Friday, January 17, 2025

Iran’s hedge against Trump

With Donald Trump poised to return to the White House, Iran has a lot to be worried about.
View in browser
Bloomberg

Welcome to Balance of Power, bringing you the latest in global politics. If you haven't yet, sign up here.

The weight of the Middle East is bearing down on the most fragile of ceasefires. For Iran, it's a brittle and bitter denouement to a highly destructive war that's dramatically upended its political fortunes.

The Islamic Republic's flagship ally, Hezbollah, hangs by a thread and Syria's Assad dynasty – the other pivotal partner in Tehran's web of friends in the eastern Mediterranean – has gone.

With Donald Trump days from affirming his second US presidency, Iran has a lot to be worried about.

The country needs to protect its remaining allies — the Iraqi government and the Houthis in Yemen — and shore up the strategic ties that will probably make or break Ayatollah Ali Khamenei's ability to withstand another four years of Trump.

Putin and Pezeshkian in Ashgabat, Turkmenistan, in October. Photographer: Alexander Shcherbak/AFP/Getty Images

To that end, Iran's reformist president, Masoud Pezeshkian, is meeting with Russian President Vladimir Putin in Moscow today to sign a strategic deal.

It's likely to be Iran's best hedge against the uncertainty that Trump's incoming administration will bring and the hostile, "maximum pressure" approach he's likely to revive.

At the same time, Pezeshkian has a mandate from the clerics to pursue sanctions relief and engagement with the US, knowing that it's the only viable, long-term solution to Iran's myriad economic problems.

All of this comes as the country's theocratic regime faces widespread unpopularity and a major energy crisis that officials are struggling to control, deepening Iran's economic distress.

It's an unenviable situation that presents few easy moves for a country that's credited with being an early pioneer of chess.

With Iran sure to be in Trump's sights, the rooks on the Persian chessboard have their work cut out. Golnar Motevalli

Global Must Reads

Germany's economic and political difficulties are well documented going into snap elections on Feb. 23 that offer a chance for a fresh approach to tackling the challenges in Europe's dominant power. This piece shows where the main parties stack up on core issues including the economy, energy, debt, defense and migration that will determine whether Germany can climb out of its torpor.

Clockwise from top left, German chancellor candidates Olaf Scholz (SPD), Alice Weidel (AfD), Robert Habeck (Greens) and Friedrich Merz (CDU/CSU). Source: AFP/Getty

China's economic growth was exactly in line with the government's goal last year after an 11th-hour stimulus blitz and export boom turbocharged activity, although looming US tariffs threaten to take away a key driver of expansion. Gross domestic product expanded by 5% in the world's second-largest economy, official data showed today, after President Xi Jinping said on New Year's Eve that China was expected to meet the target.

TikTok is poised to win a reprieve from a law that would ban the popular social-media app in the US from Sunday, thanks to a holiday weekend and a pledge from Trump's incoming administration to give its Chinese owner more time to divest. Two Biden administration officials said Monday's Martin Luther King Jr. federal holiday essentially leaves enforcement to the new president.

US Treasury Secretary Janet Yellen's computer and those of two of her lieutenants were infiltrated and unclassified files were accessed as part of a broader breach of the agency by Chinese state-sponsored hackers, sources say. In the latest hack attributed to the government in Beijing, the attackers appeared to focus on Treasury's role in sanctions, intelligence and international affairs, but didn't penetrate the department's email or classified systems, according to a report we previously reviewed.

Between the thicket of the Darien Gap on Panama's border with Colombia and the treacherous ganglands of Mexico, there's a stretch of Central America where the trek northward for migrants is normally done by bus, encouraged by governments that don't want them to linger. This represents a challenge for Trump, who needs the cooperation of other countries to achieve his goal of stopping the flow of undocumented immigration.

Migrants cross illegally into Nicaragua from Costa Rica. Photographer: Glorianna Ximendaz/Bloomberg

South Korean investigators sought a new warrant to extend for as long as 20 days the detention of impeached President Yoon Suk Yeol over his short-lived martial law declaration.

Former central banker Mark Carney kicked off his bid to replace Justin Trudeau as both the head of Canada's Liberal Party and the country's prime minister, saying he has the experience to deal with Trump's return to the White House.

Nigel Farage said Reform UK isn't anti-immigration and advocated a mixture of tax and spending cuts as he sought to put a more moderate face on his insurgent party.

Kenya plans to reinforce policing of social media amid a vicious online onslaught chiefly targeting President William Ruto, as criticism mounts of government efforts to stifle dissent.

Trade tensions between the US and China, the two biggest economies, are already heating up; the question now is how quickly things escalate once Trump takes office.

Sign up for the Washington Edition newsletter for news from the US capital and watch Balance of Power at 1 and 5 p.m. ET weekdays on Bloomberg Television.

Chart of the Day

China's population shrank for a third straight year in 2024, according to official data published today, falling to 1.408 billion and highlighting a long-term risk for the economy. While around 9.54 million babies were born — 520,000 more than the previous year — it was still the second-lowest number of births since the founding of the People's Republic of China in 1949.

And Finally

A months-long crackdown on illegal mining of idled South African gold shafts went awry after authorities initially refused aid or help to hundreds of miners trapped almost 2 miles underground. After they eventually relented, rescuers pulled 78 dead bodies and more than 250 emaciated people from the mines southwest of Johannesburg. The ordeal has highlighted the desperation many face in Africa's most industrialized economy, where almost a third of the labor force and half of its youth are unemployed.

Rescue operations for trapped miners at the abandoned Buffelsfontein gold mine this week. Photographer: Leon Sadiki/Bloomberg

Pop quiz (no cheating!). The newly installed and disputed president of which country is the world's tallest leader? Send your answers to balancepower@bloomberg.net

More from Bloomberg

  • Next China for dispatches from Beijing on where China stands now — and where it's going next
  • Check out our Bloomberg Investigates film series about untold stories and unraveled mysteries
  • Next Africa, a twice-weekly newsletter on where the continent stands now — and where it's headed
  • Economics Daily for what the changing landscape means for policymakers, investors and you
  • Green Daily for the latest in climate news, zero-emission tech and green finance
  • Explore more newsletters at Bloomberg.com.
Follow Us

Like getting this newsletter? Subscribe to Bloomberg.com for unlimited access to trusted, data-driven journalism and subscriber-only insights.

Want to sponsor this newsletter? Get in touch here.

You received this message because you are subscribed to Bloomberg's Balance of Power newsletter. If a friend forwarded you this message, sign up here to get it in your inbox.
Unsubscribe
Bloomberg.com
Contact Us
Bloomberg L.P.
731 Lexington Avenue,
New York, NY 10022
Ads Powered By Liveintent Ad Choices

No comments:

Post a Comment