Foreign News
Britain’s Conservatives trounced in local elections as Labour makes gains
Britain’s ruling Conservative Party has suffered a resounding defeat in local elections, a further sign that it is likely to be removed from power in upcoming general elections.
With nearly all council results in, the Conservatives have lost 473 seats, while the opposition Labour Party has picked up 185, as counting was under way on Saturday for a few more assembly and mayoral polls.
Critically, Labour’s Sadiq Khan won London’s mayoral race, securing a record third term and dealing the Conservatives another damaging defeat.
With the results in from 106 of 107 council elections, the Conservatives lost about half of those it was defending, costing it control of 10 councils.
Its rival Labour Party wrestled control of eight councils, while also winning three newly created mayoral seats, including one in Conservative Prime Minister Rishi Sunak’s own northern English constituency.
Labour also won a by-election for the Blackpool South parliamentary seat, triggered by the resignation of the scandal-plagued Conservative MP Scott Benton.
Labour leader Keir Starmer said the emphatic victories nationwide sent the prime minister a clear message to hold a nationwide vote.
“Voters in Blackpool South have sent a direct message to Rishi Sunak: Make way, let’s have a general election,” said Starmer.
Sunak, whose Tories are down about 20 points in the polls to Labour must order a general election to be held by January 28 next year at the latest.
Labour performed strongly in areas that voted for Britain’s exit from the European Union, such as Hartlepool in the northeast of England, and Thurrock in southeastern England. Labour also seized control of Rushmoor, a leafy and military-heavy council in the south of England where it had never won.
In addition to its council victories, Labour won mayoral seats in the York and North Yorkshire, North East and East Midlands areas.
“Let’s turn the page on decline,” Starmer told supporters on Saturday in the East Midlands.
Conservative mayor Ben Houchen was re-elected in Tees Valley, a rare success, although with a greatly reduced majority.
A few more mayor races will be called over the weekend.
“We are probably looking at certainly one of the worst, if not the worst, Conservative performances in local government elections for the last 40 years,” John Curtice, professor of politics at the University of Strathclyde, told BBC radio.
While Labour had an overall strong showing, its candidates appear to have suffered in some areas with large Muslim populations, such as Blackburn and Oldham in northwest England, due to the party leadership’s stance on Israel’swar on Gaza including an initial refusal to call for a ceasefire.
In areas that have a greater than 10 percent Muslim population, Labour’s vote share dropped by an average of 11 percent, according to the BBC.
The Workers Party of George Galloway, who was re-elected to parliament in March touting a pro-Palestinian message, picked up four seats.
Sunak, while acknowledging the results were “disappointing”, has remained positive about his party’s chances in the general elections. “Come a general election, voters are going to stick with us,” Sunak said on Friday while celebrating the Conservative win in Tees Valley.
Sunak, who has failed to improve the party’s popularity since succeeding Liz Truss in October 2022, previously said he planned to call for a general election in the second half of 2024.
If that contest plays out similarly to the local elections, Labour would be expected to win about 34 percent of the vote, with the Conservatives trailing by nine points, according to the BBC.
Writing in Saturday’s Daily Telegraph newspaper, Sunak admitted the returns showed “voters are frustrated” but added that “we Conservatives have everything to fight for”.
(Aljazeera)
The World Bank says it will restart operations in Syria following a 14-year pause after the country cleared more than $15m of debt with financial backing from Saudi Arabia and Qatar.
The United States-based institution announced on Friday that Syria no longer has outstanding obligations to the International Development Association (IDA), its fund dedicated to low-income countries.
Earlier this week, Saudi Arabia and Qatar paid off Syria’s outstanding debts of approximately $15.5m, paving the way for renewed engagement with international financial bodies.
“We are pleased that the clearance of Syria’s arrears will allow the World Bank Group to reengage with the country and address the development needs of the Syrian people,” the bank said. “After years of conflict, Syria is on a path to recovery and development.”
The bank is now preparing its first project in Syria, which will focus on improving electricity access — a key pillar for revitalizing essential services like healthcare, education, and water supply.
Officials said it marks the beginning of expanded support aimed at stabilising Syria and boosting long term growth.
The bank’s announcement coincides with a dramatic shift in US policy towards Damascus.
US President Donald Trump announced on Tuesday that Washington would begin lifting sanctions imposed on Syria, including measures under the Caesar Syria Civilian Protection Act.
On Wednesday, Trump met Syria’s President Ahmed al-Sharaa on the sidelines of the GCC summit in Riyadh, marking a historic breakthrough in relations between the countries and the first such meeting between the two nations’ leaders in 25 years.
Secretary of State Marco Rubio confirmed that waivers would be issued, easing restrictions on entities previously penalised for dealings with the now former administration of Bashar al-Assad, which was toppled in December.
“Lifting sanctions on Syria represents a fundamental turning point,” Ibrahim Nafi Qushji, an economist and banking expert, told Al Jazeera. “The Syrian economy will transition from interacting with developing economies to integrating with more developed ones, potentially significantly reshaping trade and investment relations.”
The moves represent a significant moment in Syria’s reintegration into the global financial system after 13 years of civil war and isolation.
In April, a rare meeting was held in Washington involving officials from Syria, the IMF, the World Bank, and Saudi Arabia. A joint statement issued afterwards acknowledged the dire state of Syria’s economy and promised coordinated efforts to support its recovery.
The International Monetary Fund has since named its first mission chief to Syria in more than a decade. Ron van Rooden, previously involved with IMF operations in Ukraine, will lead the Fund’s renewed engagement.
Martin Muehleisen, a former IMF strategy chief, noted the urgency of providing technical assistance to rebuild Syria’s financial institutions. “Those efforts could be funded by donors and grants in-kind,” he told the news agency Reuters, adding that some support could begin within months.
Al-Assad was toppled after a lightning offensive by opposition fighters led by the Hay’et Tahrir al-Sham armed group last December.
Syria’s new government has sought to rebuild the country’s diplomatic ties, including with international financial institutions. It also counts on wealthy Gulf Arab states to play a pivotal role in financing the reconstruction of Syria’s war-ravaged infrastructure and reviving its economy.
The government, led by interim President al-Sharaa, also wants to transition away from the system that gave al-Assad loyalists privileged access to government contracts and kept key industries in the hands of the al-Assad family.
[Aljazeera]
Last week the International Monetary Fund (IMF) approved a $1bn (£756m) bailout to Pakistan – a move that drew sharp disapproval from India as military hostilities between the nuclear-armed neighbours flared, before a US led ceasefire was unexpectedly declared.
Despite India’s protests, the IMF board approved the second installment of a $7bn loan, saying Islamabad had demonstrated strong programme implementation leading to a continuing economic recovery in Pakistan.
It also said the fund would continue to support Pakistan’s efforts in building economic resilience to “climate vulnerabilities and natural disasters”, providing further access of around $1.4bn in funding in the future.
In a strongly worded statement India raised concerns over the decision, citing two reasons.
Delhi questioned the “efficacy” of such bailouts or the lack thereof, given Pakistan’s “poor track record” in implementing reform measures. But more importantly it flagged the possibility of these funds being used for “state-sponsored cross-border terrorism” – a charge Islamabad has repeatedly denied – and said the IMF was exposing itself and its donors to “reputational risks” and making a “mockery of global values”.
The IMF did not respond to the BBC’s request for a comment on the Indian stance.
Even Pakistani experts argue that there’s some merit to Delhi’s first argument. Pakistan has been prone to persistently seeking the IMF’s help – getting bailed out 24 times since 1958 – without undertaking meaningful reforms to improve public governance.
“Going to the IMF is like going to the ICU [intensive care unit]. If a patient goes 24 or 25 times to the ICU then there are structural challenges and concerns that need to be dealt with,” Hussain Haqqani, former Pakistani ambassador to the US, told the BBC.
But addressing Delhi’s other concerns – that the IMF was “rewarding continued sponsorship of cross-border terrorism” thereby sending a “dangerous message to the global community” – is far more complex, and perhaps explains why India wasn’t able to exert pressure to stall the bailout.
India’s decision to try to prevent the next tranche of the bailout to Islamabad was more about optics then, rather than a desire for any tangible outcome, say experts. As per the country’s own observations, the fund had limited ability to do something about the loan, and was “circumscribed by procedural and technical formalities”.
As one of the 25 members of the IMF board, India’s influence at the fund is limited. It represents a four-country group including Sri Lanka, Bangladesh and Bhutan. Pakistan is part of the Central Asia group, represented by Iran.
Unlike the United Nations’ one-country-one-vote system, the voting rights of IMF board members are based on a country’s economic size and its contributions – a system which has increasingly faced criticism for favouring richer Western countries over developing economies.
For example, the US has the biggest voting share – at 16.49% – while India holds just 2.6%. Besides, IMF rules do not allow for a vote against a proposal – board members can either vote in favour or abstain – and the decisions are made by consensus on the board.
“This shows how vested interests of powerful countries can influence decisions,” an economist who didn’t want to speak on the record told the BBC.
Addressing this imbalance was a key proposal in the reforms mooted for the IMF and other multilateral lenders during India’s G20 presidency in 2023.
In their report, former Indian bureaucrat NK Singh and former US treasury secretary Lawrence Summers recommended breaking the link between IMF voting rights and financial contributions to ensure fairer representation for both the “Global North” and the “Global South”. But there has been no progress so far on implementing these recommendations.
Furthermore, recent changes in the IMF’s own rules about funding countries in conflict add more complexity to the issue. A $15.6bn loan by the fund to Ukraine in 2023 was the first of itskind by the IMF to a country at war.
“It bent its own rules to give an enormous lending package to Ukraine – which means it cannot use that excuse to shut down an already-arranged loan to Pakistan,” Mihir Sharma of the Observer Research Foundation (ORF) think tank in Delhi told the BBC.
If India really wants to address its grievances, the right forum to present them would be the United Nations FATF (Financial Action Task Force), says Mr Haqqani.
The FATF looks at issues of combating terror finance and decides whether countries need to be placed on grey or black lists that prevent them from accessing funds from bodies like the IMF or the World Bank.
“Grandstanding at the IMF cannot and did not work,” said Mr Haqqani. “If a country is on that [FATF] list it will then face challenges in getting a loan from the IMF – as has happened with Pakistan earlier.”
As things stand though, Pakistan was officially removed from the Financial Action Task Force (FATF) grey list in 2022.
Separately, experts also caution that India’s calls to overhaul the IMF’s funding processes and veto powers could be a double-edged sword.
Such reforms “would inevitably give Beijing [rather than Delhi] more power”, said Mr Sharma.
Mr Haqqani agrees. India should be wary of using “bilateral disputes at multilateral fora”, he said, adding that India has historically been at the receiving end of being vetoed out by China in such places.
He points to instances of Beijing blocking ADB (Asian Development Bank) loans sought by India for the north-eastern state of Arunachal Pradesh, citing border disputes between the two countries in the region.
[BBC]
With US President Donald Trump due to visit Gulf states this week, a key focus will be securing significant new investment for the US economy.
“President Trump wants the announcement [of more Gulf money for the US],” says economist Karen Young, a senior fellow at the Middle East Institute think tank.
“He wants to have a big poster in a meeting that describes where these investments might go. And some estimation of what they will do to the American economy in terms of job creation or his big push, of course, on domestic manufacturing.”
Trump is due to arrive in the Saudi capital, Riyadh, on Tuesday 13 May, to meet the country’s de facto leader Crown Prince Mohammed bin Salman.
Trump is then expected to attend a summit of Gulf leaders in the city on 14 May, before travelling to Qatar that same day, and then ending his three-day trip in the United Arab Emirates (UAE) on 15 May.
The economic importance of the region to Trump is highlighted by the fact that the visit to Saudi Arabia was due to be the first overseas trip of his second term in the White House. That was before the death of Pope Francis necessitated Trump attending his funeral in Rome towards the end of April.
Saudi Arabia was also the first country that Trump visited during his first term of office, going against the modern practise of US presidents to start with the UK, Canada or Mexico.
Securing new investments in the US from Gulf states, and particularly from their state-backed sovereign wealth funds, will help Trump to signal back home that his “America First” agenda is delivering results.
The presidential visit is drawing top Wall Street and Silicon Valley leaders to Saudi Arabia. A Saudi-US investment forum on 13 May in Riyadh will feature CEOs from BlackRock, Palantir, Citigroup, IBM, Qualcomm, Alphabet, and Franklin Templeton.
The push comes amid economic headwinds, as President Trump’s new import tariffs have significantly disrupted global trade, confidence, and the US economy itself. US economic output fell in the first three months of this year, its first fall in three years.
Back in January, Prince Mohammed said that Saudi Arabia would invest $600bn (£450bn) in the US over the next years. However, Trump has already said that he’d like that to rise to $ 1tn, including purchases of more US military equipment.
According to Ali Shihabi – a Saudi commentator and author, with close ties to the Saudi government – a number of economic agreements will be signed during the trip.
“These deals will further integrate the Saudi and US economies together, joint ventures in the kingdom, in the United States, procurements of American weapons and goods,” says Mr Shihabi.
Saudi Arabia’s sovereign wealth fund, the Public Investment fund (PIF), which controls assets worth $925bn, already has numerous investments in the US. These include Uber, gaming firm Electronic Arts, and electric car firm Lucid.
Meanwhile, the UAE has already committed to investing $1.4tn in the US over the next 10 years, in sectors such as AI, semiconductors, energy and manufacturing. This was announced by the White House in March after the UAE’s national security advisor, Sheikh Tahnoon bin Zayed Al Nahyan, met President Trump in Washington.
Yet Ms Young from the Middle East Institute says that the scale of these investments is not realistic in the short term. She instead says that they are long-term strategic moves, and that the figures should be taken “with a little bit of a grain of salt”.
Regarding specific deals that could be announced during Trump’s visit, it is widely reported that Saudi Arabia will agree to buy more than $100bn of US arms and other military items.
These are said to include missiles, radar systems and transport aircraft.
The US has been a longstanding arms supplier to Saudi Arabia, but in 2021 the then Biden administration stopped selling Riyadh offensive weapons, citing concerns about the country’s role in the war in neighbouring Yemen.
The 2018 killing of Saudi journalist Jamal Khashoggi was also widely reported to be a factor. A US report said that Prince Mohammed had approved the murder.
The Biden White House resumed the sale of these weapons last year. While it cited that the Saudis had stopped bombing Yemen, some commentators said that the US was seeking Saudi assistance to help end the conflict in Gaza and aid its future reconstruction.
Mr Shihabi says Saudi Arabia will be seeking assurances from the White House that the US will implement a “more efficient procurement system”, enabling the Gulf state to access ammunition and military equipment far more quickly and easily.
“The Trump administration is initiating procedures to facilitate those deals. So, it’s expected that this process will improve immediately,” he adds.
Artificial intelligence is the other topic that will dominate the agenda during Mr Trump’s visit. Talks are expected to centre on attracting greater Gulf investment into US tech firms, and boosting the region’s access to cutting-edge American semiconductors.
The UAE and Saudi Arabia have been investing billions of dollars into tech and AI sectors as try to diversify their economies away from oil.
The Emiratis, in particular, are keen to establish themselves as a global AI hub.
Last week, the Trump administration scrapped the Biden-era chip regulations that placed restrictions on exports of advanced US chips to more than 120 countries including the Gulf states.
The White House is expected to draft new rules that would potentially involve direct negotiations with countries like the UAE.
“For the UAE, this is absolutely essential,” says Ms Young. “They are aggressively building out their AI capacity. So, for them getting access to US technology is imperative to be the best.”
While much attention will be on Trump courting Gulf capital for the US, Saudi Arabia is equally focused on drawing American investment into its ambitious Vision 2030 program.
Led by giant construction projects, such as the building of a linear city called The Line, Vision 2030 is central to the Saudi government’s continuing efforts to diversify the country’s economy away from oil.
It also involves pouring resources into entertainment, tourism, mining and sports.
However, foreign direct investment into Saudi Arabia declined for a third straight year in 2024, reflecting persistent challenges in attracting overseas capital.
The fall in global oil prices since the start of the year has further strained Riyadh’s finances, increasing pressure to either raise debt or cut spending to sustain its development goals.
Oil prices tumbled to a four-year low amid growing concerns that a trade war could dampen global economic growth.
The decline was further fuelled by the group of oil producing nations, Opec+, announcing plans to increase output.
Saudi Arabia is part of that group, and some commentators said that the rise was in part a desire to please Trump who has called for lower oil prices.
Other analysts said the reason was more that Opec+ remains confident that the global economy is growing.
The US-Saudi Business Council, is an organisation that aims to boost trade ties between the two countries.
It is hoping that Trump’s visit will push American businesses to explore more opportunities in Saudi Arabia, especially in sectors like AI, healthcare and education.
“The Saudi government is looking heavily to invest in these sectors. There is a very big appetite for Saudi companies to collaborate with American companies,” Hutham Al Jalal, who heads the Riyadh office for the organisation, tells the BBC.
Saudi officials are said to be confident that some deals in these sectors will be secured during Trump’s visit.
For Saudi Arabia, Trump’s visit is about strengthening ties with their longest-standing Western ally – a relationship that grew strained during the Biden years. For President Trump, it is about landing investment deals that can be framed as a win for his economic agenda.
“President Trump is looking for a headline of big investments in America, and he will get that from this trip,” adds Mr Shihabi.
[BBC]
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