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Recent data from businesses, investors, and professional forecasters seem to suggest that global economic uncertainty remains relatively contained, despite headline geopolitical and policy developments.While the “Liberation Day” tariff announcements did cause a modest uptick in uncertainty, this rise appears both muted by historical standards and short-lived.Similarly, the escalation of tensions in the Middle East has had only a limited effect on most uncertainty indicators.Since April, perceptions of downside risk have eased significantly, according to some market researchers.They say businesses now assess the likelihood of a global recession as less than half what it was earlier in the year.Market-implied probabilities of sharp equity market declines have fallen notably.The dispersion of forecasts among professionals seems to have narrowed to levels near historic lows.This suggests that businesses are interpreting recent economic shocks quite differently from previous crises. Unlike the significantspikes in uncertainty seen during the pandemic or following Russia’s invasion of Ukraine, recent downgrades to growthexpectations have not been accompanied by comparable increases in uncertainty.A more pragmatic US trade policy may be playing a central role. Market participants appear to perceive it as placing a cap on the potential fallout from higher tariffs.If sustained, this decline in uncertainty could imply more resilience in investment activity than current baseline forecasts suggest. However, the potential remains for a sudden reversal in sentiment. A breakdown in the current pause on US tariffs or major disruption in the Middle East could serve as catalysts.Just weeks ago, the assertion by Fed Chair Jerome Powell that global economic uncertainty was “unusually elevated” went largely unchallenged. But since then, news-based measures of trade policy uncertainty have fallen markedly, returning to pre-Liberation Day levels.At a broader level, recent data also point to a relatively stable uncertainty environment. Businesses have become more pessimistic about global growth prospects, yet their perceived range of potential outcomes has remained narrow.For example, the July preliminary reading of Oxford Economics Global Business Sentiment Index shows an expected global growth rate of 1.6% for late 2025, down 0.8 percentage points from January this year.Nevertheless, the interquartile range of perceived growth outcomes remains comfortably below the average for the decade to date.“This narrative is corroborated by regional surveys from the Federal Reserve Bank of Atlanta and the European Commission, bothof which suggest stable or improving perceptions of uncertainty among businesses,” Oxford Economics noted recently.In short, the reaction to recent shocks has been noticeably measured, especially when compared to periods like early 2020, when the Covid-19 pandemic introduced massive ambiguity around the scale and duration of the crisis.And early 2022, when Russia’s invasion of Ukraine caused a sharp spike in perceived geopolitical and economic risk.The recent pause in tariff escalation appears to have been a critical anchor, reinforcing expectations that US trade policy may remain disciplined and deliberate in the months ahead.According to early third quarter (Q3) data from Oxford Economics Global Risk Survey, the share of businesses citing a global trade war as a major risk has fallen by roughly one-third over the past month.Although April’s market volatility and unusual cross-asset movements had the potential to dent investor confidence, those effects appear to have faded.A leading measure of expected stock market volatility is now well below the peaks observed during earlier episodes of heightened uncertainty.Sceptics, however say, global economic uncertainty is unusually elevated right now, by both historical standards and current data.

Japan’s transition to a more conventional macroeconomic and monetary regime represents an important global shift, QNB said and noted “it is not a source of financial instability”. Interest rate differentials still support global capital flows and the Bank of Japan (BoJ)’s normalisation is prudent and transparent, QNB said in an economic commentary. Rather than a shock to global liquidity, Japan’s monetary shift should be viewed as a positive signal of macroeconomic normalisation after decades of stagnation, the bank noted. After decades of battling deflationary stagnation, which started after the bust of the domestic asset price bubble in the late 1980s, Japan’s macroeconomic environment has begun to change. During the deflationary period (1990-2020), the country operated in an anomalous setting of ultra-low growth, subdued inflation, and extraordinary monetary accommodation. But the confluence of the Covid-19 pandemic, global supply shocks, and aggressive fiscal and monetary stimulus appears to have finally “reflated” the Japanese economy. Post-pandemic, Japan has experienced more consistent growth alongside inflation levels that are no longer materially below those of other advanced economies. This marks a structural shift, moving Japan into a more “normal” macro regime after years of being a global outlier. In this context, the BoJ has initiated a long-awaited monetary policy normalisation process. Negative policy rates have been abandoned, yield curve control (YCC) has been phased out, and the central bank is gradually stepping away from its role as the dominant buyer of Japanese government bonds (JGB). The policy stance has evolved in response to improving domestic fundamentals, including a tighter labour market and persistent inflation above 2%. However, Japan’s normalisation has raised concerns in global financial circles. Market participants fear that this policy shift could catalyse a rapid reversal of capital flows and destabilise global financial markets. These concerns are rooted in Japan’s historical role as a key source of global liquidity. Years of ultra-loose monetary policy – negative rates, YCC, and massive asset purchases – positioned the BoJ as an anchor for global interest rates. Japanese investors, in search of higher yields abroad, became significant players in global capital markets, engaging in large-scale cross-border investments and yield-seeking “carry trades.” In fact, Japanese residents hold the world’s largest net international investment position, comfortably above that of China or the Euro area. Given this backdrop, the fear is that monetary policy normalisation and rising JGB yields could trigger a capital reallocation back to Japan, tightening global liquidity and generating market stress. In our view, however, these concerns are overstated. Two main reasons explain why Japan’s monetary tightening is unlikely to generate material financial instability, either domestically or globally, QNB said. First, even after the recent adjustments, interest rate differentials against major advanced economies remain wide – both in nominal and real terms. Currently, the BoJ’s short-term policy rate stands at 0.5%, while the US Federal Reserve maintains its federal funds rate at 4.5% and the European Central Bank’s deposit facility rate is at 2%. And this comes in a context where inflation in Japan runs at 3.5%, significantly above what is seen across peers. Hence, real interest rates are still deeply negative in Japan, contrasting with positive real rates in the US and Euro area. These enduring differentials continue to incentivise Japanese investors to seek higher returns abroad, sustaining outbound capital flows and carry trade activities. Second, the monetary tightening is expected to be orderly and well executed, preventing significant bouts of financial or economic stress. In fact, the BoJ’s normalisation strategy is cautious, deliberate, and well-communicated. The pace of tightening has been slow, allowing markets to adjust smoothly. The BoJ retains flexibility and has signalled a willingness to adjust course if needed. Importantly, monetary policy in Japan remains deeply accommodative, i.e., policy rates and even the 10-year JGB yields are far below the nominal neutral rate of 2.5%. “Should the gradual monetary policy tightening continue as expected, with two 25 basis points rate hikes per year, the transition to a more neutral or restrictive stance should be smoothed, reducing the likelihood of sudden capital flow reversals,” QNB added.

National delegations and practitioners gathering in Seville, Spain, for the 4th International Conference on Financing for Development face a sobering reality: Much of the developing world is in the midst of a deepening, multifaceted crisis. Major problems such as hunger, disease, economic fragility, climate vulnerability, underfunded education systems, poor infrastructure, and persistent joblessness remain – not for lack of solutions, but for lack of political will and basic human solidarity. The first step toward addressing these challenges is to resolve the debt crisis that has crippled many low- and middle-income countries. While debt distress afflicts developing countries worldwide, the effects are most acute in Africa, a region that will shape the global economy for decades. With Africa’s share of the global youth population projected to rise from 23% today to 35% by 2050, underinvestment now will not only undermine development on the continent; it will threaten stability elsewhere. This persistent failure stems from several structural features of the international financial system. Money tends to pour into developing countries during global booms, and to rush out during downturns. For advanced economies, the pattern is reversed: capital flows toward them in times of crisis. The system thus reinforces global inequalities, decreasing wealthy countries’ relative riskiness and the interest rates their governments and companies pay. At the same time, developing countries suffer from chronic underinvestment in innovation, education, and infrastructure. Growth cycles are repeatedly cut short by crises and austerity, triggering a vicious cycle of stagnation and weakened state capacity. And efforts to fund public institutions and promote development are usually further undercut by illicit financial flows, tax avoidance, under-taxation of multinationals’ profits, unfair extraction of natural resources, and large-scale dividend repatriation. Meanwhile, domestic elites historically have failed to build stronger institutions, allowed rent-seeking to flourish, and resisted reforms that would promote accountability and resilience. To help break the cycle, particularly concerning debt, we and more than 30 other economists and legal experts contributed to the Jubilee Report that was commissioned by the late Pope Francis and recently published by the Vatican. The report offers a road map for addressing the current debt and development crisis and, critically, for preventing future ones. Though it calls for co-ordinated reforms of multilateral institutions, sovereign jurisdictions, and domestic governments, the core message is simple: If poor and developing countries are to transform their economies and fulfil their development ambitions, they need access to high-quality financing. Achieving this requires three interlinked systems. First, we need an effective framework for addressing sovereign debt crises. The current system is not working, and recent attempts to improve it fell far short of what was needed. For example, the Common Framework for Debt Treatments, launched during the Covid-19 pandemic, sought to strengthen co-ordination across creditors, but failed to create incentives for timely restructurings. As a result, since 2022, net private capital flows to low- and lower-middle-income countries have turned negative, even as international financial institutions have continued to disburse funds. Instead of supporting economic recovery, new financing has been redirected to pay private creditors – often at high costs – which means taxpayers around the world have funded a bailout for private lenders while financially distressed countries have had to slash spending on essential services. This cruel cycle is entirely avoidable. It should not be so easy for private creditors and debtors to avoid ever having to restructure debts. Second, we need affordable long-term finance for development. Debt is not inherently bad. In fact, sustainable credit – planned and used correctly – can drive infrastructure development and broader economic transformation. The global system must shift from short-term, speculative flows to long-term, productive finance that supports widespread and long-lasting development. That means mobilising more and better concessional lending and financing from multilateral development banks to low-income and developing countries, as well as facilitating stronger domestic resource mobilisation and the development of local-currency capital markets. But even if all the right reforms were enacted today, it would take decades for many low-income countries to meet their financing needs domestically. In their case, access to credit will remain critically important. Third, we must ensure a fairer cost of capital. Markets and credit-rating agencies routinely exaggerate the risks facing African countries and other developing economies, which leads to interest rates far above what is needed to compensate for the risk of non-payment, let alone delayed payment. In fact, according to a Moody’s analysis, African countries have the world’s lowest default rates for infrastructure loans – just 1.9%, compared to 12.4% in Eastern Europe and 10.1% in Latin America. Nonetheless, African countries face unjustifiably high borrowing costs, rooted in risk perceptions that create perverse self-fulfilling prophecies, with the high interest rates actually causing more defaults. Today, the most powerful countries remain reluctant to increase their contributions to multilateral financing. This hesitation undermines global economic, social, and political stability. Yet much more can still be achieved by making better use of existing resources; ensuring that funds from international financial institutions support development and recovery, rather than serving as de facto bailouts for private creditors; and adopting global policies that promote more timely and comprehensive debt restructurings to restore sustainability. The returns would be significant. A forthcoming analysis by the African Center for Economic Transformation shows that lowering debt service to 5% of government revenues could allow Egypt to provide clean water to its entire population, Senegal to improve sanitation for 300,000 people, Ethiopia to enrol 340,000 more children in primary school, and Angola to save the lives of over 10,000 children under five. Development always involves risk. A fair financial system would distribute that risk efficiently and equitably, assigning the burden to those best able to bear it. The current system does the opposite. Reforming it is a necessary step toward a more stable, prosperous, and fairer global future. — Project Syndicate Martín Guzmán, a former minister of economy of Argentina, is a professor at the School of International and Public Affairs at Columbia University. Mavis Owusu-Gyamfi is President and CEO of the African Center for Economic Transformation. Joseph E. Stiglitz, a Nobel laureate in economics, is University Professor at Columbia University.

It has been all too easy to pick holes in President Donald Trump’s agenda, not least his economic strategy, which is riddled with contradictions and more likely to make America poorer than “great again.” And yet, when he recently suggested that the G7 ought to include Russia, and perhaps also China, I found myself nodding in agreement. Following the creation of the euro, when France, Germany, and Italy committed themselves to a shared currency, a centralised monetary policy, and common fiscal-policy rules, it no longer made much sense for each to retain its position in such an elite global policymaking group. And if you look beyond macroeconomics to the domains of diplomacy, security, public health, climate change, and so on, it made even less sense. This was one of the core arguments of the 2001 paper in which I coined the BRIC (Brazil, Russia, India, China) acronym. It was already obvious at the time that as these countries rose, the eurozone’s share of global GDP would decline. My goal was to raise awareness of what was coming, and to press the G7 to become more global and forward-looking. To remain relevant, it could not just represent ageing, declining “industrialised” powers. In fact, I went one step further than Trump, by suggesting that Brazil and India be included along with China and Russia. The resulting G9 would comprise the BRICs, plus Canada, a eurozone delegation, Japan, the United Kingdom, and the United States. Given how the world has evolved since 2001, I might revise this proposal to drop Canada and the UK (though neither would be too pleased by this). Canada’s inclusion has always been questionable (if Canada, why not Australia?), and the UK now falls into the same bucket, at least in strictly economic terms. There is no good argument for why these countries should come before India. While the Canadians and the British have a long history of upholding the rule of law and supporting allies like the US, these attributes are not what matters in global governance. In any case, even if Canada and the UK would never accept my proposed G9, a G11 would be a vast improvement over the current G7, which has no credible claim to global relevance. This was already true in 2001, and now the overwhelmingly dominant G7 member would seem to agree. Trump has shown that he has little time for the grouping. But what is the G7 without the US? To be sure, one valid function is to provide a forum for like-minded democracies seeking common ground on specific issues. If the point is to dictate global solutions to others, however, it is a nonstarter. Of course, if it was up to Trump, he would opt for a G3, with China, Russia, and the US carving the world into their own spheres of influence. And though he will not hold the presidency indefinitely, he could start laying the groundwork for a more enduring framework over the next few years. Whatever happens, the politics will remain complicated. India – which will be the third-largest economy by 2030, barring some major crisis – will not accept a position subservient to Russia or China, nor should it. And despite Brazil’s persistently erratic economic policies, no-one denies that it is Latin America’s leading power. At this point, many diplomats will interject to argue that the G20 represents the future of global governance. Since it already offers a place at the table for the Brics (the original four, plus South Africa), what need is there for something more elite? I was among those who celebrated the G20’s elevation as the premier international forum in 2008-10, when it proved highly effective in devising solutions to the global financial crisis. But over the last decade, it has increasingly lost its way – proving to be too large, too unwieldy, and too vulnerable to political pressures and controversies, whether they come from Russia, China, or the US. Moreover, in recent years, the Brics and other emerging powers seem to have concluded that the G20 itself is driven by the G7, with members of the latter group often imposing their own ideas or playing an outsize role in setting the agenda. This perception has made it easier for Russia and the other Brics to coalesce and oppose G7 initiatives. I witnessed this personally after the Covid-19 pandemic, when an effort to establish a G20 Health and Finance Board floundered. This is not to suggest that the G20 should cease to exist. But it does need to be more effective, and the best way to do that is to update the G7 so that it is no longer a source of distrust and resentment. — Project Syndicate Jim O’Neill is a former chairman of Goldman Sachs Asset Management and a former UK Treasury minister.

The Qatar Foundation (QF) launched its Alumni Chapter for the UK, in the presence of HE Vice Chairperson of Qatar Foundation Sheikha Hind bint Hamad Al-Thani.The Qatar Foundation Alumni Chapter for the UK - launched at a London gathering - is a platform aimed at helping its members support each other as their journeys continue to unfold, as well as to retain their ties with Qatar.It is the second international Alumni Chapter to be established by Qatar Foundation's (QF) Alumni Program, following the launch of its US and Canada equivalent in 2024.Reflecting the global reach and impact of QF's ecosystem of education, 137 of its alumni are currently working or pursuing further advanced studies in the UK, in fields including Artificial Intelligence, healthcare and medical research, policy, sustainability, communications, and humanitarianism."The true legacy of Qatar Foundation - and its schools, partner universities, and Hamad Bin Khalifa University - lies not in rankings or research output, but in the lives of our alumni," said Francisco Marmolejo, President of Higher Education and Education Advisor, QF."Graduates of Qatar Foundation-supported institutions are now driving positive change in over 120 countries - living proof of our mission to unlock human potential."Speaking at the launch of the Chapter, diplomat and economic strategist Sheikha Alanoud H. Al-Thani, who currently serves as the Counselor for Economic Affairs at the Embassy of the State of Qatar in the UK and is a graduate of QF's Qatar Academy Doha and QF partner university HEC Paris, Doha, said: "This Chapter deepens the longstanding Qatar-UK partnership in education and innovation - not just through institutions, but through the living bridge of our alumni."Across the UK, graduates of QF schools and universities are now harnessing the skills, knowledge, and values they gained through their years of study and discovery at Education City in Doha, as government economists, data scientists, software engineers, doctors, neuroscientists, climate strategists, and legal experts, among other roles. Others are pursuing postgraduate and doctoral studies in fields such as AI, public health, cancer research, and global affairs.Among them is Dr. Basil Mahfouz, a data scientist at University College London and a graduate of QF partner university Georgetown University in Qatar. His projects focus on harnessing Artificial Intelligence to unlock knowledge and drive inclusive innovation, and he co-founded SynSapien, an open science platform that united global researchers during the Covid-19 pandemic.Ulan Seitkaliyev, an alumnus of QF partner university Carnegie Mellon University in Qatar and now a London-based software engineer for Bloomberg, said: "What stood out most for me during my time at QF was the incredible support we received, as well as the wide range of projects and opportunities available to explore our interests and pursue our own initiatives - it was an environment that truly encouraged creativity, independence, and innovation."Asmaa Alkuwari, Alumni Engagement Manager, QF, said: "This Chapter represents more than just a gathering, it's part of a broader strategic effort by the QF Alumni Engagement Office to foster lasting, global connections among QF graduates."We are proud of the distinguished alumni based in the UK who hold influential roles across sectors and continue to carry QF's values into the world through their work, leadership, and impact."

Conflict and instability are exacting a devastating toll on 39 economies worldwide, accelerating extreme poverty, intensifying hunger, and pushing key development goals further out of reach.These stark warnings come from the World Bank’s first comprehensive assessment of conflict-affected economies in the aftermath of the Covid-19 pandemic.The report finds that as conflict has become more frequent and deadly in the 2020s, these economies are falling behind on nearly every major development indicator.Since 2020, per capita GDP in these countries has contracted by an average of 1.8% annually — while other developing economies have seen average growth of 2.9%.This year, some 421mn people are surviving on less than $3 a day in economies afflicted by conflict or instability — more than in the rest of the world combined. That number is projected to rise to nearly 435mn by 2030, representing nearly 60% of the world’s extreme poor.“For the last three years, the world’s attention has been focused on conflicts in Ukraine and the Middle East. That focus has now intensified,” said Indermit Gill, Chief Economist of the World Bank Group.“Yet more than 70% of those suffering from conflict and instability are in Africa. When left unaddressed, these conditions become entrenched — half of the countries currently facing conflict or instability have been in such circumstances for 15 years or more. Misery on this scale is inevitably contagious,” Gill noted.The findings help explain why the global goal of eradicating extreme poverty remains out of reach. Poverty is now increasingly concentrated in places where progress is most difficult.Of the 39 economies classified as conflict-affected or unstable, some 21 are currently experiencing active conflict.While the extreme poverty rate in developing economies has declined to just 6%, the rate stands at nearly 40% in fragile and conflict-affected settings. Their average per capita GDP remains stagnant at around $1,500 — unchanged since 2010 — compared to $6,900 in other developing economies, where it has more than doubled.Labour markets, too, are under severe strain. These economies are failing to generate enough jobs to keep up with population growth. In 2022, of the more than 270mn people of working age in these countries, fewer than half were employed.The impact of conflict and instability is evident across the development spectrum. On average, life expectancy is seven years lower than in other developing economies. Infant mortality is more than twice as high.Acute food insecurity affects 18% of the population — 18 times the rate in other developing economies. Sadly, 90% of school-age children do not meet minimum reading proficiency.Yet, the report also highlights untapped potential. Natural resource wealth — including minerals, forests, oil, gas, and coal — represents over 13% of GDP on average in these economies, three times the share found elsewhere in the developing world.Several countries — including the Democratic Republic of Congo, Mozambique, and Zimbabwe — are rich in the critical mineralsneeded for renewable energy technologies like electric vehicles, solar panels, and wind turbines.Moreover, these countries have one of the world’s youngest and fastest-growing populations. While working-age populations are stabilising or shrinking in many parts of the world, they are projected to expand in conflict-affected economies through at least 2055.By then, nearly two out of every three people in these countries will be of working age — the highest share globally!Realising this demographic dividend, however, will require substantial investment — in education, healthcare, infrastructure, and in fostering a dynamic private sector capable of generating sustainable, quality employment, the World Bank emphasised.Undoubtedly, extreme poverty is surging in conflict-affected economies with their development gains getting reversed amid most widespread conflict in a period of nearly 25 years!

The World Bank warned of worsening conditions in the world's most conflict-affected and fragile countries, where crises are becoming increasingly deadly and frequent.In a comprehensive study of 39 countries classified as fragile and conflict-affected since the outbreak of COVID-19 pandemic in 2020, the Bank found that economic stagnation has become the norm in these regions. Since 2020, the 39 countries, stretching from Marshall Islands in the Pacific to Mozambique in sub-Saharan Africa, experienced an average annual decline of 1.8% in per capita economic output. In contrast, other developing economies grew at an average rate of 2.9% annually over the same period.The study highlighted that more than 420 million people in these fragile economies live on less than $3 a day, well below the poverty line. This figure represents the largest concentration of extreme poverty globally, despite the fact that these 39 countries account for less than 15% of the world's population.The report also noted that many of these nations face long-standing challenges, including crumbling infrastructure, weak governance, and poor education systems. On average, individuals in these countries receive only six years of schooling - three years less than the average in other low- and middle-income countries. Life expectancy is five years shorter, and infant mortality rates are twice as high.Among the 39 countries, 21 are currently experiencing active conflict, including Ukraine, Sudan, Ethiopia, and Gaza Strip. The study pointed out that in countries embroiled in high-intensity conflict, defined as those with more than 150 conflict-related deaths per million people, their economies contract by a cumulative 20% within five years of the conflict's onset. As conflicts escalate, hunger rises in tandem.According to the World Bank's estimates, around 18%, roughly 200 million people, of the populations in these 39 countries are facing acute food insecurity, compared to just 1% in other low- and middle-income countries. The report also emphasized that some nations managed to escape the cycle of fragility and conflict, citing Nepal, Bosnia and Herzegovina, Rwanda, and Sri Lanka as examples.

The drama of April, in which the US President Donald Trump unveiled, and later suspended, high import tariffs affecting most of the trading world, has given way to a slower-moving but equally significant set of events in the US and world economy.The reduction of proposed tariffs between China and the US, the two biggest economies in the world, has been significant. In mid-May the two governments agreed after talks in Geneva that US tariffs imposed on China would be 30%, down from 145%, while earlier smartphones and related technologies were exempted. China’s tariffs on US imports were agreed to be 10%, reduced from 125%. Many tariff reductions, however, are temporary, for 90 days, they are still at a significant level. The Yale Budget Lab calculated the effective tariff rate to be 17.8%, compared with just 2.5% at the start of President Trump’s second term.Although the trade war appears to have died down, tariffs are still relatively high and a real war has erupted in the Middle East. These developments contribute to inflation becoming ‘sticky’ at an elevated levelOn 10-11 June, Chinese and US trade negotiators met again, this time in London, and agreed to continue the reduced tariffs. In addition, China agreed to relax export restrictions on rare earth metals – of strategic importance for several US industries including batteries, medical devices and in the defence sector – while the US eased restrictions on export of hi-tech chips for AI, and visas for Chinese students.Much attention has been diverted to the fiscal position, following a downgrading of US sovereign credit by Moody’s in mid-May from AAA to Aa1. The credit agency cited the very high debt of $36tn, little indication that it was set to be curbed, and that the sheer amount of debt was not fully compensated for by the substantial strength and depth of the US economy and global use of the dollar.Yields on 30-year Treasury bonds have touched 5%. They have also risen in other major currencies. This is a sign of low confidence generally in economic and fiscal management. It intensifies difficulties of fiscal management in the US by increasing the already-high proportion of spending taken up by servicing the debt.Alongside these trends there is a closely related feature: Elevated inflation. In May Doug McMillon, the CEO of Walmart, stated that the giant US retailer has not been able fully to absorb the higher costs of imported goods caused by tariffs.For much of the past two decades, goods inflation has been kept low by the integration of east Asian economies, with cheap manufactured exports, into the global economy. This was interrupted by the disruption to supply chains caused by the Covid-19 pandemic and the Russian invasion of Ukraine. Goods inflation had started to fall since 2023, but now there is the upward pressure from tariffs and tensions over trade. Inflation is becoming ‘sticky’.Inflation has not risen significantly yet, nudging up 0.1% to 2.4% in May. But many companies front-loaded imports ahead of the scheduled 2 April announcement of high tariffs, and that effect will wear off. There are other factors contributing to elevated inflation. With an ageing population, and curbs on immigration in the US, wage inflation is likely to remain an issue; similarly, commodity prices face upward pressures.The rise in value of physical assets such as gold is a sign of weakening confidence in paper money and an expectation of higher inflation.Interest rates will likely have to be kept at a moderately high level, given inflationary pressures, and may even be increased. Jay Powell, chairman of the Federal Reserve, in a speech in mid-May, referred to the possibility that ‘inflation could be more volatile going forward.’While sticky inflation does erode the effective level of the public sector debt, amounting to a soft default, it comes with costs. Those responsible for setting interest rates will find it difficult either to contain inflation or to encourage growth, resulting in a risk of stagflation.Meanwhile in geopolitics, military matters have started to outweigh trade and tariff issues. Just two days after the London talks, conflict between Israel and Iran escalated with exchange of missile fire, with the Israeli government convinced that Iran was accelerating its plans to develop atomic weapons. On 18 June reports emerged that US President Donald Trump was preparing a massive strike with a ‘bunker-busting’ bomb, more powerful than anything possessed by Israel, to take out a suspected nuclear weapons site in Iran. This may be a negotiating tactic, and shortly after he announced a two-week delay on strikes to allow for talks.The oil price has risen since the escalation of the Israel-Iran conflict, from below $65 a barrel at end May to above $75 by mid-June, adding to inflationary pressures. The intensity and duration of this conflict, and the wider political and economic impacts for the region and beyond, are impossible to project, and they add to already heightened global uncertainty.The author is a Qatari banker, with many years of experience in the banking sector in senior positions.

April marks the start of the cruellest months for residents of Solapur, a hot and dry district in western India. As temperatures soar, water availability dwindles. In peak summer, the wait for taps to flow can stretch to a week or more. Just a decade ago, water flowed every other day, according to the local government and residents of Solapur, some 40km inland from Mumbai.Then in 2017, a 1,320-megawatt coal-fired power plant run by state-controlled NTPC began operations. It provided the district with energy — and competed with residents and businesses for water from a reservoir that serves the area.Solapur illustrates the Catch-22 facing India, which has 17% of the planet’s population but access to only 4% of its water resources. The world’s most populous country plans to spend nearly $80bn on water-hungry coal plants by 2031 to power growing industries like data centre operations.The vast majority of these new projects are planned for India’s driest areas, according to a power ministry document reviewed by Reuters, which is not public and was created for officials to track progress.Many of the 20 people interviewed by Reuters for this story, which included power company executives, energy officials and industry analysts, said the thermal expansion likely portended future conflict between industry and residents over limited water resources.Thirty-seven of the 44 new projects named in the undated power ministry shortlist of future operations are located in areas that the government classifies as either suffering from water scarcity or stress. NTPC, which says it draws 98.5% of its water from water-stressed areas, is involved in nine of them. NTPC said in response to Reuters’ questions that it is “continuously striving towards conservation of water with best of our efforts in Solapur,” including using methods like treating and reusing water. It did not answer queries about potential expansion plans. India’s power ministry has told lawmakers in parliament, most recently in 2017, that the locations of coal-fired power plants are determined by factors including access to land and water and that state governments are responsible for allocating water to them.Access to land is the dominant consideration, two federal groundwater board officials and two water researchers told Reuters. India’s complex and arcane land laws have delayed many commercial and infrastructure projects for years, so power operators under pressure to meet burgeoning demand pick areas where they are likely to face little resistance, said Rudrodip Majumdar, an energy and environment professor at the National Institute of Advanced Studies in Bengaluru. “They look for areas with easy land availability — minimum resistance for maximum land — even if water is available only far away,” he said.The federal power ministry, as well as energy and water authorities in Maharashtra state, where Solapur is located, did not respond to queries. Delhi attempted to reduce its reliance on coal before reversing track after the Covid pandemic. It has invested heavily in renewable energy sources like solar and hydro, but thirsty thermal power will still be dominant for the coming decades.India’s former top energy bureaucrat Ram Vinay Shahi said ready access to power was strategically important for the country, whose per-capita power consumption is far lower than its regional rival China.“The only energy resource we have in the country is coal,” he said. “Between water and coal, preference is given to coal.”‘Nothing’ in Solapur?Solapur resident Rajani Thoke plans her life around water in high summer. On days with supply, “I do not focus on anything other than storing water, washing clothes and such work,” said the mother of two, who strictly polices her family’s water use.Sushilkumar Shinde, the federal power minister who approved the Solapur plant in 2008, when the area had already been classified “water scarce,” told Reuters he helped NTPC procure the land by negotiating payments to locals.The member of the opposition Congress party, who won election to retain Solapur’s parliamentary seat a year after the plant’s approval, defended the operation on grounds of NTPC’s sizeable investment. The $1.34bn plant generated thousands of jobs during its construction and now provides part-time employment to about 2,500 locals. “I made sure farmers got good money for the land NTPC acquired,” he said, adding that mismanagement by local authorities was to blame for water shortages.Solapur municipal official Sachin Ombase acknowledged that water distribution infrastructure had not kept up with population growth, but said that authorities were trying to address the problem.Shinde said “there was nothing” in Solapur in 2008 and that residents who received land payments had no reason to oppose the plant. Researcher Shripad Dharmadhikary, who founded environment advocacy group Manthan Adhyayan Kendra, said local politicians often supported splashy infrastructure projects to boost their popularity.Any “problems come up much later,” he said. Even before the Solapur plant started operating, there were signs of the trouble to come. The first of its two units was supposed to start generating power by the middle of 2016, but it was delayed by more than 12 months because of years of severe water shortages, according to a 2020 regulatory filing.The absence of nearby water resources meant the station ended up drawing on water from a reservoir about 120km away. Such distances can sharply increase costs and the risk of water theft, said Dharmadhikary and two plant sources.As of May 2023, the station is among India’s least water-efficient, according to the latest available federal records. It also has among the lowest capacity utilisation rates of coal-fired plants, according to data from government think-tank NITI Aayog.NTPC said its data indicates the Solapur plant has an efficiency ratio in line with the country’s norms.Indian stations typically consume twice as much water as their global counterparts, according to the Delhi-based Centre for Science and Environment think-tank. Solapur plant officials told reporters in March that capacity utilisation will improve with increasing demand, indicating that water consumption could surge in the future. A forthcoming survey on water use in Solapur led by state groundwater authorities and reviewed by Reuters showed that irrigation demand in the district outstrips supply by a third.Dharmes Waghmore owns farmland a few miles from the plant and said that developing it would provide more financial security than his current casual work.But he said borrowing money to develop the land by drilling a bore well is too risky: “What if there’s no water?”Kuladeep Jangam, a top local official, said authorities were struggling to draw businesses to Solapur.The lack of “water neutralises all other pull factors,” he said.Thirst for waterSince 2014, India has lost 60.33bn units of coal-power generation across the country — equivalent to 19 days of coal-power supply at June 2025 levels — because water shortages force plants to suspend generation, according to federal data.Among the facilities that have struggled with shortages is the 2,920MW Chandrapur Super Thermal Power Station, one of India’s largest. Located about 500km northeast of Solapur but also in a water-stressed area, the plant shuts several of its units for months at a time when the monsoon delivers less rain than usual, according to NITI Aayog data.Despite the challenges, the plant is considering adding 800MW of new capacity, according to the power ministry list seen by Reuters and half a dozen sources at Mahagenco, which operates the station.The document indicates the plant hasn’t identified a water source for the expansion, though it has already sourced its coal.State-owned Mahagenco did not respond to Reuters’ questions. The plant’s thirst for water has previously led to tensions with residents of nearby Chandrapur city. Locals protested the station during a 2017 drought, prompting officials such as local lawmaker Sudhir Mungantiwar to order it to divert water to homes.Mungantiwar, however, says he supports the expansion of the plant, which he hopes will lead to it retiring water-inefficient older units.But the station has already delayed a plan to decommission two polluting and water-guzzling power units with a capacity of 420MW by about seven years, citing instructions from the federal government, the company sources said. The Indian government asked power companies not to retire old thermal plants until the end of the decade due to a surge in demand following the pandemic, Reuters has reported.Chandrapur resident Anjali, who goes by one name, said she is resigned to visiting a tap installed by the station near one of its gates for drinking water.“We’re poor, we make do with whatever we can get,” she said. — Reuters

War, tariffs and the Air India crash will cast a shadow over the Paris Air Show as the aerospace industry’s biggest annual gathering opens on Monday.More than 2,400 companies from 48 countries are showing off their hardware at the week-long event at Le Bourget airfield on the outskirts of Paris.The sales rivalry between Airbus and Boeing usually drives the headlines as the world’s top civilian planemakers announce many of their biggest orders at the air show.But this year’s event “is much more complex”, said Airbus chief executive Guillaume Faury, who also chairs the board of the Gifas association of French aerospace firms that organises the biennial event.The list of challenges is growing.Russia’s war in Ukraine is stretching into its fourth year and there are fears of a wider conflict in the Middle East after Israel launched strikes on Iran yesterday, disrupting commercial flights across the region.The world economy is expected to slow sharply after US President Donald Trump launched his tariff blitz in April.And Boeing is facing a new crisis after Thursday’s crash of a 787 Dreamliner operated by Air India in the city of Ahmedabad, which killed at least 265 people on board and on the ground.Boeing chief executive Kelly Ortberg cancelled plans to attend the Paris Air Show to focus on the investigation into the crash.Prior to the tragedy, Boeing had been making progress under a new leadership as the US company sought to restore trust after a series of safety and quality lapses.Boeing and its European rival, Airbus, have also been dealing with delays in delivering aircraft due to supply chain issues.Trump’s tariff onslaught has added to the issues facing the industry, which relies on a global supply chain.Trump imposed 10% tariffs on US imports of goods from nearly every country in April, and steeper levies on dozens of countries could kick in next month.The Trump administration is also mulling whether to impose sector-specific tariffs of between 10 and 20% on civil aircraft and parts.The heads of Airbus and Boeing have both called for tariffs to return to zero as had been the case since a 1979 agreement.“The entire Western aerospace industry considers that would be the best that could happen,” said Faury.In a recent interview with trade journal Aviation Week, Ortberg warned that that tariffs are an added cost for Boeing, which has been financially weakened in recent years by production problems.We’re “not in a position to pass those (costs) along to our customers,” he told Aviation Week. “I’m hopeful that, as each of these country-by-country negotiations resolve, those tariffs will go away in the long run.” The tariff problems come as the industry has yet to fully recover from effects of the Covid pandemic on its supply chain.Airbus is having trouble getting enough fuel-efficient engines for its top-selling A320 family of single-aisle jets, holding back the delivery of around 40 aircraft.The main bottleneck is a lack of toilets for widebody aircraft, said Christian Scherer, the head of Airbus’s commercial aircraft division. The Paris Air Show is also about showing off the latest military hardware, at a time of conflicts in Ukraine and the Middle East. European countries are boosting defence budgets in the face of the Ukraine war and fears about Trump’s commitment to the Nato alliance.“The geostrategic environment has led us to bolster this aspect which was in the background in previous years,” said Gifas head Frederic Parisot. Some 75 companies related to weapons production will be participating at the show, with military jets, helicopters and drones to be displayed.Lockheed Martin’s F-35 fifth-generation stealth multirole fighter will be featured, along with the Rafale produced by France’s Dassault Aviation.

While the Covid-19 pandemic is firmly in the past for many Americans, US households continue to bear the costs of infectious-disease outbreaks. A few months ago, the price of eggs in the United States soared to a record high, largely owing to the spread of H5N1 bird flu. Since March 2024, the virus has ravaged US chicken farms, leading to tens of millions of poultry deaths from infection or culling.More ominously, at least 70 human cases of bird flu have been identified in the US, with one death reported in Louisiana. In a recent report about enhancing the response to H5N1 in America and globally, the Global Virus Network, a consortium of the world’s top virologists, warned of “the terrible consequences of underreacting to current threats.”But while bird flu poses the most immediate risk to Americans, it is by no means the only one. Virulent infectious-disease outbreaks in other countries, such as mpox in the Democratic Republic of the Congo, Ebola in Uganda, Marburg in Tanzania, and multi-country outbreaks of cholera, do not respect borders, and thus are a threat to people everywhere – including in the US.Without the efforts of the World Health Organisation to contain these outbreaks, the risks of wider transmission would be much greater. This underscores the need for a global agency like the WHO to supervise cross-border co-operation – and the shortsightedness of President Donald Trump’s decision to withdraw the US from the organisation. Despite being the world’s richest and most powerful country, America is not immune to another Covid-style calamity, and abandoning multilateralism and neglecting pandemic preparedness (such as the stockpiling of treatments and vaccines) will make it all the more vulnerable.One might think that the deadly spread of Covid-19, prolonged by the emergence of new virus strains, would convince policymakers to strengthen the world’s public-health architecture – especially as experts warn that future pandemics could be even worse. But with other leaders indicating that they may follow Trump’s example and leave the WHO, the resources for pandemic prevention and control could dwindle to the point that global outbreaks become more frequent and difficult to overcome.If Trump follows through with the move, his administration will become increasingly isolated and impotent. American officials, including at US military installations abroad, will lose access to the WHO-led and -facilitated global networks that collect and share information about infectious-disease threats and respond to outbreaks. Moreover, the US government will have no say in developing new solutions (which will almost invariably be less effective) for controlling the spread of diseases across borders – including its own.Trump has suggested that he may change his mind, presumably if the grievances set out in his executive order to withdraw the US from the organisation are addressed. This implies that the WHO should apply pressure on China to identify the pandemic’s origins. WHO Director-General Tedros Adhanom Ghebreyesus, for his part, has refused to accept the Chinese government’s prevarications. If Trump can propose a way to determine the cause of Covid-19, I am sure that the WHO’s leadership would gladly hear it.Trump’s second condition is that the WHO undertake reforms and use its resources more effectively at the local level, with a greater focus on stopping the spread of infectious diseases. This is a demand that can and should be met. To that end, Tedros has already promised more targeted use of funds and implemented other measures to transform the organisation. In addition, under Tedros, the WHO has transformed the way it raises funds. Its member states have sharply increased their annual contributions, and it has diversified its donor base to share the funding load more widely.This is all part of the WHO’s drive to be more sustainably financed, a plan launched as part of Tedros’s effort to transform the organisation’s operations after he took office in 2017. Back then, he and member states assessed that the departure of a major donor could leave the WHO’s programmes and independence vulnerable to funding shocks. Who knew it would be the US. But, had those changes not been made, we can only imagine how much more challenging the WHO’s current financial situation would be.The Trump administration should welcome these changes, not least because it benefits from having a seat at the table. If the US ultimately abandons the WHO, developing evidence-based guidance and regulations for chronic-disease prevention and management will be significantly harder, undermining the administration’s goal of addressing America’s chronic-disease epidemic.The US will also no longer be a part of the WHO’s medicine prequalification process, a programme that opens a host of new markets for drug producers in a cost-effective manner. Instead, US pharmaceutical companies will be forced to sell their prequalified products to each country individually, putting them at risk of losing access to highly profitable multibillion dollar markets.Twenty-first-century trends – including more mobility and international travel, greater urbanisation, and increasing human encroachment on nature – fuel the global spread of infectious diseases, to the detriment of everyone. US officials would be better positioned to protect their citizens if they joined – and perhaps even led – a discussion on how the WHO and other global health organisations, such as Gavi, the Vaccine Alliance, and the Global Fund to Fight AIDS, Tuberculosis, and Malaria, can meet the world’s needs.One such initiative, in which the US had been a strong partner until Trump took office, was to negotiate a WHO Pandemic Agreement, which WHO member states adopted by consensus at the World Health Assembly on May 20. This historic compact, based on the principles of equity, collaboration, and the reaffirmation of national sovereignty in public-health decision-making, will make the world safer from future pandemics.The US, bolstered by its world-class medical professionals and substantial public investment in medical research, has long exerted considerable influence on global health priorities. But withdrawing from the WHO places America on the outside, unable to shape the agency’s policy agenda and reforms. When the next pandemic strikes, the US will be left watching from the sidelines, as the WHO and its remaining member countries manage the global response and pick up the pieces as they see fit. — Project SyndicateGordon Brown, a former prime minister of the United Kingdom, is UN Special Envoy for Global Education and Chair of Education Cannot Wait.

The General Secretariat of the League of Arab States, the Arab Labor Organization, and the Arab Council for Childhood and Development have jointly affirmed that the children of Gaza are enduring one of the gravest humanitarian tragedies, with their fundamental right to life being flagrantly violated. They stressed that the ongoing situation in Gaza places the international community before an urgent moral and legal responsibility to protect Palestinian children and safeguard their rights to health, education, and a safe and dignified life.In a joint statement issued on the occasion of the World Day Against Child Labour, observed annually on June 12, the organizations revealed that recent statistics indicate the martyrdom of nearly 18,000 children in Gaza, while thousands of others have been deprived of the most basic necessities of life.The statement emphasized that the forthcoming Second World Summit for Social Development, scheduled to take place in Qatar this November, represents a pivotal opportunity to address mechanisms for promoting decent work and combating poverty, the primary driver of child labour. The summit's outcomes are expected to contribute to the deliberations of the Sixth Global Conference on the Elimination of Child Labour, to be held in Morocco in 2026, thereby strengthening the synergy between national, regional, and international efforts.The statement urgently called on all relevant stakeholders to act swiftly to protect children from all forms of exploitation and to uphold their rights as enshrined in international charters and agreements. It particularly underscored the plight of working children, who have been stripped of their childhood and innocence, subjected to harm both physically and psychologically, and denied their basic rights to education, development, and a life of dignity, humanity, and justice.The statement further called for intensified Arab and international attention and reiterated the need to reinforce regional and global commitments to eliminating all forms of child labour. It also pointed out that this year's observance of the World Day Against Child Labour comes while the global goal of eradicating child labour in all its forms by 2025 remains far from reach.It noted that the latest global estimates, issued in 2021, revealed that approximately 160 million children are engaged in child labour worldwide, 63 million girls and 97 million boys. This alarming figure is attributed to a succession of global crises, including the COVID-19 pandemic, climate change, ongoing conflicts and wars, rapid technological advancement, and widening social and economic disparities.The joint statement affirmed the unwavering commitment of the participating organizations to continue collaborative efforts to combat child labour and to support international movements and UN-led initiatives in this regard.It is worth noting that the International Labour Organization (ILO) designated June 12 as the World Day Against Child Labour in 2002, aiming to raise global awareness about the prevalence of child labour and to mobilize efforts towards its eradication. (