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Wednesday, December 18, 2024

Implement Indo-Lanka agreement as soon as possible, says Moragoda


Implement Indo-Lanka agreement 

as soon as possible, says Moragoda 


Sri Lanka’s former High Commissioner to India Milinda Moragoda has emphasised the pivotal importance of Colombo and Delhi quickly moving to the implementation phase of the agreement on ‘fostering partnership for a shared future.’ The former Minister said that the implementation should begin as fast as possible.

《  The Island LK  

He said so in response to The Island queries regarding the Indo-Lanka relations in the wake of President Anura Kumara Dissanayake’s meet with Indian Premier Narendra Modi. Referring to the joint statement that had been issued on 16 Dec., Moragoda said: “It is a comprehensive statement that covers a number of areas that are important to the Indo-Lanka relationship and Sri Lanka’s own economic development.

The statement has a significant number of action points, the execution of which can now be monitored by the two leaders during their future summits to ensure timely implementation.

 The statement blends the positive foundations and trajectory set by previous joint-statements with aspects that are important components of President Dissanayake’s own policy agenda. One such example is the focus on people-centric digitization.

Milinda Moragoda

Speedy economic integration and connectivity with India while safeguarding our sovereignty and territorial integrity is the only way in which Sri Lanka can become a fast growth economy and come out of the present crisis. Sri Lanka needs to grow at 6% -7% pa to deliver a better life for our people. This understanding between the two leaders is a good beginning.

It is now important that the two sides move to the implementation phase as fast as possible.

The financial resources required to achieve these objectives are available and can be mobilized and harnessed.

The joint-statement indicates that the UAE has expressed interest in investing in the multi-product pipeline. This is an important development towards trilateral cooperation in investment between India, Sri Lanka and third countries.

Trilateral cooperation of this nature could be explored with other countries, including Japan, the US, etc., as well.” (SF)⍐

Trump: Making Canada the 51st state is a ‘great idea’

Tuesday, December 17, 2024

Multiple Drone Incursions Confirmed Over Marine Corps Base Camp Pendleton


Marine Corps Base Camp Pendleton

Multiple Drone Incursions Confirmed Over Marine Corps Base Camp Pendleton

This is the first Marine Corps facility to acknowledge drone incursions during the recent wave of sightings at bases across the country.

Marine Corps Base Camp Pendleton in southern California experienced multiple drone incursions over its airspace the past several days, a facility spokesman told The War Zone on Tuesday morning.

Between Dec. 9 and 15, “there were six instances of unmanned aerial systems (UAS) observed entering Camp Pendleton’s airspace, with no threat to installation operations,” Capt. James C. Sartain, a base spokesman, told The War Zone in response to our query on the matter.

Howard Altman News Drones The War Zone 17-12-2024

Sartain could not immediately provide details about how many drones flew over the installation, their origin, what actions were taken in response and if any air or ground operations were affected as a result of the incursions. We have asked for these details and will update this story should any be provided. 

Located in north San Diego County, MCB Camp Pendleton is the Marine Corps’ major west coast training facility. It is home to the 1st Marine Expeditionary Force, 1st Marine Division, 1st Marine Logistics Group, elements of the 3rd Marine Aircraft Wing, and several other tenant units including Marine Corps Air Station Camp Pendleton, ACU-5, Naval Hospital, Marine Corps Tactical Systems Support Activity (MCTSSA), Weapons Field Training Battalion, Naval Weapons Station Fallbrook, and Deployment Processing Command/ Reserve Support Unit – West.


A map of the sprawling Camp Pendleton facility located on the SoCal coast. (USMC)

This is just the latest in a growing string of incursions reported over U.S. military installations at home and abroad.

News about MCB Camp Pendleton follows a drone incursion over Wright-Patterson Air Force Base in Ohio forcing the closure of its airspace Friday night into Saturday morning. The War Zone was the first to report that incident. On Tuesday, Wright-Patterson officials announced that there were additional incursions over the facility.

“Small unmanned aerial systems were spotted in the vicinity of and over Wright-Patterson AFB’s Area A and Area B during the late evening and early morning of Dec. 16 and Dec. 17th,” the 88th Air Base Wing said in a statement. “Installation leaders have determined that none of the incursions impacted base residents, facilities or assets. The Wright-Patterson AFB airspace was not affected by the incursions.” 

“The number of systems has fluctuated, and they have ranged in sizes and configurations,” the release added. “Our units continue to monitor the airspace and are working with local law enforcement authorities and mission partners to ensure the safety of base personnel, facilities and assets.  We request individuals in the area to contact either local police or Security Forces if they see anything suspicious, to include sUAS’s or drone activity.” 

The sprawling Wright-Patterson AFB complex. (Google Earth)


This all comes amid a growing frenzy about drones that began when they appeared over Picatinny Arsenal in New Jersey on Nov. 18, which we were the first to report. Since then, the FBI said more than 5,000 reports of drone sightings came into its drone hotline, of which fewer than 100 merited further investigation.

On Monday night, the Pentagon, FBI and Department of Homeland Security issued a statement that they have “not identified anything anomalous and do not assess the activity to date to present a national security or public safety risk over the civilian airspace in New Jersey or other states in the northeast.”

The full statement is below:

“There are more than one million drones lawfully registered with the FAA in the United States and there are thousands of commercial, hobbyist and law enforcement drones lawfully in the sky on any given day. With the technology landscape evolving, we expect that number to increase over time.

FBI has received tips of more than 5,000 reported drone sightings in the last few weeks with approximately 100 leads generated, and the federal government is supporting state and local officials in investigating these reports. Consistent with each of our unique missions and authorities, we are quickly working to prioritize and follow these leads. We have sent advanced detection technology to the region. And we have sent trained visual observers.

Having closely examined the technical data and tips from concerned citizens, we assess that the sightings to date include a combination of lawful commercial drones, hobbyist drones, and law enforcement drones, as well as manned fixed-wing aircraft, helicopters, and stars mistakenly reported as drones. We have not identified anything anomalous and do not assess the activity to date to present a national security or public safety risk over the civilian airspace in New Jersey or other states in the northeast.

That said, we recognize the concern among many communities. We continue to support state and local authorities with advanced detection technology and support of law enforcement. We urge Congress to enact counter-UAS legislation when it reconvenes that would extend and expand existing counter-drone authorities to identify and mitigate any threat that may emerge.

Additionally, there have been a limited number of visual sightings of drones over military facilities in New Jersey and elsewhere, including within restricted air space. Such sightings near or over DoD installations are not new. DoD takes unauthorized access over its airspace seriously and coordinates closely with federal, state, and local law enforcement authorities, as appropriate. Local commanders are actively engaged to ensure there are appropriate detection and mitigation measures in place.”

However, public furor has become so concerning that the FBI and New Jersey State Police last night issued a plea for people to not fire lasers or bullets at anything in the sky. 

“We are seeing an increase of pilots of manned aircraft being hit in the eyes with lasers as people on the ground think they see a drone,” cautioned Nelson Delgado, Acting Special Agent in Charge of the FBI Newark Field Office, which is leading the drone investigation. “We are also concerned that people will take matters into their own hands and fire a weapon at an aircraft. Not only is this act against the law, but it poses an incredible danger to the pilots and passengers on those aircraft.”

“Whatever your beliefs are,” Delgado added, “putting someone else’s life in danger is not the answer.”

The FBI warning came after pilots of 15 fixed and rotary wing aircraft from Joint Base McGuire-Dix-Lakehurst reported being struck by lasers from the ground since Dec. 7, Capt. Kitsana R. Douglomachan told The War Zone. One of those pilots had to seek medical treatment but was quickly released. All aircraft landed safely, he said, adding that officials do not know who fired the lasers. NJ.com was the first to report these incidents.

Monday night, Hill Air Force Base became the latest installation experiencing drone incursions.

“We can confirm that unmanned aerial systems were spotted in the vicinity of Hill AFB recently,” a spokesperson told KUTV–2 news Monday night. “To date, unmanned aerial systems have not impacted Hill AFB operations and all appropriate measures are being taken to safeguard Hill AFB personnel, assets, and infrastructure.”

An amazing elephant walk of F-35s at Hill Air Force Base. USAF

U.S. officials are still trying to discover the origin of drones that appeared over four U.S. Air Force bases in the U.K., another story we first broke. They’ve been spotted over RAF Lakenheath, RAF Mildenhall, and RAF Feltwell, all within close proximity, and RAF Fairford, about 130 miles to the west. A few days earlier, Ramstein Air Base in Germany joined the growing list of places registering unknown drone overflights.

TWZ has been on the leading edge of covering this topic for years and has broken multiple stories now about drone incursions over key U.S. bases and training ranges, as well as uncrewed aerial systems harassing American forces off the coasts of the United States and making worrisome overflights of important non-military sites. A spate of drone incursions over Langley Air Force Base in Virginia in December 2023, which TWZ was the first report on, has now become a particular focal point of concern about these instances.

While authorities are downplaying the majority of public drone sightings, they acknowledge a real concern about those flying over military installations, which as we have noted, forced the closure of airspace over one of those facilities.

Update: 4:37 PM Eastern –

MCB Camp Pendleton responded to our additional questions about the drones spotted over the facility.

“Each instance of observance occurs when and individual, via line of sight, observes a suspected unmanned aerial system (UAS) perceived to be in Camp Pendleton air space. Based on observation for all six instances, deploying countermeasures was not necessary, and air and ground operations were not impacted.”

The Pentagon’s top spokesman on Tuesday acknowledged that some of the drones flying over U.S. military bases could have been up to no good and shed additional light on the counter-drone capabilities being sent to two facilities in New Jersey.

“Is it possible that some of those drones could be up to malign activity? That’s entirely possible, but in the vast majority that is not the case,” Air Force Maj. Gen. Pat Ryder told reporters, including from The War Zone.

“When we detect them, [we] attempt to classify them and take appropriate measures,” he added. “Is it possible that some of those are surveilling? Absolutely. But can you make that assumption in every case? Not necessarily so in each case. 

Installation commanders “have the authority to respond appropriately, and we’ll continue to do that.”

As mentioned earlier in this story, both the Picatinny Arsenal and Naval Weapons Station Earle will be receiving equipment to help them track and, if necessary, defeat drones. During his presser, Ryder offered new details of those capabilities.

“In addition to some of the capabilities that are already on these installations, these capabilities essentially will enhance a base authority’s ability to detect, identify and track UASs,” Ryder explained. “So for example, this could include active or passive detection capabilities, plus capabilities like the system known as Dronebuster, which employs non-kinetic means to interrupt drone signals and affect their ability to operate.”

In a follow-up exchange with The War Zone, Ryder confirmed that Picatinny will be receiving the Dronebuster equipment. It’s a man-portable, radio-frequency jamming system with a pistol grip made by a company called Flex Force.

📼

The Pentagon “doesn’t see a connection between the drone sightings over military bases in the U.S. and overseas, Ryder said. When we pushed him to tell us the visual and sensor similarities between these sightings, he declined to answer.

Ryder reiterated a point made yesterday that the drones being reported are not connected to the military. They are not associated with the National Aerospace Research and Technology Park (NARTP) in southern New Jersey that develops and tests drones, he added.⍐

How Trump’s tariff threat pushed Canada’s Trudeau to brink of resignation

Canada’s embattled prime minister faces fresh calls to resign after top minister steps down over possible ‘tariff war’. 



LONG READ News Donald Trump By Jillian Kestler-D'Amours 17 Dec 2024 Al Jazeera

Montreal, Canada – For weeks, Justin Trudeau has tried to reassure Canadians that his government has everything under control.

US President-elect Donald Trump’s threat late last month to slap 25-percent tariffs on his country’s northern neighbour has dominated the headlines, with Canadian business leaders and politicians hammering the prime minister about how he plans to respond.

This week, the simmering crisis took an unexpected — and escalatory — turn when Canada’s finance minister, Chrystia Freeland, announced she was stepping down from her post because she and Trudeau were “at odds about the best path forward”.

“The incoming administration in the United States is pursuing a policy of aggressive economic nationalism, including a threat of 25 per cent tariffs. We need to take that threat extremely seriously,” Freeland wrote in her resignation letter on Monday.

“That means keeping our fiscal powder dry today, so we have the reserves we may need for a coming tariff war. That means eschewing costly political gimmicks, which we can ill afford and which make Canadians doubt that we recognize the gravity of the moment.”

Freeland’s surprise resignation — and the letter criticising her longtime political ally — have sent shockwaves across Canada.

They have also sparked renewed calls for Trudeau, already weakened by months of internal divisions and plummeting public support, to step down as leader of his Liberal Party in advance of elections next year.

“Everything is spiralling out of control,” Conservative Party leader Pierre Poilievre told reporters on Monday in the Canadian capital, Ottawa.

“We cannot accept this kind of chaos, division [and] weakness while we’re staring down the barrel of a 25-percent tariff by our biggest trading partner and closest ally,” said Poilievre, adding that Trump is “a man who can spot weakness from a mile away”.

“There’s an overwhelming appetite right now for change,” Laura Stephenson, a professor of political science at Western University in Ontario, told Al Jazeera in an interview before Freeland’s resignation and the new calls for Trudeau to step down.

“And the faith that Canadians have that change is going to come from the government that’s been in power for so long is very low.”

Trudeau has served as prime minister since 2015, when he and his centrist Liberal Party won a majority government. That election brought an end to nearly a decade of Conservative rule under former Prime Minister Stephen Harper.

‘Appetite for change’

Even before Freeland’s shock announcement, or Trump’s tariff threat, Canada was at a fraught moment, politically.

The country has been gearing up for a federal election next year that is widely expected to end a decade of Trudeau-led Liberal Party governments and usher in Poilievre, a hyper-partisan, right-wing populist, as the next Canadian prime minister.

It is also grappling with a housing crisis, rising costs and increasingly divisive political rhetoric.

The Liberals also lost the backing of the left-leaning New Democratic Party (NDP) in September, when NDP leader Jagmeet Singh announced his party was withdrawing from a 2022 agreement to prop up Trudeau’s minority government.

While the NDP has continued to vote alongside the Liberals so far, the government is more vulnerable if a no-confidence vote is triggered in the House of Commons. The result of that vote could force Trudeau to call an early election.

“They’re fighting themselves instead of fighting for Canadians,” Singh said of the Liberals on Monday. “For that reason, today, I’m calling on Justin Trudeau to resign. He has to go.”

Most recent polls have also shown Trudeau facing a difficult — if not insurmountable — challenge in trying to win back public support in advance of the looming election, which must be held before late October 2025.

A Leger survey from November found that 42 percent of Canadians said they planned to vote for the Conservatives in the next election, compared with 26 percent who backed the Liberals and 15 percent who picked the NDP.

Nearly seven in 10 Canadians also said they were dissatisfied with Trudeau’s government, the same survey found.

With Trudeau’s tenure now nearing the 10-year mark, Canadians have grown weary of his government — and like many electorates around the world, there is “incumbent fatigue” in Canada.

But more than that, Trudeau has personally become a target of growing anger in recent years around key issues, from his government’s handling of the COVID-19 pandemic to the cost of groceries and the housing crisis.

“We’re in a very different place I think than we were when Trump was first elected” in 2016, said Barbara Perry, director of the Centre on Hate, Bias and Extremism at Ontario Tech University, noting that right-wing talking points have gained ground across Canada in recent years.

She also pointed to a recent Abacus Data poll that showed Canadians viewed Trump more favourably than Trudeau — 26 percent to 23 percent — as evidence of a general shift.

“For [Trump] to be that popular is really disturbing and, I think, does suggest that there is room for right-wing forces to emerge in the Canadian context,” Perry told Al Jazeera.

“We saw little glimmers of right-wing political narratives [in 2016], but I think we’re seeing more than glimmers now,” she continued.

“It really does bode well for the far right [and] bode ill for those who would prefer to see much more progressive and inclusive policies and discourses.”

US-Canada ties

Against that backdrop, Trump’s tariff threat has loomed large — as have questions about how the Trudeau government plans to deal with the incoming US administration.

In a Truth Social post on November 25, the president-elect said he would impose the 25-percent tariff on Canada and Mexico until both countries stop the flow of drugs and migration through their borders.

“Both Mexico and Canada have the absolute right and power to easily solve this long simmering problem. We hereby demand that they use this power, and until such time that they do, it is time for them to pay a very big price!” Trump wrote.

Trudeau — who was prime minister during Trump’s first term, from 2017 to 2021 — responded to the threat by promoting a united, non-partisan “Team Canada” approach to the incoming US administration and stressing the importance of strong US-Canada ties.

The two countries share the longest international border in the world, stretching 8,891km (5,525 miles), and they exchanged nearly $2.7bn ($3.6bn Canadian) in goods and services daily in 2023, according to Canadian government figures.

The Canadian government promised to enact stricter border measures, and the prime minister also made a surprise visit to Trump’s Mar-a-Lago estate in Florida in late November to discuss the way forward.

“Thanks for dinner last night, President Trump. I look forward to the work we can do together, again,” Trudeau wrote on X after the talks, in a nod to his familiarity with the US leader.

During Trump’s first term, the Trudeau government’s view was that it could protect Canadian interests by negotiating “from a position of allyship, not from a position of enmity”, said Christine de Clercy, a political science professor at Trent University in Ontario.

Despite the changed political landscapes in both countries, Trudeau has appeared to be continuing with that approach, de Clercy told Al Jazeera in an interview before this week’s developments in Ottawa.

“And this time around, he’s not the rather inexperienced prime minister that he was in 2017 when Mr Trump was first sworn in,” de Clercy said.

“That has value because Canadians quite correctly are rather worried about the future of the Canada-American relationship for the next four years.”

Right-wing alignment

Still, the Trump administration of 2025 is expected to be different from its first iteration.

Trump has largely eschewed centrist Republicans for a crew of die-hard, MAGA believers, and he is coming into the White House with a clear plan on the economy, immigration and foreign policy.

At the same time, Trudeau has been the target of heated criticism from Trump supporters, right-wing US media outlets and even some of the figures who will play key roles in the president-elect’s new administration.

On December 11, for instance, Trump adviser and billionaire Elon Musk used his social media platform X to call Trudeau “an insufferable tool”. He added that the Liberal Party leader “won’t be in power for much longer”.

That kind of sentiment is typical for many in Trump’s orbit who view Canada under Trudeau as a “communist land with mandatory COVID vaccinations and government lockdowns”, said Asa McKercher, a professor who studies Canada-US relations at St Francis Xavier University.

“Canada is a part of the American culture war stuff, and Mr Trudeau is really a figure of hatred for a lot of people in the [Make America Great Again] world,” McKercher told Al Jazeera.

“A lot of the charm offensive that Canada was able to do with people in the White House [during the last Trump administration] is not going to fly this time.”

Meanwhile, like Trump, Poilievre — who was first elected to the House of Commons two decades ago, in 2004 — is hyper-partisan and prone to ad hominem attacks.

He regularly lambasts journalists, the “woke” left and other perceived opponents. He also makes sweeping statements about defending “freedom” and blames Trudeau personally for Canada’s ills.

“There are a lot of commonalities between them,” McKercher said of Trump and Poilievre.

“Mr Poilievre portrays himself as this macho, alpha kind of guy — very much fitting the manly, macho attitude of the Trump administration and the MAGA movement.”

Trump as line of attack

Trump’s return to the White House — and his tariffs plan in particular — have also given Poilievre and the Conservatives an opportunity to attack Trudeau as weak in the face of the Republican leader.

When asked how he would deal with possible US tariffs, Poilievre said on November 15 that he would “fight fire with fire”.

“Trump wants what’s best for American workers. I want what’s best for Canadian workers. And we’re not going to be suckers any more,” the Conservative leader said in a radio interview. “Trump would love nothing more than to keep Trudeau in power because he can walk all over him.”

Conservative politicians at the provincial level have also been hitting out against Trudeau, using Trump as a line of attack.

Some have called Trump’s concerns about irregular migration at the US-Canada border “valid” and urged the prime minister to do more.

Right-wing Ontario Premier Doug Ford, for example, said the federal government must take a more proactive approach to the border, calling Ottawa “slow to react” and “stuck on its backfoot”.

Amid that rhetoric, recent polls show that many Canadians now believe Poilievre is better equipped than Trudeau to deal with Trump.

An Abacus Data poll last month found 45 percent of Canadians said Poilievre had a better chance of getting positive results for Canada during a second Trump presidency. Only 20 percent said Trudeau was better positioned.

Another more recent poll (PDF) had the two leaders effectively tied on the question of who was better suited to manage Trump, with 36 percent choosing Poilievre compared with 34 percent who picked Trudeau.

The CBC News Poll Tracker, which aggregates federal election polling data across Canada, also had the Conservatives with a 21-percentage-point lead over the Liberals on Monday.

“The numbers are just stacked against either the Liberals or the NDP and in favour of the Conservatives,” said Perry.

“The negative messaging coming from the Conservatives — about everything being broken and the federal government’s responsible — that has become so firmly embedded in our psyches.”

‘End to the Trudeau era’?

So far, Trudeau has yet to comment publicly on Freeland’s resignation, including whether it will affect his plans to lead the Liberal Party through the next election.

The prime minister held a meeting with his cabinet on Monday evening in Ottawa, where several Liberal MPs urged him to step down, according to a report by CBC News. Sources told the public broadcaster that Trudeau has yet to make a decision.

While it remains unclear what happens next, Trudeau is on arguably shakier political ground than ever before and many experts are questioning how long he can stay on as leader after losing one of his top political allies in Freeland.

“This episode cannot help but shake those most loyal to Trudeau. Not sure he survives the end of 2024,” Stewart Prest, a political science professor at the University of British Columbia, wrote on social media on Monday.

“By the end of 2025, we’ll be reflecting that a single post from Trump put in motion the events that will have finally brought an end to the Trudeau era.”⍐

-----------------

Note-Illustration-The Week 

‘Big win’ narrative of Indian media shows New Delhi’s unease, lack of confidence

 

‘Big win’ narrative of Indian media shows New Delhi’s unease, lack of confidence

When Nepal's prime minister made his maiden visit to China early this month - a departure from the usual practice of the country's leaders making India their first official destination - the visit, along with some other regional developments, left India very worried. So, when Sri Lankan President Anura Kumara Dissanayake was in India from Sunday to Tuesday for his first overseas visit as head of state, some Indian media outlets described it as a "carnival." 

An Indian media outlet ran an opinion piece on Monday with the catchy headline, "Sri Lanka's Pivot Away From China Is A Big Win For India's Foreign Policy." According to the article, the visit underscored "how India remains central and of topmost priority for Sri Lankan leaders and policymakers, despite growing Chinese influence." Meanwhile, the Indian media extensively reported on the Sri Lankan president's "big assurance" to India during his visit that the country would not permit its territory to be "used in any way, in a manner that is detrimental to the interest of India." 

《 By Global Times

Published: Dec 17, 2024 

Regarding the choice of visits by Nepal and Sri Lanka, whether India is worried or cheering for victory, it is forcing regional countries to choose sides between China and India. Long Xingchun, a professor from the School of International Relations at Sichuan International Studies University, told the Global Times that Indian media's coverage of the Sri Lankan president's visit reflects India's mentality as a "regional" power, rather than a global one. 

In sharp contrast to India, China does not require small- and medium-sized countries in South Asia to choose sides; rather, it hopes that these countries will make choices that are most beneficial to their own futures - specifically, to work with relevant countries to promote regional peace, stability and development. This is why China-Sri Lanka relations have remained steady over the years, contrary to what the abovementioned article claimed - "Sri Lanka's pivot away from China." Chinese projects such as the Colombo Port City and the Hambantota Port have significantly boosted Sri Lanka's economic and social development, as well as the overall development of the region. For Sri Lanka, China is a partner that brings peace and development.

With such facts on the table, it is impossible for some Indian media outlets to succeed in sowing discord in China-Sri Lanka relations. While they have attempted to do so, they have ignored the right of a sovereign country like Sri Lanka to choose its partners and have underestimated the ability of the Sri Lankan government and people to determine what is in their best interest.

After all, forcing regional countries to choose sides and adopt an "India first" foreign policy reflects India's long-held, bossy and narrow-minded attitude toward other countries in South Asia, a region India views as its sphere of influence. That is why India perceives China's engagement with regional countries such as Nepal and the Maldives as an attempt to wean them away from New Delhi.

"Three mindsets of India are on display - sour grape, paranoia, and pomposity," says Zhang Xiaoyu, an expert in South Asian Studies, Communication University of China.

China is willing to see its neighboring countries develop friendly relations with other countries. This shows China's diplomatic confidence. In contrast, the "big win" mentality exhibited by some Indian people and media reflects their country's unease and lack of confidence. Some Indian media outlets often suggest that China is using its economic power to lure South Asian countries and view China's participation in regional affairs with skepticism. However, they should consider why China is welcomed in the region. Regional countries' persisting enthusiasm for China stems from its capability and willingness to provide development opportunities these countries desire.⍐ 

Monday, December 16, 2024

UK’s economy shrinks unexpectedly by 0.1% in October

 


UK’s economy shrinks unexpectedly by 0.1% in October 

GDP figures underline scale of challenge for Labour to get the economy growing

《Guardian staff and agencies Fri 13 Dec 2024》

Britain’s economy shrank by 0.1% in October, underlining the scale of Labour’s challenge to get the economy growing.

Figures from the Office for National Statistics showed the unexpected fall in GDP was driven by declines in construction and production, while the dominant services sector stagnated.

Economists, polled by Reuters, had expected the economy to grow by 0.1%. It follows a decline of 0.1% in September and sluggish growth of 0.1% in the third quarter of the year, according to figures last month.

Keir Starmer said last week it was the government’s “aim” to make the UK the fastest-growing G7 economy, while pledging to deliver higher real household disposable income by 2029.

However, a range of companies have said they plan to slow spending and hiring after Labour’s budget in October, which included £40bn of tax rises.

Economists said the second successive monthly contraction in GDP meant the economy had grown for only one of the five months to October, and might mean the economy shrank for the fourth quarter as a whole.

The chancellor, Rachel Reeves, said the figures were “disappointing” but insisted Labour was putting the economy back on track for growth.

“While the figures this month are disappointing, we have put in place policies to deliver long-term economic growth,” said Reeves. “We are determined to deliver economic growth as higher growth means increased living standards for everyone, everywhere.”

Business groups have complained that measures announced in the budget, including an increase in employer national insurance contributions, add to their costs and deter investment.

Production output fell by 0.6% in October because of falls in manufacturing, mining and quarrying, while construction fell by 0.4%.

“The economy contracted slightly in October, with services showing no growth overall and production and construction both falling,” said Liz McKeown, the director of economic statistics at the ONS.

“Oil and gas extraction, pubs and restaurants and retail all had weak months, partially offset by growth in telecoms, logistics and legal firms.”

Paul Dales, the chief UK economist at Capital Economics, said it was “hard to tell how much of the fall is temporary as activity was put on hold ahead of the budget”.

“The clear risk is that more activity was cancelled or postponed after the budget,” he said, citing weak PMI data. “There is every chance that the economy went backwards in the fourth quarter as a whole.”

Figures last week showed that growth in the UK’s dominant services sector slowed to its lowest rate in more than a year in November as firms digested business tax rises in the budget.

The closely watched S&P Global UK services PMI survey scored 50.8 in November, slowing from 52.0 in October.

The pound fell to its lowest level against the US dollar in nearly two weeks, dropping as much as 0.4% in early trading.

Analysts said the contraction in the UK economy could make it more likely that the Bank of England monetary policy committee will vote to cut the base rate when they meet later this month.

“These latest figures will send a chill through the corridors of Westminster, as the government’s growth agenda looks increasingly at risk,” said Isaac Stell, investment manager at Wealth Club.

“With more and more companies stating they will cut back on hiring and investment to deal with the rising costs related to the budget, the question will be, where will growth actually come from?”

The disappointing growth figures came as a survey by GfK showed that consumer confidence remained suppressed in December amid the “continuing uncharitable view on the UK’s general economic situation”.

The market research company’s latest consumer confidence survey said that consumers “don’t know where they are going” and are still thinking twice about big-ticket purchases.

Anna Leach, the chief economist at the Institute of Director, said: “As we head further into the festive season, and consumer confidence remains in the doldrums, many businesses are continuing the process of updating their business plans for the coming year to accommodate significant increases in employment costs.

“The recent blows to businesses have made the task of achieving stronger sustainable growth harder.”

Separate ONS trade data showed imports and exports of goods fell in October. Exports to the European Union were higher than exports to the rest of the world for the first time in nearly a year.

“A weakening export climate amid rising global policy uncertainties and declining business confidence, exacerbated by the impact of recently announced budget measures, raises concerns about sustaining the growth momentum,” Hailey Low, associate economist at NIESR, said.

Last month, the Bank trimmed its annual growth forecast for 2024 to 1% from 1.25% but predicted a stronger 2025 with 1.5% growth, reflecting a short-term boost to the economy from the budget.⍐

The US-Israeli monster is ripping Syria to pieces. Part II

The US-Israeli monster is ripping Syria to pieces.  Part II. Israel’s policy vis-à-vis Syria is malice and revenge 《 NEO Viktor Mikhin , Dec...