HOT AIR BALLOON FLIGHT

View this email in your browser 

Insights, analysis and must reads from CNN's Fareed Zakaria and the Global Public Square team, compiled by Global Briefing editor Chris Good

Seeing this newsletter as a forward? Subscribe here.

October 26, 2021

What the 'Shortage Economy' Is Doing to Companies

The US economy is facing some odd pressures. 
 
As Fareed examined recently in conversations with The Washington Post's David J. Lynch and Heather Long, shipping backups have left supply chains tangled, while workers are reconsidering what they want from jobs and have dropped out of the labor force with alacrity. Labor strikes and resignations suggest workers are gaining power. Hiring managers have complained that job seekers are ghosting them; some workers have savored the irony.
 
Signs of inflation, and expectations of more, add a wrinkle. The Economist sums up the predicament for businesses and investors, as commodity prices and wages both rise: "If you run a company or invest in one," the magazine writes, "this is the new calculation: demand is recovering and costs are rising. Can you raise prices? And should you expand capacity? By the end of this earnings season the answer may be clearer."

A Mixed Record for Stimulus

Despite the clear logic of "go[ing] big" in the face of Covid-19's economic downturn, Morgan Stanley's Ruchir Sharma writes for the Financial Times: "Scanning data on the top emerging and developed markets for a statistical link between the scale of their 2020 stimulus programmes and the strength of the ensuing recovery, I found none. … This disconnect was sharpest in emerging markets, from China to Chile." 
 
As for why, Sharma suggests pandemic factors (like lockdowns and vaccines) and the huge stimuli undertaken by the US and other large, developed economies may have washed out the effects of any particular country's Covid-19 economic response.

A Plan to Vaccinate Africa

Africa is home to about 17% of the world's population, but at present, only 5.5% of people in Africa are fully vaccinated against Covid-19. In a Foreign Affairs essay, Dr. Ashish Jha and Andrew Iliff of the Brown University School of Public Health call this "a colossal global health failure. Considering the vaccine surplus found in developed economies, especially the United States, it is also a moral crisis."
 
What's to be done? They recommend countries with vaccine surpluses should partner with (and bolster) the Africa CDC, established after the 2014 Ebola epidemic, in addition to working with the global COVAX initiative. They also suggest wealthy, highly vaccinated countries should give up their places in line. "Rather than demanding that vaccine manufacturers complete their outstanding orders first, rich countries should heed the Africa CDC director John Nkengasong's request to deprioritize their own contracts in favor of the Africa CDC's purchases," Jha and Iliff propose. "States would still receive their doses, but the delay in delivery would fall on countries already benefiting from substantial vaccine coverage." 

After Another Coup, What's Next for Sudan?

As it moved past the rule of ex-president Omar al-Bashir (who was ousted in a 2019 coup and who now may face charges of genocide at the International Criminal Court), Sudan saw its transitional institutions build some momentum, David E. Kiwuwa writes for The Conversation. But "tension between the civilian and military wings" of the country's transitional council erupted in a coup by the council's head, Gen. Abdel Fattah al-Burhan, on Monday.  
 
"This sequence of events is one familiar to Sudanese people, who saw previous democratic revolutions in 1964 and 1985 also succumb to military takeovers," The Economist writes. In the past week, citizens had protested against the military en masse, and the magazine suggests Sudan is "ready to ignite."
 
"For now, the transition might be disrupted and in fact temporarily upended," Kiwuwa writes for The Conversation, deeming it unclear whether the coup will succeed over time. "But the lesson from Sudan is never to count the masses out of the equation. Their ability to mobilise and confront counter revolutionary forces cannot be underestimated."

Should China's 'Hostage Diplomacy' Give Travelers Pause?

Before traveling to China, former US State Department officials Morgan Ortagus and David Stilwell write in a CNN op-ed, some Americans should pause and consider Beijing's recent arrests of foreigners as diplomatic clashes unfolded. 
 
The Chinese government has denied that any arrests have been politically motivated, but critics have accused Beijing of undertaking "hostage diplomacy." Most recently, China arrested two Canadians after Huawei CFO Meng Wanzhou was detained in Canada, at America's behest, over alleged US-sanctions violations. As soon as Meng was released in late September, so were the two Canadians.

Ortagus and Stilwell write that for businesspeople and the politically engaged, in particular, traveling to China carries a nonzero risk of getting caught in a geopolitical game.