What We're Watching Today, August 7, 2024

Overview

What We’re Watching Today is 1,359 words and a 9-minute read.

Global: China to regulate production of fentanyl chemicals

The US government praised the announcement by China on new controls and regulations on the production of chemicals used to make fentanyl.

Our Take: China’s new export controls are an important win for international counter-narcotics cooperation. United Nations members in 2022 agreed to impose international controls on these same chemicals, but China has not acted until now. The slight improvement in the US-China relationship has created political space for increased cooperation on counter-narcotics.

Europe: Russia warns Ukraine that delaying a peace agreement will cost Ukraine more territory

A Russian official warned that Ukraine will only face tougher terms the longer it delays in agreeing to Russia’s terms for peace.

Our Take: The Russian government is pressing its advantage, as the tide of the battlefield has turned. Since the failed Ukrainian counteroffensive, Ukraine has been losing territory. Over the past year, military supplies to Ukraine slowed as the US was bogged down in a political dispute over war funding. Assistance has since been restored, but US support could drop if Donald Trump wins the November presidential election. But Ukrainians are not ready to concede. Ukrainian President Zelenskyy is attempting to rally international support around his 10-point peace plan, which requires Russia to withdraw from occupied Ukrainian territory. Conditions are not ripe for productive peace negotiations.

MENA: Hamas taps military leader as new political chief, representing a hardened stance towards Israel

Hamas tapped Yahya Sinwar, longtime military leader and rumored architect of the Oct. 7 attacks, to lead its political wing following the death of Ismail Haniyeh.

Our Take: Sinwar, Hamas’ Gaza leader since 2017, has long been considered a key figure in the group’s military planning. His selection as the new leader of the group’s political wing represents an inevitable hardening of Hamas’ strategic stance against Israel following the targeted killing of former political leader Ismail Haniyeh. While Sinwar is believed to have already been dictating the group’s position in ceasefire talks, the appointment of a military leader in Hamas’ top political role represents a melding of the two branches and a more militaristic bent in a broader sense; the former lead, Haniyeh, resided outside of Gaza and was thought to have minimal input on military strategy.

Read More: New York Times [paywall], Washington Post [paywall]

Americas: Panama seeks summit to discuss Venezuela as Maduro remains resistant to outside pressures

Panama President Mulino announced his intention to host a 17-country summit to discuss Venezuela’s contested presidential poll and post-election violence.

Our Take: The summit would bring together a majority of Latin American leaders who have disputed Venezuelan President Maduro’s reelection win following dubious election protocols, post-election violence, and refusals from Maduro’s camp to release evidence of his win. Despite this overwhelming support for Venezuela’s opposition, prospects for forcing Maduro to change course seem slim: since his initial election in 2013, Maduro has proven resistant to diplomatic pressure, internal protest, sanctions, economic isolation, and even a brief threat of military intervention. Analysts assess that betrayal by his own security forces may be the only thing that could unseat Maduro at this point.

Read More: Reuters, New York Times [paywall], Council on Foreign Relations

Asia-Pacific: Thai court dissolves progressive opposition party over law against criticizing the monarchy

On Wednesday, a Thai court mandated the disbandment of the progressive Move Forward Party, which topped last year's general election, citing its proposal to amend a law against slandering the royal family as a breach of the constitution.

Our Take: The dissolution of Thailand's Move Forward Party by a court ruling risks further hampering liberalization in the country's political landscape, as the party was a powerful voice advocating for changes to laws protecting the monarchy from criticism. Yet, the opportunity for the party's lawmakers to retain their seats if they transfer to a new party within 60 days, paired with the party’s former leader Pita Limjaroenrat’s commitment to continue his work as an active citizen, offers a chance for the continuation of their advocacy under a new banner, thereby challenging the grip on power held by conservative monarchists.

Read More: Associated Press, Bangkok Post, Nikkei Asia [paywall]

Africa: Nigeria arrests tailors who produced Russian flags for anti-government demonstrations

The state secret police in Nigeria arrested several tailors for creating Russian flags utilized in recent anti-government demonstrations in the northern states, highlighting apprehension about growing Russian involvement in West Africa.

Our Take: The use of Russian flags in Nigeria’s anti-government protests, coupled with the close relations that West African military juntas are building with Moscow, presents concerns that Nigeria could chart a similar course should the protests continue. Public sentiment against economic turmoil, as evidenced by the protests and subsequent governmental response, may lead to a volatile socio-political climate, which could then be exploited by Moscow and turn Africa’s most populous country into a battleground for geopolitical competition between Russia and the West.

Read More: Reuters, Africanews, Council on Foreign Relations, Foreign Affairs [paywall]

Trade and Compliance: US sanctions tobacco company it accuses of enriching Paraguay’s former president

On Tuesday, the Biden administration sanctioned Tabesa, a Paraguayan tobacco firm, accusing it of financially benefiting the country's former President Horacio Cartes, who was previously penalized by the White House for corruption.

Our Take: The sanctions on Tabesa, allegedly tied to the Cartes, underscore Washington’s commitment to combating corruption while promoting good governance abroad. However, the move could escalate tensions between the US and Paraguay, potentially impacting diplomatic and trade relations. Additionally, it risks pushing the South American country closer to regional US adversaries, such as Cuba and Venezuela, solidifying a bloc of countries in the region opposed to Washington’s influence and favorable to the growing presence of Moscow in the Americas.

Energy Transition: The IEA’s divisive mission to decide the future of oil; risks of getting it wrong

The Financial Times interviews the head of the International Energy Agency, Fatih Birol, who is using increasingly blunt language on the need to transition to clean energy, citing risks of carbon emissions and increasing global temperatures.

Our Take: The divergence between energy forecasts of the IEA and OPEC has been steadily growing since 2021 as the IEA estimates that energy transition away from fossil fuels to renewables is already well underway and not reversible and OPEC forecasts no peak oil demand, now or in the future. These alternative futures, which some argue are caused by biased analysis, have real impact because historically, industry, investors and governments have used their statistics and analysis to inform energy policy and investment decisions. When experts disagree so fundamentally over market trends in a sector that requires long-term investment to build capacity, mismatched supply and demand risks over- or under-investment across the supply chain.

ESG: Third of carbon credits fail new benchmark testing as doubts about the voluntary carbon market grow

The Integrity Council for the Voluntary Carbon Market issued a new ruling determining that existing renewable technologies marketed as carbon offsets, which represent nearly a third of the voluntary carbon market, will not qualify for the body’s highest quality determination.

Our Take: The Integrity Council is a leading independent governance body that oversees the voluntary carbon market and publishes guidance in an attempt to ensure that the market accelerates the green transition. The decision, which judges that 32% of the renewable technologies marketed as offsets in the voluntary carbon market are not as effective as previously thought according to a new benchmark test, comes amid a public battle in the green space over the effectiveness of carbon credits and carbon offsets – just last week, the Science Based Targets initiative walked back its support of carbon credits following backlash from environmental scientists and activists. While the voluntary carbon market is popular as a relatively simple way to reduce net emissions, there are significant doubts about their efficacy.

Read More: ESG News, Harvard Business Review