Overview
What We’re Watching Today is 1,429 words and a 9-minute read.
Global: The biggest East-West prisoner swap; high stakes realpolitik in the midst of great power contest
Years of secret negotiations have resulted in the release of 16 westerners held in Russian prisons and eight Russians incarcerated in the United States, Germany and Slovenia.
Our Take: The swap of political prisoners for Russian spies marks the latest chapter in the new cold war that is reshaping geopolitics. The pragmatic deal prioritized freedom of civilians caught in a political web over punishing captured Russian spies in western prisons for illegal and criminal activities, including assassination. The deal does not represent a thawing in relations, but realpolitik in play. Critics will argue that the exchange will only encourage future hostage taking, which ignores that fact that East-West prisoner swaps were a feature of the Cold War. Old playbooks are being taken out and dusted off as the conflict with Russia returns as a persistent feature of global politics.
Read More: Reuters, Wall Street Journal [paywall], USA Today
Europe: Georgia responds to US pressure on democratic backsliding
In response to the US decision to pause more than $95 million in assistance to the Georgian government over concerns of democratic backsliding, Georgian Prime Minister Kobakhidze called for a “reset” in the relationship.
Our Take: The Georgian government’s adoption of legislation related to foreign agents has raised alarm bells in the US and EU that the Georgian government is slipping into authoritarianism and aligning with Russia. The law is similar to a Russian law that has been used to crack down on political dissent. Georgia, formerly part of the Soviet Union, has struggled to remain independent of Russian influence. In 2008, Russia backed the separatist regions of Abkhazia and South Ossetia, occupying Georgian territory. The current government, led by the political party Georgian Dream, has adopted illiberal policies, failed to back Ukraine and condemn Russian aggression (despite continuing Russian occupation of Georgian territory), and has polarized the population. In an effort to give the Georgian people a clear alternative, the EU granted the country candidate status in November 2023. Risks of political violence are high in Georgia, particularly as elections approach in October, and geopolitics put the country at the center of the East-West contest.
Read More: Reuters, German Marshall Fund, Chatham House, Carnegie Endowment for International Peace
Middle East: Hamas and Iranian groups poised to react following several Israeli blows
Israel confirmed the death of Mohammed Deif, a Hamas military leader that died as the result of an airstrike in southern Gaza last month.
Our Take: The confirmation of Deif’s death (widely suspected since last month) alongside the death of Hamas political leader Ismail Haniyeh earlier this week in Tehran makes two top Hamas officials killed, or likely killed, by Israel in recent weeks. Hamas is relatively used to turnover at its top levels, and the vacancies are unlikely to significantly hobble Hamas operations (which are limited more severely by the ongoing war in and isolation of Gaza). Nonetheless, the deaths illustrate a surprisingly high risk tolerance for the Israeli military, and they may push Hamas and its allies to take a more aggressive stance towards Israel. The country especially risks reprisals from Hizballah and other Iran-backed groups following the Israeli strike in Beirut and likely strike in Tehran that killed Haniyeh.
Read More: Washington Post [paywall], Carnegie Endowment, Washington Post [paywall], Crisis24
Americas: Opposition hope dims in Venezuela despite continued protests, outside pressure
The US recognized Venezuelan opposition candidate Edmundo Gonzalez as the winner of Venezuela’s disputed presidential election, a snub to authoritarian President-elect Maduro, who simultaneously claimed that the US is in the midst of a coup attempt against Caracas.
Our Take: The US is one of several countries in the Americas and Europe that have denied Maduro’s election for a contested third term. As violent protests continue throughout the country, the opposition claims that its headquarters were ransacked, and Maduro’s government claims that a coup attempt is ongoing, the situation in Caracas continues to devolve. The likeliest scenario is that the Maduro government will violently crack down to quell protests and enforce its election mandate, although international observers remain hopeful that internal and external pressure could push Maduro to release voter tallies.
Read More: Reuters, Reuters, The Wilson Center
Asia-Pacific: Indonesian president-elect seeks stronger ties with Russia
The President-elect of Indonesia, Prabowo Subianto, expressed that his forthcoming administration would continue their relationship with Russia following his meeting with President Vladimir Putin.
Our Take: Prabowo’s comments reflect Indonesia’s efforts to balance good relationships with both Russia and the West, presenting the Southeast Asian country as a “friend to all” that can serve as a bridge for dialogue between the two adversaries. Influenced by its historical position of non-alignment, Jakarta today is attempting to embark on a more active foreign policy that can bring benefits to the country’s economic and military development, though risks remain over the potential that warming up too much to one side could bring the ire of the other.
Read More: Reuters, The Diplomat [paywall], South China Morning Post [paywall], Carnegie Endowment for International Peace
Africa: Police fire on demonstrators protesting Nigeria’s cost of living crisis
Security forces killed at least nine people as demonstrators clashed with people amid mass protests over Nigeria’s worst economic crisis in a generation.
Our Take: The protests are part of a larger wave of unrest that is spreading throughout Africa, destabilizing countries such as Kenya, Uganda, and Ghana, which have also been facing issues of rising food and housing costs amid corruption and poor governance. As the continent appears set to sink further into social instability, external stakeholders, including the US, EU, Russia, and China, will face increased risks in expanding their economic influence in the continent, with opportunities to take advantage of Africa’s critical mineral reserves presenting a particular point of uncertainty.
Read More: Associated Press, The Africa Report, Al Jazeera, CNN
Trade and Compliance: New survey shows the majority of Americans are disillusioned with trade deals
A recent survey conducted by the Pew Research Center shows that a majority of Americans believe that increased international trade hurts more than it benefits the US.
Our Take: US trade policy stands at a crossroads, where policymakers and individuals alike continue to debate the trade-offs that the growth of international trade over the past few decades has brought. The negative effects that past trade deals such as NAFTA have had on America’s manufacturing competitiveness and associated job creation has become an increasingly salient political issue at the national level, one that is likely to play a predominant role in the November presidential election.
Read More: Insider Trade [paywall], Pew Research Center, Council on Foreign Relations
Disruptive Technology: The EU’s AI Act goes into force
The EU AI Act went into force on Thursday and will be applicable to all existing or under-development artificial intelligence (AI) systems.
Our Take: As the world’s first major AI law, the implementation of the EU AI Act will likely influence how AI regulation in other jurisdictions, such as the US, takes shape moving forward. Analysts expect that US tech giants will be one of the most heavily-targeted under the EU’s new rules, which adopts a risk-based approach to regulation with struct compliance and reporting requirements. While US tech firms have expressed concerns over their perception that the rules will excessively regulate their AI initiatives to the point of stifling innovation, most of the provisions in the law will not come into force until at least 2026.
Read More: European Commission
Energy Transition: Challenges of bringing green hydrogen to market at competitive pricing
Reversals in ambitious plans for bringing green hydrogen to market at scale by 2030 are acknowledgement that the high costs to transport and store the gas limits potential future applications.
Our Take: The current backtracking away from some of the optimist targets set by countries on production of green hydrogen, such as the EU target of producing 10 million tons by 2030, is due the challenge of creating a hydrogen value chain, building demand at the same time as developing supplies. There are opportunities in hard-to-abate sectors such as steel production, cement manufacturing and chemical processes that are hard to directly electrify, and where green hydrogen production can be co-located, eliminating costly and inefficient transportation. Industrialization of production and scaling to meet local needs will focus investment opportunities and set more realistic targets. China is a leader in green hydrogen production and is promoting local utilization in production areas, proving a good case model to manage risks for the transition from fossil fuels.
Read More: Reuters, Reuters, World Bank
