The European Commission is to appeal against a court decision that ruled in favour of Apple in relation to the Commission’s demand that the tech giant repay €14.3bn in tax advantages to Ireland. Margrethe Vestager, the EU’s executive vice-president in charge of competition policy, said on Friday that the EU would need to “continue to use all tools at our disposal to ensure companies pay their fair share of tax”. The Danish Commissioner, who has become well known for her tough stance against Silicon Valley corporations, has faced setbacks in relation to Apple’s taxes before.
Asia Pacific: Satyajit Mohanan
Vodafone wins international arbitration case against India in $2 billion tax case dispute. British telecom Vodafone Group Plc won a decade-long battle against the Indian tax department’s demand of Rs 20,000 crore. The international arbitration tribunal in The Hague ruled that the Indian government’s imposition of a tax liability on Vodafone is in breach of the investment treaty agreement between India and the Netherlands. The Tribunal in its hearing has also ordered the government to pay over Rs 40 crore as partial compensation for Vodafone’s legal costs. India is entangled in more than a dozen international arbitration cases against companies over retrospective tax claims and cancellation of contracts. Some analysts feel that this significantly lowers India’s image globally as a business friendly destination.
About 3,500 United States companies, including Tesla, Ford Motor, Target, Walgreens and Home Depot, have sued the Trump administration in the last two weeks over the imposition of tariffs on more than $300bn in Chinese-made goods. The companies in their suits filled in the US Court of International Trade challenged “the unlawful escalation” of the US trade war with China through the imposition of a third and fourth round of tariffs. The suits challenge tariffs in two separate groups known as List 3 and List 4A. List 3 includes 25 percent tariffs on about $200bn in imports, while List 4A included 7.5 percent tariffs on $120bn in goods.
Africa & Middle East: Camille Capelle
After the successful normalisation of relations with Israel by Bahrain and the UAE, the US government has started to direct its efforts at achieving the same with Sudan. To accomplish this, the US has offered a removal of Sudan from their ‘state-sponsors of terrorism’ list in exchange. However, so far Sudan has rejected the idea of linking these two issues, since many believe that the label is undeserved since the removal of al-Bashir last year.
Amid the overwhelming challenge of forming a new government, the Lebanese Prime Minister, Mustapha Adib, has announced his resignation. Various sectarian parties felt threatened as the PM tried to redistribute key appointments, the most controversial being the finance minister position. Not only does this offset all French efforts to get past the political stalemate, the situation is also becoming increasingly critical as economic circumstances deteriorate.
In Egypt, protests calling for the resignation of President el-Sisi have continued since last Sunday when an activist and opponent of the regime called for a “day of rage”. Since then, hundreds have been arrested while at least one protestor was killed last Friday. The protests erupted in response to accusations of corruption, rising prices and housing demolition. Already on the radar for human rights infringements, Sisi’s government is said to hold thousands of political prisoners, including those arrested during protests last September.
North America: Amelia Brown
President Trump has announced Amy Coney Barrett as his pick to fill the U.S. Supreme Court vacancy. Barrett is a conservative federal appeals court judge, with a record of anti-abortion, anti-LGBTQ, anti-Affordable Cares Act, and pro-Second Amendment. If confirmed, she would be Trump’s third appointee to the life-long position, and the court would take a 6-3 conservative-liberal slant.
Meanwhile, the U.S. government is still at a standstill with the next coronavirus relief stimulus package. The House of Representatives has designed a $2.4 trillion package, lower than the one proposed before break in May, but still higher than many members would agree to. The unemployment rate from August was 8.4%, and will likely remain at a similar level from September.
Canada made a deal to secure 20 million doses of a coronavirus vaccine being worked on at Oxford University. The country now has deals with six major vaccine candidates for a total of 282 million doses. Prime Minister Justin Trudeau also announced Canada’s involvement with COVAX, agreeing to provide $440 million to the global initiative meant to provide timely and equitable access to an eventual vaccine to less developed countries.
On Saturday, Mexican authorities issue arrest warrants for some police officers and military members believed to be involved in the disappearance of 43 college students in September, 2014. Coming on the six year anniversary of the disappearance, thousands of citizens marched in Mexico City over the unsolved kidnapping.
Latin America & the Caribbean: Annie Smith
Mexico is investigating claims that six Mexican women underwent hysterectomies in a US migrant detention centre without their consent. On Monday, Mexican President Andrés Manuel López Obrador said his government could take legal action against the United States if the allegations are true. Foreign Minister Marcelo Ebrard said to the BBC, “We are already in contact with six (Mexican women) who could potentially have been subjected to this type of procedure,” adding, “If confirmed, it’s a major issue and measures must be taken.” A hysterectomy is a medical procedure where all of part of the uterus is removed, and whistleblower-nurse Dawn Wooten has alleged that Spanish-speaking women detained by Immigration and Customs Enforcement (ICE) were forced to undergo the procedure at a detention centre in Georgia.
Rio de Janiero has announced that its world-famous carnival parade, Rio Carnaval, has been postponed indefinitely. The annual event, set to take place in February 2021, has been cancelled due to the country’s struggle against COVID-19, where Brazil has seen the second-highest death toll in the world. Jorge Castanheira, president of the group that organises the annual parades, noted that the event will likely not take place until there is a COVID-19 vaccine. Carnival typically draws millions of domestic and international tourists to the capital city every year, yet now it is the state second-hardest hit in Brazil, after Sao Paulo.
However, that vaccine may not be far away, as the governor of São Paulo, Brazil, said this week that he expects to roll out a Chinese-made coronavirus vaccine by December. Governor Joao Doria said that five million doses of the Sinovac vaccine against COVID-19 would be delivered next month, and noted that he hopes the entire state of São Paulo could be vaccinated by the end of February 2021. He said that there are encouraging signs that the Sinovac vaccine is safe after it reached stage three of testing with 50,000 volunteers in China. As of Saturday 26 September, Brazil has seen nearly 4.7 million cases of COVID-19 and over 140,000 deaths.
Science & Technology: Paula Plechschmidt
Following the legal battle between Apple and Epic (maker of Fortnite) over the 30% fee Apple charges on in-app purchases in the app store, Apple has made a surprising concession. While not benefiting Epic, Apple has decided todrop this highly contentious 30% fee for businesses that due to the pandemic had to pivot to online-only stores. This is due to the high amount of pressure companies like Apple are already facing to prove that they have not been acting in an anti-competitive way towards small businesses. In fact, earlier this week companies including Spotify and Match Group (parent group of tinder) had started a group called the Coalition for App Fairness, to call for these kinds of actions and to encourage reforms and transparency.
Brussels has long been working towards asolution to big tech taxation in Europe. The main propagator of this has been Margrethe Vestager, who has been dealt a severe blow to her efforts this week. Vestager, the EU’s executive vice-president in charge of competition policy, has been fighting to force Apple to pay back €14.3bn in tax advantages in Ireland. This is only one example of the problem Vestager is fighting against, which is that many big tech companies do not pay taxes in the European countries in which they are competing with many smaller businesses which are already at a disadvantage due to the value big tech creates simply due to its size, without considering that they have to pay more taxes than these giants. In aninterview with the guardian she said: “I think it is very important that we keep up the momentum. Because of this very fundamental injustice that most people and businesses pay their taxes and they are competing with businesses who create value but do not pay taxes.”
Swedish billionaire entrepreneur and Spotify founderDaniel Ek has pledged to invest €1bn in very early-stage start-ups in Europe. Europe has been lagging behind the United States and China in their efforts to become part of the tech scene. As Ek mentioned: “Some of the most promising tech talent in the world automatically leaves Europe because they don’t feel valued here. We need more super-companies that raise the bar and can act as an inspiration.” Therefore, he is committed to provide funding to companies that may still be too early for venture capital firms to invest in. Unlike the American dream, he sees the European dream as building a “better future for the collective, not just the individual”, which is the driving spirit behind him reinvesting almost a third of his wealth in the European technology market.
Business: Tom Woods
Shares in HSBC have plummeted to a 25-year low after it was revealed that the London-based bankallowed the orchestrators of a Ponzi scheme to transfer $80 million around the world in 2013 and 2014. On Monday, over 2000 documents were leaked from the FinCEN bureau of the US Treasury, which attempts to tackle financial crimes such as money laundering and bank fraud. The bulk of these were suspicious activity reports (SARs), which banks send to authorities if they suspect unlawful behaviour from customers. As well as incriminating other institutions such as JP Morgan, the documents unveiled that HSBC had submitted a SAR regarding a Ponzi scheme, then continued to allow the fraudsters to transfer millions of dollars through their systems. The scam, WCM777, was led by Chinese national Ming Xu and claimed to be an investment bank offering unique opportunities to recoup one’s money. HSBC reported the potential fraud in mid-2013 but took until April 2014 to shut down the WCM777 accounts, by which time there was virtually nothing left in them. This is just the latest hit to HSBC’s reputation this year, with the bank having already come under further pressure as a result of its support for China’s security law in Hong Kong as well as fears over people defaulting on loans as a result of the COVID-19 pandemic.
A federal judge is set to decide today whether the US government has the authority to ban TikTok. Last week, Trump issued an executive order toban the app from both Apple and Google’s app stores, but this was contested by TikTok’s parent company ByteDance. The ban has now been delayed until tonight if the court deems Trump’s actions lawful. If he gets his way, Trump plans to help launch an American-owned company called TikTok Global to run the US operations for the app. He hopes that the California-based Oracle will hold all of the equity in this alongside Walmart, but ByteDance hopes to maintain at least 80% of the stakes in the app.