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July 2022, Volume 28, Number 3

Europe, Asia

Many countries, especially small island states such as St Kitts, offer golden passports that provide citizenship in exchange for an investment of $100,000 to $1 million in the country. Several EU member states offer golden passports, including Cyprus, Malta and Portugal, and 130,000 foreigners became EU immigrants or citizens via such programs between 2011 and 2019.

Many of the foreigners who become citizens by investment are from China and Russia. After Russia’s invasion of Ukraine, the EU called for an end to golden passport schemes and urged EU member states to revoke the citizenship of Russians who have been sanctioned.

There were record-breaking high temperatures in many European countries in mid-June 2022, with southern Spain recording 112F. Unlike the US, where 90 percent of homes are air-conditioned, fewer than 10 percent of homes in France and Germany are air conditioned.

Britain. Over 2,000 migrants a month crossed the English Channel and entered the UK illegally in the first half of 2022, and two-thirds of those who applied for asylum were recognized as refugees. Over 28,000 migrants arrived in small boats in 2021.

Britain plans send migrants who arrive illegally to Rwanda, whose government agreed in April 2022 to be paid L120 million ($157 million) to finance “opportunities for Rwandans and migrants” including “education, secondary qualifications, vocational and skills training and language lessons.” Under the Rwanda plan, migrants who arrive in the UK via “unnecessary and dangerous routes” could be fitted with a GPS tag until they are removed. Migrant advocates sued, and a charter flight for migrants to Rwanda was blocked in June 2022.

The UK announced new work and residence visas for an unlimited number high-potential individuals, defined as foreigners who graduated from the top 50 non-UK universities, including 20 in the US, within the past five years. Foreign graduates can be from any country, and will get a two-year visa without a UK job offer by paying L715, or a three-year visa if they earned a PhD. Foreign students who graduate from British universities can remain for two years after graduation.

The UK in December 2021 announced that it would allow 38,000 migrants to fill horticulture jobs and 2,000 to fill poultry jobs. These migrants are admitted to the UK via five operators for horticulture and two for poultry, who will allocate them to farmers. Currently, there are four approved operators, including Concordia, Pro Force, Fruitful and AG.

Farm workers must be paid at least L10.10 per hour. The government, after finding that the presence of foreign workers “held down wages, disincentivized investment and discouraged [local] workers” from seeking seasonal farm jobs, urged farmers to improve pay and working conditions to attract local workers. A Food Strategy White Paper promises subsidies for adopting labor-saving machines and producing more fruits and vegetables in CEA facilities that hire local workers and use more automation.

Transport for London opened the $22 billion 42-mile Crossrail or Elizabeth line under central London in May 2022. Ridership on public transport is only 70 percent of pre-covid levels. The National Union of Rail, Maritime and Transport Workers called strikes that disrupted train travel in June 2022, and more labor unrest is feared as the government urges employers to restrain wage increases.

France. President Emmanuel Macron, re-elected in April 2022, saw his Renaissance party fail to maintain a majority of the seats in the 577-member National Assembly in June 2022 elections. Macron’s party won 245 seats in 2022, down from 350 in 2017 elections, which may make it hard for Macron to raise the retirement age from 62 to 65. A leftist alliance led by Jean-Luc Mélenchon’s France Unbowed won 131 seats and the anti-immigrant National Rally led by Marine Le Pen won 89 seats, highlighting increasing polarization.

France generates 70 percent of its electricity from 56 nuclear reactors, the highest share worldwide. The government-owned EDF in summer 2022 struggled to generate electricity for France and other European countries as aging nuclear plants went offline for maintenance. EDF aims to build 14 next-generation water reactors by 2035, but is already heavily indebted and may need an infusion of government money.

Germany. The anti-immigrant Alternative for Germany party entered the German Parliament after 2017 elections in part due to a backlash against the arrival of Syrian and other migrants in 2015. Polls before elections in 2021 found that a sixth of Germans regarded immigration and integration as one of the top two issues facing Germany and tended to support anti-migrant parties such as the AfD, which lost seats in 2021 but remains in Parliament.

Before February 2022, Russia supplied over half of the natural gas and a third of the oil used in Germany, plus half of the imported coal. Much of the gas arrived via Nord Stream 1, one of a pair of $20 billion gas pipelines under the Baltic Sea. As the Russia-Ukraine war dragged on, Germany reduced energy imports from Russia.

Germany’s policy toward Russia has been change through trade, the notion that increased trade would encourage democracy in Russia. German firms supplied the steel used to build the pipelines that brought Russian oil and gas to Germany, giving its export-oriented manufacturing sector the competitive advantage of low energy costs.

In June 2022, Russia’s Gazprom reduced gas supplies to Germany, prompting the government to restart coal-fired power plants and to offer incentives for companies to curb natural gas consumption. Germany aims to have its gas storage facilities 90 percent full by Fall 2022, up from the current half full. Christian Democrats won the largest share of the vote in two states, Schleswig-Holstein and North Rhine-Westphalia, in May 2022.

Portugal. Fieldwork Robotics is testing a machine that can pick 25,000 raspberries in an eight-hour day, compared with 15,000 berries picked by a hand worker. There are about 135 raspberries per pound.

Russia-Ukraine. On February 24, 2022, Russia launched an invasion of neighboring Ukraine. After failing to conquer Kiev and other major cities, Russian forces regrouped in a bid to conquer the Donbas region in the east, where Russian-backed separatists held about 30 percent of the territory. Russia aims to create a land bridge in southeastern Ukraine to the Crimean peninsula, which was “given” to Ukraine in 1954 and retaken by Russia in 2014.

By June 2022, some seven million Ukrainians left their country, including half who moved to neighboring Poland. EU member states gave the Ukrainians TPS, which means they could live and work in any EU state.

Ukraine’s economy is expected to shrink by 35 percent in 2022. The last census in 2001 found 48 million people, but the population was shrinking before the Russian invasion, by some estimates to less than 40 million.

Russian President Vladimir Putin wants to recreate greater Russia by conquering Ukraine, the birthplace of Russia in the 10th century. In Putin’s view, Ukrainians are “little Russians” who would rejoin the motherland if they were not drawn westward by NATO and the EU. Putin in June 2022 compared himself to Peter the Great and said that, like Peter’s taking land from Sweden during the Great Northern War (1700-21), he was taking back Russian lands in Ukraine.

Russia’s invasion is expected to have lasting consequences, including a strengthened NATO and a Europe less dependent on Russian energy, which could slow Russian economic growth. Sanctions that reduce trade are expected to lead to plant closures and higher unemployment. The US and its allies seized $300 billion in Russian central bank reserves, and many allies want to use this seized Russian money to rebuild Ukraine, which could cost $600 billion.

Spain. Melilla and Ceuta are Spanish enclaves on the Moroccan coast ringed by high fences to keep out the migrants who periodically storm these fences and apply for asylum. In June 2022, some 2,000 migrants cut the fence, prompting clashes that left at least 20 migrants dead and allowed 150 migrants to enter Melilla.

Spain and the rest of Europe had record heat in June 2022, with temperatures topping 100F in many cities. Wildfires arrived early, setting the stage for a long and hot summer that could generate record fires and smoke. Huelva province, which has 6,200 acres of mostly Fortuna and Rociera strawberries, faced shortages of pickers in May-June 2022.

Turkey. Turkey did not join other countries and impose sanctions on Russia, encouraging some Russians to migrate to Turkey. Foreigners can become Turkish citizens by investing at least $250,000 in Turkey, including in housing. Turkey threatened to block Finland and Sweden from joining NATO, prompting some NATO members to say that Turkey under President Recep Tayyip Erdogan is such a flawed democracy that the country could be suspended.

Turkey’s currency has dropped toward 20 lira to $1 as inflation rose toward 75 percent a year. The government forced the Central Bank to reduce interest rates in the belief that lower rates would stimulate economic activity.

Bangladesh. Some 200 rivers crisscross the low-lying country of Bangladesh, making flooding a regular event during monsoon rains between June and September. Half of Bangladeshi rivers flooded their banks in June 2022, inundating fields in the country’s northeast that are the rice bowl for 170 million Bangladeshis.

China. The Uyghur Forced Labor Prevention Act that went into effect in June 2022 bans US imports of goods that are made in Xinjiang or sold by businesses with ties to forced labor programs in Xinjiang; importers must prove that their goods were not made with forced Uyghur labor. Chinese manufacturers produce a quarter of the world’s goods, and many firms in eastern China have ties to firms that produce parts in the western province of Xinjiang.

By some estimates, 10 percent of the 10 million businesses that trade goods over borders could be affected by the Uyghur Forced Labor law. Apparel and solar panels are most likely to be affected, along with many other goods that may include inputs from Xinjiang. Cotton, processing tomatoes, hops, walnuts and rare earth minerals are some of the other items produced in Xinjiang.

The US government says that over a million people from minority groups in Xinjiang have been detained over the past five years and forced or coerced into working in fields, factories and mines; China says that all labor in Xinjiang is voluntary. The Uyghur law shifts the burden of proof to US importers to prove that their goods are not associated with forced labor. Activists say that some of the US importers who have declared their supply chains to be free of forced labor have not looked hard enough.

Some global brands began to sever ties with Chinese suppliers in 2022 when they found it difficult to confirm that there was no forced labor in their supply chains. Patagonia planned to end sourcing from China after it could no longer guarantee that its suppliers there did not used forced Uyghur labor.

President Trump imposed tariffs on $360 billion worth of Chinese goods, and President Biden came under pressure to lift them during his second year in office. Some Biden advisors want to lift the tariffs to reduce inflationary pressures, while others want to keep them until China changes its trade and human rights practices.

China aims to eventually incorporate the 23 million residents of Taiwan into the mainland, and in 2022 stepped up displays of military might and put economic pressure on the island by banning particular agricultural commodities from Taiwan. The Chinese government often justifies these bans by citing the presence of banned chemicals in the products; the farmers say that there are no banned chemicals.

China’s zero covid strategy became more controversial after a lock down in Shanghai failed to stamp out infections. A quarter of Chinese residents lived in cities that were under full or partial lockdown orders in April 2022, slowing economic growth. Leader Xi Jinping, who hopes for an unprecedented third term later in 2022, has maintained China’s zero covid policy and cracked down on business leaders who protested these policies.

China’s zero covid strategy may lead to recession. Real estate accounts for up to a third of the Chinese economy when considering related industries such as construction and property management. Many middle-class families often buy condos as investments, hoping to benefit from price appreciation. However, in summer 2022, condo prices began falling, which could presage recession.

China has 125,000 hectares of strawberries, most in eastern provinces including Shandong, Jiangsu and Liaoning. Grower prices are 90 to 120 yuan ($15 to $18) per kg.

India. Prime Minister Narendra Modi won re-election in 2019 with a pledge to double India’s GDP to $5 trillion by 2024. The economy is expected to grow by almost nine percent in 2022, but most of the benefits of this growth accrued to the rich and middle class. The government is trying to hold down inflation rather than create formal sector jobs, believing that rising prices are the greatest threat to the majority of Indians who are employed in the informal sector.

India lacks a labor-intensive export-oriented manufacturing sector due to rigid labor laws and tariffs on needed inputs.

Japan. Japan had 125.5 million people in 2021, down from 126.1 million in 2020. Almost 30 percent of residents are 65 or older, and a new law requires firms to allow workers to work until 70 rather than forcing them to retire at 65.

Japan’s fertility rate, the average number of babies a woman would have over her lifetime, was 1.3 in 2021, the lowest level in 16 years. Japan’s fertility rate has been below 1.5 since the mid-1990s; some attribute low fertility in Japan and East Asia to an obsession with work.

Sri Lanka. The Sri Lanka government led by members of the Rajapaksa family tried to force the country’s two million farmers to go organic by banning imports of fertilizer. As a result, production of the staple crop rice and the export crop tea fell, forcing the government to lift the ban on fertilizer imports at the end of 2021. NGO Viyathmaga developed the organic policy, and emphasized that fertilizer imports and subsidies cost $500 million in 2020.

Farmers have long fertilized with guano and animal manure, but the Haber-Bosch process invented in the early 1900s used high temperature, high pressure, and a chemical catalyst to pull nitrogen from the air to produce ammonia, the basis of synthetic fertilizers.

The Rajapaksas rode a wave of Buddhist Sinhalese nationalism after a civil war victory over Tamil separatists to power, and have governed Sri Lanka for most of the period since 2000. The country of 22 million borrowed to expand government and welfare services, and is now unable to pay its debts.

ANZ. Australians voted in May 2022 to replace the Liberal-National coalition government with a Labor government, giving Labor 77 of the 151 seats in the House. Labor leader Anthony Albanese promised incremental reforms and a less pugnacious style of governing and competition without catastrophe in dealing with China.

Many voters cited the rising cost of living as their top priority, while most of the Greens and independents who won seats wanted the government to do more to deal with climate change. Many of the independents are so-called teals, a blend of blue for the Liberal-National coalition’s free-market policies and green for their focus on climate issues.

The Fair Work Commission raised Australia’s minimum wage from A$20.33 to A$21.38 July 1, 2022. Award rates for 2.5 million workers establish higher minimum wages in particular sectors; the FWC required their wages to rise by at least $40 a week. Australian farmers can hire guest workers via the WHM, Pacific Australia Labour Mobility (PALM), and Australian Agriculture Visa (Ag Visa) programs. There were about 20,000 PALM workers in 2021-22.

New Zealand Labor PM Jacinda Ardern is celebrated abroad but losing support at home in the face of inflation, gang violence, and persisting child poverty amidst high housing prices. Labor won a majority of the seats in Parliament in October 2020 elections, but the average house price of NZ$1 million ($625,000) emphasizes the unaffordability of housing.

Many of New Zealand’s birds are flightless because they evolved without the mammalian predators that were introduced with colonization in the 19th century. New Zealand’s government in 2016 promised to eliminate most non-native predators by 2050, a goal unlikely to be achieved, leading some to question the wisdom of pursuing the predator-free goal.

South Africa. South Africa attracts migrants from poorer neighboring countries, prompting periodic scapegoating of migrants by frustrated residents who have not benefited from economic improvements since apartheid ended in 1994. Anti-migrant activists formed Operation Dudula (Zulu for push back) to confront migrants, many of whom are street vendors.

The four million migrants are in South Africa suffered attacks in 2008, 2014 and 2016. Migrant advocates say that political leaders persuade their followers to attack migrants to hide their inability to improve conditions.

The Indian-born Gupta brothers, Atul and Rajesh Gupta, were arrested in Dubai in June 2022, accused of abetting corruption during the nine-year Zuma presidency of 2009-17; a third brother Ajul could not be found. The Gupta brothers won at least $3.2 billion in South African government contracts, and were accused of state capture, that is, effectively controlling key ministries and state-owned firms such as electricity monopoly Eskom.

Burglars stole millions of dollars from the Phala Phala Wildlife farm owned by South African President Cyril Ramaphosa in February 2020, who did not report the burglary to avoid awkward questions about why he had so much cash. The ruling African National Congress will determine whether Ramaphosa remains their leader in December 2022; Zuma allies leaked the burglary to weaken Ramaphosa.

Gqeberha (Port Elizabeth on Nelson Mandela Bay) receives water from four dams that are at dangerously low levels, creating a water crisis similar to that of Capetown in 2018. Droughts reduce water levels, but a third of the water available is lost due to old pipes that leak, in part because city officials spent money on other projects.

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