April 30th – The BESA Times
Thirty-Eighth Edition - Sunday, 30th
Every week, a complete snapshot of what happened around the world in the past seven days
French voters last Sunday chose Emmanuel Macron and Marine Le Pen to go to the second turn to choose the next president. While Macron took 24% of the votes, Marine Le Pen got 21.3%. It is the first time in the nearly 59 years that both of the final candidates in French Presidential elect are from outside the traditional left-right political structure. French traditional parties seem to have adopted a wrong strategy, setting the country on an uncertain path in an election that will also be crucial for the future of the European Union. Bruno Cautrès, a political analyst at Sciences Po, the institute of political studies in Paris, said that “this shows that France is going through deep political tensions: clashes over the global economy, the integration of France into the global economy and into Europe”. Rather than a vote between left and right, French elections seem to have divided voters between pro-globalizers and anti-globalizers. The right candidate François Fillon had nearly 20 percent, and the far-left candidate Jean-Luc Mélenchon had 19.6 percent.
On January 20, Donald J. Trump was inaugurated as the 45th president of the United States. President Trump on Wednesday proposed significant reductions in individual and business income tax rates and a radical change in the tax code that would significantly benefit the wealthy. Trump did not offer explanation of how the plan would be financed. This seemed to have been a way to show progress before the 100-day mark of his presidency, which will be on Saturday April 29th. In an interview with Reuters on Thursday, President Donald Trump mentioned the possibility of a “major, major” conflict with North Korea, although he admitted that a diplomatic solution would be preferable. “We’d love to solve things diplomatically but it’s very difficult,” he said. He also declared that the US was losing a “tremendous amount of money” defending Saudi Arabia.
European leaders (minus Theresa May) met in Brussels on Saturday April 29th in order to sign off on their negotiating guidelines for Brexit. The latest word is that the text could include a reference to the potential for a "united Ireland" to remain in the EU. Donald Tusk and other leaders have made clear since the June Brexit vote that protecting the Irish peace process will be one of their top priorities. Adding the wording would effectively confirm that Northern Ireland would seamlessly rejoin the EU if it voted in a referendum to leave the UK and become part of the Irish Republic. Still, the move may further stoke fears in Westminister that Brexit could spur the break-up of the UK, given that Northern Ireland and Scotland both voted by large margins to remain in the EU.
What to remember of last week's news?
ECB leaves rates unchanged. On April 27th, The European Central Bank has decided to keep interest rates on hold, and maintained the previous pace of bond purchases. In a statement, the ECB said the deposit rate would stand at -0.4 per cent, with other rates also unaltered. The decision is due to the fact that risks to the euro-area economy have diminished but it is still consistent. Leaving the QE programme intact is also a sign of resistance against pressure from Germany to scale back the purchasing programme. Pressure over the QE programme has risen after that inflation in the Eurozone rose more sharply than expected: the annual rate passed from 0.7% in March to 1.2% in April, according to European Commission’s statistics bureau.
Chinese cost of borrowing money hit its peak level in two years. The Shanghai interbank overnight lending rate arrived to 2.792 percent on Thursday, April 27th, reaching the highest level since April 2015. The fact is linked to recent Xi Jinping’s call for strong efforts to maintain financial security during the economic meeting of the Communist Party in Beijing. Mr. Xi stressed the concept that the Financial System is a core element for a modern economy, affirming that the party should do an important job in order to maintain the economic development stable and healthy.
In Macedonia, nationalists stormed Parliament and assaulted opposition lawmakers to protest the election of an ethnic Albanian speaker. The president has summoned party leaders for talks today aimed at defusing tensions. Greece said it feared that its northern neighbour, which has been in a month-long deadlock over efforts to form a government, risked “sliding into deep political crisis”.
Pope’s visit to Egypt. Pope Francis has arrived in Egypt, bearing a message of peace and reconciliation. The country is under a state of emergency after suicide bombings, attributed to Islamic State militants, killed at least 44 people in Coptic Christian churches before Easter, on Palm Sunday.
Understand in Pictures...
Want to know more about the Crisis of Credit that exploded in the US and expanded worldwide involving almost everyone? Do you feel confused when hearing words such as CDO, Subprime Mortgages and CDS? Here is explained in detail the whole mechanism that brought to the system collapse and the reasons why the impact have been so hard to provoke the biggest financial crisis after 1929.
A Week in the Financial Markets
Our Homemade Article
Financial Stability For Our Time: A 21st century Glass-Steagall Act
by Eleonora Barbieri
What to expect for next week?
Next Sunday, the Italian Center-left party primary elections will be held. Polls show Matteo Renzi winning an absolute majority against two weak opponents. However, no one expects it to gain the 3m voters who made Mr Renzi leader of the PD in 2013. An average of five recent polls shows that the populist Five Star Movement is now ahead of the PD by 29.2 per cent to 26.7 per cent.
The 2017 State of the Union Conference Building a People’s Europe will take place in Florence on 4-5 May 2017. The State of the Union conference, organised by the European University Institute (EUI), is an annual event for high-level reflection on the European Union (EU). Now in its seventh year, it has become a reference point in the EU agenda for policy-makers, civil society representatives, business and opinion leaders, and academics.
France will return to the polls on Sunday May 7 to vote in either Marine Le Pen or Emmanuel Macron for the next French president. Mr Macron said: “I hope that in a fortnight I will become your president. I want to become the president of all the people of France - the president of the patriots in the face of the threat from the nationalists”.
Did you know?
Sevens Rugby (a particular kind of Rugby played by seven men) is the Fiji national sport and, since Rio 2016, is an official Olympic discipline. Fiji national representative team won the first gold medal of the sport’s history during Rio 2016 and the country decided to dedicate them the first $7 bill that has ever been printed as a tribute. Moreover, the 50 cent coin has been dedicated to the head coach of the team, the English Ben Ryan. The Reserve Bank of Fiji Governor Barry Whiteside explained the decision saying that “Sevens rugby is a sport that is loved by all Fijians, a sport that we excel in and a sport that continues to unite us all”. The new bills and coins will be used in normal transactions and will also be an item for collectors because the amount is limited: 2 Million notes and 1 million coins.
WRITTEN BY FRANCESCO ROMAGNOLI
PLEASE DIRECT ANY INQUIRY TO AS.BESA@UNIBOCCONI.IT
THANKS FOR READING THE BESA TIMES, FOLLOW US ON FACEBOOK TO RECEIVE IT NEXT WEEK!