World in Brief - The Economist Roundup

 World in Brief

The Economist Roundup

China’s double decline

On Wednesday China’s government revealed two notable declines in the country’s national heft. China’s population fell in 2023 by over 2m people. And its economy shrank in dollar terms.

After China hastily abandoned its covid-19 controls at the end of 2022, many people succumbed to the virus. That pushed the number of deaths up to 11.1m in 2023, according to official data, compared with 10.4m in the previous year. At the other end of the life cycle, the number of births dropped by over half a million.

One reason is a lack of economic confidence. Today’s figures confirmed that GDP grew by 5.2% in real terms, meeting the government’s target of about 5%. But “nominal” GDP, which makes no adjustment for changing prices, grew by only 4.2%, thanks to deflation. And the decline of the yuan left China’s dollar GDP a little smaller than a year earlier.

India’s EV Boom

India’s economic growth is especially visible on its roads. Data published last week showed that car sales grew by 7% in 2023, making India the world’s third-biggest market (behind America and China). Sales of electric vehicles are purring along especially rapidly. In the first nine months of 2023 they more than doubled, year on year.

The government is incentivising both producers and consumers of EVs. Narendra Modi, the prime minister, is courting Tesla, hoping to convince the American EV-maker to invest in India. Vinfast, a Vietnamese firm, plans to start selling electric two-wheelers and cars this year. And on Wednesday Tata Motors, the Indian market leader with 73% of electric-car sales, launched Punch, a compact electric SUV. Still, the government’s target for EVs to account for 30% of all car sales by 2030 looks a tall order.

Whats next for IPCC?

On Wednesday delegates from 195 governments will continue a meeting in Istanbul to plan the work of the Intergovernmental Panel on Climate Change, which assesses and summarises scientific guidance on the climate.

The IPCC influences how governments understand and respond to climate change, not least because it outlines the future warming scenarios that inform policy. The body’s main output is “assessment reports”, published roughly every seven years. (The last came out between 2021 and 2023; the next could appear as early as 2028.) In the meantime, the IPCC will publish special reports on how higher temperatures affect cities and on how aerosols and methane affect the climate. What else the body chooses to focus on this cycle will guide how countries move their economies away from reliance on fossil fuels, which they promised to do at COP28, the UN’s climate summit, in Dubai in December.

 

Iran carried out air strikes on targets in Pakistan. Iranian reports claimed the strikes were directed at bases for Jaish al-Adl, a Sunni militant group. Pakistan condemned the attack as “illegal” and said two children were killed. On Tuesday Iraq withdrew its ambassador to Iran, in response to an Iranian missile strike on targets in northern Iraq. Iran’s Revolutionary Guards claimed to have attacked Israel’s “espionage headquarters”.

 

China’s economy grew by 5.2% in 2023, one of the lowest rates in decades. A property-sector collapse has taken a toll on the world’s second-largest economy, despite the lifting of all covid-19 restrictions. Meanwhile, the country’s population fell by 2m, a larger decline than in the previous year, accelerating a demographic shift that poses long-term challenges.

 

Britain’s annual inflation rate unexpectedly rose to 4% in December, from 3.9% in November, the first increase in ten months. The “core” rate, which strips out energy, food, alcohol and tobacco prices, remained at 5.1%; economists had expected it to fall. The latest figures lower the chances that the Bank of England will cut interest rates soon.

 

America will reportedly redesignate the Houthis, a Yemen-based group that for weeks has been launching attacks in the Red Sea, a terrorist organisation. The Biden administration removed the group from its foreign terrorist list three years ago, to smooth aid deliveries to Yemen. On Tuesday America again hit Houthi targets, hours after the Iran-backed militants claimed responsibility for striking a Greek-owned cargo ship in the Red Sea.

 

Qatar and France mediated a deal between Hamas and Israel that will allow more humanitarian aid into Gaza in return for medication being delivered to Israeli hostages. Two Qatari planes packed with medical supplies will land in Egypt on Wednesday, before passing through the Rafah border crossing. Negotiations to free hostages have, however, made little progress.

 

Emmanuel Macron, France’s president, unveiled several proposed policies at his first full-scale press conference in years. They included regulating children’s screen time, introducing compulsory school uniform and cutting taxes. Mr Macron appointed Gabriel Attal as prime minister last week in an attempt to revive his second term, amid a growing challenge from the political right.