Europe
EU leaders avoid deep rift on gas price cap at energy summit
European Union leaders struggled to find immediate practical solutions on how to deal with the energy crisis but avoided an open rift between Germany and France on Friday that would have exposed a divided bloc as it confronts Russian President Vladimir Putin over his war in Ukraine.
After daylong talks in Brussels dragged well into the night, the 27 EU leaders papered over divisions between some of the biggest member states and at least agreed to continue working on ways to impose a gas price cap in case of big price increases.
French President Emmanuel Macron highlighted his work with German Chancellor Olaf Scholz to create a veneer of unity after talks that started early Thursday. He said that together with close technical advisers, “I will see Chancellor Scholz in Paris next week so that we can move forward, with our teams, on all the issues.”
Scholz said the main issue was curbing “spikes” in gas trading that may last only a few hours but still send prices excessively upward. He said measures to counter that should be further examined.
“How can we avoid these spikes? There is still a lot of concrete work to be done. But we must look at ways to contain it, which certainly makes sense,” Scholz said.
When the axis between Paris and Berlin is aligned, usually the rest of the EU follows.
“There is a strong and unanimously shared determination to act together, as Europeans, to achieve three goals: lowering prices, ensuring security of supply and continuing to work to reduce demand," said summit host Charles Michel, the EU Council president.
Diplomats said the execution of the proposals, including the possibility of a price cap, should be first properly assessed by energy ministers next Tuesday and might even need a new summit of leaders in the coming weeks.
“There is a lot of work ahead," said Belgian Prime Minister Alexander De Croo. “We are pushing ourselves into unchartered territory, where we don’t have experience yet."
To make sure the runaway cost of gas doesn’t further tank struggling EU economies, the Commission has proposed a system to pool buying of gas and offered a compromise that would allow for a correction mechanism to kick in in exceptional circumstances.
Countries like the Netherlands and Germany were loathe to start such market intervention, but agreed to study a system that would be failproof and not allow suppliers to stop delivering and go to more lucrative markets.
“It is incredibly complex but you see that everyone wants to get the gas prize further down, but in a way that we continue to get gas deliveries and that it doesn't move to Asia or Latin America. We need it here, too,” said Dutch Prime Minister Mark Rutte.
In addition, the leaders are also pushing for the creation of a new LNG gas index better reflecting the market following the drastic reduction of imports of pipeline gas from Russia.
Divisions were so big at the start of the summit that agreeing on further exploration of the plan proposed by the Commission was seen as almost an achievement in itself.
Hungarian Prime Minister Viktor Orban said a price cap would send suppliers away. The “gas price cap is like going to a bar and telling the bartender you want to pay half price for your beer. Not going to happen,” he said on Twitter.
The traditional driving duo of the EU — Germany and France — were in opposing camps, with Germany expressing doubts and holding off plans for the price cap, while most others want to push on.
Scholz said any dispute was on the method, not the goal. “Prices for gas, for oil, for coal, must sink; electricity prices must sink, and this is something that calls for a joint effort by all of us in Europe,” he said.
Natural gas prices spiraled out of control over the summer as EU nations sought to outbid one another to fill up their reserves for winter. The member states have already agreed to cut demand for gas by 15% over the winter. They have also committed to filling gas-storage facilities to at least 80% of capacity by November and — as a way of reducing gas-fired power generation — to reducing peak demand for electricity by at least 5%.
The question of possible EU gas-price caps has moved steadily up the political agenda for months as the energy squeeze tightened, with 15 countries such as France and Italy pushing for such blunt intervention.
At the opening of the summit, the need for rock-solid EU unity in confronting Russia was highlighted by Ukrainian President Volodymyr Zelenskyy, who addressed the 27 national leaders by video conference from Kyiv, asking for continued help to get his nation through the winter.
Russia is increasingly relying on drone strikes against Ukraine’s energy grid and civilian infrastructure and sowing panic with hits on Ukrainian cities, tactics that European Commission President Ursula von der Leyen called “war crimes” and “pure terror” on Wednesday.
Diplomats are already assessing more sanctions to come. But Orban’s perceived friendliness toward the Kremlin makes life tougher. Even though the previous EU sanctions targeting Russia have been approved unanimously, it has increasingly become difficult to keep Orban on board by agreeing to exemptions.
3 years ago
Iranian troops in Crimea supporting Russian drone attacks, says US
The White House said Thursday the U.S. has evidence that Iranian troops are “directly engaged on the ground” in Crimea supporting Russian drone attacks on Ukraine’s infrastructure and civilian population.
National Security Council spokesman John Kirby told reporters that Iran has sent a “relatively small number” of personnel to Crimea, a part of Ukraine unilaterally annexed by Russia in contravention of international law in 2014, to assist Russian troops in launching Iranian-made drones against Ukraine.
Members of a branch of the Iranian Revolutionary Guard Corps were dispatched to assist Russian forces on how to use the drones, according to a British government statement.
“The information we have is that the Iranians have put trainers and tech support in Crimea, but it’s the Russians who are doing the piloting,” Kirby said.
He added that the Biden administration was looking at imposing new sanctions on Tehran and would look for ways to make it harder for Tehran to sell such weapons to Russia.
The U.S. first revealed this summer that Russia was purchasing Iranian unmanned aerial vehicles to launch against Ukraine. Iran has denied selling its munitions to Russia.
U.S. officials believe that Iran may have deployed military personnel to assist the Russians in part because of the Russian’s lack of familiarity with the Iran-made drones. Declassified U.S. intelligence findings showed that Russians faced technical problems with the Iranian drones soon after taking delivery of the weapons in August.
“The systems themselves were suffering failures and not performing to the standards that apparently the customers expected,” Kirby said. “So the Iranians decided to move in some trainers and some technical support to help the Russians use them with with better lethality.”
Read: Ukraine’s Kyiv attacked with Iranian-made kamikaze drones
The Biden administration released further details about Iran’s involvement in assisting Russia’s war in Ukraine at a sensitive moment. The administration has levied new sanctions against Iran over the government’s brutal crackdown on antigovernment protest in recent weeks spurred by the death of 22-year-old Mahsa Amini, who died in Iranian security custody.
Morality police had detained Amini last month for not properly covering her hair with the Islamic headscarf, known as the hijab, which is mandatory for Iranian women. Amini collapsed at a police station and died three days later.
Her death and the subsequent unrest have come as the administration tries to bring Iran back into compliance with the nuclear deal that was brokered by the Obama administration and scrapped by the Trump administration.
But Kirby said that the administration has little hope for reviving the Iran nuclear deal soon.
“We’re not focused on the on the diplomacy at this point,” Kirby said. “What we are focused on is making sure that we’re holding the regime accountable for the way they’re treating peaceful protesters in their country and supporting those protesters.”
The White House spoke out about Iranian assistance to Russia as Britain on Thursday announced new sanctions on Iranian officials and businesses as the Russians use the drones to bombard civilian infrastructure.
“These cowardly drone strikes are an act of desperation,” British Foreign Secretary James Cleverly said in a statement. “By enabling these strikes, these individuals and a manufacturer have caused the people of Ukraine untold suffering. We will ensure that they are held to account for their actions.”
Among the individuals hit with asset freezes and travel bans by the British were Major General Mohammad Hossein Bagheri, chairman of the armed forces general staff overseeing the army branches supplying Russia with drones; Brigadier General Seyed Hojjatollah Qureishi, a key Iranian negotiator in the deal;. and Brigadier General Saeed Aghajani, the head the Iranian Revolutionary Guard Aerospace Force UAV Command.
Shahed Aviation Industries, the Iranian manufacturer of the drones being used by Russia, was also hit by an asset freeze.
3 years ago
Truss resignation: UK’s political, economic turmoil far from over
British Prime Minister Liz Truss quit Thursday after a tumultuous and historically brief term in which her economic policies roiled financial markets and a rebellion in her political party obliterated her authority.
Truss became the third Conservative prime minister to be toppled in as many years, extending the instability that has shaken Britain since it broke off from the European Union and leaving its leadership in limbo as the country faces a cost-of-living crisis and looming recession.
“I cannot deliver the mandate on which I was elected by the Conservative Party,” Truss acknowledged in a statement delivered outside her 10 Downing Street office.
Financial markets breathed a sigh of relief, but Truss leaves a divided party seeking a leader who can unify its warring factions. Truss, who said she will remain in office until a replacement is chosen, has been prime minister for just 45 days and will almost certainly become the shortest-serving leader in British history.
The ruling Conservative Party said it would choose a successor by the end of next week. Potential contenders include former Treasury chief Rishi Sunak, who lost to Truss in the last leadership contest, House of Commons leader Penny Mordaunt, Defense Secretary Ben Wallace — and Boris Johnson, the former prime minister ousted in July over a series of ethics scandals.
The low-tax, low-regulation economic policies that got Truss elected proved disastrous in the real world at a time of soaring inflation and weak growth.
Her Sept. 23 economic plan included a raft of tax cuts — paid for by government borrowing — that investors worried Britain couldn’t afford. That pummeled the value of the pound and drove up the cost of mortgages, causing economic pain for people and businesses already struggling from an economy yet to emerge from the pain of the pandemic.
That tumult resulted in the replacement of Truss’ Treasury chief, multiple policy U-turns and a breakdown of discipline in the governing Conservative Party.
Truss bowed out just a day after vowing to stay in power, saying she was “a fighter and not a quitter.” But she couldn’t hold on any longer after a senior minister quit her government with a barrage of criticism and a vote in the House of Commons descended into chaos and acrimony just days after she was forced to abandon many of her economic policies.
The pound rose about 1% Thursday to around $1.13 after Truss’ resignation.
But where the Conservative Party goes from here is not clear. Party chiefs hope lawmakers can rally around a unity candidate, but that seems unlikely in a party whose myriad factions — from hard-right Brexiteers to centrist “One Nation” Tories — are at each other’s throats.
“Nobody has a route plan. It’s all sort of hand-to-hand fighting on a day-to-day basis,” Conservative lawmaker Simon Hoare told the BBC on Thursday before Truss resigned.
Read: Pound rises against dollar as investors react to UK PM Truss' resignation
“It’s time for the prime minister to go,” Conservative lawmaker Miriam Cates said, echoing the sentiments of many others.
Newspapers that usually support the Conservatives were vitriolic. An editorial in the Daily Mail on Thursday was headlined: “The wheels have come off the Tory clown car.”
Her downfall was so rapid that the party was unable to spell out exactly how the selection of a new leader would unfold, and whether the party’s 172,000 members, or only its 357 lawmakers, would get a say. The new leader is due to be in place by Oct. 28.
Truss’ resignation is the culmination of months of simmering discontent inside the Conservative Party as its poll ratings with the public have plunged.
Johnson’s government was revealed to have held a series of parties in government buildings during period of coronavirus lockdown, when people in Britain were barred from mingling with friends and family or even visiting dying relatives.
The party spent the summer picking a replacement as the economy worsened amid spiking energy prices triggered by Russia’s invasion of Ukraine.
Against that backdrop, many people — including many Conservatives — felt Truss’ tax-cutting policies would do little to help ordinary people struggling to make ends meet.
Whoever succeeds Truss will become the country’s third prime minister this year. A national election doesn’t have to be held until 2024, but opposition parties demanded one be held now, saying the government lacks democratic legitimacy.
Opposition Labour Party leader Keir Starmer accused the Conservatives of presiding over “utter chaos.”
“This is doing huge damage to our economy and the reputation of our country,” he said. “We must have a chance at a fresh start. We need a general election – now.”
Truss’ political unraveling began after she and her Treasury chief, Kwasi Kwarteng, unveiled an economic plan with 45 billion pounds ($50 billion) in unfunded tax cuts. That hammered of the value of the pound and increased the cost of U.K. government borrowing. The Bank of England was forced to intervene to prevent the crisis from spreading to the wider economy and putting pension funds at risk.
Read: Temporary ban on tourism at Rowangchhari and Ruma to fight ‘militants and criminals’
Truss then fired Kwarteng, and his replacement, Hunt, scrapped almost all of Truss’ tax cuts, along with energy subsidies and her promise of no public spending cuts. He said the government will need to save billions of pounds and there are “many difficult decisions” to be made before he sets out a medium-term fiscal plan on Oct. 31.
Speaking to lawmakers for the first time since the U-turn, Truss apologized Wednesday and admitted she had made mistakes during her six weeks in office, but insisted that by changing course she had “taken responsibility and made the right decisions in the interest of the country’s economic stability.”
Still, Truss said she would not resign — a resolve that was short-lived. Within hours a senior Cabinet minister, Home Secretary Suella Braverman, quit, blasting Truss in her resignation letter, saying she had “concerns about the direction of this government.”
For many Conservative lawmakers, the final straw was a Wednesday evening vote over fracking for shale gas that produced chaotic scenes in Parliament, with party whips accused of using heavy-handed tactics to gain votes.
Chris Bryant, a lawmaker from the opposition Labour Party, said he “saw members being physically manhandled ... and being bullied.” Conservative officials denied this.
Truss’ departure on Thursday sparked jubilation for the tabloid Daily Star, which has set up a livestream featuring a photo of the prime minister beside a head of lettuce to see which would last longer.
“This lettuce outlasted Liz Truss!” it proclaimed Thursday.
While many Britons joined the world in laughing at the lettuce joke, Bronwyn Maddox, director of international affairs think-tank Chatham House, said “there is no question that the U.K.’s standing in the world has been severely battered by this episode and by the revolving door of prime ministers.”
She said Truss’ successor would need to have policies “based on economic stability, but need also to include a resolution of the relationship with Europe; much of the upheaval represents the bitter aftermath of Brexit.”
3 years ago
‘A cautionary tale’: World reacts to UK PM Truss’ resignation
The UK's economic and political turmoil over the past few weeks - culminating in nearly all of Liz Truss's original finance plans now being axed - has been watched around the world.
It is rare for close allies to comment on each other's key policies at home - and if they do, it's unlikely to be an outright criticism.
But at the weekend US President Joe Biden weighed in, saying Ms Truss's original plan was a "mistake" and it was "predictable" that she would have to backtrack.
"I wasn't the only one that thought it was a mistake," Mr Biden said. "I disagree with the policy, but that's up to Great Britain."
The EU's economy chief, meanwhile, said there were "lessons to learn" from what is happening in the UK.
"What happened shows how volatile is the situation and so how prudent we should be also with our fiscal and monetary mix," said Paolo Gentiloni on Friday after Ms Truss fired ex-Chancellor Kwasi Kwarteng.
The world's media has been far more brutal.
"Liz Truss, who's been the British PM for barely six weeks, has managed to drag her party and her country into a debacle the depth of which the country has never before sunk to. And less so at such speed," says an editorial in Colombian daily El Colombiano.
Its headline suggests what the PM might be known for: "Liz Truss the Brief?"
"Clinging to her ideology, far removed from the reality facing the country, Truss exemplifies to perfection what it means to go against common sense when steering the politics of a country."
Meanwhile, the UK is becoming a "cautionary tale" about the effect of "bad politics", said an editorial in Indian daily newspaper The Hindu on Monday.
The newspaper - a widely-read English-language paper and generally critical of right-leaning political parties - said Ms Truss was "once seen as a new hope for breathing life back" into the UK Conservative Party.
Read: Pound rises against dollar as investors react to UK PM Truss' resignation
But now she may have added the "label of 'incompetence' to the Tory governance image", it adds.
Russia's media speculates over Ms Truss's future, reporting that she might be out of her post soon.
"Embarrassment for Liz", said the state-owned daily Rossiyskaya Gazeta on Monday.
"Yet another political crisis is looming over Britain: the newly minted prime minister, Liz Truss, may be forced out of her Downing Street residence already in the coming days and weeks," it says.
"The Tory leader's unpopularity in party circles and in British society has long been known, but now the [prime] minister has come close to the end of her scandalous career."
China's state media also heaped on further criticism. "The outside world does not seem optimistic about the turnaround of the Truss government," said state-run news agency China News Service on Friday.
The Global Times said Truss's position remained unstable because of "continued negative reviews".
But some online media, including Shenniao Zhixun, a blog run in south-west China, noted that the new Chancellor Jeremy Hunt, nicknamed "son-in-law of China", had a Chinese wife and "a good attitude towards China".
For the Irish Independent, Truss bought herself some time by the change of chancellor.
But "once we start writing about a prime minister 'buying some time', or 'seeing off the immediate danger', they are nearing the end of their time," the opinion piece on Sunday adds.
3 years ago
Pound rises against dollar as investors react to UK PM Truss' resignation
The pound rose against the dollar and government borrowing costs dipped as investors reacted to Prime Minister Liz Truss's resignation.
Sterling jumped to $1.13 at one point before slipping back, but was still higher than at the start of Thursday, reported BBC.
One analyst said the reaction suggested investors were "relieved" by the news, despite a lot of uncertainty remaining.
Business groups said the new prime minister would have to act quickly to restore confidence.
Government borrowing costs rose sharply last month after the government promised huge tax cuts in its mini-budget without saying how it would pay for them.
But these costs fell back after the Bank of England stepped in with an emergency support programme, and after Jeremy Hunt reversed nearly all the mini-budget measures when he became chancellor.
Mr Hunt is due to announce plans for spending and tax on 31 October in his economic plan, which the Treasury confirmed was set to go ahead.
"Although the resignation of Liz Truss as Prime Minister leaves the UK without a leader when it faces huge economic, fiscal and financial market challenges, the markets appear to be relieved," said Paul Dales, chief UK economist at Capital Economics.
He added that her resignation was "a step that needed to happen for the UK government to move further along the path towards restoring credibility in the eyes of the financial markets".
"But more needs to be done and the new prime minister and their chancellor have a big task to navigate the economy through the cost of living crisis, cost of borrowing crisis and the cost of credibility crisis."
Read: British pound hits record low against dollar
Simon French, chief economist at Panmure Gordon, said the market reaction had been "fairly muted", with investors waiting for the "detail of what comes next".
Ms Truss said her successor would be elected in a Tory leadership contest, to be completed in the next week. Her resignation came after a key minister quit and Tory MPs rebelled in a chaotic parliamentary vote on Wednesday.
Mr French said the markets could rally "more aggressively" if a clear favourite emerged for PM. "The sooner you get there the more likely the person who has won will have the support to do the difficult stuff."
The head of the CBI business lobby group, Tony Danker, said: "The politics of recent weeks have undermined the confidence of people, businesses, markets and global investors in Britain.
"Stability is key. The next prime minister will need to act to restore confidence from day one.
"They will need to deliver a credible fiscal plan for the medium term as soon as possible, and a plan for the long-term growth of our economy."
The interest rate - or yield - on UK government bonds for borrowing over a 10-year period climbed above 4% at one point on Thursday morning, but then fell back steadily as speculation grew about Ms Truss's possible departure.
Following the PM's statement, the rate edged higher again to about 3.8%, but still remained below the level seen at the start of the day.
Ahead of the PM's resignation, Bill Blain of Shard Capital had told the BBC that the markets had been "watching in a kind of stunned, open-mouthed horror" at political events.
"The problem we've got is that the last couple of weeks has really destroyed the image of political competency and that's one of the key elements to make any economy work," he said.
3 years ago
Can’t deliver the mandate on which I was elected: Truss
The prime minister has been speaking outside Downing Street to announce her resignation.
Having spent just 45 days in office, Liz Truss announced she is stepping down with a Conservative Party leadership election to take place within the next week, reports BBC.
Read:British PM Liz Truss resigns after 44 days in office
Here is her speech in full:
"I came into office at a time of great economic and international instability.
"Families and businesses were worried about how to pay their bills.
"Putin's illegal war in Ukraine threatens the security of our whole continent and our country has been held back for too long by low economic growth.
"I was elected by the Conservative Party with a mandate to change this.
"We delivered on energy bills and on cutting National Insurance.
"And we set out a vision for a low tax high growth economy that would take advantage of the freedoms of Brexit.
"I recognise, though, given the situation I cannot deliver the mandate on which I was elected by the Conservative Party.
"I have therefore spoken to His Majesty The King to notify him that I am resigning as leader of the Conservative Party.
"This morning, I met the chairman of the 1922 committee, Sir Graham Brady.
Read: UK PM Truss’ waning power brings political plots, jokes
"We've agreed there will be a leadership election to be completed within the next week.
"This will ensure that we remain on a path to deliver our fiscal plans and maintain our country's economic stability and national security.
"I will remain as prime minister until a successor has been chosen.
"Thank you."
3 years ago
British PM Liz Truss resigns after 44 days in office
British Prime Minister Liz Truss resigned Thursday — bowing to the inevitable after a tumultuous six-week term in which her policies triggered turmoil in financial markets and a rebellion in her party obliterated her authority.
She said “I cannot deliver the mandate on which I was elected.”
Just a day earlier Truss had vowed to stay in power, saying she was “a fighter and not a quitter.” But Truss couldn't hold on any longer after a senior minister quit her government with a barrage of criticism and a vote in the House of Commons descended into chaos and acrimony just days after she was forced to abandon many of her economic policies.
Her departure leaves a divided Conservative Party seeking a leader who can unify its warring factions.
Read: UK PM Truss’ waning power brings political plots, jokes
A growing number of lawmakers had called for Truss to resign after weeks of turmoil sparked by her economic plan. The plan unveiled by the government last month triggered financial turmoil and a political crisis that has seen the replacement of Truss’ Treasury chief, multiple policy U-turns and a breakdown of discipline in the governing Conservative Party.
Earlier, Conservative lawmaker Simon Hoare said the government was in disarray.
“Nobody has a route plan. It’s all sort of hand-to-hand fighting on a day-to-day basis,” he told the BBC on Thursday. He said Truss had “about 12 hours” to turn the situation around.
Truss had held a hastily arranged meeting in her 10 Downing Street office with Graham Brady, a senior Conservative lawmaker who oversees leadership challenges. Brady was tasked with assessing whether the prime minister still has the support of Tory members of Parliament — and it seemed she did not.
A growing number of Conservative members of Parliament had called Thursday for her to step down and end the chaos.
“It’s time for the prime minister to go,” lawmaker Miriam Cates said. Another, Steve Double, said of Truss: “She isn’t up to the job, sadly." Legislator Ruth Edwards said “it is not responsible for the party to allow her to remain in power.”
Lawmakers' anger grew after a Wednesday evening vote over fracking for shale gas — a practice that Truss wants to resume despite opposition from many Conservatives — produced chaotic scenes in Parliament.
With Conservatives holding a large parliamentary majority, an opposition call for a fracking ban was easily defeated. But there were displays of anger in the House of Commons, with party whips accused of using heavy-handed tactics to gain votes.
Chris Bryant, a lawmaker from the opposition Labour Party, said he “saw members being physically manhandled ... and being bullied.” Conservative officials denied there was manhandling.
Rumors swirled that Conservative Chief Whip Wendy Morton, who is responsible for party discipline, and her deputy had resigned. Hours later, Truss’ office said both remained in their jobs.
Newspapers that usually support the Conservatives were vitriolic. An editorial in the Daily Mail was headlined: “The wheels have come off the Tory clown car.”
International Trade Secretary Anne-Marie Trevelyan, sent onto the airwaves Thursday morning to defend the government, insisted the administration was providing “stability.” But she was unable to guarantee Truss would lead the party into the next election.
“At the moment, I think that’s the case," she said.
Read: In six weeks, UK leader Liz Truss goes from triumph to trouble
With opinion polls giving the Labour Party a large and growing lead, many Conservatives now believe their only hope of avoiding electoral oblivion is to replace Truss. But they were divided about how to get rid of her, and over who should replace her.
The party is keen to avoid another divisive leadership contest like the race a few months ago that saw Truss defeat ex-Treasury chief Rishi Sunak. Among potential replacements — if only Conservative lawmakers can agree — are Sunak, House of Commons leader Penny Mordaunt and newly appointed Treasury chief Jeremy Hunt.
A national election doesn't have to be held until 2024.
In a major blow, Home Secretary Suella Braverman resigned Wednesday after breaching rules by sending an official document from her personal email account. She used her resignation letter to lambaste Truss, saying she had “concerns about the direction of this government.”
“The business of government relies upon people accepting responsibility for their mistakes,” she said in a thinly veiled dig at Truss.
Braverman was replaced as home secretary, the minister responsible for immigration and law and order, by former Cabinet minister Grant Shapps, a high-profile supporter of her defeated rival Sunak.
The dramatic developments came days after Truss fired her Treasury chief, Kwasi Kwarteng, on Friday after the economic package the pair unveiled Sept. 23 spooked financial markets and triggered an economic and political crisis.
The plan’s 45 billion pounds ($50 billion) in unfunded tax cuts sparked turmoil on financial markets, hammering the value of the pound and increasing the cost of U.K. government borrowing. The Bank of England was forced to intervene to prevent the crisis from spreading to the wider economy and putting pension funds at risk.
On Monday Kwarteng’s replacement, Hunt, scrapped almost all of Truss’ tax cuts, along with her flagship energy policy and her promise of no public spending cuts. He said the government will need to save billions of pounds and there are “many difficult decisions” to be made before he sets out a medium-term fiscal plan on Oct. 31.
Speaking to lawmakers for the first time since the U-turn, Truss apologized Wednesday and admitted she had made mistakes during her six weeks in office, but insisted that by changing course she had “taken responsibility and made the right decisions in the interest of the country’s economic stability.”
Opposition lawmakers shouted “Resign!” as she spoke in the House of Commons.
Labour Party leader Keir Starmer accused the Conservatives of lacking “the basic patriotic duty to keep the British people out of their own pathetic squabbles.”
He said that amid a worsening a cost-of-living crisis, “Britain cannot afford the chaos of the Conservatives anymore. We need a general election now.”
3 years ago
Putin doubles down on war with martial law
Russian President Vladimir Putin doubled down Wednesday on his faltering invasion by declaring martial law in four illegally annexed Ukrainian regions and setting the stage for draconian new restrictions and crackdowns throughout Russia. The drastic escalation appeared to be prompted by the threat of more stinging battlefield defeats, sabotage and troubles with his troop mobilization.
The order belies the Kremlin’s attempts to portray life in the annexed regions as returning to normal, with the latest example the removal of civilian leaders, the installation of a military administration and a mass evacuation in Kherson.
With a Ukrainian counteroffensive grinding toward Kherson, the battle for the annexed southern city of more than 250,000 people, key industries and a major port is a pivotal moment for Ukraine and Russia heading into winter, when front lines could become largely frozen for months.
In announcing martial law, effective Thursday, Putin told his Security Council, “We are working to solve very difficult large-scale tasks to ensure Russia’s security and safe future.”
It was Putin’s latest attempt to solidify control of not only the annexed regions but his entire country as he faces threats not only from the largely successful Ukrainian counteroffensive, but sabotage of a strategically important bridge linking Russia with Crimea, assassinations of Kremlin-installed officials in Kherson and chaos and mistakes in his partial troop mobilization.
Putin’s martial law declaration authorized creation of territorial defense forces in the annexed regions of Kherson, Donetsk, Luhansk and Zaporizhzhia, along with the potential impositions of curfews, restrictions on travel and public gatherings, tighter censorship and broader law enforcement powers.
In a potentially ominous move, Putin’s order opens the door for restrictive measures to be extended across Russia. That may lead to an even tougher crackdown on dissent and freedom in Russia, where authorities have dispersed antiwar protests and jailed people for making statements or providing information about the fighting that differs from the official line.
The severity of restrictions inside Russia depends on proximity to Ukraine, covering freedom of movement and other security steps.
In the Kherson region, Ukrainian forces have pushed back Russian positions on the west bank of the Dnieper River. By pulling civilians out and fortifying positions in the region’s main city, which backs onto the river, Russian forces appear to be hoping that the wide, deep waters will serve as natural barrier against the Ukrainian advance.
A trickle of evacuations from the city in recent days has become a flood. Local officials said Wednesday that 5,000 had left the city already out of an expected 60,000. Russian state television showed residents crowding on the Dnieper’s banks, many with small children, to cross by boats to the east — and, from there, deeper into Russian-controlled territory.
Russia has said the movement of Ukrainians to Russia or Russian-controlled territory is voluntary, but in many cases, they have no other routes out, and no other choice. Under martial law, authorities can force evacuations.
Reports have circulated of forced deportations, and an Associated Press investigation found that Russian officials deported thousands of Ukrainian children to be raised as Russian.
Russian authorities played up fears of an attack on Kherson, seemingly to persuade residents to leave. Text messages warned residents to expect shelling, Russian state media reported.
One resident reached by phone described military vehicles leaving the city, Moscow-installed authorities scrambling to load documents onto trucks, and thousands of people lining up for ferries and buses.
“It looks more like a panic rather than an organized evacuation. People are buying the last remaining groceries in grocery shops and are running to the Kherson river port, where thousands of people are already waiting,” the resident, Konstantin, said. The AP is withholding his family name, as he requested, for his safety.
“People are scared by talk of explosions, missiles and a possible blockade of the city,” he added.
Leaflets told evacuees they could take two large suitcases, medicine and food for a few days.
Andriy Yermak, head of the Ukrainian presidential office, called the evacuation “a propaganda show” and said Russia’s claims that Kyiv’s forces might shell Kherson were “a rather primitive tactic, given that the armed fdo not fire at Ukrainian cities.”
Ukrainian military analyst Oleh Zhdanov said the operation could presage intense fighting and “the harshest” tactics from Russia’s new commander for Ukraine, Gen. Sergei Surovikin.
“They are prepared to wipe the city from the face of the Earth but not give it back to the Ukrainians,” Zhdanov said in an interview.
In a rare acknowledgement of the pressure that Kyiv’s troops are exerting, Surovikin himself described the situation his forces face in the Kherson region as “very difficult.” Russian bloggers interpreted the comments as a warning of a possible Kremlin pullback. Surovikin claimed that Ukrainian forces were planning to destroy a hydroelectric facility, which local officials said would flood part of Kherson.
Incapable of holding all the territory it has seized and struggling with manpower and equipment losses, Russia has stepped up air bombardments, with a scorched-earth campaign targeting Ukrainian power plants and other key infrastructure. Russia has also increased its use of weaponized Iranian drones to hit apartment buildings and other civilian targets. In the invasion’s opening stages in February, Russian commanders had seemingly sought to spare some utilities they might need.
Russia launched numerous missiles over Ukraine on Wednesday. Ukrainian authorities said they shot down four cruise missiles and 10 Iranian drones. Energy facilities were hit in Vinnytsia and Ivano-Frankivsk.
Air raid sirens blared in the Ukrainain capital, Kyiv, sending many people into metro stations for shelter. Mayor Vitali Klitschko announced the city would start seasonal centralized heating on Thursday at lower temperatures than normal to conserve energy.
Ukrainian President Volodymyr Zelenskyy reported Tuesday that nearly a third of the country’s power stations had been destroyed since Oct. 10, causing blackouts. One area where power and water were reported knocked out due to overnight shelling was Enerhodar. The southern city is next to the Zaporizhzhia nuclear power plant, which is one of the war’s most worrisome flashpoints.
Missiles severely damaged an energy facility near Zelenskyy’s hometown, Kryvyi Rih, a city in south-central Ukraine, cutting power to villages, towns and to one city district, the regional governor reported.
In Chernihiv city, Iranian drones left three people wounded, said Regional Gov. Viacheslav Chaus.
3 years ago
UK PM Truss’ waning power brings political plots, jokes
Powerless, humiliated, labeled a “ghost” prime minister and compared unfavorably to a head of lettuce — this is not a good week for Liz Truss.
Britain’s prime minister was scrambling to recover her grasp on power Tuesday after her economic plans were ripped up and repudiated by a Treasury chief whom she was forced to appoint to avoid meltdown on the financial markets.
Truss remains in office, for now, largely because her Conservative Party is divided over how to replace her.
In a bid at business as usual, Truss held a Cabinet meeting on Tuesday, where, her spokesman said, there was an “in-depth discussion” of the new economic plan, and no one asked her to resign.
Truss also met lawmakers from rival Conservative factions, arguing that keeping her in post can provide stability, even though she has had to ditch almost the entire prospectus on which she was elected party leader just six weeks ago.
Chastened but defiant, Truss acknowledged Monday that “mistakes were made” — but insisted she would lead the Conservatives into the next national election.
Few believe that. Britain’s lively, partisan press is unusually united in the opinion that Truss is doomed. The Conservative-backing tabloid The Sun called her “a ghost PM” and said “for the sake of the country, we cannot go on like this.” The left-leaning Guardian compared the Conservatives to a mutinous ship’s crew, saying “Truss has not left her party. But it appears to have left her.”
After The Economist said Truss’ time in control of the government — before the Sept. 23 “mini-budget” that set the markets aflame — was “roughly the shelf-life of a lettuce,” the tabloid Daily Star set up a livestream featuring a photo of the prime minister beside a head of iceberg, adorned with a blond wig, eyes and a mouth. It asks “Can Liz Truss outlast this lettuce?” — which, five days in, is gradually turning brown.
Truss initially tried to stay the course after her government’s package of 45 billion pounds ($50 billion) in unfunded tax cuts spooked the markets, pushing up government borrowing costs, raising home mortgage costs and sending the pound plummeting to an all-time low against the dollar. The Bank of England was forced to intervene to protect pension funds, which were squeezed by volatility in the bond market.
Under intense political and economic pressure, Truss last week fired her ally Kwasi Kwarteng as Treasury chief, replacing him with the Cabinet veteran Jeremy Hunt, who had been sidelined since 2019.
On Monday Hunt scrapped almost all of Truss’ tax cuts, along with her flagship energy policy and her promise that there will be no public spending cuts, saying there are “many difficult decisions” to be made before he issues a medium-term fiscal plan on Oct. 31.
The market for British government bonds and the pound weakened Tuesday as relief over the government’s about-face was tempered by the recognition that the new policies are likely to mean slower economic growth.
The pound fell 0.75% against the U.S. dollar to $1.1273 in late morning trading in London, after jumping as much as 1.2% on Monday. Yields on 10-year government bonds rose to 4.081% after dropping to 3.973% on Monday. Bond yields, which represent the return investors receive on their money, rise as a borrower’s creditworthiness decreases and decline when it improves.
“While one could argue that yesterday’s measures have stabilized the public finances in the short term and pulled the U.K. back into the pack as far as market perceptions of fiscal responsibility is concerned, one must question at what price to the economy next year,” said Michael Hewson, chief market analyst at CMC Markets UK.
With opinion polls giving the opposition Labour Party a large and growing lead, many Conservatives now believe their only hope of avoiding electoral oblivion is to replace Truss.
Under Conservative Party rules, Truss is safe from a leadership challenge for a year, but those rules can be changed if enough lawmakers want it. Some Conservative legislators also believe Truss can be forced to resign if the party can agree on a successor. But the many divisions in the party — whose factions range from hard-right Brexiteers to centrist “One Nation” Conservatives — makes that a challenge.
Truss’ defeated leadership rival Rishi Sunak, House of Commons leader Penny Mordaunt and popular Defense Secretary Ben Wallace all have supporters, as does Hunt, who many see as the de facto prime minister already. Some even want the return of Boris Johnson, who was ousted in the summer after becoming enmeshed in ethics scandals.
A national election does not have to be held until 2024, and a few Conservatives say Truss should be given a second chance. But lawmaker Charles Walker said that if Truss led the party into the next election, “I think we’ll be out (of power) for 15 years.”
The chaos is unprecedented even for a country that has experienced plenty of political turbulence. Since the shock 2016 referendum vote to leave the European Union, Britain has seen years of bitter wrangling with the EU, two general elections and three prime ministers.
“British politics and economics is convulsed from time to time, as many countries are,” said Tony Travers, visiting professor in the Department of Government at the London School of Economics. “But the two coming together — where a political crisis effectively causes an economic one, which then the government has to try to bail itself out from — I think it’s pretty well without parallel.”
3 years ago
As war rages on, Ukraine gears up for a brutal winter
Nine-year-old Artem Panchenko helps his grandmother stoke a smoky fire in a makeshift outdoor kitchen beside their nearly abandoned apartment block. The light is falling fast and they need to eat before the setting sun plunges their home into cold and darkness.
Winter is coming. They can feel it in their bones as temperatures drop below freezing. And like tens of thousands of other Ukrainians, they are facing a season that promises to be brutal.
Artem and his grandmother have been living without gas, water or electricity for around three weeks, ever since Russian missile strikes cut off the utilities in their town in Ukraine’s eastern Kharkiv region. For them and the few other residents that remain in the complex in Kivsharivka, bundling up at night and cooking outdoors is the only way to survive.
“It’s cold and there are bombings,” Artem said Sunday as he helped his grandmother with the cooking. “It’s really cold. I’m sleeping in my clothes in our apartment.”
More Russian strikes on Monday in Kyiv, the capital, and other Ukrainian cities by drones and missiles that targeted power plants have added to the general sense of foreboding about the coming winter.
As the freeze sets in, those who haven’t fled from the heavy fighting, regular shelling and months of Russian occupation in eastern Ukraine are desperately trying to figure out how to dig in for the cold months.
In the nearby village of Kurylivka, Viktor Palyanitsa pushes a wheelbarrow full of freshly cut logs along the road toward his house. He passes a destroyed tank, the remnants of damaged buildings and the site of a 300-year-old wooden church that was leveled as Ukrainian forces fought to liberate the area from Russian occupiers.
Palyanitsa, 37, said he’s gathered enough wood to last the entire winter. Still, he planned to begin sleeping beside a wood-burning stove in a rickety outbuilding and not his home, since all the windows in his house have been blown out by flying shrapnel.
“It’s not comfortable. We spend a lot of time on gathering wood. You can see the situation we’re living in,” Palyanitsa said, quietly understating the dire outlook for the next several months.
Authorities are working to gradually restore electricity to the area in the coming days, and repairs to water and gas infrastructure will come next, according to Roman Semenukha, a deputy with the Kharkiv regional government.
“Only after that will we be able to begin to restore heating,” he said.
Authorities were working to provide firewood to residents, he added, but had no timeline for when the utilities would be restored.
Standing beside his pile of split wood, Palyanitsa was not waiting for government help. He said he didn’t expect heating to be restored anytime soon, but that he feels ready to fend for himself even once winter sets in.
“I have arms and legs. So I’m not scared of the cold, because I can find wood and heat the stove,” he said.
3 years ago