15 August 2024
This Week:
Kursk Offensive Indicates Change in Ukraine War
Japan’s Prime Minister Resigns
UN Signs First Cybercrime Treaty
Meta Wins Lawsuit Over Censorship
India Becoming A Growth Market For Packaged Goods
France Supports Morocco’s Sahara Claims
Infrastructure Investment in Africa
See previous editions of P&M here
Kursk Offensive Indicates Change in Ukraine War
On August 6, Ukraine launched a significant incursion into Russia's Kursk region, marking the largest foreign attack on Russia since World War II. The advance has caused a major dilemma for President Vladimir Putin, who faces difficulties in pushing Ukrainian forces out despite a week of intense battles. Ukrainian President Volodymyr Zelenskyy reported that his troops continue to gain ground, taking an additional 1-2 kilometers and capturing Russian prisoners of war. Ukraine controlled approximately 308 square miles (800 square kilometers) of the Kursk region as of August 12. Russia's defense ministry countered with claims of shooting down 117 Ukrainian drones and repelling attacks, while also bolstering security at the Kursk nuclear power plant, located close to the fighting. Russia has also claimed it halted the Ukrainian incursion into the Kursk region.
The Ukrainian assault has altered the war’s dynamics, impacting Russian military and economic stability. Russia was also forced to evacuate more than 70,000 people from its border regions and initiated a "counterterror operation" in response. U.S. President Joe Biden noted that the incursion has created a strategic dilemma for Putin and highlighted that the U.S. was not informed in advance of Ukraine’s plans. Russian officials have suggested that Ukraine’s Western allies were involved, a claim the U.S. denies. The offensive has increased pressure on both Kyiv and Moscow, with Ukraine's actions seen as a tactic to strengthen its negotiating position. Although the incursion risks exposing other parts of Ukraine’s front lines, Russian military observers predict further Ukrainian moves.
Besides the kinetic aspects to the offensive, Kursk experienced a significant distributed denial-of-service (DDoS) attack. The attack targeted government and business websites, and critical infrastructure, causing temporary disruptions. The Russian digital ministry reported that the attack peaked with over 100,000 junk requests per second, though DDoS attacks can reach millions of requests. The IP addresses involved were primarily from Germany and the U.K., but the exact origin of the attack remains unclear. While the attackers aimed to disrupt key services, they did not compromise e-government infrastructure or user data. Both the kinetic and cyber aspects to this incursion indicate that Ukraine can counter Russia, and that this war will likely continue for at least a few more years until Russia is drained of resources. If Ukraine can implement more operations like this, then they will likely force Russia to expend even more resources over the medium term.
Japan’s Prime Minister Resigns
Japanese Prime Minister Fumio Kishida announced his resignation on August 14, citing diminished public trust due to political scandals and rising living costs during his three-year term. Kishida, who will step down next month, will not seek re-election as leader of the ruling Liberal Democratic Party (LDP), triggering a leadership contest set for September. His approval ratings dropped following revelations of ties between the LDP and the controversial Unification Church, and issues related to unreported political donations. Kishida's successor will need to restore public confidence and address key issues, including the cost of living, rising geopolitical tensions, and potential U.S. political changes. Kishida's tenure was marked by significant economic and security policies, including efforts to boost household income, a major military buildup, and improved relations with South Korea. Potential candidates to replace Kishida include former defense minister Shigeru Ishiba, Foreign Minister Yoko Kamikawa, Digital Minister Taro Kono, and former Environment Minister Shinjiro Koizumi. The LDP faces pressure to select a leader untainted by current scandals to improve its chances in upcoming elections. Kishida’s successor will have a profound impact on the global economy and balance of power. For example, by Japan raising interest rates, the U.S. stock market took a decline as companies had acclimated to cheap/free loans that no longer existed.
UN Signs First Cybercrime Treaty
The United Nations has adopted its first cybercrime treaty, creating a new global legal framework aimed at tackling cybercrime and facilitating cross-border data access. Negotiations took three years, was endorsed by Russia despite earlier reservations, and it is anticipated to receive approval from the General Assembly. The agreement allows authorities to request electronic evidence and data from other nations and internet service providers.
The treaty has faced criticism from human rights organizations and tech companies, who are concerned about insufficient safeguards against misuse and increased surveillance. They argue that it lacks robust safeguards against the misuse of digital investigative powers, raising concerns about increased surveillance, diminished public trust in digital technology, and potential risks to individuals worldwide.
This treaty does mark a major change as it establishes a universally debated and accepted legal framework. It has a broader scope than the Budapest Convention, a previous cybercrime treaty not signed by major countries like China, Russia, India, or Brazil, which are significant players in internet-based criminal activity. The new treaty is viewed as a global effort to address cybercrime, even though it has been described as a "bad treaty" that some member states accepted as better than having no treaty at all.
Meta Wins Lawsuit Over Censorship
On August 9, the 9th U.S. Circuit Court of Appeals upheld Meta Platforms' decision to censor Facebook posts from Children's Health Defense, an anti-vaccine group led by Robert F. Kennedy Jr. The court ruled that the nonprofit did not prove Meta was coerced by federal officials to suppress vaccine misinformation. Meta had flagged and restricted posts promoting false claims about vaccine safety and efficacy and removed the group's Facebook and Instagram accounts in August 2022. The court's decision, written by Judge Eric Miller, affirmed Meta's First Amendment right to curate content on its platform according to its own standards. The court also rejected claims against the Poynter Institute and Science Feedback, which assist Meta in content moderation. This decision was significant because the court effectively upheld the legal right of private corporations to limit speech they disagree with, as long as they do not coordinate with the federal government. There are political implications in the coming U.S. election as Trump and Republicans have taken an anti-Big Tech stance as they view these corporations as limiting conservative speech. This ruling could further encourage them to pursue legal controls over social media companies.
India Becoming A Growth Market For Packaged Goods
India is emerging as a key growth market for major packaged goods companies, such as PepsiCo, Unilever, and others, as these companies face a slowdown in China. With India’s economy growing rapidly compared to China’s sluggish recovery, these companies are focusing on India’s diverse and expansive market, including both urban and rural areas. They are introducing new products and packaging innovations to cater to local tastes and boost market share. Consumer goods giants are investing heavily in India, anticipating increased government spending, improved wealth, and rising private consumption to drive growth. This has led to a significant increase in their market share in India. In contrast, China's market is experiencing weak demand and slower economic recovery. These market changes highlight important long-term geopolitical trends. First, Western corporations are slowly moving away from China towards friendly countries that are easier to do business in. Second, further friendshoring of corporate activity will indicate to China that the West wants to challenge them geopolitically and economically.
France Supports Morocco’s Sahara Claims
Algeria has responded negatively to France’s support for Morocco’s claim over Western Sahara. French President Emmanuel Macron recently endorsed Morocco’s 2007 proposal to grant limited autonomy to Western Sahara under Moroccan sovereignty, which has heightened tensions between Algeria and France. Algeria has reacted by refusing to accept deportations and recalling its ambassador to France. The two countries have a history of strained relations, exacerbated by Algeria’s support for the Polisario Front, which seeks independence for Western Sahara. Morocco's aggressive expansion in Western Sahara, including infrastructure development since the U.S. recognized Moroccan sovereignty in 2020, has further fueled the conflict. The Polisario Front resumed armed conflict in 2020, breaking a 1991 ceasefire. Algeria's response to France’s position, which may influence other countries, is partly driven by its own strategic interests. France's shift could also be motivated by economic factors, including access to Moroccan renewable energy projects and mineral resources. Algeria, a major gas supplier to the EU, might use its energy leverage in retaliation. This situation demonstrates the continued conflict that occurs over disputed territory, but it also shows the importance of competition in Africa. Western countries will likely have to choose sides on controversial issues like sovereignty to gain access to requisite minerals.
Infrastructure Investment in Africa
Efforts to address Africa’s infrastructure gaps are increasing, with annual funding for development rising to $77 billion between 2013 and 2017—double the amount in the early 2000s. Investments are concentrated in West and East Africa, with transport and energy sectors receiving most of the funding. African governments contributed 42% of this total, while Chinese investment has grown, notably funding major projects like the Mombasa-Nairobi Railway. Despite this progress, Africa's infrastructure investment as a percentage of GDP has remained at about 3.5% since 2000, below the 4.5% needed to close the continent's infrastructure gaps. To meet this target, annual investment would need to double to $150 billion by 2025. Challenges include rising debt-to-GDP ratios among African governments, which limit their infrastructure spending. However, there is significant international interest in African infrastructure projects, with investors holding up to $550 billion in assets. This includes funding from the United States, UAE, China, the UK, and France. Importantly, infrastructure investment is a critical area for geopolitical competition, and the United States will struggle to meet its commitments to challenge China.
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- Simone de Beauvoir
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