Falling stocks in Europe and US stoke banking crisis fears


Shares in global investment bank Credit Suisse fell sharply on Wednesday sending shares plunging in other European banks.

A record drop in shares at Swiss banking giant Credit Suisse on Wednesday has fanned fears of a possible banking crisis.

US-listed shares at the global investment bank plummeted by more than a quarter after the banks largest shareholder — the Saudi National Bank — said it would not inject in more cash into the bank.

The Financial Times reported that Credit Suisse had appealed to the Swiss National Bank for a public show of support, citing people familiar with the matter.

At the close of trade in Europe on Wednesday, Credit Suisse's stock price was down 24%, having recovered slightly from its lowest ebb during the day. It was trading at around €1.84 — compared to almost €3 per share last week and more than €7.50 per share late last March.

European and US markets react

Stocks fell in Europe and Wall Street on Wednesday amid worries about the strength of banks on either side of the Atlantic. Germany's DAX had lost 3.32% at the close of trade in Europe
The FTSE 100 in London fell 3.80%.
France's CAC 40 dropped 3.68%
European STOXX 600 index (aggregating 600 of the core companies across the continent) shed almost 3%
And the STOXX Banks index of 21 leading European lenders sagged 8.4%, showing the sector under the most pressure
The S&P 500 was -0.69% at the close of trade
The Dow Jones Industrial Average was down -0.87%
The Nasdaq composite finished up at 0.05% in the green
All major cryptocurrency platforms were also deep in the red for the day; Bitcoin was the most stable, but still down 1.3%

Aftermath of Silicon Valley Bank collapse

The volatility comes after last weeks sudden collapse of Silicon Valley Bank in the US which forced authorities to intervene to prevent the spread of market disturbances.

Multi-national investment firm BlackRock's Chief Executive, Laurence Fink, warned on Wednesday that the US regional banking sector was at risk, and predicted continued high inflation and rate increases.

Europe's bank index has seen more than €120 billion ($127 billion) of value by market capitalization wiped out since March 8.

Germany's financial supervisory authority (BaFin) has moved to allay fears and said the German banking system appeared robust and capable of absorbing higher interest rates.

"Our main focus is currently on some smaller banks with little surplus capital and increased interest rate risks — we are closely monitoring these institutions," a BaFin spokesperson said in a statement.

The European Central Bank looks poised to hike interest rates again on Thursday in a bid to tackle high inflation.

Reuters news agency cited a spokesperson from the US treasury as saying that officials are "monitoring" the problems surrounding Credit Suisse and that they have "been in touch with global counterparts."

Swiss National Bank will offer liquidity 'if necessary'

The Swiss National Bank (SNB) and the Swiss Financial Market Supervisory Authority (FINMA) said in a statement that "the problems of certain banks in the USA do not pose a direct risk of contagion for the Swiss financial markets," and pointed to "the strict capital and liquidity requirements" which applied to Swiss financial institutions.

The SNB said that Credit Suisse met the capital and liquidity requirements imposed on what it called "systemically important banks" and said "If necessary, the SNB will provide CS with liquidity."

kb/msh (Reuters, AP)

Credit Suisse says it will borrow up to $53.7 bn from central bank

Credit Suisse will borrow up to 50 billion francs from the Swiss central bank to shore up its business 

Zurich (AFP) – Credit Suisse announced Thursday that it would borrow almost $54 billion from the Swiss central bank to reinforce the group after a plunge in its share prices.

The disclosure came just hours after the Swiss National Bank said capital and liquidity levels at the lender were adequate for a "systemically important bank", even as it pledged to make liquidity available if needed.

In a statement, Credit Suisse said the central bank loan of up to 50 billion francs ($53.7 billion) would "support... core businesses and clients", adding it was also making buyback offers on about $3 billion worth of debt.

"These measures demonstrate decisive action to strengthen Credit Suisse as we continue our strategic transformation to deliver value to our clients and other stakeholders," CEO Ulrich Koerner said in the statement.

"My team and I are resolved to move forward rapidly to deliver a simpler and more focused bank built around client needs."

Credit Suisse, hit by a series of scandals in recent years, saw its stock price tumble off a cliff Wednesday after major shareholder Saudi National Bank declined to invest more in the group, citing regulatory constraints.

Its shares fell more than 30 percent to a record low before regaining ground to end the day 24.24 percent down, at 1.697 Swiss francs.

Credit Suisse's market value had already taken a heavy blow this week over fears of contagion from the collapse of two US banks, as well as its annual report citing "material weaknesses" in internal controls.

Mounting concerns

Analysts have warned of mounting concerns over the bank's viability and the impact on the larger banking sector, as shares of other lenders sank on Wednesday after a rebound the day before.

Credit Suisse is one of 30 banks globally deemed too big to fail, forcing it to set aside more cash to weather a crisis.

Neil Wilson, chief market analyst at trading firm Finalto, said Wednesday that if the bank did "run into serious existential trouble, we are in a whole other world of pain".

In February 2021, Credit Suisse shares were worth 12.78 Swiss francs, but since then, the bank has endured a barrage of problems that have eaten away at its market value.

It was hit by the implosion of US fund Archegos, which cost it more than $5 billion.

Its asset management branch was rocked by the bankruptcy of British financial firm Greensill, in which some $10 billion had been committed through four funds.

The bank booked a net loss of 7.3 billion Swiss francs for the 2022 financial year.

That came against a backdrop of massive withdrawals of funds by its clients, including in the wealth management sector -- one of the activities on which the bank intends to refocus as part of a major restructuring plan.

© 2023 AFP

Social media frenzy fuels bank busting panic

Issued on: 16/03/2023 

New York (AFP) – Fearful Twitter posts and anxious WhatsApp exchanges coupled with online banking ease are seen as helping power an internet-age run on a pair of now-collapsed American lending institutions.

Both Silicon Valley Bank and Signature Bank were hit with massive withdrawals by customers fearful of losing their money, but the speed was dizzying in an age when rumors spread like wildfire on social media and apps make moving funds with the click of a button simple.

Congressman Patrick McHenry, chairman of the US House Financial Services Committee, referred to the recent turmoil as "the first Twitter fueled bank run."

Some messages that caused cold sweats among financial customers proved to be misleading, prompting calls to focus on facts not speculation.

Gone is the time when a "run on the bank" meant mobs of customers banging on bolted doors and demanding deposits back.

Now, as rumors of dwindling bank reserves ricochets about social media, customers can make them real by tapping into online accounts to transfer money.

Federal authorities took over Silicon Valley Bank (SVB) last week less than 48 hours after it first announced bad news.

The forced closure of Signature Bank came just two days later.

In between, high-profile entrepreneurs sounded an alarm and fired off advice on Twitter.

Investor Bill Ackman tweeted during the weekend that if federal regulators didn't quickly step in and guarantee all deposits, runs on other banks would start Monday.

"You should be absolutely terrified right now," investor Jason Calacanis tweeted, using all capital letters for emphasis.

"That is the proper reaction to a bank run and contagion."

Meanwhile, startup founders shared bank trouble rumors in WhatsApp groups.

"The mix of technology and fast-moving rumors fueled a crisis of unprecedented speed," researcher Jonathan Welburn of the Rand Corporation think tank told AFP.

Online banking was around during the 2008 financial crisis, but "the adoption of these technologies is definitely increasing," he said.

Circuit breakers?

Banking regulators need to put in place "circuit breakers" that could quickly suspend banking transactions in the event of cyber attacks, weather disasters, or customer panic, said Hilary Allen, a specialist in financial technologies at American University in Washington.

This is a "very political" undertaking, Allen said.

"Banking regulators need to think about what this kind of technological circuit breaker would look like, and in which circumstances they would be ready to deploy it."

Markets have seen the power of online platforms trigger surges in the prices of "meme stocks" like video game retail chain Game Stop and AMC Theaters due to endorsements in chat forums at Reddit.

"The flip side is that social media can also exacerbate panic and loss of confidence," Allen said.

In the case of SVB, fears which spread on social media resonated loudly with the bank's customers, who tended to be tech-savvy entrepreneurs keenly tuned in to online chatter.

The collapse of SVB was the second largest bank failure in the United States but played out in barely two days.

The largest bank failure in the country, that of Washington Mutual in 2008, took place over the course of eight months.

At that time, Twitter and iPhones were fledgling products; there were no WhatsApp groups, no Slack chat threads, Welburn noted.

"What happens when bankers are drowning their sorrows in the social media age?" Welburn wondered.

"Viral posts, retweets and shares could deprive regulators of precious time."

© 2023 AFP

Israel's Netanyahu shortens Germany trip amid protests

DW
9 hours ago9 hours ago

Israel has seen weeks of protests against Prime Minister Benjamin Netanyahu's controversial judicial reform plans. It was unclear if the itinerary change was linked to the demonstrations.



https://p.dw.com/p/4OhOx

Israeli Prime Minister Benjamin Netanyahu is shortening a trip to Berlin, his office said on Wednesday.

A preliminary itinerary circulated last week said that the Israeli premier would leave Germany on Friday. The new statement said he would return on Thursday.

The office said that the prime minister had earlier held consultations "on developments in national security." The statement did not specify whether the change was linked to the security concerns.

Netanyahu's trip accompanied by protests

Thousands in Israel took to the streets on Wednesday again to protest a controversial judicial reform Netanyahu's government wishes to enact.

Police have given out 30 emergency tickets for blocking emergency routes at the Ben Gurion International Airport, as demonstrators sought to disrupt Netanyahu's travel itinerary, with similar tactics having been employed in recent days and weeks.

"Netanyahu will meet us at every corner, on every flight or at every conference," protest organizers said in a statement. "We will not allow him to destroy the dream of many generations and turn Israel into a dictatorship."

 

Demonstrators gathered near the Ben Gurion airport to protest Israeli Prime Minister Benjamin Netanyahu's judicial reforms

Image: Tsafrir Abayov/AP Photo/picture alliance

What has led to the recent protests?

Changes planned by the Israeli leadership would allow parliament to overturn Supreme Court rulings with a simple majority vote and grant politicians more influence in appointing judges.

Opponents of the proposed reforms argue that they would effectively end the separation of powers and endanger the role of the judiciary. Netanyahu and his allies argue that the judiciary had become politicized and engaged in judicial activism.

Thousands of people in Israel took to the streets during a visit last week by US Defense Secretary Lloyd Austin.

Protesters blocked roads to the Ben Gurion international airport and major intersections in a number of cities. Netanyahu was forced to hold talks with Austin near the airport.
Israel says Iranian threat to be focus of Berlin talks

Protests are also expected in Berlin on Thursday, when the Israeli prime minister is scheduled to meet with Chancellor Olaf Scholz and President Frank-Walter Steinmeier.

The Israeli prime minister's office said that Netanyahu and Scholz "are expected to discuss various diplomatic and security issues, especially Iran and developments in the region."

It added that Netanyahu would "emphasize the need to prevent Iran from obtaining nuclear weapons."

Netanyahu's visit is due to be accompanied by a large-scale police operation. More than 3,000 officers had been set for deployment from Wednesday to Friday morning, a German police trade union had said, still commenting on Netanyahu's original travel plans.

German authorities have set the highest security level for the stay, with road closures and cordons planned.

Netanyahu has recently visited Rome and is planning a trip to London. The Israeli head of government is seeking to establish a firm stance in the West against the Iranian nuclear program among allies.

Netanyahu and his allies seek to push through with reforms targeting the country's judicial system

 Ohad Zwigenberg/AP Photo/picture alliance

sdi/rc, msh (dpa, Reuters)

Under fire over legal reforms, Netanyahu to face critics in Berlin

Ahead of Netanyahu's departure, critics took their protests to Ben Gurion airport

Issued on: 15/03/2023 - 

Berlin (AFP) – Israeli Prime Minister Benjamin Netanyahu, under heavy fire at home over planned legal reforms, was due to arrive Wednesday in Berlin where Germany's leaders will also urge him to reconsider the overhauls.

The German government is under pressure for hosting Netanyahu at a time of the disputed reforms, with critics urging Berlin to scrap the visit.

Speaking in Tallinn on Wednesday, German President Frank-Walter Steinmeier said he planned to raise the reforms with Netanyahu when they meet on Thursday.

Israel is the "only democracy in the whole region, a country with a strong constitutional state", he said.

"What I would like to see is that what we have admired about Israel... is preserved."

Netanyahu's government, which includes ultra-Orthodox and extreme-right parties, introduced its judicial reform package in January.

The changes would allow lawmakers to override Supreme Court decisions that strike down legislation with a parliamentary majority, and then deny the court the right to review such a move.

It would also make it harder for the Supreme Court to strike down legislation it deems to contravene Basic Laws, Israel's quasi constitution.

Netanyahu's government has argued the reforms are needed to limit judicial overreach, but protesters have decried them as threatening Israel's liberal democracy by weakening key checks and balances.

Ten consecutive weeks of nationwide demonstrations have followed, with critics also charging that the proposed changes aim to protect Netanyahu as he fights corruption charges in an ongoing court battle.

Ahead of Netanyahu's departure, critics took their protests to Ben Gurion airport.

"Dictator on the run" and "Don't come back", read placards held up by demonstrators near the airport, where a convoy of cars bearing Israeli flags circulated between the terminals, making them difficult to access, an AFP correspondent reported.

Netanyahu's flight was delayed by hours as he held talks with his coalition partners while President Isaac Herzog prepared to announce his compromise outline.

Herzog, who holds a largely ceremonial role, has for weeks been toiling over a proposal to soften the government's legal overhaul.
'Worst possible time'

The controversy in Israel puts Germany in an uncomfortable position.

Germany and Israel forged strong diplomatic ties in the decades after World War II, with Berlin committed to the preservation of the Jewish state in penance for the Holocaust.

Successive German governments have described Israel's national security as a crucial foreign policy priority.

On the eve of Netanyahu's departure for Germany and ahead of a planned trip to Britain, 1,000 writers, artists and academics wrote to the two nations' ambassadors urging their governments to scrap the visits, denouncing what they called his "dangerous and destructive leadership".

In Frankfurt, Meron Mendel, who heads the Anne Frank educational centre named for the teenage Holocaust victim, also said Berlin should have declined the visit.

"If an Israeli prime minister wants to get rid of common democratic values, then today is the worst time possible to invite him to Berlin," Mendel told public broadcaster Bayerischer Rundfunk.

Berlin should have clearly informed Netanyahu's office that it was not possible to receive him at this time, said the German-Israeli historian.

Chancellor Olaf Scholz's government must "finally realise" that "no business can be done with a far-right Israeli government", said Mendel, noting that the German-Israeli friendship is based on common values.

Some Israelis living in Berlin have also called for protests against the visit, including a demonstration at the Brandenburg Gate on Thursday.
'Normal guest'

Government spokesman Steffen Hebestreit on Monday said Netanyahu is the "elected prime minister of Israel and therefore also a normal guest in Germany".

Besides meeting Steinmeier, Netanyahu will hold separate talks with Scholz.

According to Netanyahu's office, the prime minister and Scholz "will discuss diplomatic and security issues, first and foremost the Iranian issue, as well as regional developments".

It said the Israeli leader would "stress the need to prevent Iran from obtaining nuclear arms".

The meeting with Scholz is the first in their current roles, "and an expression of the special relations between Israel and Germany, and of the cooperation in a range of fields", added Netanyahu's office.

© 2023 AFP

Iran-Saudi deal: China's growing clout in the Middle East

William Yang in Taipei

03/14/2023

March 14, 2023

DW

The recent Saudi-Iran deal is a major triumph for Chinese diplomacy, but Beijing may find the Middle East to be a tricky region to operate in, say experts.

After China successfully brokered a deal last week to restore relations between Iran and Saudi Arabia, Beijing appears set to take on a larger role in the Middle East and potentially challenge US dominance in the oil-rich region.

Under the agreement reached in the Chinese capital on Friday, Riyadh and Tehran agreed to reopen their embassies and exchange ambassadors after seven years of severed diplomatic ties and tensions.

The rivalry between Iran and Saudi Arabia, respectively the leading Shiite and Sunni Muslim powers in the Middle East, has dominated regional politics in recent years, affecting not only the two nations but also others with both sides backing rival camps in proxy wars from Yemen to Syria and elsewhere.

Beijing described the result as a "major outcome" achieved through "concerted efforts" by the three countries, emphasizing that China "pursues no selfish interest whatsoever in the Middle East."

"China has no intention to and will not seek to fill the so-called vacuum or put up exclusive blocs," Beijing said in a statement on Saturday, adding: "China will be a promoter of security and stability, partner for development and prosperity, and supporter of the Middle East's development through solidarity."
Tricky region for Chinese diplomacy

The deal is a major triumph for Chinese diplomacy, said Camille Lons, a research associate at the International Institute for Strategic Studies.

It also marks a shift in Beijing's strategy as "until now, it had refused to get entangled in regional disputes, and smartly benefited from the US-led security umbrella while doing business with the entire region," she noted.

"But by getting more involved in politics, China takes the risk of exposing its own limits."

Ian Chong, an expert on China's foreign policy at the National University of Singapore (NUS), shared a similar view.

He pointed out that Beijing may find the Middle East to be a tricky region to operate in.

"There are lots of complicated interests and tensions so how brokering this deal between Iran and Saudi Arabia will play out remains to be seen," he told DW.
A long presence in the Middle East

China has cultivated strong economic and political ties with both Riyadh and Tehran in recent years. Saudi Arabia is China's largest oil supplier, with trade between the two countries amounting to $87 billion (€81 billion) in 2021.

Commerce between Iran and China, meanwhile, was worth more than $16 billion in the same year, with Tehran depending on the Asian giant for as much as 30% of its foreign trade.

China has also pledged to invest $400 billion in Iran over 25 years.

Chinese President Xi Jinping traveled to Saudi Arabia in December for a state visit, and Iranian President Ebrahim Raisi visited Beijing in February.

Chong from NUS said that by facilitating this deal, Beijing is signaling that it is now not just a leading economic player but is also willing to get involved in politics in the Middle East, a region which is the primary source of China's energy imports.

Tuvia Gering, an expert on China-Middle East relations at the Diane and Guilford Glazer Center at the Institute for National Security Studies in Israel (INSS), said Beijing hopes to carve out a bigger role for itself because the region has become "strategically important" to it.

"It's not just for energy security, but on this wider gamut of areas," Gering told DW, pointing to Chinese investments in regional infrastructure as part of its massive multibillion-dollar Belt and Road Initiative.

The Saudi-Iran deal comes at a time when many countries in the region perceive the US as winding down its engagement there.

This doesn't mean Beijing could replace Washington in the Middle East, said Gering.

"China said it doesn't want to be dragged into regional conflicts, and I don't think that wish has changed even though recent developments may have given Beijing a bit more appetite to become more active," he underlined, adding that China still needs to gain the region's trust before it can become a reliable partner. "China is still a new actor and these things take a long time."

Is US influence waning?

The US, meanwhile, welcomed China's efforts to help end the war in Yemen and deescalate tensions in the Middle East, but rejected the notion that it was stepping back from the region.

It also stressed that the agreement was two years in the making.

"This is not about China. We support any effort to deescalate tensions in the region. We think that's in our interests, and it's something that we worked on through our own effective combination of deterrence and diplomacy," said White House national security spokesperson John Kirby.

John Calabrese, director of the Middle East-Asia Project at the Middle East Institute, said Beijing's role in brokering the deal doesn't fundamentally alter Washington's position.

In his view, Beijing's main goal in the region is still "maintaining its economic interests and expanding its economic equities."

"This requires regional stability to the extent that the US is still equipped to do so," he said, adding that de-escalation between Tehran and Riyadh is in the interest of the Middle East, China and the US.

And despite US-Saudi tensions over an array of issues — ranging from human rights violations to Riyadh's continued participation in a pandemic-era oil pact with Russia — Saudi Arabia remains one of Washington's staunchest security partners in the region.

Lons from IISS said the agreement shows that Gulf states like Saudi Arabia are willing to diversify their security and strategic partnerships so that they do not rely entirely on the US.

She described these countries' approach as "pragmatic" and warned against overestimating Beijing's importance to the region.

"When it comes to hard security guarantees, they are fully aware that the US remains their key partner."

Edited by: Srinivas Mazumdaru

Iran, Saudi Ink China-Brokered Deal to Restore Ties

By Nigar Bayramli March 14, 2023

 
 
 
 
 

Wang Yi, director of the Office of the Central Foreign Affairs Commission of China, Ali Shamkhani, the secretary of Iran’s Supreme National Security Council, and Minister of State and national security adviser of Saudi Arabia Musaad bin Mohammed Al Aiban pose for pictures during a meeting in Beijing, China March 10, 2023. / Reuters

  

Middle East regional rivals Saudi Arabia and Iran signed a China-brokered deal to restore diplomatic ties, seven years after relations were severed.

A joint statement was signed on March 10 between Ali Shamkhani, Secretary of Iran’s Supreme National Security Council (SNSC), Saudi National Security Adviser Musaid Al Aiban, and, China's senior diplomat Wang Yi, according to Iran's state broadcaster IRIB.

As per the joint statement reached by the three countries, Iran and Saudi Arabia have agreed to resume diplomatic relations within two months and reopen embassies and agencies in both countries, Iran’s news agency IRNA reported.

It added that both Riyadh and Tehran stressed "respect for sovereignty and non-interference in each other's internal affairs", in accordance with a previous security cooperation agreement signed in April 2001.

The statement concluded that "the three countries declare their decisive will to use all efforts to strengthen regional and international peace and security."

Diplomatic relations between the two countries were severed in 2016 after protesters stormed Saudi Arabian diplomatic missions in Iran in retaliation to the execution of Sheikh Nimr al-Nimr, a religious leader, in Saudi Arabia.

Iran supports the Lebanese Hezbollah group and Yemen's Houthi rebels, against whom Saudi Arabia has led a military campaign since March 2015.

Saudi Arabia had blamed Iran for a 2019 missile and drone assault on its oil plants, a charge Tehran denies. The two countries have also been locked in rivalry for decades, backing allies fighting proxy wars across the region.

Shamkhani said that the move followed Iranian President Ebrahim Raisi's visit to China in February, and his talks with Chinese President Xi Jinping. The discussions provided a platform for "new and very serious negotiations" between Iranian and Saudi delegations.

Referring to the agreement, Iranian Foreign Ministry Spokesman Nasser Kanani said during a press conference on March 13 that the two countries would reopen their embassies in Tehran and Riyadh "within a timeframe of not more than two months", along with consulates in the Iranian city of Mashhad and the Saudi port city of Jeddah.

Meanwhile, Saudi Foreign Minister Faisal bin Farhan told the Saudi daily Asharq al-Awsat that the China-brokered agreement does not mean all disagreements have been resolved, adding that the agreement indicated the mutual will of Saudi Arabia and Iran "to resolve differences through dialogue".

Iran's Foreign Minister Hossein Amir-Abdollahian said in a tweet on March 10 that the resumption of bilateral relations would "provide great capacities to the two countries, the region and the Islamic world".

"The neighbourhood policy, as the key axis of the thirteenth government's foreign policy, is strongly moving in the right direction, and the diplomatic apparatus is actively behind the preparation of more regional steps," the minister added.

US 'Imperial Anxieties' Mount Over China-Brokered Iran-Saudi Arabia Diplomatic Deal


One American intelligence expert urged the U.S. to maintain friendly relations with "barbarous, but long-standing allies" in the Middle East lest China fill the vacuum.


Wang Yi, China's top diplomat, stands between Ali Shamkhani, secretary of Iran's Supreme National Security Council, and Saudi Arabia's minister of state and national security adviser, Musaad bin Mohammed Al Aiban, on Friday in Beijing.
(Photo: Chinese Foreign Ministry)

BRETT WILKINS
Mar 11, 2023

While advocates of peace and a multipolar world order welcomed Friday's China-brokered agreement reestablishing diplomatic relations between Iran and Saudi Arabia, U.S. press, pundits, and politicians expressed what one observer called "imperial anxieties" over the deal and growing Chinese influence in a region dominated by the United States for decades.

The deal struck between the two countries—which are fighting a proxy war in Yemen—to normalize relations after seven years of severance was hailed by Wang Yi, China's top diplomat, as "a victory of dialogue and peace."

The three nations said in a joint statement that the agreement is an "affirmation of the respect for the sovereignty of states and non-interference in internal affairs."

"The U.S. encourages war while China pushes the opposite."

Iran and Saudi Arabia "also expressed their appreciation and gratitude to the leadership and government of the People's Republic of China for hosting and sponsoring the talks, and the efforts it placed towards its success," the statement said.

United Nations spokesperson Stéphane Dujarric thanked China for its role in the deal, asserting in a statement that "good neighborly relations between Iran and Saudi Arabia are essential for the stability of the Gulf region."



Amy Hawthorne, deputy director for research at the Project on Middle East Democracy, a Washington, D.C.-based nonprofit group, toldThe New York Times that "China's prestigious accomplishment vaults it into a new league diplomatically and outshines anything the U.S. has been able to achieve in the region since [President Joe] Biden came to office."

Yun Sun, director of the China program at the Stimson Center, a think tank in Washington, D.C., called the deal a sign of "a battle of narratives for the future of the international order."

CNN's Tamara Qiblawi called the agreement "the start of a new era, with China front and center."



Meanwhile, Ahmed Aboudouh, a nonresident fellow at the Atlantic Council, another D.C. think tank, wrote that "China just left the U.S. with a bloody nose in the Gulf."

At the Carnegie Endowment, yet another think tank located in the nation's capital, senior fellow Aaron David Miller tweeted that the deal "boosts Beijing and legitimizes Tehran. It's a middle finger to Biden and a practical calculation of Saudi interests"

Some observers compared U.S. and Chinese policies and actions in the Middle East.

"The U.S. is supporting one side and suppressing the other, while China is trying to make both parties move closer," Wu Xinbo, dean of international studies at Fudan University in Shanghai, told the Times. "It is a different diplomatic paradigm."

Murtaza Hussein, a reporter for The Intercept,tweeted that the fact that the agreement "was mediated by China as a trusted outside party shows shortcomings of belligerent U.S. approach to the region."




While cautiously welcoming the agreement, Biden administration officials expressed skepticism that Iran would live up to its end of the bargain.

"This is not a regime that typically does honor its word, so we hope that they do," White House National Security Council Strategic Coordinator John Kirby told reporters on Friday—apparently without any sense of irony over the fact that the United States unilaterally abrogated the Iran nuclear deal during the Trump administration.

Kirby added that the Biden administration would "like to see this war in Yemen end," but he did not acknowledge U.S. support for the Saudi-led intervention in a civil war that's directly or indirectly killed nearly 400,000 people since 2014, according to United Nations humanitarian officials.



U.S relations with Saudi Arabia have been strained during the tenure of President Joe Biden. While Biden—who once vowed to make the repressive kingdom a "pariah" over the gruesome murder of journalist Jamal Khashoggi—has been willing to tolerate Saudi human rights abuses and war crimes, the president has expressed anger and frustration over the monarchy's decision to reduce oil production amid soaring U.S. gasoline prices and Russia's invasion of Ukraine.

Nevertheless, the Biden administration is currently trying to broker a peace deal between Saudi Arabia and Israel following the Trump administration's mediation of the Abraham Accords, a series of diplomatic normalization agreements between Israel and erstwhile enemies the United Arab Emirates and Bahrain.

The United States, which played a key role in overthrowing Iran's progressive government in a 1953 coup, has not had diplomatic relations with Tehran since shortly after the current Islamist regime overthrew the U.S.-backed monarchy that ruled with a brutal hand for 25 years following the coup.

Jonathan Panikoff, director of the Scowcroft Middle East Security Initiative in the Middle East Programs for the Atlantic Council, urged the U.S. to maintain friendly relations with brutal dictatorships in the region in order to prevent Chinese hegemony there.

Panikoff wrote in an Atlantic Council analysis:

We may now be seeing the emergence of China's political role in the region and it should be a warning to U.S. policymakers: Leave the Middle East and abandon ties with sometimes frustrating, even barbarous, but long-standing allies, and you'll simply be leaving a vacuum for China to fill. And make no mistake, a China-dominated Middle East would fundamentally undermine U.S. commercial, energy, and national security.

Other observers also worried about China's rising power in the Middle East and beyond.



New York Times China correspondent David Pierson wrote Saturday that China's role in the Iran-Saudi Arabia rapprochement shows Chinese President Xi Jinping's "ambition of offering an alternative to a U.S.-led world order."

According to Pierson:

The vision Mr. Xi has laid out is one that wrests power from Washington in favor of multilateralism and so-called noninterference, a word that China uses to argue that nations should not meddle in each other's internal affairs, by criticizing human rights abuses, for example.

The Saudi-Iran agreement reflects this vision. China's engagement in the region has for years been rooted in delivering mutual economic benefits and shunning Western ideals of liberalism that have complicated Washington’s ability to expand its presence in the Gulf.

Pierson noted Xi's Global Security Initiative, which seeks to promote "peaceful coexistence" in a multipolar world that eschews "unilateralism, bloc confrontation, and hegemonism" like U.S. invasions and the North Atlantic Treaty Organization.


"Some analysts say the initiative is essentially a bid to advance Chinese interests by displacing Washington as the world's policeman," wrote Pierson. "The plan calls for respect of countries' 'indivisible security,' a Soviet term used to argue against U.S.-led alliances on China's periphery."

The U.S. has attacked, invaded, or occupied more than 20 countries since 1950. During that same period, China has invaded two countries—India and Vietnam.

"The Chinese, who for years played only a secondary role in the region, have suddenly transformed themselves into the new power player."

New York Times chief White House correspondent Peter Baker also published an article Saturday about how the "China-brokered deal upends Mideast diplomacy and challenges [the] U.S."

"The Americans, who have been the central actors in the Middle East for the past three-quarters of a century, almost always the ones in the room where it happened, now find themselves on the sidelines during a moment of significant change," fretted Baker. "The Chinese, who for years played only a secondary role in the region, have suddenly transformed themselves into the new power player."

Some experts asserted that more peace in the Middle East would be a good thing, no matter who brokers it.



"While many in Washington will view China's emerging role as mediator in the Middle East as a threat, the reality is that a more stable Middle East where the Iranians and Saudis aren't at each other's throats also benefits the United States," tweeted Trita Parsi, executive vice president of the Washington, D.C.-based Quincy Institute for Responsible Statecraft.

"Unfortunately, the U.S. has adopted an approach to the region that has disabled it from becoming a credible mediator," he lamented. "Too often, Washington takes sides in conflicts and becomes a co-belligerent—as in Yemen—which then reduces its ability to play the role of peacemaker."

"Washington should avoid a scenario where regional players view America as an entrenched warmaker and China as a flexible peacemaker," Parsi cautioned.


China-aided deal challenges US

Saudi pact leaves America on sidelines

China’s Wang Yi (centre) with Iran’s Ali Shamkhani (right) and Saudi Arabia’s Musaad bin Mohammed Al Aiban in Beijing on Friday

Peter Baker | Washington | Published 12.03.23

Finally, there is a peace deal of sorts in West Asia. Not between Israel and the Arabs, but between Saudi Arabia and Iran, which have been at each other’s throats for decades. And brokered not by the US but by China.

This is among the topsiest and turviest of developments anyone could have imagined, a shift that left heads spinning in capitals around the globe. Alliances and rivalries that have governed diplomacy for generations have, for the moment at least, been upended.
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The Americans, who have been the central actors in West Asia for the past three-quarters of a century, almost always the ones in the room where it happened, now find themselves on the sidelines during a moment of significant change.

The Chinese, who for years played only a secondary role in the region, has suddenly transformed themselves into the new power player. And the Israelis, who have been courting the Saudis against their mutual adversaries in Tehran, now wonder where it leaves them.

“There is no way around it — this is a big deal,” said Amy Hawthorne, deputy director for research at the Project on West Asia Democracy, a nonprofit group in Washington.

“Yes, the US could not have brokered such a deal right now with Iran specifically, since we have no relations. But in a larger sense, China’s prestigious accomplishment vaults it into a new league diplomatically and outshines anything the US has been able to achieve in the region since Biden came to office.”

President Joe Biden’s White House has publicly welcomed the re-establishment of diplomatic relations between Saudi Arabia and Iran and expressed no overt concern about Beijing’s part in bringing the two back together.

Privately, Biden’s aides suggested too much was being made of the breakthrough, scoffing at suggestions that it indicated any erosion in American influence in the region. And it remained unclear, independent analysts said, how far the rapprochement between Saudi Arabia and Iran would actually go.

After decades of sometimes violent competition for leadership in West Asia and the broader Islamic world, the decision to reopen embassies that were closed in 2016 represents only a first step.

It does not mean that the Sunnis of Riyadh and the Shias of Tehran have put aside all of their deep and visceral differences.

Indeed, it is conceivable that this new agreement to exchange ambassadors may not even be carried out in the end, given that it was put on a cautious two-month timetable to work out details.

The key to the agreement, according to what the Saudis told the Americans, was a commitment by Iran to stop further attacks on Saudi Arabia and curtail support for militant groups that have targeted the kingdom.

Iran and Saudi Arabia have effectively fought a devastating proxy war in Yemen, where Houthi rebels aligned with Tehran battled Saudi forces for eight years.

A truce negotiated with the support of the United Nations and the Biden administration last year largely halted hostilities.

New York Times News Service

From: Inside Story

What are the implications of the Saudi-Iranian diplomatic deal?

China brokers agreement between two adversaries to restore diplomatic relations.

Iran and Saudi Arabia have agreed to restore diplomatic relations following talks between the two regional rivals in China.

Entrenched on different sides on a host of issues, and in proxy wars – notably in Yemen, Syria and Lebanon – few would have believed even days ago that a rapprochement between the two was about to happen 

The United States was not involved in the deal in a region where it would see itself as the dominant power.

China brokered the Saudi-Iran negotiations – with the announcement of the successful outcome made in Beijing.

What are the implications of this agreement – in the region and beyond?

Presenter: Adrian Finighan

Guests: 

Foad Izadi – Associate professor at the University of Tehran

Hillary Mann Leverett – CEO at political risk consultancy Stratega in McLean, Virginia

Ibrahim Fraihat – Conflict resolution specialist, associate professor, Doha Institute, and author of, Iran and Saudi Arabia: Taming a Chaotic Conflict

Farmers set to shake up Dutch political landscape


The outcome of a provincial election in the Netherlands could end Prime Minister Mark Rutte's environmental protection plans.



Opinion polls suggest a party started by disgruntled farmers could get significant support in Wednesday's provincial elections in The Netherlands.

That is bad news for Prime Minister Mark Rutte as provincial elections also determine the make-up of the Senate.

What might we expect from voters?

The polls show the BBB or BoerBurgerBeweging (Farmer-Civilian Movement) could win more seats in parliament's upper house than Rutte's conservative VVD party.

It will be a severe setback for Rutte's governing coalition, which has not had a Senate majority since the previous provincial elections in 2019 and must negotiate deals with left-wing opponents.

The BBB could ally with other parties in the Senate to challenge Rutte's plans to cut nitrogen emission levels.

Why the farmers oppose the plans

The Dutch prime minister has committed to halving the Netherlands' nitrogen emissions by 2030.

To do that that his government announced plans to reduce livestock numbers by a third and possibly the "expropriation" of farms. Farmers say the still unfinalized proposals are unfairly targeting them compared to sectors such as industry and transport.

"We don't really feel heard," Erik Stegink, national president of the BBB said. "Sometimes we don't even feel welcome in our own country anymore."

It is the issue that prompted the party's formation in 2019. The BBB won a single Dutch House of Representatives seat in 2021, but its popularity has since surged partly to Rutte's environmental policies.

More than 10,000 Dutch farmers protested in The Hague on Saturday against the government's plans.

Rutte, who has been in power since 2010, says he has "hope" his governing coalition could solve problems, including the farm plans.

lo/rc (AFP, AP, dpa)

Protesters rally across France as Macron's pension overhaul nears finale

Protesters marched across France on Wednesday in a last-ditch effort to convince lawmakers not to back President Emmanuel Macron's pensions reform bill that would raise the retirement age by two years to 64. The protests have drawn millions of people since mid-January and walkouts have disrupted transport and energy sectors and left garbage piling up in the streets of Paris. FRANCE 24's Liza Kaminov reports from Paris.

'Unions at top level very united': French protesters very active in 'physical' & 'digital' street

Opponents of French President Emmanuel Macron’s pension plan are staging an eighth round of strikes and protests Wednesday as a joint committee of senators and lower-house lawmakers examines the contested bill. For more on the on-going protests to pressure Macron to scrap his controversial pension reform, FRANCE 24 is joined by Jean-Christophe Gallien, French political analyst.

Political tensions, new protests over French pension bill

By SYLVIE CORBET

TODAY

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People demonstrate in Bayonne, southwestern France, Wednesday, March 15, 2023. Opponents of French President Emmanuel Macron's pension plan are staging a new round of strikes and protests as a joint committee of senators and lower-house lawmakers examines the contested bill.

 (AP Photo/Bob Edme)

PARIS (AP) — Opponents of French President Emmanuel Macron’s pension plan are staging an eighth round of strikes and protests Wednesday as a joint committee of senators and lower-house lawmakers examines the contested bill.

The latest step in the legislative process to raise the retirement age from 62 to 64 is prompting a peak of political tensions and one key question: Will the bill command a parliamentary majority?

Meanwhile, unions are hoping the 200 demonstrations taking place across the country will further show workers’ massive opposition to the plan, promoted by Macron as central to his vision for making the French economy more competitive.

The strikes in France are part of widespread unrest in Western Europe about the economic situation. In Britain on Wednesday, teachers, junior doctors and public transport staff were among those striking to back their demands for higher wages to match rising prices.

Wednesday’s meeting of seven French senators and seven lawmakers from the National Assembly is meant to find an accord on the final version of the text. The Senate is expected to approve it on Thursday, as its conservative majority is in favour of raising the retirement age.

The situation at the National Assembly is much more complicated, however.

Macron’s centrist alliance lost its majority in legislative elections last year, forcing the government to count on conservatives’ votes to pass the bill. Leftists and far-right lawmakers are strongly opposed to the measure.

The head of the conservative Republicans, Eric Ciotti, who himself has a seat at the National Assembly, said in the Journal du Dimanche newspaper that “the highest interest of the nation ... commands us to vote for the reform.”

But conservative lawmakers are divided and some are planning to vote against or abstain, making the outcome in the lower house hard to predict.

With no guarantee of a majority, Macron’s government is facing a dilemma: A vote Thursday afternoon in the National Assembly would give more legitimacy to the bill, if adopted, but there’s a risk it would be rejected.

Another option would be to use a special constitutional power to force the bill through parliament without a vote. But such an unpopular move would prompt immediate criticism from the political opposition and unions about the lack of democratic debate.

French government spokesperson Olivier Véran said Wednesday that the government wants the joint committee, dominated by supporters of the reform, to find an accord to “financially balance and strengthen our pension system.”

The bill will continue its way through the legislative process, respecting “all the rules that are provided by our Constitution,” he said.

Véran spoke after a weekly Cabinet meeting during which the government did not discuss whether to use its special constitutional power.

Republicans party lawmaker Aurelien Pradié — who opposes the reforms — said Wednesday that if this special power were used he would lodge it with the constitutional council, a higher French legal body, to challenge the democratic legitimacy of the move.

Train drivers, school teachers, dock workers and others are expected to walk off the job Wednesday. Thousands of tons of garbage is piling up on the sidewalks of Paris and other French cities amid a continuing strike against the pension plan.

In Paris, garbage collectors and sanitation agents announced that they will continue the strike until at least March 20.

Interior Minister Gerald Darmanin asked Paris city hall to force some of the garbage workers to return to work, calling it a public health issue.

The Paris mayor, Socialist Anne Hidalgo, said she supports the strike. Government spokesperson Véran warned that if she doesn’t comply, the Interior Ministry is ready to act instead.

Public transport was disrupted in many cities. About 40% of high-speed trains and half regional trains have been canceled. The Paris metro was slightly disrupted. France’s aviation authority, the DGAC, said 20% of the flights at Paris-Orly airport have been canceled, and warned about potential delays.

Protesters gathered at several areas including sites for the 2024 Olympics.

Workers in several oil refineries are also among those pursuing an open-ended strike launched last week.

UK: Strike expands from doctors to include other workers

Teachers, train drivers and civil servants joined the UK's doctors on the picket line. Hundreds of thousands of workers have walked off the job.


https://p.dw.com/p/4Oje2

Following the unveiling of the UK Finance Minister Jeremy Hunt's budget on Wednesday, teachers, London Tube drivers and civil servants in their hundreds of thousands joined striking doctors.

Inflation has hit workers across all sectors, including white collar workers. UK university employees and journalists at the BBC also joined in the multisector walkout.The ASLEF (Associated Society of Locomotive Engineers and Firemen) and Rail, Maritime and Transport (RMT) trade unions in the capital London left the Underground system paralyzed. The 130,000 civil servants from various government departments along with the country's Border Force.

Near No. 10 Downing Street, workers chanted outside Prime Minister Rishi Sunak's office, "What do we want?, 10 percent, when do we want it? Now!"
What are workers in the UK concerned about?

Labor unions representing public sector workers have been at loggerheads with the government seeking pay increases they say are needed to allow for inflation. The government, meanwhile, says that they are unaffordable and will further fuel inflation.

The world's sixth-largest economy has faced a turbulent few years amid the shocks government austerity, Brexit, COVID-19 and double-digit inflation amid Russia's invasion of Ukraine.

In addition to salaries not keeping up with inflation, workers mention conditions, job security and pensions as top among their concerns.

The British Medical Association said junior doctors had effectively taken a 26% pay cut since 2009.

Hunt, whose formal title is Chancellor of the Exchequer, became minister last year in the wake of former Prime Minister Liz Truss's mini-budget that proved politically disastrous and leaned heavily on unfunded plans for tax cuts. Prime Minister Rishi Sunak, himself a former chancellor, then kept Hunt in the role.

Increasing industrial action across much of public sector

The General Secretary of the civil servants' PCS trade union, Mark Serwotka, said that it was scandalous that some government workers were themselves forced to accept government benefits because of their low salaries.

The cascade of ever-more-severe strikes had also reached a tipping point, he added.

"I believe that for the first time in years, opinion polls show there's a lot of support for strikes," Serwotka told AFP.

The two-day teachers' strike is expected to affect every school in the UK.

More and more public sector workers have been downing tools more frequently in recent months in the UK, nurses went on strike for what their unions said was the first time in history earlier in the labor dispute.

ar/msh (AFP, Reuters)

Hundreds of thousands strike in UK over pay

Issued on: 15/03/2023 - 

Workers hit by the cost of living crisis have been striking across the economy from nurses to lawyers © Daniel LEAL / AFP

London (AFP) – Teachers, London Underground train drivers and civil servants joined striking doctors Wednesday in a mass stoppage as Britain's finance minister unveiled his tax and spending plans.

With hundreds of thousands of walking out, it was expected to be the biggest single day of industrial action since a wave of unrest began last year.

From nurses to lawyers, workers hit by a cost-of-living crisis have been striking across the economy, pitting unions against the government which insists big pay hikes are unaffordable and will only fuel inflation.

Alongside salaries, which workers say have not kept up with inflation, other issues include conditions, job security and pensions.

Other groups walking out Wednesday included UK university staff and BBC journalists in England.

The strike by train staff in the Aslef and Rail, Maritime and Transport (RMT) unions in London left the entire Underground train network at a standstill.

Government departments and the Border Force were also hit by a walk-out of an estimated 130,000 members of the PCS civil servants' union.

PCS General Secretary Mark Serwotka said it was a scandal that some of those administering government services were now so poorly paid they were forced to rely on handouts themselves.

The spiralling strikes could no longer be ignored, he added.

"Doctors are on strike in our hospitals, train drivers are on strike. Teachers are on strike. I believe that for the first time in years, opinion polls show there's a lot of support for strikes," he told AFP.
'10 percent, Now!'

As Hunt delivered his budget plan to parliament, hundreds of striking civil servants marched near Prime Minister Rishi Sunak's Downing Street office chanting "What do we want?, 10 percent, when do we want it? Now!"

Civil Service project manager Ben Millis, 25, said the country was witnessing an "amazing wave of activism".

"Prices of everything have increased so much, and it's the longest pay freeze... since pretty much pay records began," he told AFP as marchers blew whistles and banged drums.

"I think people are really starting to feel that something has to change and we need to get organised," he said.

The latest stoppage by teachers -- a two-day strike starting Wednesday -- was expected to affect every school in England.

Emmanuel Adebayo, 36, who teaches at an east London primary, said he had always dreamed of being a teacher.

But he said conditions were currently "really poor" and often it was children with special needs and other vulnerable pupils who suffered as a result.

"I have considered leaving teaching but I love my job. That's why I'm here today, to make sure that things are better for other teachers to come," he said at a huge gathering of striking teachers in central London.

National Education Union leaders Mary Bousted and Kevin Courtney earlier threatened to step up their action if the government failed to put "money on the table".

"If they don't our action will escalate," they said in a joint statement.

"Shamefully, ministers don't seem interested in giving their own employees a fair pay rise to help them through the cost-of-living crisis and beyond."

UK hospital doctors in England on Monday launched a three-day stoppage claiming some were paid less than coffee shop workers.

The British Medical Association which represents junior doctors says they have suffered the equivalent of a 26 percent cut to their pay since 2008-09.

© 2023 AFP

Why the British are suddenly so strike-happy

Double-digit inflation has spurred a wave of strikes across the UK not seen for 40 years. While French and German workers want to maintain standards, British workers are trying to get back what they've lost.



Nik Martin

DW
https://p.dw.com/p/4OaNq

Around 40,000 junior doctors in the United Kingdom began a three-day walkout on Monday that is expected to be even more disruptive to the country's health care system than recent industrial action by nurses and ambulance staff.

A wave of strikes has disrupted life in Britain as workers react to decades-high inflation that reached 11.1% in October 2022.

In recent months, public transport staff, teachers, postal workers and border staff have all walked off the job to demand higher pay and better working conditions.

Until a short while ago, many Britons would sneer at French or German workers, believing that their continental counterparts were "always on strike," and that such walkouts were bad for business.

But as the UK emerged from the COVID-19 pandemic and the impact of Brexit began to kick in, the country's economic malaise was plain to see.
Britain's chances hamstrung by neglect

Years of austerity following the 2008 financial crisis weakened public services to the point that they are now often struggling to provide basic levels of support. The National Health Service (NHS) is buckling under the strain of an aging and increasingly unhealthy population, as well as a huge backlog of treatments that were delayed during the pandemic.

Striking workers complain of an obsession by successive Conservative governments with efficiencies that they say has led to years of underinvestment and left them with unreasonable workloads and falling real incomes. Worst still, the full economic effects of Brexit have yet to be felt.

"Over the last 12 years, Britain has experienced the longest phase of real wage stagnation since the early 19th century," Scott Lavery, a lecturer in politics at the University of Sheffield, told DW. "Since the financial crisis, we've seen sustained real wage decline."

Real incomes — after accounting for inflation — have fallen 5.1% since December 2007, according to UK government figures. This coupled with the inflation crisis, which Lavery said was "eroding living standards dramatically," has left British workers struggling to stay afloat.

The cost of living crisis has also hit UK small businesses hardImage: David Cliff/NurPhoto/picture alliance

British struggle to play catch-up

French workers have also hit the streets recently over soaring inflation. But their main priority is to oppose planned reforms to the country's generous pension system that allows retirement at 62. German unions, meanwhile, have succeeded in negotiating several inflation-busting pay deals, including one with Deutsche Post last weekend that favors the lower paid and even includes trainees.

"In France, there is a sense of defending an existing standard of living, while in the UK, people feel that whatever used to exist has gone," Sam Moorecroft, vice president of the Trades Union Council in the city of Sheffield, told DW.

Moorecroft believes the seeds of today's misery were sown in 1979 when Margaret Thatcher took office as prime minister and proceeded to crush the trade union movement. She blamed generous pro-union laws introduced by the then-socialist Labour Party for allowing widespread strike action to bring the country to its knees.

"When Thatcher defeated the miners in the 1980s, many believed that the trade union movement had been completely defeated. But now, there is a move to return to the same level of union participation as the past," Moorecroft added.

That ambition is yet to be seen in the statistics. Union membership peaked in 1979 and by 2021 had more than halved to 23.1% of the workforce or 6.44 million people. Union members tend to be over 35 and almost half have been working for the same company for a decade or more, but that is changing.

Can young people restore the balance?

Unions are reaching out to younger workers, who are more likely to be on the minimum wage, and a third of whom are on zero-hours contracts. The Trades Union Congress (TUC) calculated recently that nearly 90% of those under 30 on low to median incomes in Britain work in the private sector, which is mostly non-unionized.

The Low Pay Commission, which advises the UK government, found last month that many UK employers were failing to incorporate annual hikes to the national minimum wage — a phenomenon known as wage theft. Before the pandemic, around 22% of minimum wage earners were underpaid, but by April 2022, that figure had grown to almost a third.

Moorecroft noted how non-unionized workplaces are increasingly mobilizing for better pay and conditions, citing a recent strike at Amazon's largest UK fulfillment center, in Coventry. Around 300 workers at the 1,400-strong warehouse walked out several times over the past two months over low wages and grueling round-the-clock shift patterns.

While the US tech firm's French and German workers have previously staged several strikes, particularly around the Black Friday sales, Amazon has so far refused to recognize Britain's GMB union, which fights for the rights of the firm's employees in the UK.

 

In December, the Royal College of Nursing called its members on strike for the first time everImage: Maja Smiejkowska/REUTERS

Strikes garner more public backing

Public support for walkouts in the UK has always been mixed as memories of the Winter of Discontent linger. During the coldest months of 1978-9, the country was brought to a standstill by large-scale private and public sector strikes that caused food shortages, weeks of uncollected garbage and, in one city, the dead to lie unburied.

This time, however, with public services already defective, the cost of living crisis hitting everyone's pockets and living standards lower than a decade ago, the public's backing for strikes is noticeably higher.

A poll by Sky News in January found that 63% of Britons strongly support or somewhat support walkouts by health care workers, with 49% backing wider public sector action.

"There is certainly a sense that those core public sector workers that kept the economy running during the pandemic have strong public support ... particularly nurses, despite their strikes having potentially life-or-death consequences," Lavery said.
Sunak's government under pressure

Recent signs of progress toward ending the wage disputes are encouraging, despite the government having argued that inflation-busting pay increases would drive prices higher. Nurses, midwives and ambulance staff last week called off their planned strikes as negotiations looked positive.

Britain is, however, unlikely to pivot to a more European labor market structure. After all, the country's decision to leave the EU was sometimes referred to as an opportunity to create a low-tax Singapore-on-Thames. The country's heavy indebtedness last year forced a 70-year-high tax burden on workers, which put that possibility on hold for now.

Prime Minister Rishi Sunak proposed new legislation in January that would enforce "minimum service levels" in key areas of the public sector, including education and health care, which would hamper strikes.

"[This] would effectively debar some workers from taking legal industrial action," Lavery told DW. "The UK already has some of the most restrictive anti-union legislation in the Western world and Sunak is trying to tighten up further ... so he's far from being a peacemaker."

Edited by: Ashutosh Pandey