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AMERICA’S RETREAT IS EUROPE’S BIG OPPORTUNITY
IS EFFECTIVE CRYPTO REGULATION FINALLY COMING?
WHAT ISLAMIC FINANCE BRINGS TO CLIMATE RESILIENCE
US PROTESTS IN DOWNTOWN LA MAY DEEPEN ECONOMIC STRAIN
Protests in downtown Los Angeles, triggered by recent immigration raids, have brought more than 4,700 federal troops and a surge in economic disruption. With highways blocked and businesses shuttered, the financial toll is mounting fast. The area, a vital hub for logistics, real estate, and retail, is bleeding revenue by the hour. Insurance claims are spiking, and investor confidence is showing cracks.
Analysts warn that prolonged unrest could push up risk premiums on California municipal bonds and regional REITs. As street tensions escalate, markets are beginning to price in instability. For now, L.A. isn’t just a flashpoint, it’s a financial stress test in motion.
Sub-Saharan Africa’s economy is showing steady signs of recovery, with regional growth expected to reach 3.5% in 2025 and rise further to 4.3% by 2027, according to the World Bank’s latest Africa’s Pulse report. The improved forecast is driven by stronger private consumption, higher investment levels, and more stable macroeconomic conditions across several countries.
Declining inflation, from 7.1% in 2023 to a projected 4.5% in 2024, is helping to restore consumer confidence and improve household spending power. Additionally, stabilised local currencies and tighter fiscal management are supporting investment and trade activity, contributing to a more favourable business environment throughout the region.
Despite this progress, the report warns that underlying structural challenges persist. Real income per capita is still projected to remain 2% below 2015 levels by 2025, indicating that economic recovery has yet to translate into meaningful improvements in living standards for many Africans. Poverty reduction targets are also being missed, particularly in countries with heavy reliance on external commodities and resource exports.
The report highlights that growth is uneven across the region. Countries experiencing conflict or those reliant on a narrow range of natural resources are lagging behind more diversified economies. Employment growth continues to fall short, especially for the rapidly expanding youth population, which poses risks for long-term social and economic stability.
To ensure recovery becomes sustainable and inclusive, the World Bank is urging governments to pursue key reforms. These include improving governance, expanding education and healthcare services, and strengthening public infrastructure, digital access and institutional capacity.
The African Continental Free Trade Area (AfCFTA) remains a central opportunity. It is expected to boost trade integration, diversify economies, and create much-needed jobs across the continent.
While the regional outlook is gradually improving, the World Bank concludes that deeper reforms are essential to secure long-term prosperity.
The European Commission’s spring 2025 economic forecast reveals a stronger-than-expected start to the year for the EU economy. Modest but steady growth is expected to continue throughout 2025 and gain momentum into 2026, despite ongoing global uncertainty.
Real GDP in the euro area is projected to grow by 0.9% in 2025 and increase further to 1.4% in 2026. Across the broader EU, economic growth is forecast to reach 1.1% in 2025 and accelerate to 1.5% by 2026. This cautious optimism reflects the resilience of household spending and gradual improvements in investment and labour market conditions.
Inflation within the euro area is expected to ease from 2.4% in 2024 to 2.1% in 2025, and down to 1.7% in 2026, bringing it closer to the European Central Bank’s official target. In the wider EU, inflation is projected to fall below 2% by 2026. This trend is anticipated to support a recovery in consumer confidence and household purchasing power.
The labour market continues to perform strongly. By the end of 2024, 1.7 million new jobs are expected to be created. A further 2 million roles are forecast to be added by the end of 2026. As a result, the EU’s unemployment rate is set to decline to a record low of 5.7%. Although nominal wage growth is slowing, real wages are projected to rise, helping workers recover the income lost during recent inflationary pressures.
Export growth remains limited for now, at just 0.7% in 2025. However, a rebound is expected by 2026, reaching 2.1%. The EU’s general government deficit is forecast to remain steady at 3.3% through 2025 and 2026.
Key risks include global trade tensions and climate disruptions, though easing frictions with the US and structural reforms could offer upside potential.
ARON LEVINE
Group Head & President, BMO U.S.
Bank of Montreal (BMO) has named Aron Levine as group head and president of BMO U.S., effective 7 July 2025. He will oversee personal and business banking, commercial banking, and wealth management, reporting to CEO Darryl White and U.S. CEO Darrel Hackett.
Levine joins from Bank of America, where he spent nearly 32 years and most recently served as president of Preferred and Consumer Banking and Investments. He is recognised for expanding the bank’s retail and investment reach.
His appointment comes amid a wider U.S. leadership reshuffle at BMO, which includes the hires of JPMorgan’s Tony Sciarrino and Kristin Milchanowski as chief AI officer, alongside the planned 2026 retirement of Ernie Johannson.
The UK government is aiming for a trade agreement with Gulf nations, including Saudi Arabia, the UAE and Qatar, as its next move to expand global trade ties. Chancellor Rachel Reeves confirmed the intention as part of a broader post-Brexit trade strategy.
In a recent interview, Reeves said the UK is now in a stronger trade position following major agreements with the United States, the European Union and India. She noted that these deals are expected to support upgraded growth forecasts in the government’s next economic assessment.
The EU agreement, announced this week, covers trade, fishing, defence and energy, and is being called the most comprehensive UK–EU deal since Brexit. It follows a pact with India that removes tariffs on UK exports such as whisky and cars, while reducing duties on Indian textiles. A deal with the US also cuts tariffs on selected transatlantic goods.
STEFAN
CEO, Deutsche India GCC
Deutsche Bank has promoted Stefan Schaffer to CEO of its India Global Capability Centre, effective immediately. In this senior role, he succeeds Dilipkumar Khandelwal and will also serve as Global CIO for Corporate Functions and head of the bank’s global technology centres. Schaffer joined Deutsche Bank in 2020 and has held several leadership positions within the Technology, Data and Innovation division. He led the Bucharest Technology Centre and most recently oversaw shared applications and services aimed at simplifying the bank’s global tech operations.
Deutsche India, home to over 20,000 professionals across Mumbai, Pune, Bengaluru and Jaipur, is key to the bank’s global technological ambitions. Schaffer’s appointment underscores Deutsche Bank’s commitment to strengthening its digital transformation hub in India.
Reeves stated that the Office for Budget Responsibility would reflect stronger-than-expected 0.7% growth in early 2025 and factor in the impact of these deals. The UK economy is currently forecast to grow by 1% this year.
While Reeves highlighted the potential benefits such as stronger wages and more jobs, she acknowledged external risks. Economists warn that US tariffs could weigh on global demand, while rising employer costs in the UK may limit business expansion.
Political criticism remains. Conservative leader Kemi Badenoch called the EU agreement a setback and said the US deal lacked ambition. Reform UK’s Nigel Farage accused the government of failing the fishing sector. Liberal Democrat leader Ed Davey welcomed progress but called for a full customs union to deepen trade further.
Talks with Gulf nations are expected to begin soon, but it remains uncertain whether the economic gains will materialise quickly enough to ease domestic political pressure.
SOLANGE CHAMBERLAIN CEO, NatWest Retail Bank
NatWest Group has appointed Solange Chamberlain as CEO of its Retail Bank, effective 1 July 2025, subject to regulatory approval. She will report to Group CEO Paul Thwaite and join the Executive Committee of NatWest Holdings.
Chamberlain joined NatWest in 2019 as Chief Operating Officer of the Commercial Bank. She later led the combined Commercial & Institutional Banking division, and most recently served as Group Director of Strategic Development. Before joining NatWest, she spent seven years at Lloyds Banking Group and began her career in investment banking, holding roles at Citigroup, Perella Weinberg Partners and Lazard.
Her promotion comes as NatWest marks its first major leadership change since returning to full private ownership.
Russian developers are exploiting the openness of Western digital infrastructure to support military operations in Ukraine. Despite international sanctions, Russian forces have built a network of Android-based applications used for artillery targeting, drone control, logistics coordination, and battlefield weather tracking, many of which rely heavily on cloud services hosted in the United States and Europe.
The study, titled The Cloud of War, analysed 62 sideloaded Russian military apps. These applications are distributed through Telegram and other informal channels, bypassing official app stores and their oversight mechanisms. Behind the scenes, they connect to backend infrastructure often provided by major Western firms such as Amazon Web Services, Google Cloud, and Cloudflare. Over 70% of the supporting architecture is located in the US. Chinese providers like Alibaba and Huawei were used less frequently, due to limited market penetration and regulatory constraints.
Android’s sideloading system, while promoting innovation and competition, also introduces risk. Unlike Apple’s tightly controlled ecosystem, Android permits decentralised distribution, making it difficult to monitor or restrict harmful use. EU competition laws further limit Google’s ability to curtail sideloading, exacerbating oversight gaps.
Several apps include mapping tools from open-source platforms like OpenStreetMap and Mapbox. Originally intended for civilian use, these tools are now being repurposed for military operations. Some apps, such as AlpineQuest, are designed for outdoor activities but offer offline maps, waypoint plotting, and tactical overlaysfeatures now serving dual-use functions.
This situation presents a complex dilemma. Western tech companies, widely recognised for supporting Ukraine, are inadvertently powering systems that enable Russian military operations.
Experts are calling for urgent action. Suggested measures include monitoring API calls, applying regional geofencing, restricting access to critical services, and re-evaluating the notion of tech neutrality during armed conflict. Without targeted intervention, open digital infrastructure risks being weaponised by hostile actors.
Agroup of over 42 organisations, led by Nokia, has launched a major initiative to deploy autonomous robots for the protection of Europe’s critical infrastructure. The project, announced this week, brings together a mix of industry leaders such as NVIDIA, Safran, Leonardo, and Saab, alongside research universities, startups, and technology firms, according to Reuters.
The goal is to safeguard essential infrastructure such as energy grids, data centres, transportation links, and telecommunications lines by using unmanned robots on land, in the air, and underwater. These drones will be equipped with advanced sensors, including laser, radar, and imaging tools, to provide real-time surveillance and improved situational awareness.
The programme receives funding from the European Union, national governments, and private companies through the Chips Joint Undertaking. Though led by the EU, the initiative also welcomes participation from non-EU countries, including Israel, highlighting its broader strategic importance.
Nokia has confirmed that defence is becoming a core focus of its business strategy, alongside investments in data centres and artificial intelligence. While the drones are designed for civilian infrastructure monitoring, their underlying technologies could be adapted for military or security applications in the future.
The initiative is projected to generate approximately €90 million in commercial revenue by 2035. It will offer services to both public institutions and private companies, covering tasks like monitoring power lines, inspecting railway networks, securing ports, and managing remote or high-risk sites.
The project reflects growing concern across Europe about the vulnerability of critical infrastructure to cyber and physical threats. At the same time, it signals a clear commitment to investing in autonomous and AI-enabled technologies as tools for long-term resilience.
By uniting leading innovators and research institutions, the effort positions Europe to take a global lead in smart infrastructure defence and operational automation.
Saudi Arabia’s banking sector recorded its fastest annual credit growth in nearly four years this March, with total lending reaching SR3.1 trillion ($827.2 billion), according to the Saudi Central Bank. The 16.26% year-on-year increase was driven by a rise in corporate borrowing tied to Vision 2030.
Corporate loans account for 55.2% of total bank credit, up from 52.5% a year earlier. Lending to businesses rose 22.3% to SR1.71 trillion. Real estate led growth, climbing 40.5% to SR374.5 billion, followed by trade (SR212.8 billion), manufacturing (SR189.2 billion), and utilities (SR181.4 billion). Education loans, while small, grew fastest at 44.7% to SR9.35 billion.
Retail lending rose 9.6% to SR1.39 trillion. However, its share of total credit fell from 47.5% to 44.8%, reflecting a shift in bank strategy toward business lending.
A McKinsey report noted better credit quality in sectors like finance and utilities, where rising volumes are paired with lower risk. Banks are diversifying into more stable industries to improve resilience.
Saudi lenders are adopting capital market tools. The launch of residential mortgage-backed securities marks early progress toward a more efficient funding model.
Looking ahead, McKinsey forecasts 12 to 14 percent annual credit growth through 2030. Banks are accelerating digitisation, investing in AI and automation to improve risk controls and processing.
ESG-linked finance is gaining ground, with several banks issuing green bonds and incorporating sustainability into lending decisions.
President Donald Trump has signed a resolution repealing a Biden-era rule that would have capped overdraft fees at $5 for large banks and credit unions. The rule, proposed by the Consumer Financial Protection Bureau (CFPB), was set to take effect in October and aimed to eliminate about $5 billion annually in overdraft charges.
The signing concludes a months-long legislative effort led by Senator Tim Scott, chair of the Senate Banking Committee, under the Congressional Review Act. The Senate voted to overturn the rule in March, followed by the House. Trump’s signature officially finalised the repeal.
Scott criticised the CFPB’s rule as harmful, arguing it would reduce access to essential banking services and increase the number of unbanked Americans. He stated the rule risked harming the very consumers it sought to protect. The CFPB, under former director Rohit Chopra, had proposed allowing banks to charge either a $5 flat fee or an amount based on actual costs, with disclosures similar to credit card rules.
Critics of the regulation argued it interfered with consumer choice and market competition. Many banks had already reduced or removed overdraft fees voluntarily. Supporters countered that current practices disproportionately affect low-income consumers.
Banking industry groups, including the American Bankers Association (ABA), filed lawsuits challenging the CFPB’s legal authority. After Trump’s decision, the ABA withdrew its legal challenge, calling the repeal a win for broader consumer access and financial choice.
Trump also repealed another Biden-era rule expanding CFPB oversight of major digital payment providers under the Electronic Fund Transfer Act. Representative French Hill said both reversals support free-market principles and limit unnecessary regulatory overreach.
The Independent Community Bankers of America also praised the decision, arguing the CFPB had exceeded its mandate and risked creating unintended consequences for consumers and the broader financial sector.
Chancellor Rachel Reeves has indicated she is open to reviewing the UK’s ring-fencing rules for major banks, following calls from leading financial institutions to modernise the framework. The current system, they argue, is outdated and restricts banks’ ability to support the broader economy.
In a letter to the banking sector, Reeves confirmed that officials are considering the issue and invited further dialogue. The move follows a joint appeal from the chief executives of HSBC, Lloyds, NatWest and Santander, who described the ring-fencing model as “redundant”.
Ring-fencing was introduced after the 2008 financial crisis to separate retail banking services from riskier investment activities. Enshrined in law in 2013, it applies to banks with over £25 billion in core deposits and aims to protect consumer funds and maintain financial stability.
Bank leaders argue that the structure has become less relevant and now limits their ability to allocate capital efficiently and fund business growth. Reeves acknowledged the sector’s central role in delivering the government’s economic strategy and signalled a willingness to revisit the rules.
Analysts believe the removal of ring-fencing could unlock significant savings. RBC Capital Markets estimates that NatWest could see a benefit of £530 million, while Lloyds and other major banks could collectively gain up to £2.5 billion in an optimistic scenario. HSBC and Barclays are also expected to benefit, though to a lesser degree.
Not all voices in the sector support a change. Barclays CEO CS Venkatakrishnan has defended the current rules, stating they remain important for protecting depositors and ensuring system stability. He recognised the costs involved but highlighted the longterm benefits of resilience.
The discussion highlights a wider debate about how to balance financial regulation with growth. Any shift in the ring-fencing regime could reshape the UK’s banking landscape for years ahead.
Bank of America is moving forward with plans to open 40 new branches this year and an additional 110 between 2026 and 2027, reinforcing its belief in the value of a strong physical presence. This expansion comes despite the growing dominance of digital banking, which now accounts for 90% of the bank’s customer interactions.
Since 2016, the bank has invested $5 billion in modernising its network. Although its total branch count has dropped from 4,700 in 2015 to around 3,700, the focus is on newer, high-functioning locations in growth markets. These sites are designed to encourage meaningful client engagement, replacing older branches with more efficient formats.
According to Will Smayda, head of financial centres, the strategy goes beyond maintaining visibility. The new branches are built with open layouts, fewer counters, and more space for digital tools and financial consultations. Many customers still prefer to open accounts and receive advisory services in person, with 600,000 clients visiting branches daily.
This month, four new locations are opening in Boise, Idaho, marking the bank’s first retail presence in the area. Expansion is also planned for Wisconsin, Louisiana and Alabama, targeting markets with strong demographics and business activity. Performance in new regions will be evaluated based on how quickly market share grows and how deeply relationships develop.
Some branches will no longer offer traditional features such as safe deposit boxes, which are in less demand. Instead, customers are seeking services related to fraud protection and financial education.
Bank of America’s approach mirrors efforts by other major banks like JPMorgan Chase and PNC. While total branch numbers may decline slightly, the bank sees physical locations as a key part of its long-term plan to rank among the top three financial service providers in every market it serves.
Santander Bank plans to shut 18 of its US branches as part of its strategy to streamline retail operations and focus more on digital banking services. The closures represent about 4.5% of the bank’s 400 branches across the United States and reflect a broader trend in the industry toward reduced reliance on physical locations.
The affected branches are concentrated in the Northeast, covering six states. Massachusetts will see six closures, followed by four each in New Jersey and Pennsylvania, two in New York, and one each in New Hampshire and Rhode Island. The decision underscores Santander’s aim to align its physical presence more closely with customer demand.
A Santander spokesperson noted that the bank is evolving its retail model by combining digital tools with more targeted in-person service. Investment is being directed toward enhanced mobile platforms and innovative customer support systems. This approach is intended to offer greater convenience while optimising operational efficiency.
Santander’s commitment to digital banking is highlighted by the performance of Openbank, its US-based digital platform. Since launching in October, Openbank has gained traction, surpassing $2 billion in deposits by February. The head of retail banking said this success demonstrates customers’ growing appetite for flexible, tech-driven services supported by a well-established institution.
The closures in the US follow a similar move in the UK, where Santander is shutting 95 branches. These steps signal a unified global strategy to shift from traditional branch-based banking to more digital-focused delivery methods, in line with evolving customer behaviour.
Other banks are also making similar moves. Data from S&P Global shows that institutions including US Bank, Wells Fargo, Flagstar and TD Bank have closed numerous branches. This industry-wide trend indicates a structural transformation in how banks operate, aiming to provide efficient, accessible, and technology-led services.
conomic prospects across Asia have improved slightly after the United States and China agreed to ease selected trade tariffs. However, analysts at UBS say overall growth across the region is likely to slow, pressured by softening exports and declining investment in manufacturing sectors.
UBS now forecasts average GDP growth in the Asia-Pacific region at 4% for 2025, a modest revision from earlier estimates of 3.6%. When excluding Japan, the region is projected to expand by 4.4%, a decline from 5.1% in previous projections, reflecting a mixed recovery across key markets.
The first quarter showed economic activity in Greater China performing more strongly than expected. However, growth appears to be tapering in previously high-growth economies such as Malaysia and Singapore. South Korea has seen minor improvements, but persistent structural challenges are expected to limit overall momentum.
UBS expects further easing of US tariffs, forecasting a drop to 15–20% by year-end, compared with earlier projections of 25–30%. This could provide moderate support for regional trade. Export activity may stay firm in the short term, driven by orders from Western markets, but is expected to soften by the third quarter as demand stabilises and inventory cycles normalise.
India is forecast to lead regional growth at 6.8%. Indonesia and the Philippines are set to expand by 4.7% and 5.8%, while Malaysia is expected to grow by 4%. In contrast, Japan, South Korea and New Zealand are each forecast to grow by 0.6% to 1%, placing them among the region’s weakest performers. China is projected to grow by 4%, falling short of its 5% target.
UBS analysts note that falling interest rates and declining inflation may provide some relief in the latter half of the year. However, further risks remain, including global trade tensions and weaker-than-anticipated demand, particularly in key export markets.
Factory activity across Asia slowed significantly, as weak demand from China and US tariffs continued to pressure regional manufacturers. Private surveys show broad industrial declines, reinforcing a subdued outlook for Asia’s export-driven economies.
Japan and South Korea, both heavily reliant on international trade, reported further deterioration in manufacturing. Concerns are growing over US tariffs, particularly those targeting automotive exports. Continued trade policy uncertainty is affecting business sentiment, long-term planning, and supply chain investment across the region.
China’s official data confirmed a second consecutive monthly contraction in its manufacturing sector, raising fresh concerns about slowing demand and industrial overcapacity. With trade negotiations showing little meaningful progress, many businesses are holding back on production and capital investment due to caution over economic direction.
“High reciprocal tariffs are already in place, and with weak domestic demand, China is exporting cheap goods into regional markets, adding deflationary pressure,” said Mr Toru Nishihama of Dai-ichi Life Research Institute. “This dynamic is squeezing profit margins and limiting recovery potential across Asia.”
Japan’s au Jibun Bank Manufacturing PMI rose slightly to 49.4 but stayed below the 50 mark, signalling contraction for the 11th month in a row. South Korea’s PMI dropped to 47.7, its fourth straight decline, due to weak demand and tariff impacts. Both economies also posted negative GDP growth in the first quarter.
India’s factory output slowed to a three-month low, affected by softer demand and rising input costs. Vietnam, Indonesia, and Taiwan also reported declining manufacturing activity, tied to reduced export orders, currency pressure, and inflationary trends.
Trade tensions escalated as the US imposed a 50% tariff on global steel and aluminium and accused China of violating trade agreements. With no resolution in sight, analysts warn that Asia’s manufacturing may continue facing headwinds, unless stronger domestic demand and policy support emerge more quickly and forcefully.
A new report from PYMNTS shows how zillennials, the micro-generation between millennials and Gen Z, are becoming a key force in digital banking. Technologically fluent yet loyal to traditional institutions, they present a challenge for banks.
The study, Generation Zillennial: Driving Financial Service Innovation, surveyed over 3,700 consumers and found that zillennials blend digital-first expectations with cautious financial habits. They use both legacy banking products and newer tools such as buy now, pay later (BNPL) and cryptocurrency wallets.
Zillennials hold an average of nine financial accounts, more than any other generation, including savings, credit cards, digital wallets, and BNPL. Surprisingly, 23 percent are more likely than average to bank with national institutions, favouring a balance between digital convenience and institutional trust.
Mobile banking dominates for this group. Sixty-six percent rely on smartphones for financial tasks, nearly 50 percent higher than the general population. Physical branches hold little relevance, with a quarter of zillennials reporting no ATM or branch use in the past year.
Beyond basic banking, zillennials want advanced features. They prioritise live support, chargeback tools, budgeting, and smooth onboarding. They are also open to technologies such as generative AI and voice assistants, although trust and usefulness remain important.
Banks hoping to win this generation’s loyalty must go beyond sleek apps. The report finds user experience and responsive service outweigh legacy benefits like branch access. Zillennials want financial tools that match their lifestyles, multiple income streams, and need for personalisation.
The report positions zillennials as digital strategists. For banks and fintechs, aligning with their values and expectations will be key to success in a changing digital economy.
Revolut has announced the launch of its new Western European headquarters in Paris, a move aimed at deepening its banking presence across the continent. As part of the expansion, the company has also applied for a French banking licence, signalling its intent to operate more extensively under national regulatory frameworks.
The Paris hub will oversee operations across six major markets: France, Spain, Italy, Portugal, Ireland and Germany. Revolut said the decision to centre these activities in France reflects strong growth in the country, where the fintech now serves more than five million customers. Of these, 1.6 million signed up in the past year, highlighting the increasing demand for digital financial services.
Revolut also pointed to France’s reputation as a financial hub with an established regulatory infrastructure as a key factor behind the decision. It said the environment is well suited to support the development of next-generation banking solutions and to strengthen cooperation with national regulators.
The new hub complements Revolut’s existing base in Lithuania, which will continue to manage its operations in Eastern Europe. The dual-office model is designed to streamline coordination across the European Economic Area, improve customer service in local markets, and align the company more closely with region-specific regulatory standards.
By establishing a physical presence in France, Revolut aims to provide more localised offerings, such as personalised products, language-specific customer support and tailored compliance practices. The firm said this strategy aligns with its goal of building a pan-European banking network that balances digital innovation with trusted financial oversight.
The move marks another significant milestone in Revolut’s transition from a digital payments platform into a full-service financial institution. With its regional hub strategy, the company is positioning itself to better serve Europe’s diverse financial landscape while reinforcing its status as one of the continent’s fastest-growing fintech players.
PayPal is set to launch its first in-store payment experience in Germany, marking a major expansion from its online payments business into physical retail. The move will introduce contactless mobile payments and instalment options at the point of sale, offering German consumers a seamless way to shop online and in person.
Users will soon be able to pay with smartphones at any retailer accepting Mastercard contactless payments. The feature will be accessible through the latest version of the PayPal app on iOS and Android, with Germany becoming the first country to roll out the mobile wallet.
The updated app will also combine users’ instore and online purchases into a single view, reinforcing PayPal’s goal to unify the customer experience across digital and physical environments. Alongside contactless payments, the company is introducing Ratenzahlung To Go, its Pay Later instalment product, for use in shops. For the first time in Europe, shoppers in Germany can spread payments over 3, 6, 12 or 24 months, applying directly through the app.
Users will also gain access to cashback offers activated in the app and redeemed at participating retailers. More details on store partnerships and new app features are expected soon from PayPal.
Joerg Kablitz, Managing Director of PayPal Germany, Austria and Switzerland, said the expansion reflects changing consumer expectations. “Cash has a role, but many consumers and businesses are ready for innovative alternatives,” he said. “Our app will make it easy and safe to pay in stores, give you more choice in how and when you pay, and even help put money back in your pocket.”
The rollout comes as digital payments gain ground in Europe’s largest economy, where cash remains common but mobile adoption is accelerating. By entering retail, PayPal is betting on rising demand for tech-enabled payment options that cover the full customer journey across channels.
Stripe has rolled out a major update to its platform, introducing Stablecoin Financial Accounts that let businesses in over 100 countries hold and move dollar-based stablecoins like USDC. This marks Stripe’s most expansive product launch to date and signals a bold step toward blending digital assets with traditional finance systems.
Announced at the annual Stripe Sessions conference, the new accounts allow businesses to send, receive, and store funds in stablecoins across blockchain networks and traditional rails such as ACH and SEPA. The move responds to global demand for faster, more reliable cross-border payment tools that combine the speed of crypto with the stability of fiat-backed currencies.
Stripe also introduced a USDC corporate card, built with Bridge and running on the Visa network. The card allows spending directly from USDC balances, though it remains unclear if conversions occur instantly at the point of sale.
Beyond stablecoins, Stripe revealed broader ecosystem updates, including: Orchestration, a tool for managing multiple payment providers, AI-powered upgrades to the Optimized Checkout Suite, and Support for 125+ global payment methods, such as Pix and UPI.
To support automation, Stripe launched Scripts and Workflows for custom billing. Its tax solution now enables automated compliance in 102 countries. Stripe Connect has been updated with smoother onboarding and a redesigned dashboard for easier account management.
Looking ahead, Stripe Issuing previewed a new consumer credit card programme, with plans to expand card issuance in over 40 countries. Additional features include: Stripe Profiles for business identity, Stripe Verified for compliance, An Order Intents API for advanced commerce flows.
The update also brings an AI-powered dashboard assistant, a new sandbox for testing, and a Stripe Startups programme to support early-stage businesses.
With this sweeping update, Stripe is positioning itself as a full-scale financial infrastructure platform, aiming to power the future of global commerce across both traditional and digital currencies.
Meta is preparing to re-enter the cryptocurrency space, focusing on stablecoins to power payments across its platforms, especially for Instagram creators. The move signals renewed interest, three years after its Diem project was shut down.
Sources say Meta is in early talks with crypto infrastructure firms, exploring how fiat-pegged stablecoins could support global payments for creators and small businesses. Rather than committing to a single provider, the company is keeping options open to ensure flexibility and scalability across multiple jurisdictions.
Leading the effort is Ginger Baker, Meta’s new Vice President of Product. Baker, who joined in January, brings experience from Plaid and serves on the board of the Stellar Development Foundation. Under her guidance, Meta is reportedly in “learn mode”—engaging with industry players while holding off on final decisions.
The focus is on using stablecoins for faster, low-cost cross-border payments. For modest creator payouts, such as $100, stablecoins could be more efficient than traditional banking, which often involves high fees and long processing times.
The timing aligns with momentum in the stablecoin market. Global capitalisation now exceeds $230 billion. Stripe recently launched stablecoin-based accounts in over 100 countries, Visa has invested, and firms like Fidelity and Ripple are also entering. Standard Chartered expects the market could grow by $2 trillion by 2028, driven by demand for instant, trusted digital transactions.
Meta’s shift may also be influenced by political change. Donald Trump’s return has created a more favourable climate for crypto innovation. New players such as World Liberty Financial have launched stablecoins like USD1, now among the top five by market cap.
Still, regulatory uncertainty remains. A US vote on the GENIUS Stablecoin bill failed after Democrats withdrew support, stalling momentum for broader oversight.
At a Stripe event, Mark Zuckerberg acknowledged Diem’s failure but hinted at renewed ambition and future innovation. Meta has declined to comment officially.
Executives from OpenAI, Microsoft and AMD have urged the United States to rapidly boost its artificial intelligence infrastructure and ease export restrictions to maintain a lead over China. At a Senate Commerce Committee hearing, the leaders warned lawmakers that action is needed to strengthen American technological leadership and counter advances by Chinese firms.
The session, led by Republican Senator Ted Cruz, addressed concerns that Chinese models are becoming cheaper and more powerful. DeepSeek, based in Hangzhou, gained attention with a model rivaling top Western systems. Huawei, meanwhile, has started mass-producing AI chips, prompting fears about data privacy.
Microsoft President Brad Smith stressed the importance of widespread adoption of democratic AI systems, likening the current landscape to the global 5G race. He revealed Microsoft banned internal use of DeepSeek due to concerns over propaganda and surveillance.
Smith called for broader support for the domestic AI sector, including investments in education, data centres, skilled trades and research. “This race will be won not just by innovation,” he said, “but by whose systems the world chooses to use.”
OpenAI CEO Sam Altman echoed the call, urging investment in critical infrastructure - from servers to energy. He warned that without such foundations, U.S. AI leadership could falter.
AMD CEO Lisa Su supported revising policy, welcoming the Trump administration’s decision to roll back Biden-era export controls on AI chips. Those rules, originally set for May, would have limited U.S. firms’ global sales of AI tools.
Senator Cruz criticised the withdrawn rules as a “midnight AI diffusion” move that could have harmed national competitiveness. Some controls remain, particularly on Nvidia and AMD shipments to China, aimed at blocking military applications.
The message from industry leaders was unified: the U.S. must act swiftly to safeguard its AI edge.
Amazon Web Services (AWS) has announced a $4 billion investment to build its first data centres in Chile, marking a major step in its expansion across South America. The project, which has received all required approvals, will deliver significant computing capacity for services including generative artificial intelligence, according to Juan Pablo Estevez, head of AWS South Latin America.
The investment comes amid heightened environmental scrutiny of data centre development in Chile, a country affected by more than 15 years of drought. In a previous case, a Chilean court partly revoked Google’s permit for a $200 million data centre, prompting a complete redesign with an emphasis on sustainability. Google has since pledged to switch from water-dependent to air-cooling systems.
Responding to concerns, Estevez stressed AWS’s commitment to energy efficiency and water responsibility. He noted that Amazon’s facilities will use water-based server cooling only 4% of the year, equivalent to the consumption of eight homes over 15 years. The remainder of the time, the centres will rely on air and evaporative cooling. Since 2023, AWS has also matched 100% of its electricity use in Chile with renewable energy, sourced from local generation.
AWS’s entry into Chile is part of a broader strategy. The firm currently operates in 36 global regions with 114 availability zones, serving clients such as Netflix, Sony and General Electric. In Chile, local users include retail group Cencosud, e-commerce platform MercadoLibre and multiple mining companies.
Chile is becoming a key technology hub in Latin America. Microsoft is also preparing to open an Azure data centre there, reinforcing the country’s role as a strategic location for cloud services in the region.
Amazon’s multibillion-dollar commitment reflects confidence in Chile’s stable regulatory environment and digital economy, while highlighting the growing importance of sustainable infrastructure in the data-driven age.
Honda Canada has announced a two-year delay to its $15 billion Canadian (US$10.7 billion) electric vehicle investment project in Ontario, citing a slowdown in the EV market as the main reason for the postponement. The plan, which included building an EV battery plant and retooling its vehicle assembly facility in Alliston, was expected to play a key role in Canada’s EV manufacturing ambitions.
Spokesperson Ken Chiu confirmed the delay, stating that Honda will continue to assess market conditions before moving forward. He noted the decision will not affect current employment at the Alliston facility, which has around 4,200 workers and remains a critical part of Honda’s North American operations.
The project was projected to add 1,000 new jobs once operational. Plans included a revamped assembly line and a new battery plant, alongside two other Ontario-based component sites. The facilities were originally scheduled to be fully operational by 2028, with annual production of up to 240,000 electric vehicles aimed at both domestic and international markets.
Both the federal and Ontario governments had pledged support, with each committing up to $2.5 billion Canadian (US$1.8 billion) through tax credits and other financial incentives.
The delay reflects broader challenges in the EV sector, where demand has softened due to shifting consumer sentiment, rising interest rates, supply chain volatility, and changing global trade policies. “The market cooling consequences of US tariff actions continue to be felt by everyone, Honda included,” said Flavio Volpe, president of the Automotive Parts Manufacturers’ Association.
While Honda remains committed to electrification, the decision to pause such a large-scale investment highlights growing uncertainty in the global auto sector. The company has not announced a new timeline but said it will revisit the project schedule as conditions evolve.
Saudi Arabia has committed to investing $600 billion in the United States across sectors including defence, energy, technology, infrastructure and critical minerals, in what the White House called the largest package of commercial agreements ever signed between the two nations.
The deals were unveiled during President Donald Trump’s visit to the kingdom. At the US-Saudi Investment Forum in Riyadh, Crown Prince Mohammed bin Salman said the partnership could grow to $1 trillion. He noted that US companies account for nearly a quarter of all foreign investment in Saudi Arabia, with more than 1,300 American firms active in the country.
A defence agreement worth nearly $142 billion includes systems for air and missile defence, space, coastal security, and land forces modernisation, alongside training and support. The kingdom is the US’s largest foreign military sales partner, with active agreements totalling $129 billion.
In technology, Saudi firm DataVolt will invest $20 billion in US-based AI data centres and energy. A further $80 billion in joint investment will come from companies including Google, Oracle, Salesforce, AMD and Uber, strengthening digital ecosystems across both economies.
GE Vernova will supply energy solutions and gas turbines worth $14.2 billion. Boeing has signed a $4.8 billion deal with Saudi lessor AviLease for 30 737-8 aircraft, marking AviLease’s first direct order. Deliveries run through 2032.
Healthcare investment includes $5.8 billion from Shamekh IV Solutions, which plans a major IV fluid plant in Michigan. Additional funds include a $5 billion Energy Investment Fund, a $5 billion Aerospace and Defence Technology Fund, and a $4 billion Global Sports Fund.
Agreements also cover cooperation in energy, space and education, including a CubeSat mission and new cultural partnerships. The US and Saudi Arabia also updated air cargo rules to support global hub operations.
Annual inflation in the euro area eased to 1.9% in May 2025, down from 2.2% in April, according to preliminary figures from Eurostat, the EU’s statistical agency. The decline brings inflation within the European Central Bank’s target range, offering a potentially reassuring sign for policymakers assessing the region’s outlook.
The moderation was mainly driven by a slowdown in services, where annual price growth fell to 3.2% from 4.0%. Food, alcohol and tobacco prices rose by 3.3%, up from 3.0% in April. Prices for non-energy industrial goods were unchanged at 0.6% year-on-year, while energy prices declined by 3.6%, matching the previous month.
The data reflects disinflationary pressure across much of the eurozone, even as some consumer categories, such as food and services, continue to see price increases. Energy prices remain a key drag on overall inflation after recent volatility.
Eurostat’s flash estimate is based on early data and may be revised. A full dataset, including harmonised indices of consumer prices (HICP) for the euro area, individual EU member states and the bloc, is expected on 18 June.
The euro area includes 20 member states, among them Germany, France, Italy and Spain. Inflation figures are calculated using a chain index formula that adjusts for changes in the composition of the monetary union.
With annual inflation dipping below 2% for the first time in over a year, economists and market analysts will watch closely for signals from the European Central Bank regarding interest rate policy, as officials weigh the balance between price stability and economic recovery.
The European Union is preparing to publish a list of American products worth over $100 billion that could face tariffs if trade negotiations with the United States falter. Sources say the European Commission is finalising the list.
The draft, still under consultation with member states and industry, covers about €100 billion ($114 billion) of U.S. imports. While specific products remain unconfirmed, the move signals Brussels’ intent amid uncertainty over U.S. trade policy under the Trump administration.
EU Trade Commissioner Maroš Šefčovič said the Commission is taking preparatory steps for “rebalancing measures,” without specifying targeted goods. These are intended as a counterweight to future U.S. duties and affirm the EU’s commitment to fair, reciprocal trade.
This is not the EU’s first retaliatory tariff list. A separate package covering €21 billion in American goods, including peanut butter, beef, soybeans and pleasure boats, was approved earlier but paused last month. That followed a 90-day suspension of some U.S. tariffs announced by the Trump administration to ease tensions and allow talks.
European officials say they are engaging constructively, proposing deeper transatlantic trade, including increased imports of American liquefied natural gas and soybeans, and possible tariff elimination on industrial goods. Yet the latest EU move shows Brussels is preparing for potential talks breakdown and ready to respond.
The planned tariff list intensifies pressure during a fragile period for global trade. With rising protectionism and political issues ahead of the U.S. presidential election, both sides face a critical window to reach agreement or risk escalation with wide economic impact.
Mexico’s leading bankers have urged the government to strengthen the rule of law ahead of a landmark judicial election, where citizens will vote directly for Supreme Court justices. The appeal came during the country’s annual banking convention, where outgoing Association of Banks of Mexico (ABM) president Julio Carranza warned that a strong judiciary is essential for sustained economic progress.
Addressing President Claudia Sheinbaum and industry leaders, Carranza highlighted concerns about legal certainty and its impact on business confidence. His comments came shortly before the election, following a reform introduced by former president Andrés Manuel López Obrador. The reform makes Mexico the only country where all judges are elected by popular vote.
López Obrador often accused the judiciary of corruption. However, opposition parties argue the reform risks politicising the justice system and increasing organised crime influence. The Supreme Court has struck down several of López Obrador’s initiatives, deepening political divisions over judicial independence.
Sheinbaum, a political ally and successor, defends the reform as necessary to tackle corruption in the judiciary. She also pointed to Mexico’s economic resilience, noting growth in the domestic economy compared to contraction in the United States.
Sheinbaum outlined her ‘Plan Mexico’ to boost domestic industry through stronger local supply chains and consumption. She acknowledged credit access remains a barrier for many, especially small and medium enterprises. Her administration and the ABM signed an agreement to expand lending to these businesses, which constitute most Mexican companies.
As Mexico prepares for this judicial election, the mix of legal reform and financial inclusion will shape investor sentiment and national discourse in the months ahead.
The fintech industry has secured a foothold in the battle over the future of open banking in the United States, after a court granted the Financial Technology Association (FTA) intervenor status in an ongoing lawsuit. This allows the FTA to formally defend the Consumer Financial Protection Bureau’s (CFPB) open banking rule, which faces regulatory uncertainty under the Trump administration.
The rule, finalised by the CFPB under the Biden administration, aims to implement section 1033 of the Dodd-Frank Act by enabling consumers to access and transfer financial data between banks and service providers. Supporters say it will boost competition, increase consumer choice, and create new opportunities for fintech firms. However, three major banking associations challenged the rule, arguing that the CFPB exceeded its authority and did not properly address cost recovery and data protection.
The court’s decision to admit the FTA comes at a pivotal time. Under acting director Russell Vought, the CFPB has shifted priorities, deprioritising Biden-era enforcement and signalling a possible retreat from the open banking rule. Reports suggest the bureau may try to vacate the rule and redraft it to allow banks to charge fees and gain liability protections - changes that could alter the rule’s original intent.
Representing many fintech firms, the FTA sees its role as essential to protecting consumer rights and preventing large banks from shaping regulations in their favour. With compliance deadlines starting in 2025 and 2026, the outcome could reshape financial services for years.
Open banking remains a central issue in debates over consumer data ownership, with fintechs promoting innovation and banks citing compliance and security concerns.
American banks are increasingly targeted by complex money laundering operations linked to international drug cartels, with Chinese underground networks exploiting weaknesses in the U.S. financial system, new reports reveal.
Criminal groups are depositing large volumes of illicit cash, which are often from drug trafficking, into mainstream banks through accounts opened under false identities or by unwitting local participants, such as students and small business owners acting as intermediaries.
A notable case in North Carolina involved a Chinese money laundering ring accused of depositing at least $92 million into accounts at Bank of America, Chase, and Wells Fargo over two years. While the banks face no wrongdoing accusations, the case highlights the scale and sophistication of such operations.
In a rare enforcement action, TD Bank paid $3 billion last year in penalties after compliance failures allowed over $470 million in drug-linked cash to move through branches in New York, New Jersey, and Pennsylvania. The funds were tied to a New York-based Chinese laundering network, showing how entrenched these groups are.
Frank Tarentino of the Drug Enforcement Administration says U.S. banks have been vulnerable targets for years. Money brokers use fragmentation, spreading deposits across banks and accounts to avoid detection.
With rising fraud, industry leaders urgently urge lawmakers to modernise anti-money laundering (AML) rules. Darrin McLaughlin of Flagstar Bank, speaking for the American Bankers Association, called for coordinated efforts between banks, government and regulators to combat the evolving threat.
Experts warn outdated regulations hinder banks from focusing on high-risk threats. Without reform and collaboration, banks risk falling behind in compliance and client protection.
Banco Santander has overtaken UBS to become continental Europe’s most valuable bank by market capitalisation, as U.S. tariffs continue to impact the region’s financial sector. The Spanish bank reached a market value of €91.3 billion ($103.78 billion), surpassing UBS, whose market cap stood at 79.5 billion Swiss francs ($97.23 billion).
The change reflects diverging share performances. UBS’s stock has declined 17.2% this year, while Santander’s rose nearly 35%, driven by resilience in international operations and a stronger earnings outlook.
European banks face economic uncertainty triggered by U.S. President Donald Trump’s protectionist trade agenda. Reciprocal tariffs on imports from many countries, including a 20% levy on EU goods, have raised recession fears. Though a temporary 90-day reduction to 10% was announced, long-term concerns remain, especially for export-heavy economies.
Switzerland, not an EU member, faces harsher trade penalties. A 31% tariff on Swiss imports will resume, with extra duties on pharmaceutical exports signalled. The Swiss franc has appreciated 8% against the dollar since restrictions began, prompting speculation about further Swiss National Bank rate cuts.
Santander generates about 9% of global profits in the U.S., focused on auto lending and consumer finance via Verizon partnership. UBS relies heavily on U.S. wealth management, with half its assets in the region, and faces regulatory uncertainty following its acquisition of Credit Suisse.
Santander benefits from EU defence spending initiatives and anticipated ECB rate cuts. Its strategic diversification amid geopolitical shifts has placed it firmly at the forefront of Europe’s banking sector, gaining investor confidence and market momentum.
Two years ago, the cryptocurrency world was reeling from a series of spectacular crashes and scandals. Headlines declared the crypto “bubble” had burst as investors licked their wounds. Fast forward to 2025, and crypto is on the front page again – but this time it’s not as a Wild West sideshow. From Washington to Brussels to Hong Kong, governments and financial institutions are publicly embracing digital assets in a way that would have been unthinkable a few years ago. The message is clear: crypto is staging a comeback, only now it’s wearing an official seal of approval.
FROM WILD WEST TO REGULATORY FRAMEWORKS
What changed? In a word: regulation. After years of hesitation, major economies have decided that if crypto is here to stay, it needs to play by ground rules. In the United States, a watershed moment came in January 2024 when the Securities and Exchange Commission (SEC) greenlit the first exchange-traded funds (ETFs) linked to Bitcoin. This approval – which included fund offerings from heavyweight firms like BlackRock and Fidelity – was hailed as a game-changer that finally brought the world’s largest cryptocurrency into traditional securities markets. Bitcoin’s price, which had already been rising in anticipation, surged to its highest levels since 2022 on the news. After nearly a decade of failed attempts, Bitcoin ETFs trading on U.S. exchanges signaled a new era of institutional acceptance of crypto assets.
Across the Atlantic, Europe moved even faster to establish clear rules. The European Union’s Markets in Crypto-Assets (MiCA) law was adopted in 2023 and fully came into force by the end of 2024, making the EU the first major jurisdiction with a comprehensive crypto regulatory framework. MiCA sets strict standards for crypto companies and token issuers across the 27-nation bloc, covering everything from consumer protection to capital requirements. The goal is to eliminate the legal gray zones that previously plagued crypto ventures in Europe. Notably, MiCA also includes tailored rules for stablecoins – digital tokens pegged to fiat currencies – requiring issuers to hold robust reserves and submit to supervision. Britain, after initially diverging from the EU’s approach, recently unveiled its own plan to bring crypto under the financial regulatory umbrella. In April 2025 the UK Treasury announced draft laws to license and oversee crypto exchanges, dealers, and wallet providers much like traditional banks. Under this regime, crypto firms serving UK customers would have to meet the same transparency, capital and consumer-protection standards as other financial institutions. “We’re cracking down on bad actors while supporting legitimate innovation,” Britain’s finance minister said, encapsulating the balancing act regulators are trying to pull off.
That balancing act is playing out globally. In the wake of the 2022 crypto market implosion – which saw a $32 billion exchange go bankrupt and a stablecoin ecosystem collapse – officials worldwide felt compelled to act. A string of high-profile failures had underscored
the risks of an unregulated market, from rampant fraud to billions in customer losses. By late 2023, international bodies stepped in: the G20 (which includes the U.S., EU, China, and other powers) endorsed a joint IMF–Financial Stability Board roadmap for crypto policies, aiming for global regulatory standards by 2025. Their mantra: “same activity, same risk, same regulation,” meaning crypto services should be subject to the same rules as their traditional finance equivalents. This push for coordination reflects a new consensus that completely banning crypto (as a few countries have attempted) isn’t practical – better to integrate it safely into the system. Indeed, as of January 2024, 130 countries – representing almost 98% of the global economy – were exploring central bank digital currencies or other digital asset policies, showing just how universal the crypto conversation has become.
Perhaps the most striking sign of crypto’s rehabilitation is that politicians and central bankers are not only crafting rules, but also endorsing crypto’s role in the economy.
A dramatic example came from Washington, D.C. this year. In March 2025, U.S. President Donald Trump stunned markets by announcing a national “Crypto Strategic Reserve.” Under this proposal, the U.S. government would actively hold and manage a stockpile of top cryptocurrencies – including Bitcoin and Ethereum – similarly to how it maintains strategic reserves of oil and other critical assets. Trump, who once lambasted Bitcoin as a scam, has executed an about-face. He’s now touting crypto as part of his vision to establish the United States as “the crypto capital of the world,” backing up his campaign rhetoric with policy action. The planned reserve would initially hold five major tokens – Bitcoin, Ether, XRP, Solana, and Cardano – effectively giving them a government stamp of approval in the U.S. News of the announcement sent prices of those assets soaring almost instantly (observers likened it to a modern gold rush). While details are still being ironed out – how exactly the reserve will operate, and whether it will actively buy crypto or just stockpile what the government already owns – the symbolism was enough. A sitting U.S. president openly championing crypto marks a profound shift from the tone of past administrations.
The United States is not alone in its official embrace. A number of governments are now literally invested in cryptocurrency. El Salvador broke ground in 2021 by adopting Bitcoin as legal tender, and despite mixed results (few Salvadorans actually use it for day-to-day purchases), the country’s maverick experiment continues. The Salvadoran government has accumulated over 6,000 BTC in its treasury as part of President Nayib Bukele’s policy, even buying 1 Bitcoin per day to boost reserves. In Africa, the Central African Republic briefly followed suit by declaring Bitcoin legal tender in 2022. And in Asia’s Himalayas, the Kingdom of Bhutan has quietly been mining Bitcoin using hydroelectric power – amassing about 11,000 BTC (worth over $1 billion) that it holds
in sovereign reserves. These are small countries taking big bets on crypto. Now, larger players are signaling interest too: Switzerland is considering a proposal to make Bitcoin part of the Swiss National Bank’s reserves (the idea is up for a public referendum). Brazil, Germany, Hong Kong, Poland, and Russia are likewise studying or taking steps toward holding crypto at the national level. It’s a remarkable turn of events – a few years ago, many of these governments were warning citizens to stay away from Bitcoin, and now they’re debating whether to put public funds into it.
Even where crypto isn’t yet an official national currency or reserve asset, governments have become significant holders by accident or design. Law enforcement seizures have turned states into involuntary crypto whales. The U.S. government, for instance, now holds roughly 200,000 Bitcoins (valued around $17 billion) recovered from criminal cases like darknet market busts. This makes America by far the largest state holder of BTC in the world. (For context, that stash is about 1% of all Bitcoin that will ever exist.) China, despite its blanket ban on crypto trading at home, similarly ended up with about 194,000 BTC seized from the dismantling of a Ponzi scheme – and has quietly retained those coins. Rather than auctioning off all these assets immediately, officials seem content to hold some, blurring the line between enforcement and investment.
Policymakers are starting to see strategic angles: one U.S. Senator even introduced a bill to transfer all government-held Bitcoin into the Treasury and manage it transparently as part of a national reserve. The implication is that cryptocurrency is being seen as a strategic asset class, akin to gold or foreign currency holdings, that could potentially bolster national balance sheets or financial sovereignty. In the words of Senator Cynthia Lummis, “becoming the first developed nation to use Bitcoin as a savings technology secures our position as a global leader in financial innovation”. Not everyone agrees with that rosy take – but it’s telling that such arguments are now happening in parliaments and congresses, not just on crypto Twitter.
Government approval is only part of the story. The clear signal from regulators has unlocked a new wave of institutional and corporate adoption. Traditional financial institutions that once shied away from crypto (or were outright hostile to it) are tiptoeing back in, now that rules of the road are emerging. The launch of U.S. Bitcoin ETFs in 2024 is a prime example. Those funds, offered by the likes of BlackRock and Fidelity, give pension funds, mutual funds, and everyday investors a regulated way to gain exposure to crypto. Analysts at Standard Chartered Bank projected that these Bitcoin ETFs could draw as much as $50–100 billion of investment in their first year. In other words, a wall of institutional money that sat on the sidelines (due to legal uncertainties or compliance constraints) might finally enter the crypto market. That influx would dwarf the scale of previous retail-driven crypto rallies, potentially stabilizing the market with deeper liquidity
– and certainly cementing crypto’s place in diversified portfolios.
Payment and tech companies are also making moves that suggest crypto is edging into the financial mainstream. PayPal, the global payments giant, launched its own U.S. dollar-backed stablecoin (PYUSD) in August 2023 – becoming the first major fintech firm to issue a cryptocurrency for payments. PayPal’s stablecoin is fully regulated, issued by a licensed New York trust company and backed one-for-one by dollar reserves. This was a striking vote of confidence amid what had been a “troubled” period for the crypto industry. Just a few years earlier, regulators had quashed Facebook’s attempt at a similar project (the Libra/Diem stablecoin) out of fear it could disrupt monetary systems. By contrast, PayPal’s initiative garnered cautious praise –U.S. lawmakers pointed to it as evidence that stablecoins “hold promise as a pillar of our 21st century payments system,” as House Financial Services Chair Patrick McHenry put it. In parallel, Congress has been advancing bipartisan legislation to establish federal oversight for stablecoin issuers, which could further legitimize these digital dollars. The broader vision is that a well-regulated stablecoin could make everyday transactions faster and cheaper, from remittances to online commerce, without the wild swings of Bitcoin. Other payment networks are on board too – Visa, for instance, has been piloting ways to settle transactions in stablecoin on its network, effectively treating crypto as just another currency for moving money.
Banks and stock exchanges are likewise adapting. In the UK and EU, traditional banks can soon custody crypto assets or offer crypto trading services under the new legal frameworks, something that was often prohibited or discouraged before. Some of the world’s biggest asset managers launched crypto divisions once regulatory clarity improved. Even Hong Kong, which sits at the doorstep of crypto-skeptic China, has pivoted to become a crypto-friendly hub under government oversight. Hong Kong’s regulators rolled out a licensing regime in 2023 that allows retail crypto trading on approved exchanges, complete with investor protection measures and strict anti-money-laundering checks. This policy U-turn – Hong Kong had banned retail crypto investing in the past – underscores how jurisdictions are competing to foster crypto innovation (especially as Singapore, Dubai, and others court the industry). The assumption now is that with proper guardrails, crypto can coexist with the established financial system and even enhance it, rather than being perpetually at odds.
The official blessing of crypto by governments and institutions carries enormous implications. On one hand, it addresses many of the issues that made the crypto sector risky and fringe. Bringing exchanges and stablecoin issuers into the regulatory perimeter means greater transparency and accountability. Consumers stand to benefit from protections long taken for granted in banking – things like clear disclosure of risks, safeguards against fraud, and
perhaps even deposit-style insurance in the future. Regulated crypto ETFs and custodians reduce the need for individuals to navigate shady online exchanges or worry about losing passwords to digital wallets. With the “seal of approval” comes a sense that crypto is no longer an outlaw asset class, but a maturing part of the financial landscape. This could spur wider adoption: businesses may be more willing to accept crypto if they know it’s overseen by regulators, and conservative investors might allocate a portion of their portfolio to digital assets once they can do so through familiar, regulated channels. The entrance of big players also tends to dampen extreme volatility – for example, having sovereign wealth funds or central banks hold Bitcoin might gradually stabilize its price swings over time, much as broader ownership of gold has smoothed out that market. Some enthusiasts even argue that government involvement will accelerate beneficial innovation. They point to projects like central bank digital currencies (which borrow ideas from crypto) potentially making payments more efficient, or to blockchain technologies finding use in everything from clearing stock trades to securing medical records, under the watch of public authorities.
On the other hand, crypto’s integration with the establishment is not without its trade-offs and skeptics. By definition, increased regulation means crypto companies must comply with rules that can be costly and burdensome – a requirement that only larger, well-capitalized players can easily meet. This could reinforce the dominance of big tech and finance firms in the crypto space, squeezing out smaller start-
ups and perhaps slowing down the pace of radical innovation. Some early crypto adopters also worry that government-approved crypto loses the very qualities that made it attractive: privacy, autonomy, and independence from central authorities. For instance, if every major exchange requires strict identity checks and surveillance (as they now do under anti-money-laundering laws), it could drive illicit activity deeper underground, but it also means ordinary users give up a degree of anonymity.
Another concern is the risk of complacency. Regulators caution that just because crypto is regulated doesn’t make it risk-free – a point driven home by Federal Reserve officials who warned investors “if you buy crypto-assets and the price goes to zero, don’t expect taxpayers to socialize your losses.” In the UK, some critics argue that regulating the sector too thoroughly might give the public a false sense of security, as if crypto is as safe as a bank deposit, which it isn’t. The technology is still young and prone to technical glitches, hacks, and speculative bubbles that no amount of regulation can completely fix.
Moreover, not all governments are on the same page, which could lead to an uneven global landscape. While the U.S. and Europe are opening doors to crypto, China has doubled down on its ban – Beijing outlawed virtually all crypto trading and mining in 2021 and has shown no signs of reversing course. Instead, China is focused on its state-controlled digital yuan. This divergence raises questions about the future: Will we see a bifurcated world where crypto flourishes under
government auspices in some places but remains in the shadows in others? And how will truly decentralized cryptocurrencies coexist with a wave of government-issued digital currencies (CBDCs) that give authorities even tighter control of money flows? Those are big-picture questions that the next few years will begin to answer.
For now, the trajectory is unmistakable – after years of regulatory wrangling and wild west speculation, crypto has entered a phase of cautious integration into the global financial order. The tone of the conversation has shifted from “Should crypto be banned?” to “How can we make it work safely and beneficially?” The fact that G7 finance ministers, SEC commissioners, and even presidents are discussing blockchain and digital tokens in serious terms lends the industry a credibility it never had during the first manic boom of 2017 or the DeFi frenzy of 2021. This new legitimacy could be the key to unlocking crypto’s more transformative potential. With rules in place, a scandal like the FTX exchange collapse –which devastated trusting users – is less likely to happen on regulated turf. Greater oversight might have prevented some of the stablecoin failures in 2022 that briefly shook financial markets. And if governments themselves become stakeholders in crypto, as we are seeing with national reserves, they have a vested interest in keeping these markets orderly and robust.
None of this means the end of risk or the guar-
antee of success. Crypto will undoubtedly experience more ups and downs. There will be projects that fail and maybe even future bubbles that burst – innovation always carries uncertainty. But the involvement of governments and established institutions suggests that crypto is unlikely to fade away; it’s evolving from a rebel experiment into something more enduring. In a way, we’re witnessing the internet-of-money grow up. The coming years will show whether that maturation delivers on the technology’s promise – more accessible finance, new economic opportunities, and diversified wealth – or whether it gets bogged down by the very oversight meant to help it.
For the moment, optimism is prevailing. The vibe at recent finance conferences and blockchain summits is palpably different: less utopian hype, more pragmatic partnership. Bankers talk about digital assets in the same breath as stocks and bonds. Regulators speak of “fostering innovation” in crypto rather than simply warning of doom. The crypto ecosystem, once notorious for its distrust of government, is finding common ground with policymakers. As one industry CEO remarked when the Bitcoin ETFs were approved, “we believed Bitcoin could change the world, and now it’s being invited to the table”. Crypto is back, indeed – not with a bang of unruly speculation, but with the quiet affirmation that comes when the establishment finally nods in approval. The next chapter will be about what this technology can achieve now that it’s stepping out of the regulatory shadows and into the halls of power, with both the opportunities and responsibilities that entails.
Pinelopi Koujianou Goldberg, a former World Bank Group chief economist and editor-in-chief of the American Economic Review, is Professor of Economics at Yale University.
In light of recent domestic and global developments, European policymakers increasingly see America’s retreat as a chance for their own countries to catch up and thrive in the twenty-first-century economy. But to succeed, they will have to address four politically difficult questions that have long been swept under the rug.
The United States is at a turning point. For reasons that future historians will debate – and that will leave many dumbfounded –the country is attacking the very foundations of its strength: its openness, its institutions, and its global engagement.
The shift began with President Donald Trump’s tariffs. Their chaotic and inconsistent deployment in pursuit of ill-defined objectives has not only raised the cost of imports and disrupted global trade, but also undermined America’s credibility as a reliable economic partner, prompting questions about the dollar’s future as the world’s reserve currency.
Then came the attacks on US universities, long a cornerstone of the country’s scientific and technological leadership. Cuts to research funding, higher taxes on endowments, and restrictive visa policies are weakening their ability to attract and retain top global talent. The result is a loss not just for academia,
but for US innovation and thus the broader economy.
Meanwhile, the country’s most dynamic sector – technology – has come under political and regulatory pressure. Apple, Alphabet (Google), and Meta face intensifying scrutiny at home while their competitors abroad benefit from supportive industrial policies. As most countries position themselves to compete in the twenty-first-century economy, the US has adopted a policy that reflects the past (reviving domestic manufacturing, relaxing child labor protections).
Behind all these recent policy shifts is a fundamental misreading of the positive spillovers that the US has historically generated. American leadership in science, security, and innovation has certainly benefited others; but rather than viewing this as a sign of strength, the Trump administration treats it as evidence of exploitation. The response has been to withdraw, even if that means damaging the in-
stitutions that have enabled and sustained US global leadership.
Rather than curbing the rise of other countries, America’s retreat creates openings for them to advance. Nowhere is this more evident than in continental Europe. Faced with longstanding economic challenges – low productivity growth, aging populations, and missed opportunities in the digital transformation – European policymakers increasingly regard America’s inward turn as a chance to catch up.
Two recent developments have given them hope. First, Germany’s relaxation of its constitutional “debt brake” (a cap on annual deficits) has created fiscal space for sorely needed public investment. Second, in the face of geopolitical and economic fragmentation, there is a growing political consensus that Europeans must act with greater unity and purpose. But seizing the moment requires more than optimism. Four conditions are essential if Europe is to fill the void left by US disengagement.
First, the European Union must resist the Trump administration’s divide-and-rule strategy by avoiding bilateral bargaining with the US by any member country. Only by presenting a united front can the EU leverage its market power and defend its interests.
Second, Europe must embrace openness, particularly to talent and trade. With the US becoming increasingly hostile to international students and foreign labor, Europe can benefit from the coming US brain drain by welcoming skilled migrants and researchers. Further, since developing new technologies requires critical minerals and rare earths that are currently unavailable in Europe, it also must maintain productive trade relations with others – not least China. That will require political will and a recognition that openness, managed well, is a source of strength.
Third, Europe needs regulatory reform. While European standards for food safety, environmental protection, and labor rights are
rightly admired, excessive or poorly designed regulations in other sectors have stifled investment and innovation and impeded productivity growth. This is especially true when rules serve incumbent interests rather than broader societal goals. For example, qualified refugees are often unable to work because of bureaucratic hurdles.
To be sure, loosening such constraints will be difficult, particularly in countries where high living standards make change politically costly. Workers in Europe will not willingly log more hours, give up job security and long vacations, or take on unpleasant tasks. But failing to make the necessary changes would mean sacrificing future dynamism to preserve past achievements.
Lastly, Europe must tackle its growing labor shortages through immigration policies that apply to skilled and less-skilled individuals alike. Demographic decline and rising living standards mean that many jobs – especially
in care, construction, and services – are going unfilled. There is no path to sustained growth or innovation if the workforce is stretched thin meeting basic household and social needs.
Reforming immigration policy does not mean accepting uncontrolled borders; but it does mean creating legal pathways for those willing to contribute. Politically, this may be the hardest challenge of all, given the rise of anti-immigrant sentiment and far-right parties. But it is essential.
America’s retreat from the global stage presents Europe with an opportunity it has not had in decades. Whether it can rise to the occasion will depend on its ability to form a united front, remain open, modernize its regulatory frameworks, and embrace a pragmatic approach to immigration. Otherwise, the momentum may pass once again to Asia, which has never stopped preparing for the future.
Muhammad Al Jasser is Chairman of the Islamic Development Bank Group.
With traditional funding models falling far short of climate-finance needs, building resilience now hinges on financial innovation. By embracing non-conventional sources like Islamic finance, multilateral development banks can close funding gaps and support adaptation efforts across the Global South.
As ministers representing the 57 member countries of the Islamic Development Bank Group gather in Algiers for the IsDB’s 51st annual meeting, the devastating effects of climate change are impossible to ignore. Wildfires consuming entire communities, floods displacing millions of people, and heat waves claiming hundreds of thousands of lives. Such extreme weather events are no longer anomalies; they are the new normal, threatening lives and livelihoods in the world’s most climate-vulnerable regions – especially in the Global South.
With traditional responses proving inadequate to this escalating threat, innovative finance must take center stage. According to the Intergovernmental Panel on Climate Change, as many as 3.6 billion people currently live in regions that are highly vulnerable to climate change. Between 2010 and 2020, deaths caused by floods, droughts, and storms in those areas were 15 times more frequent than in low-vulnerability regions, underscoring the
severe and unequal toll of the climate crisis.
Conventional wisdom holds that for resource-dependent economies, climate action is a matter of economic survival, while for developing economies, it offers a pathway to sustainable growth and development. But many economies fall into both categories – developing and resource-dependent –compounding the challenge of designing and implementing effective climate strategies.
While a comprehensive strategy for building climate resilience is essential to strengthening developing economies’ ability to withstand shocks, resilience and adaptation must go hand in hand. For vulnerable countries, this may involve reinforcing infrastructure to protect against flooding, investing in drought-resistant crops, and diversifying income sources to reduce dependence on climate-sensitive sectors.
But conventional modes of resilience financing remain constrained, both in terms of sources
and delivery mechanisms. As a result, vital social safeguards and support systems are often underfunded or insufficient. The problem is made worse by growing uncertainty over the availability of concessional financing from developed countries.
Given this reality, financial innovation must become a central pillar of climate resilience. To that end, financial institutions, governments, and other stakeholders must work together to develop new financing mechanisms aimed at protecting climate-vulnerable regions.
Encouragingly, several innovative financing funds and mechanisms have emerged to support resilience and adaptation efforts. These include the Green Climate Fund, which provides financial assistance to developing countries; the Climate Bonds Initiative, which promotes the growth of the climate bond market; climate insurance, which helps manage and reduce climate-related risks; community-based adaptation, which enables local communities to design and implement their
own adaptation strategies; and nature-based solutions, which focus on restoring and protecting natural ecosystems. Even so, such financing falls far short of demand.
Multilateral development banks play a pivotal role in delivering the financing necessary for vulnerable countries to reduce emissions and invest in adaptation projects. According to the most recent Joint Report on Multilateral Development Banks’ Climate Finance, MDBs provided a record $125 billion in public climate finance in 2023. Notably, 60% of that total – $74.7 billion – was directed to low- and middle-income countries, highlighting MDBs’ commitment to supporting those most exposed to climate risks.
The IsDB is a notable example. In November 2024, the IsDB approved $1.15 billion in financing to bolster food and water security in Kazakhstan by sustainably irrigating 350,000 hectares of land. The project aims to boost average crop yields by 30%, thereby strengthening community resilience to climate-related disasters and improving the economic well-being of 1.3 million vulnerable people.
Like other MDBs, the IsDB is grappling with the challenge of strengthening climate resilience across its 57 member countries, more than half of which are more vulnerable to climate
change than the global average. Addressing such vulnerabilities requires an estimated $75-90 billion annually through 2030 for sustainable agriculture, water, and infrastructure projects. Adaptation-related financial flows to these countries average $23.9 billion per year, leaving a 68% funding gap that the IsDB is actively working to close.
The growing supply of adaptation financing illustrates MDBs’ indispensable contribution to global climate efforts. But success should not be measured only by the amount of money disbursed; instead, it must be judged by tangible, real-world outcomes. While climate finance is growing, its effectiveness hinges on rigorous monitoring and impact assessment. Establishing robust reporting frameworks is therefore critical to building stakeholders’ confidence and channeling more financing toward adaptation projects. To enhance their impact, MDBs should also adopt targeted results-based and policy-based financing models.
Beyond bolstering borrowers’ institutional capacity and expanding targeted financing, MDBs also have an opportunity to boost resource mobilization by attracting capital from non-conventional sources. The IsDB’s sustainability framework is a prime example. Under this scheme, the IsDB has mobilized
more than $6 billion by issuing Islamic bonds (Sukuk), attracting both Muslim and non-Muslim investors.
Rooted in asset-backing and risk-sharing, Islamic finance is inherently aligned with sustainability principles. In recent years, instruments like cooperative insurance (takaful), charitable endowments (waqf), and faithbased crowdfunding platforms have emerged as alternative sources of climate financing across the Muslim world.
Recognizing the need for targeted climate-funding solutions, the IsDB has actively promoted and supported these mechanisms. By tapping into the $4.5 trillion Islamic finance industry and adopting its asset-backed, risk-sharing model, other MDBs could expand and diversify their funding sources, enabling them to support adaptation and mitigation initiatives in the world’s most vulnerable regions.
But the time for pilot projects and piecemeal interventions is over. To build a sustainable, climate-resilient future, MDBs must urgently scale high-impact solutions, embrace financial innovation, and foster global cooperation. Drawing on more than a half-century of experience, the IsDB is ready to do its part.
Howard Davies, the first chairman of the United Kingdom’s Financial Services Authority (1997-2003), is Chairman of NatWest Group. He was Director of the London School of Economics (2003-11) and served as Deputy Governor of the Bank of England and Director-General of the Confederation of British Industry.
There are signs that the United States may finally enact legislation to establish basic rules for parts or all of the cryptocurrency sector. As they craft their bills, lawmakers could do worse than to borrow from Europe’s recently implemented framework.
Acouple of years ago, the Atlantic Council published a report highlighting the remarkable global diversity of attitudes toward cryptocurrencies – which were generally legal in 45 countries surveyed, partly banned in 20, and completely banned in ten.
The same diversity of opinion can be found today within the US Securities and Exchange Commission (SEC). The new chairman, Paul Atkins, is an enthusiast who previously chaired a crypto industry group, while the remaining Democratic commissioner, Caroline Crenshaw, has inveighed against the SEC’s new “crypto-friendly” perspective. She decries the agency’s decision to abandon what she sees as well-founded enforcement actions against firms in the sector. Atkins’s more permissive approach, she argues, will end in tears.
These sharp differences – and a territorial dispute between the SEC and the Commodity Futures Trading Commission (CFTC) – have held up moves to create a stable regulatory
framework for the industry in the United States. While the SEC has taken the view that cryptocurrencies are akin to securities, the CFTC has sought to characterize them as commodities. Not surprisingly, each agency’s perspective implies that it should be the principal regulator.
But the regulatory logjam may be about to break. For starters, US President Donald Trump has experienced his own Damascene conversion in favor of the industry. Just four years ago, he described Bitcoin as “a scam.” Yet now he and his wife have launched their own memecoins. Though the value of $MELANIA quickly slumped, the president appears to be making billions from his $TRUMP venture, even hosting a dinner for the top buyers.
Trump has used his enthusiastic promotion of the crypto sector to make peace with Silicon Valley. He also has issued an executive order prohibiting the US Federal Reserve from working on a central bank digital currency, which some see as a potential public-sector competitor to private digital offerings.
A second signal is the emerging consensus in Congress, where lawmakers recognize that a robust legal framework for the sector is needed. For example, the Guiding and Establishing National Innovation for US Stablecoins (GENIUS) Act has made good progress in the Senate in recent weeks and now commands a clear majority despite continued opposition from Senator Elizabeth Warren.
The House of Representatives may need more persuading. Ultimately, though, it seems likely that stablecoins will be given a helpful legal wrapper, with workable rules on transparency and asset backing. Standard Chartered estimates that if the legislation passes, the US stablecoin market will expand from its current size of roughly $240 billion to $2 trillion by the end of 2028. Most of that total would be invested in US Treasuries, providing a helpful boost for an administration with a nasty deficit habit to feed.
True, enacting the GENIUS Act would still leave considerable uncertainty about other, racier digital assets. But these, too, may benefit from
the changed legislative mood. Bitcoin’s price has surged again, presumably on the expectation (or perhaps just the hope) that Congress will adopt the view that cryptocurrencies should be regulated by the lighter-touch CFTC. While a bill that would have delivered that outcome failed last year, the political balance has changed.
Since many other countries are also grappling with these issues, is there a clear model that the US should adopt? Comparisons to Europe are not fashionable in Washington nowadays. As Trump sees it, the European Union was established precisely “to take advantage of the United States.” And yet, the EU has already studied this issue and come up with what looks like a viable option: the Markets in Crypto-Assets Regulation.
MiCA (which does not have the same ring to it as GENIUS) was adopted in 2023 but implemented only at the end of 2024, so it is
still too early fully to assess its implications. Nonetheless, there is good reason to believe that the law’s impact will be far-reaching. In fact, its rules on appropriate asset-backing for stablecoins circulating in the EU are already having an effect on the market.
The requirement that reserves be held in stable, solid assets is uncontroversial; but the stipulation that at least 30% be held in EU banks has created problems for the cryptocurrencies Tether and Circle (though the latter seems prepared to comply). An entity seeking authorization under MiCA must apply initially to its local regulator, though if their assets grow to a systemic level, they may become subject to EU-level regulation.
Could MiCA offer some lessons for American legislators? US Treasury Secretary Scott Bessent has told American bankers that he will not “outsource” regulation to international bodies (which has alarmed the Basel
Committee, whose future is now uncertain). But borrowing an idea from elsewhere is not outsourcing. And besides, whatever details are finally agreed for regulating stablecoins – a process that now seems close to completion – there will be more work to do, because “pure,” unbacked cryptocurrencies pose different problems. The virtue of the EU’s MiCA framework is that it covers these, too.
The signals coming out of Congress on this latter issue point in several directions at once. Bills proposing a strategic Bitcoin reserve, or targeting corruption (with a thinly veiled reference to Trump’s own financial interests), seem unlikely to go anywhere. Instead, the House Financial Services Committee and the Senate Banking Committee should put their heads together and consider embarking on a fact-finding mission to the EU’s offices in Brussels. They’ll certainly eat well, and they might just learn something.
Ancient Rome Used High Tariffs toRaise Money Too –And Created Other Economic Problems Along the Way
Tariffs are back in the headlines this week, with United States President Donald Trump introducing sweeping new tariffs of at least 10% on a vast range of goods imported to the US. For some countries and goods, the tariffs will be much higher.
Analysts have expressed shock and worry, warning the move could lead to inflation and possibly even recession for the US.
As someone who’s spent years researching the economy of Ancient Rome, it all feels a shade familiar.
In fact, tariffs were also used in Ancient Rome, and for some of the reasons that governments claim to be using them today.
Unfortunately for the Romans, however, these tariffs often led to higher prices, black markets and other economic problems.
ROMAN TARIFFS ON LUXURY GOODS
As the Roman Empire expanded and became
richer, its wealthy citizens demanded increasing amounts of luxury items, especially from Arabia, India and China. This included silk, pearls, pepper and incense.
There was so much demand for incense, for example, that growers in southern Arabia worked out how to harvest it twice a year. Pepper has been found on archaeological sites as far north as Roman Britain.
Around 70 CE the Roman writer Pliny – who later died in the eruption that buried Pompeii –complained that 100 million sesterces (a type of coin) drained from the empire every year due to luxury imports. About 50 million sesterces a year, he reckoned, was spent on trade from India alone.
In reality, however, the cost of these imports was even larger than Pliny thought.
An Egyptian document, known as the Muziris Papyrus, from about the same time Pliny wrote shows one boat load of imports from India was valued at 7 million sesterces.
Hundreds of boats laden with luxuries sailed from India to Egypt every year.
At Palmyra (an ancient city in what’s now Syria) in the second century CE, an inscription shows 90 million sesterces in goods were imported in just one month.
And in the first century BCE, Roman leader Julius Caesar gave his lover, Servilia (mother to his murderer Marcus Brutus), an imported black pearl worth 6 million sesterces. It’s often described as one of the most valuable pearls of all time.
So while there was a healthy level of trade in the other direction – with the Romans exporting plenty of metal wares, glass vessels and wine – demand for luxury imports was very high.
The Roman government charged a tariff of 25% (known as the tetarte) on imported goods.
The purpose of the tetarte was to raise revenue rather than protect local industry. These imports mostly could not be sourced in the
Roman Empire. Many of them were in raw form and used in manufacturing items within the empire. Silk was mostly imported raw, as was cotton. Pearls and gemstones were used to manufacture jewellery.
With the volume and value of eastern imports at such high levels in imperial Rome, the tariffs collected were enormous.
One recent estimate suggests they could fund around one-third of the empire’s military budget.
Today, economic experts are warning Trump’s new tariffs – which he sees as a way to raise revenue and promote US-made goods – could end up hurting both the US and the broader global economy.
Today’s global economy has been deliberately engineered, while the global economy of antiquity was not. But warnings of the inflationary effects of tariffs are also echoed in ancient Rome too.
Pliny, for example, complained about the impact of tariffs on the street price of incense and pepper.
In modern economies, central banks fight inflation with higher interest rates, but this leads to reduced economic activity and, ultimately, less tax revenue. Reduced tax collection could cancel out increased tariff revenue.
It’s not clear if that happened in Rome, but we do know the emperors took inflation seriously because of its devastating impact on soldiers’ pay.
Ancient traders soon became skilled at finding their way around paying tariffs to Roman authorities.
The empire’s borders were so long traders could sometimes avoid tariff check points, especially when travelling overland.
This helped strengthen black markets, which the Roman administration was still trying to
deal with in the third century, when its economy hit the skids and inflation soared. This era became known as the Crisis of the Third Century.
I don’t subscribe to the view that you can draw a direct line between Rome’s high tariffs and the decline of the Roman Empire, but it’s certainly true that this inflation that tore through third century Rome weakened it considerably.
And just as it was for Rome, black markets loom as a potential challenge for the Trump administration too, given the length of its borders and the large volume of imports.
But the greatest danger of the new US tariffs is the resentment they will cause, especially among close allies such as Australia.
Rome’s tariffs were not directed at nations and were not tools of diplomatic revenge. Rome had other ways of achieving that.
In April, Argentina’s president Javier Milei partially lifted the capital and currency controls that had been in place since 2011. The move was possible with the support of a US$20 billion (£15 billion) IMF bailout and means Argentinians may now buy unlimited dollars again.
Announcing the move in the capital Buenos Aires, Milei was flanked by American treasury secretary Scott Bessent. Milei took the opportunity to liken it to US president Donald Trump’s “liberation day”.
While he is often associated with Trump for his abrasive rhetoric and right-wing populist support base, Milei’s liberation day was intended to reduce the role of the state in the economy
– unlike the US’s approach of deepening it.
The latest iteration of currency controls was implemented by then-president Cristina Fernández de Kirchner to try to shore up the deteriorating value of the Argentinian peso.
The controls, known locally as el cepo (the clamp), meant that citizens and businesses were limited in the amount of foreign currency they could purchase. At the same time, they were constrained in moving money out of Argentina. This was designed as a safeguard against capital flight, but in effect it stifled inward investment.
These measures, coupled with a centrally controlled foreign exchange rate, created a
lucrative black market for US dollars. Citizens were eager to exchange cash pesos for the traditionally safer US dollar.
The currency controls were previously lifted by another advocate for market-friendly policies, president Mauricio Macri in 2015. But they were reimposed in 2019 at the end of his term to address a fall in value of the peso.
Unlike Macri’s broad-brush removal, Milei is phasing out the controls. He is doing so in the context of less economic volatility and a more stable national budget.
The measures announced this time mean that rather than being fixed, the peso will be able to float between a value of 1,000–1,400
pesos (64p-87p) per US dollar. Milei’s previous policy was a crawling peg, which meant that the peso was pegged to the dollar, but it was prevented from depreciating by more than 1% each month.
However, this was costly. The central bank had to provide the liquidity and has spent US$2.5 billion since mid-March propping up the official rate of the peso.
Floating it means its value is determined by the currency markets. This exposes it to volatility, but the currency band provides some security and the central bank can go back to focusing on building its reserves.
For international companies, future capital can be repatriated out of Argentina (which had been a major barrier to investment). Under the previous restrictions, any profits made by international firms could not be moved out of the country.
And while Argentinians can now buy unlimited dollars through banks, there is still a US$100 restriction on exchanging physical cash.
Analysts have called Milei’s move bold and brave, but also described it as a high-stakes gamble. Recent attempts to do the same thing ended in capital flight, near bankruptcy and ultimately the re-imposition of controls.
But it was also a step that he promised on the campaign trail in 2023. Back then, Milei argued
that economic stability and deregulation were essential to attract investment into Argentina.
So while the Trump administration looks inwards, Milei is opening Argentina to the private sector – especially in relation to its vast natural resources including shale oil and gas, and lithium.
Extraction of Argentina’s shale oil and gas has slowed in recent years, but attracting foreign investment in infrastructure has been high on Milei’s priority list. Business, including US energy giant Chevron, seems cautiously optimistic.
And increased foreign investment in Argentina’s lithium mining sector has raised hopes that the country could be a linchpin in the global energy transition. But at the same time it is deepening Argentina’s dependency on finite commodities.
But what does all this mean for Argentinians right now? For many old enough to remember, it might seem like deja vu. Opening Argentina up to the forces of the market, reducing the regulatory role of the state and privatising major state assets while borrowing more from the IMF has precedent.
It was the same approach followed by president Carlos Menem in the 1990s. This had initial success but over the course of the decade resulted in economic disaster, unsustainable debt (leading to the 2001 IMF debt default) and pushed nearly 60% of the population into poverty.
The US$20 billion IMF loan package (alongside other borrowing) provides Argentina’s central bank with capital to lift the currency restrictions. Adding to the IMF debt burden (which already stood at more than US$40 billion in March 2025) has so far been well received by the markets.
But market-friendly policies being well received by the markets is surely to be expected. What might the social costs be, however?
Milei’s programme of deep austerity included cuts to salaries and welfare payments. These initially pushed poverty levels up to 53%, their highest point in two decades. Recent figures show that, while still frighteningly high, falling inflation has helped bring this down to 38%.
But these figures mask the desperate reality of many. Reductions in state spending and the removal of subsidies mean that income levels for workers and pensioners are below 2023 levels. Many are taking on additional and more precarious work, and soup kitchens are proving essential.
So for many citizens, the news about the partial lifting of currency controls is a moot point. For these people, buying dollars is not remotely feasible.
One thing Argentinians are broadly united in is their disdain for the IMF. Borrowing from it has pushed Argentina to the brink previously – Milei will be hoping that by jettisoning one anvil, his deal with the IMF won’t chain him to a heavier one.
In 2021, the World Bank shut down one of its flagship projects: the Doing Business index, a global ranking system that measured how easy it was to start and run a business in 190 countries.
It followed an independent investigation that found World Bank officials had manipulated the rankings to favor powerful countries, including China and Saudi Arabia. The scandal raised serious concerns about the use of global benchmarks to shape development policy.
Now, the Bank is trying again. In October 2024, it launched its newest flagship report, Business Ready. The 2025 spring meeting of the World Bank and its sister institution, the International Monetary Fund, mark the first time the report will be formally presented to delegates as part of the institutions’ high-level agenda.
Nicknamed B-READY, the report aims to evaluate business environments through more transparent data. This time, the annual assessment has a broader ambition: to go beyond laws and efficiency and also measure social inclusion, environmental sustainability and public service delivery.
As experts on international organizations, law and development, we have given B-READY a closer look. While we appreciate that a global assessment of the economic health of countries through data collection and participation of private stakeholders is a worthwhile endeavor, we worry that the World Bank’s latest effort risks recreating many of the same flaws that plagued its predecessor.
FROM DOING BUSINESS TO DOING WHAT?
To understand what’s at stake, it’s worth recalling what the Doing Business index measured.
From 2003 to 2021, the flagship report was used by governments, investors and World Bank officials alike to assess the business environment of any given country. It ranked countries based on how easy it was to start and run a business in 190 economies.
In prioritizing that as its marker, the index often celebrated reforms that stripped away labor protections, environmental safeguards and corporate taxes in the name of greater “efficiency” of common law versus civil law jurisdictions.
As economist Joseph E. Stiglitz argued in 2021, from its creation, the Doing Business index reflected the values of the so-called Washington Consensus − a development model rooted in deregulation, privatization and market liberalization.
Critics warned for years that the Doing Business index encouraged a global “race to
the bottom.” Countries competed to improve their rankings, often by adopting symbolic legal reforms with little real impact.
In some cases, internal data manipulation at the World Bank penalized governments that did not appear sufficiently business-friendly. These structural flaws − and the political pressures behind them − ultimately led to the project’s demise in 2021.
B-READY is the World Bank’s attempt to regain credibility after the Doing Business scandal. In recent years, there has been both internal and external pressure to create a successor − and B-READY responds to that demand while aiming to fix the methodological flaws.
In theory, while it retains a focus on the business environment, B-READY shifts away from a narrow deregulatory logic and instead seeks to capture how regulations interact with infrastructure, services and equity considerations.
B-READY, which in the pilot stage covers a mix of 50 countries, does not rank countries with a single score. Rather, it provides more accurate data across 10 topics grouped into three pillars: regulatory framework, public services and operational efficiency. The report also introduces new themes such as digital access, environmental sustainability and gender equity.
Unlike the Doing Business index, B-READY publishes its full methodology and makes its data publicly available.
On the surface, this looks like progress. But a criticism of B-READY is that in practice, the changes offer only a more fragmented ranking system — one that is harder to interpret and
still shaped by the same investor driven macroeconomic assumptions.
In our view, the framework continues to reflect a narrow view of what constitutes a healthy legal and economic system, not just for investors but for society as a whole.
LABOR FLEXIBILITY OVER LABOR RIGHTS
A key concern is how B-READY handles labor standards. The report relies on two main data sources: expert consultations and firm-level surveys.
For assessing labor and social security regulations, the World Bank consults lawyers with expertise in each country. But when it comes to how these laws function in practice, the report relies on surveys that ask businesses whether labor costs, dismissal protections and public services are “burdens.”
This approach captures the employer’s perspective, but leaves out workers’ experiences and the real impact on labor rights. In some cases, the scoring system even rewards weaker protections. For example, countries are encouraged to have a minimum-wage law on the books − but are penalized if the wage is “too high” relative to gross domestic product per capita. This creates pressure to keep wages low in order to appear competitive. And while that might be good news for international companies seeking to reduce their labor costs, it isn’t necessarily good for the local workforce or a country’s economic well-being.
According to the International Trade Union Confederation, this approach risks encouraging symbolic reforms while doing little to protect workers. Georgia, for example, ranks near the top of the B-READY labor assess-
ment, despite not having updated its minimum wage since 1999 and setting it below the subsistence level.
Another troubling area, to us as comparative law experts, is how B-READY evaluates legal issues. It measures how quickly commercial courts resolve disputes but ignores judicial independence or respect for the rule of law. As a result, countries such as Hungary and Georgia, which have been widely criticized for democratic backsliding and the erosion of the rule of law, score surprisingly high. Not coincidentally, both governments have already used these scores for propaganda and political gain.
This reflects a deeper problem, we believe. B-READY treats the legal system primarily as a means to attract investment, not as a framework for public accountability. It assumes that making life easier for businesses will automatically benefit everyone. But that assumption risks ignoring the people most affected by these laws and institutions − workers, communities and civil society groups.
B-READY introduces greater transparency and public data − and that, for sure, is a step up from its predecessor. But in our opinion it still reflects a narrow view of what a “good” legal system looks like: one that might deliver efficiency for firms but not necessarily justice or equity for society.
Whether B-Ready becomes a tool for meaningful reform − or just another scoreboard for deregulation − will depend on the World Bank’s willingness to confront its long-standing biases and listen to its critics.
The International Monetary Fund (IMF) has just published its World Economic Outlook, and it does not take an expert to deduce that, even among some of the world’s top economic minds, confident predictions are currently hard to come by.
Every spring the IMF and World Bank hold their Spring Meetings in Washington DC: a week of seminars, briefings and press conferences focusing on the global economy, international development and world financial markets. At both the Spring Meetings and the Annual Meeting, held each autumn, the IMF publishes its global economic growth forecasts.
For its 2025 Spring Meeting the IMF has published a baseline forecast, as well as an addendum analysing the tariff events that took place between 9 and 14 April. According to the Fund’s report, world GDP will grow by 2.8%
in 2025 and 3.0% in 2026. For the euro area, growth will be 0.8% and 1.2% for 2025 and 2026 respectively.
These forecasts represent a substantial downward revision from IMF figures published just three months ago. Globally, growth in 2025 is down by 0.5% compared to the Fund’s January update, with a reduction of 0.2% for the euro area.
One major shift is key to understanding the most recent IMF report and its pessimistic predictions: we live in a much more uncertain world than we did three months ago.
If one had to sum up the new US tariff policy in a word, “unpredictable” would suffice, as the so-called “Liberation Day” of 2 April 2025 represented the largest tariff increase in modern history.
Just one week later, the US president then made two further announcements. First, a 90day freeze on tariff hikes, apparently in search of bilateral agreements with the countries to which he had applied tariffs above 10%. Second, that China would be excluded from this exception, with tariffs on its products being raised to 145%.
This freeze means that until July EU goods being sold to the US will have a 10% tariff instead of the 20% that was announced on 2 April. However, the 10% applied by the new US administration is still much higher than the average tariff of 1.34% that was in force before 5 April.
But what will the tariff be after these 90 days? What about in December? What about in 2 years’ time? What goods will be exempted?
How far will the trade war between China and the US go? The answer to all of these questions is: nobody knows. This uncertainty is evident in of the IMF’s spring forecast.
The IMF’s world trade uncertainty index is currently 7 times higher than it was in October 2024, much higher than in the pandemic.
As far as the economy is concerned, this uncertainty is far worse than a high but definitive tariff. With a tariff, companies can at least reorganise their production chain, and consumers can look for alternative products. There is a cost, but at least businesses and consumers can plan for it.
However, nobody can calculate these costs today because nobody knows how tariffs will evolve. An American company may decide today to buy a particular product from the EU thinking that the tariff will be 10%, but upon the product’s arrival in the US it turns out the tariff has risen to 100% because a presidential advisor said it would be good for the US economy to raise tariffs on that product.
Unbelievable though it may sound, this appears to be how the tariffs are being decided and enacted. According to one account, the US Treasury and Commerce Secretaries were only able to persuade Trump to freeze recent tariff hikes because Peter Navarro – the president’s economic advisor and tariff ideologue – was in another room at the time.
The end result of this unpredictability is that the best course of action, for consumers and businesses alike, is inaction.
It is no surprise that these constant changes of plans are causing great instability in financial markets. Although Trump may have triumphantly celebrated rising stock prices immediately after the tariff freeze was announced, financial markets are now subject to levels of uncertainty and fear similar to those seen during COVID-19.
Five years ago, volatility was associated with increased demand for US government debt due to the “flight to safety” effect: investors selling higher risk investments and buying safer assets, such as gold and government
bonds, in times of uncertainty.
Now we are seeing the exact opposite. The price of US bonds has fallen since “Liberation Day”, and this means that investors are selling them. In other words, markets no longer believe that US government debt is a safe asset. Given the role of the dollar and US debt in international markets, this paradigm shift may generate even more financial instability down the line.
COVID-19, the last major global economic crisis, has one thing in common with the current situation: disruption of global supply chains. During the pandemic it was confinement that forced production to stop. Today, it is the imposition of tariffs.
However, there is another major difference. During COVID people knew it was a matter of time before vaccines became available and normality returned. Today, instability in financial markets comes not from any virus, but from President Trump’s own advisors selling him all manner of plans to protect US economic interests.
Martin Jacob Professor of Accounting and Control, IESE Business School (Universidad de Navarra)
Trump’s sweeping “reciprocal” tariffs are generating huge uncertainty, which may prompt many companies around the globe to delay investments and major decisions as they await greater clarity. Even with the newly announced 90-day suspension of tariffs, large companies will be moving cautiously over the coming weeks and months.
This is bad news for growth, especially at a time when companies and economies face additional sources of geopolitical uncertainty, such as the war in Ukraine and shifting relationships in Nato.
To understand the impact of these tariffs on Europe and elsewhere, it’s important first to note that US calculations of the trade deficit include only goods and exclude services. This is a major omission – especially since the US is a huge exporter of services – and skews the
true magnitude of the EU-US trade gap.
The White House has claimed that EU tariffs on the US are around 39%, justifying its (currently paused) reciprocal tariff of 20%. However, World Trade Organization and EU data puts EU tariffs on US goods somewhere closer to 1% or 5%.
Vowing to “fight to the end”, China has already retaliated and the US has responded in kind, announcing a further tariff hike from 104% to 125% at the same time as the 90-day suspension for most of the rest of the world.
NOBODY WINS A TRADE WAR
Retaliation with equivalent tariffs tends to magnify their already negative impact. Escalating trade wars mean that exporting companies are not only hit with a new tax on their products, but all of Europe’s imports from the US also become more costly. That both slows economic
growth and pushes up inflation. However, Trump has rejected repeated EU offers of “zero for zero” tariffs on certain goods.
The EU took its first tentative step towards retaliating by saying it would gradually impose tariffs on around €21 billion of US goods, though the Commission stated that “these countermeasures can be suspended at any time, should the US agree to a fair and balanced negotiated outcome.”
Ursula von der Leyen has therefore welcomed the new pause on US tariffs, calling it “an important step towards stabilising the global economy”.
Her statement highlighted that “tariffs are taxes that only hurt businesses and consumers”. It also reiterated the offer of zero-for-zero tariffs and called for stability – in her words, “clear, predictable conditions are essential for trade and supply chains to function.”
Trump’s decision to pause tariffs is presumably driven by capital market pressure, looming consumer price increases, and the pressure on US government bonds. While capital markets have rebounded in response, the long term picture is still mired in uncertainty. It is just a pause, not an end to the trade war.
As global markets continue to deliver their verdict on the tariffs, companies are caught in the geopolitical crossfire. These policy shifts generate major uncertainty, which is very bad for business.
One corporate response to tariffs and uncertainty is to shift supply chains away from high tariff or uncertain countries. This is neither easy nor cheap. It would be costly for European firms to replace all US suppliers, to limit imports from its largest trading partner, or to find alternative markets.
Despite being the motivator for Trump’s tariff war, one of the underlying problems is that there’s a logic behind trade deficits. Put simply, countries tend to specialise in the goods and services in which they have a competitive advantage.
Take coffee, for instance. Colombia and Brazil
are the world’s biggest coffee producers, largely because of favourable growing conditions. About 0.35% of the coffee consumed in the US is grown domestically, mainly in Hawaii, but tariffs will not replicate the soil and climate of South America.
There is also the question of wages, especially in industries such as clothing and footwear. In the unlikely scenario that Nike, for example, were to shift all its production back to the US, the cost of paying American workers would drive the prices of their goods exponentially higher. It is simply not feasible for all low-wage manufacturing jobs to come back to the US.
In the end, the most common reaction by business leaders to policy uncertainty is simply to wait and see. Companies delay investments and hold off on major decisions until the situation becomes clearer. The 90-days tariff pause will not solve this issue, and it might even exacerbate it by further delaying big investment decisions.
We’ve seen this negative investment impact of uncertainty clearly in our research on policy decisions that were much less disruptive than this. We looked at corporate reactions to the
surprise election of Donald Trump in 2016 and to his 2017 Tax Cuts and Jobs Act (TCJA), the most significant reform to US corporate tax policy in over 30 years.
Conventional wisdom would indicate that once these two major events had passed, uncertainty would decrease, especially given the generally positive sentiment that corporate-friendly changes to tax policy were in the works. That turned out not to be the case. We found tax policy uncertainty rose after the election and, while it decreased overall once TCJA was passed, it still remained high in many firms.
Domestic companies, even those that stood to benefit from the tax cuts, held back on investment. Multinational companies shifted some investments abroad, particularly to countries with lower political risk.
One of the major goals of Trump’s tariffs is to increase investment in the US. Some companies are even sending signals that that is what they intend to do, but it will be difficult for production on a large, global scale to suddenly return to the US. If history is any guide, companies are more likely respond to the recent radical political swings with caution rather than bold investment plans.
After more than three years and 14 rounds of negotiations, the UK and India have finally announced a free trade agreement (FTA). UK Prime Minister Keir Starmer will formally sign the deal on a visit to India later this year. This is the biggest and most economically significant bilateral trade deal the UK has struck since leaving the EU. It will have implications for both businesses and workers.
In 2024, the UK’s trade with India was worth £43 billion – £17.1 billion of exports and £25.5 billion of imports. Government modelling estimates that trade between the nations will increase by as much as 39% and the UK’s GDP will expand by £4.8 billion or 0.1 percentage points per year as a result.
India’s economy is growing fast. It is expected to expand by 6% annually, becoming the
world’s third largest economy by 2028 after the US and China. This certainly makes the deal with the UK very timely.
With a population of more than 1.4 billion and a growing middle class, the country offers huge market potential. Its import demand is predicted to grow by 144% between 2021 and 2035. This combination of strong economic growth and increasing numbers of citizens with disposable cash makes a compelling case for the deal.
Both the UK and India have agreed to reduce tariffs under the deal. India will immediately lower its 150% tariffs on Scotch whisky and gin to 75%, and then to 40% within ten years. Tariffs on foodstuffs such as lamb, salmon and cheeses will fall from around 30% to zero.
Simplified trade rules, including faster customs processing, reduced barriers such as complex
labelling requirements, and enhanced support for small businesses should bring gains for companies. Timely customs clearance will support exports of perishable items like Scottish salmon, where delays reduce the product’s shelf life. Similarly, exporters of things like biscuits and cheese will benefit from streamlined paperwork and be able to compete in India’s growing market.
There will no longer be limits on the number of UK businesses allowed to provide telecommunications, environmental and construction services. And UK businesses will not need to set up a company in India or be a resident in India to supply their services in these sectors.
Once the FTA comes into force, which could take up to a year, the UK will allow 99% of Indian imports duty-free access into the UK. The sectors set to benefit most are footwear, textiles and clothing, as well as processed
prawns, basmati rice and ready meals. These reductions will mean lower prices for UK consumers, given tariffs on clothing and footwear are 12% and 16% respectively.
Tariffs on luxury cars will also be reduced from more than 100% to 10% under quotas on both sides. The FTA locks in zero tariffs on industrial machinery, advanced materials for use in hi-tech industries, and components for electric vehicles. This will position British suppliers inside a manufacturing market ranked the world’s second-most attractive after China.
In terms of workers, there were well publicised fears that the agreement might lead to UK workers being undercut by Indian counterparts. Plans for a so-called “double contribution convention” grants a three-year exemption from national insurance contributions for Indian employees temporarily working in the UK. But this is a reciprocal deal and is likely to apply only to workers who are seconded from one country to the other, so should not result in UK workers being more expensive to hire.
And although no changes to immigration policy are planned, the FTA will offer easier movement for skilled workers. UK providers of services like construction and telecoms will have access to India’s growing market.
Both countries have committed to encouraging the recognition of professional qualifications. A professional services working group for UK and Indian government officials will provide a forum to monitor and support this initiative.
Against a backdrop of rising protectionism and geopolitical tensions, the UK-India FTA stands out as a strategic deal. It is also a significant milestone in Britain’s Indo-Pacific “tilt”. This approach gives UK firms a hedge against over-reliance on any single region or country-centric supply chains, to keep trade flowing in the event of more US tariff shocks, for example.
With the US fixation on tariffs, and global
supply chains facing continued disruption, securing preferential access to the world’s fastest-growing major economy is a strategic win for the UK. From India’s perspective, the trade deal is aligned with its rise as a “China-plus-one” manufacturing hub (where businesses diversify to ensure they do not invest only in China).
The UK and India share historical ties that are underpinned by cultural, educational and people-to-people links. The UK-India FTA marks a new phase in this relationship, where shared economic interests define a forward-looking partnership between the two countries.
And in terms of its ongoing talks with the EU, India could use the agreement to showcase its willingness to negotiate ambitious trade deals. For the UK, given its own upcoming trade and cooperation talks with the EU, the FTA with India demonstrates that new partnerships can be built while maintaining vital European ties.
Wolff Professor of International Security, University of Birmingham
The term that perhaps best describes the international impact of the first 100 days of Donald Trump’s second term is “disruption”. His tariff policy, his abolition of USAID, his questioning of the transatlantic alliance, and his attempted rapprochement with Russia have neither destroyed the liberal international order nor established anything new in its place.
But the prospects of liberal internationalism under Trump are vanishingly small. And Trumpism, in the guise of an America-first foreign policy, is likely to outlast Trump’s second term.
That the US is no longer the standard bearer of the liberal international order has been clear for some time. Trump and his Russian and Chinese counterparts, Vladimir Putin and Xi Jinping, appear to see themselves as dominant players in a new multi-polar world order. But it is not clear that a grand bargain between them is possible – or that it would endure.
Europe is particularly vulnerable to these changes in the international order. Having been able to rely for the past eight decades on an iron-clad American security guarantee, European countries chronically under-invested in their defence capabilities, especially since the end of the cold war.
Defence spending as a proportion of GDP may have increased over the past decade but remains lacklustre. And investment into an independent European defence industrial base faces many hurdles.
These deficiencies predated Trump’s return to the White House. Addressing them will only be possible in a time frame beyond his second term. With no dependable partners left among the world’s great powers, Europe’s predicament – unenviable as it may be for the moment – nonetheless offers an opportunity for the continent to begin to stand on its own feet.
Early signs of a more independent Europe are promising. In March, the European commission released a white paper on defence which an-
ticipates defence investment of €800 billion (£680 billion) over the next four years.
The bulk of this will rely on the activation of the so-called “national escape clause”. This allows EU member states to escape penalties if they exceed the normal deficit ceiling of 3% GDP.
Once activated for the purpose of defence spending, they can now take on additional debt of up to 1.5% of their GDP. By the end of April, 12 EU member states had already requested that the national escape clause be activated, with several more expected to follow.
Defence is clearly the most urgent problem for Europe. But it isn’t the only aspect to consider when it comes to achieving greater strategic autonomy, something that the European Union has grappled with for more than a decade. In other areas, such as trade and energy, the starting point is a very different one.
Regarding energy independence, the EU has achieved a remarkable and quick pivot away
from Russia. It has just released a final plan to stop all remaining gas imports from Russia by the end of 2027.
On trade, Donald Trump’s America-first tariff policy has done significant damage to the global system. This has, in turn, created opportunities for the EU, as one of the world’s largest trading blocs, including greater cooperation with China, already one of its largest trading partners.
China and the EU clearly share an interest in preserving a global trade regime from which both have benefited. But their economic interests cannot be separated easily from their geopolitical interests. So far, China has sent very mixed signals to Europe.
Beijing has, for example, proposed to lift sanctions against some members of the European parliament who have been critical of China in a show of goodwill. But China’s support for Russia continues as well, most recently with Xi’s commitment to visit Moscow for the victory day parade on May 9.
Standing with Moscow may benefit Beijing in its rivalry with the US by solidifying the no-limits partnership that Xi and Putin announced on the eve of Russia’s full-sale invasion in February 2022. But it does little to win the EU over as a partner in defence of the open in-
ternational order that Trump is trying his best to shutter.
On the contrary, in reaffirming China’s commitment to its partnership with Russia, Xi may well have lost whatever chances there were for a European realignment with China.
The complexities of the EU-China and EU-US relationships – a curious mix of rapidly shifting interests – reflects the EU’s position as the natural centre of gravity of what is left of the west. This is evident in the rapid evolution of the “coalition of the willing” in support of Ukraine, which brings together 30 countries from across the EU and Nato under French and British leadership.
Beyond Europe, Trump’s tariff policy has given plans for a strategic partnership between the EU and the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) a new lease of life. The CPTPP is a group of 11 Indo-Pacific countries and the UK, which joined last December. It is one of the world’s largest free trade areas, accounting for approximately 15% of global GDP.
Even without US and Chinese membership, a partnership between the EU and the CPTPP would wield significant power in the global economic system and could play a future role in shielding its members from an intensifying US-China trade war.
None of the steps taken by the EU and its partners on the continent and elsewhere require the breakdown in the transatlantic relationship that the Trump administration appears keen to engineer. But speeches by both the US vice president, J.D. Vance, and the secretary of state, Marco Rubio, were clear that America’s relationship with Europe is changing.
Washington, under its current leadership, increasingly leans towards the political forces in Europe that are opposed to the values on which the continent has been orientated since 1945. This leaves Europe few options but to seek more independence from the US.
A more independent Europe is unlikely to become a global superpower on par with the US or China. But it will be better able to hold its own in a geopolitical environment that is less based on rules and more on power.
The EU currently enjoys historically high approval ratings among its citizens – who also support more unity and a more active role for the EU in protecting them from global security risks.
It’s increasingly clear that EU leaders and their partners have a unique opportunity – and an obligation – to carve out a more secure and independent space in a hostile global environment.
William D. O’Connell Postdoctoral Research Associate, Center
As United States President Donald Trump’s tariff announcements wreak havoc on stock markets, concerns are mounting over the possibility of a global financial crisis.
These concerns have intensified amid reports that the Department of Government Efficiency (DOGE), headed by Tesla founder Elon Musk, has set its sights on the Federal Deposit Insurance Corporation (FDIC) — the U.S. agency responsible for protecting deposits and administering bank insolvencies.
The targeting of the FDIC appears to mark an escalation in the Trump administration’s efforts to rein in regulatory agencies. In February, an executive order issued issued by Trump expanded his control over independent regulators, including the FDIC.
What sets the FDIC apart from other agencies targeted by DOGE is that it’s not under direct executive authority and it isn’t funded by the U.S. government. Instead, the FDIC is funded
through levies on the banks it monitors — a structure designed to insulate it from political pressure.
In February, the FDIC cut 1,000 new and temporary staff as part of DOGE’s broader cuts to the federal bureaucracy. According to a regulatory official, DOGE has reportedly been reviewing the agency’s contracts and staffing.
In December, Trump administration officials reportedly floated abolishing the FDIC with prospective nominees for various bank regulatory appointments.
More recently, in February, DOGE and U.S. administration officials attempted to dismantle the Consumer Financial Protection Bureau, a separate regulator that was established after the 2008 financial crisis. A judge moved to block this process in late March after finding the administration had acted “completely in violation of law.”
There are also reports suggesting the FDIC’s regulatory and intervention functions could be transferred to the Office of the Comptroller of the Currency (OCC). Unlike the FDIC, the OCC is under the authority of the Treasury Department, therefore lacking the same degree of operational independence. This risks further politicizing decisions on bank regulation or intervention.
Any of these reforms would be a disaster for the stability of the global financial system.
Deposit insurers like the FDIC cover losses for deposits in the event of a bank failure. In theory, this coverage is capped at $250,000 in the U.S. and $100,000 in Canada. In practice, as the failure of Silicon Valley Bank in 2023 made clear, there is no upper limit to this insurance.
This insurance serves two main purposes. First, it protects everyday people and small
businesses from risks taken by their banks. Two, it prevents panic, as it means depositors have no reason to rush to withdraw their money before a bank collapses.
The FDIC and its Canadian equivalent, the Canadian Deposit Insurance Corporation, have the authority to intervene when banks fail, ensuring they are wound down in an orderly fashion without a bailout or broader economic disruption.
During the 2008 financial crisis, few mechanisms other than taxpayer-funded bailouts existed to rescue the financial system. Postcrisis reforms, like the Dodd–Frank Act, granted the FDIC more power help address systemically important bank failures with a broader set of tools. Many of these reforms were negotiated at the international level.
Project 2025, a Heritage Foundation plan that has supported many of DOGE’s interventions, has called to repeal these reforms. Dismantling or undermining the FDIC would strip the U.S. of one of its most effective ways to respond to a financial crisis.
The FDIC also plays a role in monitoring large banks, alongside the Federal Reserve and the OCC. At the international level, the FDIC works with foreign regulators to plan for the possibility of a crisis, and to implement solutions if one occurs.
In 2023, the FDIC failed to prevent the collapse of Silicon Valley Bank largely due to two key reasons: deregulation enacted during the first Trump administration and staffing shortages that existed even before the February cuts.
However, once the FDIC did intervene, it was able to contain the crisis and prevent wider fallout. Weakening the FDIC, as has occurred with other U.S. federal agencies, would greatly reduce its ability to perform this function in the future. Fewer regulators means less oversight and more risk-taking behaviour by financial institutions.
Limiting the FDIC’s capacity to intervene would effectively return the U.S. to a pre-2008
world in which large banks operated with the expectation of public bailouts. This is a hazard made more dangerous by the fact that many of those banks are much larger and more interconnected than they were back then.
Foreign regulators also rely heavily on the FDIC for information on the health of U.S. banks and U.S.-based subsidiaries of foreign banks. This co-operation was crucial to ensuring a smooth resolution when global bank Credit Suisse failed in 2023. Without a reliable, independent FDIC, these relationships may fall apart, leaving the world with few options to avoid another financial meltdown.
Global financial stability depends, in large part, on U.S. leadership. But recent developments indicate the current administration no longer believes this responsibility is in its best interests. If this view extends to the FDIC’s role in regulating and resolving too-big-to-fail banks, the world faces risks far greater than just volatility in the stock market.
Around the world, millions remain excluded from the benefits of traditional banking, held back by outdated systems that favour the privileged few. CrossFi is changing that. By combining the power of Web3 technology with real-world usability and robust compliance, CrossFi is creating a borderless financial ecosystem designed to put people, not banks, first. This article examines how CrossFi is redefining financial freedom and unlocking new opportunities for those who need it most.
The world’s financial infrastructure wasn’t built for inclusion. Traditional systems favour the already privileged—those with established credit histories, residency in developed markets, and access to reliable banking. For billions across the Global South, the reality is different: underbanked, overlooked, and underserved. But what if the future of finance didn’t need to be built on old foundations?
That’s the thesis behind CrossFi: a decentralised financial ecosystem engineered to serve users not banks. With one foot in the real world and the other in the Web3 economy, CrossFi offers a full-stack solution that enables people to spend, earn, and grow their wealth without relying on traditional intermediaries.
CrossFi isn’t just another DeFi protocol. It’s a complete infrastructure layer combining:
• The CrossFi App, a user-friendly wallet and card solution for daily use
• xApp, a powerful DeFi dashboard enabling swaps, bridging, and staking
• xAssets, synthetic financial instruments granting exposure to commodities, currencies, and indexes
• PhoLend, a collateralised lending protocol for stablecoin-based microfinance
• CrossFi Chain, a sovereign Layer 1 blockchain designed for modular growth
• DeBridge, a cross-chain liquidity and messaging layer
Each product targets a core pain point. A freelancer in Nairobi can get paid in USDT and spend it using a card. A crypto trader in Buenos Aires can gain synthetic exposure to gold without needing a broker. A micro-entrepreneur in Jakarta can borrow against stablecoin savings all without stepping into a bank.
COMPLIANCE, SECURITY, AND SCALABILITY
CrossFi was designed with regulation in mind. Products are non-custodial, user-controlled, and built on audited smart contracts. PCI DSS compliance ensures payment-grade security, and its regional rollout strategy aligns with licensing in emerging economies.
This makes CrossFi more than an experiment, it’s a scalable blueprint for how DeFi can coexist with compliance and real-world usability.
The real innovation isn’t just in the tech, it’s in the model. By bundling essential financial services into one cohesive experience, CrossFi becomes a gateway for users in underserved markets to leapfrog outdated systems.
In the long arc of financial history, we’re witnessing a shift from centralised control to decentralised sovereignty. CrossFi is writing the next chapter.
− And so are the
When the first cryptocurrency, Bitcoin, was proposed in 2008, the goal was simple: to create a digital currency free from banks and governments. Over time, that idea evolved into something much bigger: “decentralized finance,” or “DeFi.”
With decentralized finance, people trade, borrow and earn interest on crypto assets without relying on traditional intermediaries. DeFi services run on blockchains, which are essentially digital ledgers, and use “smart contracts” − self-executing code that automates financial
transactions. Tens of billions of dollars have poured into the DeFi market.
But with innovation comes risks. The lack of centralized oversight has made crypto, including decentralized finance, a prime target for hackers and scammers. In 2024 alone, people lost nearly US$1.5 billion due to security exploits and fraud. And unlike traditional finance, there’s usually no way to recover stolen crypto.
As a computer scientist, I wanted to better understand how people perceive and respond to these risks. So my colleagues and I first conducted in-depth interviews with 14 crypto
investors, then surveyed nearly 500 others to validate our findings.
Our study found that people often made the same mistakes, driven by recurring misconceptions and gaps in security awareness. Here are some of the most important.
MISTAKE 1: THINKING THE BLOCKCHAIN GUARANTEES SECURITY
Many people told us they thought decentralized finance was secure – but their reasoning wasn’t very convincing. Some seemed to confuse decentralized finance with blockchain
technology itself, which is designed to ensure transactions are tamper-resistant through socalled “consensus mechanisms.” One told us that DeFi is secure “because a hacker would have to override an entire blockchain” to steal funds.
But services on the blockchain are still vulnerable to implementation and design flaws. These include smart contract breaches, in which bad guys exploit bugs in a service’s code, and front-end attacks, where a user interface is altered to redirect funds into a hacker’s wallet. A front-end attack was reportedly to blame for a recent $1.5 billion crypto heist.
Another common misconception is that DeFi is secure if private keys are well stored. A private key is a secret code that allows someone to access their crypto assets. It’s true that in DeFi – unlike in centralized crypto finance where an exchange holds private keys – users have full control over their own private keys.
But even with perfect private key management, users can still lose funds by interacting with compromised DeFi platforms. That’s because safeguarding private keys can prevent only direct attacks targeting private key access, such as phishing attempts.
The people we spoke with also failed to follow best practices for securing their private keys. Using a hardware wallet – a physical device that stores private keys offline – is one of the most secure options for protecting keys from online threats. However, our study found that only a handful of participants actually used hardware wallets.
Two-factor authentication, or 2FA, is a standard security mechanism in which two forms of verification are required to access an account. Think being texted a one-time code before you can log into your bank account.
To prevent account breaches, centralized crypto exchanges such as Binance and Coinbase use two-factor authentication for logins, account recovery and withdrawal confirmations. But while 2FA is crucial to security in the traditional and centralized crypto finance system, it plays a much smaller role in decentralized finance.
DeFi wallets give users access based on private key ownership rather than identity verification, which means traditional 2FA can’t be used. Instead, only 2FA-like mechanisms are available in DeFi. For instance, multisignature wallets require approval from multiple private key holders. However, if your private key is compromised, attackers can perform wallet operations on your behalf without any additional verification. In addition, even users who adopt 2FA-like measures can’t prevent the security breaches on the DeFi services’ end.
Unfortunately, our participants were overly
confident regarding the effectiveness of 2FA, with one saying, “Two-factor authentication has been one of the best solutions for keeping wallets safe.” In our survey, 57.1% of users relied on 2FA as their only technical countermeasure against rug pulls – scams where project creators suddenly withdraw funds –and 49.3% did so for smart contract exploits. This misplaced trust could lead them to ignore more effective security strategies.
MISTAKE 4: NOT MANAGING TOKEN APPROVALS
One such effective strategy is revoking token approvals. In DeFi, tokens are digital assets on a blockchain that represent value or rights, and users often need to approve smart contracts to access or spend them. But if you leave these approvals open, a malicious contract – or one that’s been hacked – can drain your wallet. So it’s crucial to routinely check all token approvals you’ve granted to prevent losses caused by fraudulent or hacked DeFi services. Specifically, you should limit spending allowances instead of using the default “unlimited” option, and revoke approvals for apps you no longer use or trust.
Worryingly, we found that only 10.8% and 16.3% of participants regularly checked and revoked token approvals to protect against rug pulls and smart contract exploits, respectively. In light of this, we recommend that wallet providers introduce a reminder feature
to prompt users to review their token approvals periodically.
MISTAKE 5: NOT LEARNING FROM PAST INCIDENTS
Even after they’re hacked or scammed, people often don’t do anything to improve their security practices, we found. Just 17.6% of those who reported being victims of a DeFi scam regularly checked token approvals afterward. Worse, 26% took no action at all after a scam, and 16.4% doubled down by investing even more in other DeFi services.
Surprisingly, more than half of the victims said their belief in DeFi either stayed the same or grew stronger after the incident. One user who lost $4,700 due to a rug-pull incident said, “My belief in cryptocurrency has grown stronger after that because I made good money from it.” That person added, “An opportunity to make money is something I believe in.” This suggests that DeFi users’ financial motivations can sometimes outweigh their security concerns –and, perhaps, their better judgment.
There’s no one-size-fits-all solution to DeFi security. But awareness is the first step. To stay safe, crypto investors should use hardware wallets, revoke unused token approvals and continually learn new techniques to protect themselves from evolving threats. Most importantly, they should stay rational and not let the allure of profits cloud their security practices.
Peter Doyle Founder
INTRODUCTION: A NEW ERA OF PRIVATE MARKETS INVESTING
As global markets navigate unrelenting volatility, geopolitical fragmentation, and shifting investor sentiment, one thing has become clear: The traditional playbook for wealth preservation and growth is being rewritten.
In this new era, private markets are emerging as a preferred safe harbour for capital — but only for those firms who can offer what today’s sophisticated investors demand: security, liquidity, transparency, and performance. Consult Group Worldwide (CGW), a boutique investment intermediary headquartered in Dubai, is at the forefront of this evolution. With a 13-year legacy and over $710 million in capital raised, CGW is reshaping how financial professionals — from IFAs and wealth managers to
family offices and institutional agents — access and distribute fixed-income solutions that are built for the world we now live in.
CAPITAL PRESERVATION IS NO LONGER A FEATURE — IT’S A MANDATE
2025 marks a clear turning point in investor behaviour. Where once high-yield, long-term products dominated portfolio allocation, today’s clients — particularly high-net-worth investors — are demanding shorter investment horizons, robust, asset-backed security, fixed, pre-determined returns, and non-correlation to global markets.
CGW has recognised this shift early, building an investment architecture focused on UltraShort-Term Notes (USTNs) — structured private credit instruments with maturities of 120 to 180
days and 100% capital protection. Backed by institutional-grade litigation finance, CGW’s solutions are purpose-built for security-conscious investors seeking predictable returns without sacrificing liquidity.
WHY LITIGATION FINANCE IS REDEFINING FIXED INCOME
Litigation finance is no longer an emerging asset class — it is now an institutional-grade investment solution poised for mainstream adoption.
The reason is simple. Legal case outcomes are unrelated to stock market performance, interest rate fluctuations, or political events. They are determined by facts, contracts, and court outcomes — making them an attractive hedge against market volatility.CGW has
capitalised on this opportunity, creating structured notes that deliver between 12% and 20% fixed returns over a short-term horizon while maintaining rigorous due diligence and risk oversight.
Beyond its innovative product architecture, CGW’s value proposition lies in its unique positioning within the private markets ecosystem.
Since 2012, CGW has refined its proprietary S.O.S. model:
S → Sourcing Institutional-Grade Opportunities
O → Originating Structured Investment Products
S → Structuring Solutions for Global Distribution
This model enables CGW to act not just as a product distributor but as a strategic partner — working closely with wealth managers, IFAs, family offices, and placement agents to customise investment strategies for their clients.
Operating out of Dubai — a global hub for finance and investment innovation — CGW’s network spans Europe, the Middle East, Asia, LATAM, and Africa. This global footprint allows CGW to tap into diverse investor networks while maintaining deep local expertise in
compliance, client management, and product education.
Another defining characteristic of CGW is its operational philosophy which prioritises an unshaking commitment to transparency. Unlike many investment platforms focused purely on distribution volume, CGW operates a dedicated Product & Risk Committee, ensuring independent evaluation of investment products, regular publishing of risk assessments, rigorous case selection methodology, and alignment with global regulatory best practices. This governance-first approach has established CGW as a trusted intermediary in an industry that is increasingly scrutinised for product misalignment and investor risk.
THE FUTURE OF PRIVATE CREDIT BELONGS TO THOSE WHO PROTECT CAPITAL
As market cycles shorten and investor expectations rise, CGW believes the future of private markets belongs to those who can deliver fixed, attractive returns, offer products with liquidity and flexibility, protect investor capital as a core promise, and operate with transparency and governance. It is not enough to offer alternatives. The winning firms will be those who offer security-first alternatives that clients want to invest in themselves.
CGW’s 2025 and beyond growth strategy is anchored in one principle: Empowering financial professionals to access best-in-class, secure alternative investments that enhance
client portfolios while building long-term trust. Through partnerships with IFAs, wealth managers, private banks, and institutional agents, CGW will continue to expand its footprint — bringing short-term, capital-protected investment solutions to markets that demand innovation without compromise.
For over a decade, CGW has built its reputation not on speculation — but on structure, security, and success. As private markets become more integral to global investing, CGW remains committed to raising the standard for product integrity, capital protection, and investor trust. In a world of complexity, CGW’s approach is refreshingly simple: Protect capital. Generate returns. Build relationships that last.
Consult Group Worldwide (CGW) is a leading boutique investment intermediary providing secure, asset-backed alternative investment solutions to IFAs, wealth managers, family offices, and institutional investors globally. With a proven track record of $710 million in capital raised, CGW specialises in ultra-short-term investment products backed by institutional litigation finance and private credit strategies.
Website: www.consultgroupworldwide.com
Media Contact: info@consultgroupworldwide.com
Clive Roland Boddy Deputy Head, School of Management, Anglia Ruskin University
Would you want a psychopath looking after your pension? Or what about your shares? In a recent talk at the Cambridge Festival of Science, I spoke about the latest research relating to a psychopath’s love of money, greed for power, and willingness to harm other people financially for personal gain.
Since I began researching corporate psychopaths and the global financial crisis, the idea of the financial psychopath, an employee in the financial sector acting ruthlessly, recklessly, greedily and selfishly with other people’s money, has gained traction.
The theory won support because psychopaths are more commonly found in financial services than in other sectors. It has even been argued that up to 10% of employees in financial services could be psychopathic. That is to say they have no empathy, care for other people, conscience or regrets for any damage they do.
These traits make them ruthless in pursuit of their own agendas and entirely focused on self-promotion and self-advancement.
But my ongoing research goes even further. It has found that psychopaths are willing to knowingly cause financial harm to the entire global community, in order to receive a financial bonus for themselves. Personal greed
outweighs the immense social and community costs of implementing that greed.
This aligns with earlier perceptions of some captains of finance or leading politicians as psychopaths. Previous research found they are freed by their selfish philosophy of life and their trivialising of other people from the restraints of being evenhanded, truthful or generous.
This new research also shows that a majority of psychopaths would even be willing to cause a global financial crisis – if they personally would profit from, for example, falling stock prices. This willingness holds true even when they could be personally identified as being
the source of the crisis. Only a tiny minority of non-psychopaths would be willing to do this.
Financial insiders appear to agree with the assumption that psychopaths have always been prevalent in the sector. Many psychologists and other management commentators have come to the same conclusion.
Researchers have also found that interpersonal-affective psychopathic traits – such as deceitfulness, superficial charm and a lack of remorse – were associated with success in the finance sector.
Employees at financial institutions in New York scored significantly higher on these traits than people in the wider community. They also had significantly lower levels of emotional intelligence (as would be expected of psychopaths).
What’s more, having psychopathic traits has also been linked to higher annual incomes –as well as a higher rank within the corporation.
In other words, it looks like the more psychopathic an employee is, the further up the corporate finance ladder they will go. This corresponds with findings that show there are more psychopaths at the top of organisations than at the bottom.
This is not to say that personal success in climbing the corporate ladder equates to professional success when someone reaches the top job. Quite the opposite. In fact, my research has shown that psychopathic leadership is associated with organisational destruction.
This includes a greater propensity to take risks with other people’s money, a greater willingness to gamble with someone else’s money and lower returns for shareholders.
In one study over a ten-year period, psychopathic fund managers were found to generate annual returns that were 30% lower than their less psychopathic peers.
The research team concluded that among elite financial investors, psychopathy and its appearance of personal dominance and competence may enable people to rise to the top of their profession. But this does not translate into improved financial performance at the organisational level, where the presence of the psychopathic is actually counterproductive.
Fraud has always been associated with the psychopathic – so much so that in one study 69% of auditors believed they had encountered corporate psychopaths in relation to their investigations.
Years ago, one bank reportedly used a psychopathy measure to recruit staff. But I would advise against hiring people who score very highly, because they are totally concerned with personal success. They are not bothered about long-term organisational growth or sustainability. As such, decisions will be made to suit the psychopathic worker, and not the organisation.
For example, new hires would be likely to be people who can help the psychopath achieve their personal aims and objectives rather than aid the company. Anyone astute enough to potentially be a challenge to the psychopathic employee would not be hired by them in the first place.
Without exception, psychopathic people love money and they are more motivated by it than other people are.
Unlike the rest of the population, psychopaths are uninterested in higher values such as close emotional connections with family and friends, and much more focused on money and materialism. Seen through this lens, the appeal of the corporate banking sector – and the salaries and bonuses it offers – to people with these traits soon becomes clear.
In the aftermath of the global financial crisis, as traditional lenders withdrew and liquidity evaporated across entire segments of the market, a new generation of capital advisory firms emerged to fill the void. Among them, Arc & Co. distinguished itself not by scale or noise, but through conviction, strategy, and the ability to operate within the grey zones of complexity that others avoided. Founded in 2008, it was a response to a financial system retreating from risk just as clients needed ingenuity most. Today, Arc & Co. stands as a benchmark in strategic lending - independent, adaptive, and, above all, unrelenting in the pursuit of solutions others deem unworkable.
Its impact has not gone unnoticed. With previous accolades from Real Estate Capital Europe, the NACFB, Moneyfacts, and Bridging & Commercial, including consecutive Debt Advisor of the Year UK titles in 2022 and 2023, the firm is trusted not only by clients, but by the financial community at large. In an industry where credentials are hard-earned and easily revoked, Arc & Co.’s record is not merely consistent; it is exceptional.
From the beginning, Arc & Co. was built to respond to dislocation. Its founder, Andrew Robinson, launched the firm to serve a postGFC market starved of liquidity and fraying at the edges of traditional lending. At a time when high street banks and private equity houses were shuttering credit lines to private
clients, the firm carved out a vital space, offering bespoke capital solutions to those left stranded by institutional inertia.
This crisis-born mindset became cultural. The firm does not chase simplicity; it thrives in complexity. Whether advising property developers, asset-rich but cash-poor family offices, or international investors navigating regulatory challenges, Arc & Co. approaches each brief as a multi-dimensional puzzle requiring fluency in both finance and circumstance.
Managing Director Edward Horn-Smith, who joined in 2009 and formalised the commercial and development finance division by 2011, played a crucial role in scaling this ethos. Together, the leadership embedded adaptability into the firm’s DNA, ensuring that its services could keep pace with global liquidity shifts, evolving borrower profiles, and cross-border funding requirements.
The philosophy remains clear: structure should follow need, not precedent. And in an increasingly segmented marketplace, this principle has proven essential.
STRUCTURING INTELLIGENCE: THE NEW CURRENCY IN CAPITAL ADVISORY
If independence is Arc & Co.’s foundation, structuring is its engine. The firm’s value lies not in generic access to capital, but in its ability to assemble layered, creative funding solutions that align with both asset characteristics and borrower strategy. Working across real estate, development, mezzanine, JV equity, luxury asset finance, and bridging, it is lender-agnostic by design, partnering with one lender for every two deals, ensuring objectivity and precision.
Nowhere is this clearer than in one of the firm’s most illustrative recent cases: a £14 million re-
financing on a £21 million retail and leisure portfolio. The borrower, a well-established UK family business, faced a hard deadline: existing finance would not be extended beyond January. Lender appetite was weak; indicative terms arrived from only two sources, both cautious given the volatility in the retail sector. Further complicating matters was the need for the highest possible leverage on day one, essential for a broader restructuring programme involving multiple assets across varied geographies.
Where others might have walked away, Arc & Co. mobilised. Over the festive period, the transaction was completed in under four months. By leveraging longstanding relationships, the team negotiated flexible terms with the outgoing lender, maintaining communication throughout via monthly updates. An ICR waiver and interest reserve were structured for the initial 12 months, during which an asset management programme was deployed to increase rental income. The result: administration was avoided, liquidity was secured, and the family business continued to trade without disruption.
This case was not an outlier. It was emblematic. It reflected a commitment to client continuity, a capacity for deep structuring intelligence, and a rare ability to deliver under pressure.
What sets Arc & Co. apart is not merely its process but its people. The firm has rejected the gig economy ethos prevalent in the advisory space, opting instead to build careers, not
silos. Trainees are brought in early, mentored by directors, and given immediate exposure to live client work and lender relationships. It is a model of institutional apprenticeship, not transactional training.
The leadership of Robinson and Horn-Smith exemplifies this approach. Neither confines themselves to an office or spreadsheet. Both lead from the front - nurturing client relationships, refining the brand, and remaining closely involved in deal development. Their influence shapes an internal culture where empathy, authenticity, and strategic thinking are prioritised over volume.
The result is a team that behaves less like brokers and more like embedded advisorsindividuals who carry responsibility beyond completion and remain engaged long after transactions close. Clients recognise this. Many return not because of rates or speed, but because they trust Arc & Co. to own the outcome as fiercely as they do.
In recent years, the firm’s reach has expanded in tandem with its credibility. With a strong client base across Asia, the Channel Islands, and the Middle East, and personnel such as Paul Davies, formerly Vice Chairman of Coutts Asia, leading business development from the region, Arc & Co. has positioned itself as a preferred partner for global clients investing in UK and Western European assets.
This expansion has been underpinned by an equally strategic focus on governance. As
a directly authorised firm, Arc & Co. views regulation not as an obstacle but as an essential pillar of long-term legitimacy. The firm has invested in compliance infrastructure, technology, and client communication tools that ensure transparency, reporting, and data management remain best-in-class, even as requirements become more exacting.
The appointment of James Fleming as Executive Chairman further cements this trajectory. With decades of leadership in private banking and multi-family office strategy, Fleming brings the institutional discipline and networks needed to unlock the next phase of the firm’s evolution. His presence signals a deeper integration with the wealth management sector, expanding Arc & Co.’s relevance and reach.
In an environment often defined by binary outcomes, approved or declined, Arc & Co. has built a business on nuance. Its leadership understands that capital is not just a financial instrument but a strategic enabler, and that clients need more than products. They need partners.
Recognition from PAN FINANCE as Capital Advisory Firm of the Year - UK 2024 is not a capstone. It is a signal that what the firm offers, structural intelligence, independence, continuity, and deep human engagement, is not only rare but required.
In a world of retrenchment and volatility, Arc & Co. has chosen relevance. And in doing so, it has reshaped what modern capital advisory can and should mean.
Johannes Petry CSGR Research Fellow, University of Warwick
The trade war between China and the US has spiralled into unchartered territory. On April 10, the Trump administration imposed a tariff of 125% on all Chinese imports. China called the actions unfair and responded with similar measures.
Within the broader debate around unravelling economic ties between the US and China, where economic interdependence has increasingly been viewed as a threat to US national security, this escalation raises questions about whether global finance is also reducing its presence in China.
After all, the risks of financial connectivity with China have been discussed prominently by US policymakers in recent years. And many financial analysts have spent much of the past year discussing whether China has become “uninvestable” due to rising geopolitical tensions.
However, as I show in a recently published study, most global financial firms have continued to expand their presence in Chinese markets over the last decade, even as tensions have intensified.
Crucially, they have done so on China’s terms, operating within a system that prioritises government oversight and policy goals over liberal market norms. This pragmatic accommodation is quietly reshaping the global financial order.
China’s capital markets, which have historically been sealed off from the rest of the world, have been opening up in recent decades. This has prompted global financial firms to expand their footprint in China.
Investment banks such as Goldman Sachs and JP Morgan have taken full ownership of local joint ventures. And asset managers like BlackRock or Invesco have established fund
management operations on the Chinese mainland.
Yet China has not liberalised in the way many in the west expected. Rather than conforming to global norms of open, lightly regulated markets, China’s financial system remains largely guided by the state.
Markets there operate within a framework shaped by the policy priorities of the central government, capital controls remain in place, and foreign firms are expected to play by a different set of rules than they would in New York or London.
Foreign investors have been allowed to buy into mainland markets, but through infrastructure that limits capital outflows and preserves regulatory oversight.
Rather than adapting China to the global fi-
nancial order, Wall Street has accommodated China’s distinct model. The motivation behind this is clear: China is simply too big to ignore.
Take China’s pension system as an example. Whereas pension assets in the US amount to 136.2% of GDP in 2019, in China these only amounted to 1.6%. The growth potential in this market is enormous, representing a trillion-dollar opportunity for global firms.
Consequently, index providers such as MSCI, FTSE Russell, and S&P Dow Jones – key gatekeepers of global investment – have included Chinese stocks and bonds in major benchmark indices.
These decisions, taken between 2017 and 2020, effectively declared Chinese markets “investment grade” for institutional investors around the world. This has helped legitimise China’s market model within the architecture of global finance.
In recent years, Washington has sought to curtail US financial exposure to China through a growing set of measures. These include investment restrictions, entity blacklists, and forced delisting for Chinese firms on US stock exchanges. Such actions signal a broader effort to use finance as a tool of strategic leverage.
The moves have had some effect. Some US institutional investors and pension funds have
declared China “uninvestable”, and are reducing their exposure. American investments in China have roughly halved since their US$1.4 trillion (£1.1 trillion) peak in 2020.
But attributing this solely to geopolitical pressure overlooks another key factor: China’s underwhelming market performance. A protracted property crisis, a government crackdown on tech companies, and a weak post-pandemic economic recovery have made Chinese markets less attractive to investors in purely financial terms.
More strategically oriented investors from Asia, Europe and the Middle East have invested more into Chinese markets, filling gaps left by US investors. Sovereign wealth funds from the Middle East, especially, have engaged in more long-term investments as part of broader efforts to strengthen economic cooperation with China.
And at the same time, many western financial firms have doubled down on their presence in China, expanding their onshore footprint. Since 2020, institutions like JP Morgan, Goldman Sachs and BlackRock have opened new offices, increased their staff, acquired new licences and bought out their joint venture partners to operate independently as investment banks, asset managers or futures brokers.
It has become more difficult to invest foreign capital in China. But western financial firms are positioning themselves to tap into China’s
huge domestic capital pools and capture its long-term growth opportunities – even as they tread carefully around geopolitical sensitivities.
It is too early to predict the long-term effects of the current geopolitical tensions. But Wall Street is trying to placate both sides. On the one hand, it is adapting to capital markets with Chinese characteristics. And on the other, it is trying not to antagonise an increasingly interventionist America.
However, while holding its breath amid further escalation and having scaled back some of its activities, Wall Street has not left China. It is instead learning how to work within the constraints of a system shaped by a different set of priorities.
This does not necessarily signal a new global consensus. But it does suggest that the liberal financial order, once defined by AngloAmerican norms, is becoming more pluralistic. China’s rise is showing that alternative models – where the state retains a strong hand in markets – can coexist with, and even shape, global finance.
As tensions between the US and China continue to rise, financial firms are learning to navigate a world in which existing relationships between states and markets are being reconfigured. This process may well define the future of global finance.
In today’s fast-paced financial ecosystem, agility and innovation are not just competitive advantages—they are imperatives. As consumer expectations evolve and regulatory landscapes shift, financial institutions and fintechs must be able to respond with speed, precision, and creativity. At the heart of this transformation lies a powerful concept: configurability.
Configurability refers to the ability to adapt systems and services quickly and efficiently without being shackled by rigid, legacy infrastructure. It’s about empowering institutions to design, launch, and refine financial products that meet the unique needs of their customers and markets. One company that has embraced this philosophy from the beginning is i2c, a global leader in banking and payment technology.
For over two decades, i2c has been at the forefront of enabling innovation through its highly configurable platform. In recognition of its impact, Pan Finance named i2c the Best Configurable Banking Platform and Payment Technology Innovator of the Year in 2025. According to i2c’s Founder and CEO, Amir Wain, this recognition is not just a reflection of the company’s technology—it’s a testament to
its mission of empowering clients to innovate on their own terms.
CONFIGURABILITY MATTERS NOW MORE THAN EVER
Configurability is more than a technical feature—it’s a strategic necessity in the modern financial world. Traditional banking platforms often rely on rigid, outdated monolithic architectures that are slow to adapt and expensive to modify. These systems can trap financial institutions in long vendor backlogs, stifling innovation and delaying time-to-market by months—and even years—for new products and features.
“That’s why we built i2c differently,” says Wain. “Our unified, global platform is designed to be configurable, modular, and
scalable. Whether credit, debit, prepaid, core banking, or money movement, our clients can design, launch, and iterate products in real time without being trapped in what we call the “blacklog hole.”
Configurability gives clients control over their innovation roadmap. They are no longer dependent on vendor timelines or development queues—they can move at the speed of their business. This level of flexibility empowers them to respond rapidly to market shifts, regulatory changes, and evolving customer expectations with unmatched speed and precision.
INSIDE i2c’s CUSTOMER-CENTRIC PLATFORM
At the core of i2c’s platform is a customer-centric architecture enabling modular, building-block
solutions. This design philosophy allows clients to create tailored programmes that reflect their brand identity, operational needs, and strategic goals—quickly, cost-effectively, and without compromise. Because it’s cloud-native, the platform delivers this flexibility with enterprise-grade security, reliability, and scalability.
Every component of the platform—product features, rules, limits, rewards, and integrations—can be configured to meet specific requirements. Every aspect of a product—from user experience to risk logic—can be tailored through a self-serve environment. This means that clients are not forced to conform to a rigid template; instead, they can build solutions that are as unique as their customer base.
What truly differentiates i2c from other banking and payment platforms is its unwavering commitment to client empowerment through configurability. While many platforms offer limited configurability within predefined parameters, i2c’s solutions are designed to accommodate the diverse needs of financial institutions across different geographies, regulatory environments, and customer segments, enabling them to:
• Tailor product parameters for credit, debit, prepaid, core banking and money movement solutions— down to the rules, limits, and rewards.
• Personalise customer experiences that reflect their brand identity and resonate with their audience.
• Adapt quickly to market shifts, evolving technologies, customer demands, and regulatory changes.
• Integrate seamlessly with external platforms and third-party systems to build connected ecosystems and unlock new value streams with expanded capabilities and services.
“We leaned into configurability early on, because it’s the most powerful, scalable, and sustainable way to future-proof financial services,” explains Wain. “It’s how we give our clients control—empowering them to innovate on their terms, compete in crowded markets, and scale with confidence. As financial services become increasingly commoditised in an industry that demands speed and personalisation, configurability has become the engine of competitive advantage.”
i2c doesn’t just innovate on its platform—it fosters a culture of innovation, dedicating nearly one-third of its workforce to ongoing research and development and continuously investing in:
• Future-Ready Technology: i2c integrates
cutting-edge technologies such as artificial intelligence, machine learning, and real-time analytics to help clients deliver smarter, faster, and more personalised experiences.
• Expanding Ecosystem: Through strategic partnerships with fintechs, global innovators, and technology providers, i2c enables clients to plug into a wide range of integrated solutions that enhance functionality and accelerate scalability.
• Ongoing Client Collaboration: i2c collaborates closely with clients to turn bold ideas into real-world solutions, helping them launch differentiated products that drive sustainable growth and elevate customer experiences.
• Emerging Use Case Support: The platform’s modular configurable design supports virtually any use case such as embedded finance, digital wallets, buy-now-pay-later (BNPL), and loyalty-driven programmes, allowing clients to adapt in real time, seize new opportunities and remain resilient in an ever-evolving environment.
• Data Empowerment: i2c enhances its data infrastructure with advanced tools for analytics, segmentation, and personalisation to help clients unlock actionable insights, make informed decisions, and personalise meaningful offerings.
In a world where change is the only constant, i2c’s configurable platform offers a powerfully resilient foundation for building the future of banking and payments—one that is agile, inclusive, and ready for whatever comes next.
Looking ahead, i2c envisions a future where financial institutions are empowered to innovate without limits. It’s agile, future-ready solutions help clients thrive in a rapidly evolving environment influenced by trends for:
• Digital-First Experiences: The shift to digital is no longer optional—it’s foundational. Consumers now expect seamless, intuitive, and secure experiences across all digital touchpoints.
• Hyper-Personalisation: One-size-fits-all is over. Customers want financial products and services that reflect their unique needs, behaviours, and life stages.
• Embedded Finance: Financial services are becoming invisible—integrated directly into the platforms and ecosystems where consumers already spend their time. This trend is blurring the lines between banking, retail, travel, and more, creating new opportunities for customer engagement.
• AI and Data-Driven Innovation: Artificial intelligence and advanced analytics are unlocking smarter, faster decision-making. From fraud prevention to credit underwriting to customer service, AI is enhancing every layer of the financial stack.
• Real-Time Payments: Speed is the new standard. The demand for instant, frictionless transactions is accelerating, and real-time payments are becoming a critical capability for financial institutions worldwide.
• Sustainability and Financial Inclusion: Purpose-driven innovation is gaining momentum. Institutions are increasingly focused on building solutions that promote financial wellness, expand access to underserved communities, and support environmental and social goals.
i2c’s vision helps clients turn these trends into strategic advantages, ensuring they are not only prepared for change, but positioned to lead it.
These accolades are a testament to i2c’s unique all-in-one platform, composable building-block solutions, and over twenty years of trusted ingenuity. But for Amir Wain and the i2c team, the real victory lies in the success of their clients.
“When we innovate, our clients lead,” Wain says. “These awards are not just a win for us—they’re a win for every organisation we partner with, and for every customer they serve.”
Angel Zhong Professor of Finance, RMIT University
Warren Buffett, the 94-yearold investing legend and chief executive of Berkshire Hathaway, has announced plans to step down at the end of this year.
His departure will mark the end of an era for value investing, an investment approach built on buying quality companies at reasonable prices and holding them for the long term.
Buffett’s approach transformed Berkshire Hathaway from a small textile business in the 1960s into a giant conglomerate now worth more than US$1.1 trillion (A$1.7 trillion)
He built his fortune backing US industry in energy and insurance and American brands, including big stakes in household names such as Coca-Cola, American Express and Apple.
At Berkshire’s annual meeting at the weekend, held in an arena with thousands of devoted investors, Buffett named Greg Abel as his successor.
Abel, 62, is currently chairman and chief executive of Berkshire Hathaway Energy, as well as vice chairman of Berkshire Hathaway’s vast non-insurance operations.
He’s known for his disciplined, no-nonsense management style. The company’s board has now voted unanimously to approve the move.
This changing of the guard comes at a pivotal moment. Donald Trump’s return to the US presidency has already delivered significant economic policy shifts.
Meanwhile, questions about US economic dominance grow louder against China’s continued rise.
THE ‘ORACLE OF OMAHA’
Few names command as much respect in the world of finance as Warren Buffett. Born in Omaha, Nebraska, in 1930, Buffett displayed an early genius for numbers and investing. He bought his first stock at age 11.
His investment philosophy – buying undervalued companies with strong fundamentals – would later earn him the nickname the “Oracle of Omaha” for his uncanny ability to predict market trends and identify winning investments years before others did.
Buffett drew his investment approach from the value investment principles of British-born US economist Benjamin Graham.
He preferred businesses with lasting advan-
tages and a clear value proposition. Some of his key investments included insurance company GEICO, railroad company BNSF, and more recently Chinese electric vehicle maker BYD.
He avoided speculative bubbles (such as the dotcom bubble of the late 1990s and, more recently, cryptocurrencies) and preached longterm patience to investors. As he famously wrote in a 1988 letter to shareholders:
“In fact, when we own portions of outstanding businesses with outstanding managements, our favorite holding period is forever.”
Buffett’s guidance helped Berkshire navigate many economic booms and recessions. Over his six decades at the helm, the company delivered impressive compounded annual returns of almost 20% – virtually double those of the S&P 500 index.
Beyond financial success, Buffett championed ethical business practices and pledged to donate more than 99% of his wealth through the Giving Pledge, which he cofounded with Bill Gates and Melinda French Gates.
In an op-ed for the New York Times in 2008, Buffett famously shared the maxim that guides his investment decisions:
“Be fearful when others are greedy, and be greedy when others are fearful.”
But his strategy thrived in an era of increasing globalisation, free trade, and US economic supremacy. The world has shifted since Buffett’s heyday.
There are concerns about the recent underperformance of value investing. Technology companies now dominate older industries.
This raises questions about whether those who succeed Buffett can spot the next major industry disruptors.
Trump’s return as US president heralds major changes in economic policy. Trade restrictions might hurt some of Berkshire’s international investments. However, these same policies might benefit Buffett’s US-focused
investments.
The idea of US economic superiority also faces new questions. China may overtake the US economy in the 2030s. The US share of global economic output has fallen from about 22% in 1980 to about 15% today.
Buffett’s “never bet against America” mantra faces new scrutiny.
Abel inherits a company with about US$348 billion (A$539 billion) in cash. That’s a serious amount of capital to deploy wisely amid global economic uncertainty and Trump’s trade war.
Abel will likely maintain Berkshire’s core values while updating its approach. His challenges include:
• Maintaining the “Buffett premium”: Abel lacks Buffett’s cult-like following among investors, which may gradually erode the additional value the market assigns to Berkshire due to Buffett’s leadership.
• Without Buffett’s reputation, Abel may face increased pressure to effectively deploy Berkshire’s massive cash pile in a still-expensive stock market, where valuations are high and finding bargains is harder than ever.
• Technological adaptation: while Berkshire has increased its technology investments over the years (including positions in Apple and Amazon), balancing its legacy holdings (such as Coca-Cola and railroads) with growth sectors (AI, renewables) remains challenging.
• Environmental concerns: Berkshire Hathaway’s heavy reliance on coal and gas-fired utilities has drawn growing criticism as investors and regulators demand cleaner energy solutions.
Replicating the “golden touch”: Buffett’s genius wasn’t just in picking stocks. It was also in capital allocation, deal-making, and crisis management (for example, buying into Goldman Sachs during the global financial crisis). Can Abel replicate that?
Buffett’s principles – patience, intrinsic value and betting on America – are timeless. But the world has moved on. His successor must navigate geopolitical risks, technological disruption, and the rise of passive investing while preserving Berkshire’s unique culture.
The post-Buffett era represents more than just a leadership change. It’s a test of whether Buffett’s principles can survive in an increasingly short-term, technology-dominated, and geopolitically complex world.
Abel’s leadership will reveal the enduring power – or limitations – of Buffett’s philosophy.
As Zambia’s free market economy dawned, what began in 1993 as a capital markets project by the Government of the Republic of Zambia, the International Finance Corporation (IFC) and the United Nations Development Program (UNDP) has now blossomed into Zambia’s premier Securities Exchange. The Lusaka Securities Exchange (LuSE) PLC has proven resilient through varying economic times such as during the global pandemic and most recently difficult environmental challenges in the form of national drought. The Exchange has not only remained resilient but thrived across all these dynamic periods. Given its strength, the LuSE remains Zambia’s main securities exchange and has been at the heart of Zambia’s economic development, anchoring the country’s medium to long term development objectives.
In 2024, the LuSE was among the best five performing exchanges in Africa having delivered consistent gains for investors across the year. Its total cumulative gains as measured by its All Share Index closed at a cumulative gain of 43% in local currency and 39% in US Dollar terms, placing the exchange in the top 5 best performing markets in Africa. The consistent growth in market returns remains a true reflection of the growth momentum that the market continues to enjoy in a very competitive mar-
ket landscape in Africa. Additionally, the performance of the exchange posits a very stable and positive macroeconomic performance of the country.
Zambia remains an ideal investment destination in Africa and top ranked among countries with ease of doing business. With its rich untapped natural resources Zambia ranks very competitively within the sub-Saharan region. It has implemented several reforms and is among the best investor friendly countries
with fiscal policy measures that act as an enabler for investors seeking opportunities in its capital markets. Over the medium term, the country is poised to grow over 5% in Gross Domestic Product (GDP). This growth is anchored on a robust private sector supported by favourable fiscal regime. This positions the Capital Markets for favourable growth in the medium to long term with growth opportunities in key economic sectors such as ICT, Telecommunications, Financial, Agriculture, Energy and Construction sectors.
The LuSE remains optimistic over the current economic growth trajectory premised on positive economic, legal and regulatory policy environment. The Board of the LuSE have set out a clear strategic plan that seek to redefine the way business is conducted on the Exchange as the market navigates the current dynamic economic times and reposition Zambia’s financial sector.
Commenting on the strategic imperatives for the Exchange, Mr. Kabaso stated that the Board of Directors have given the Management team a challenge to reposition and enhance the way business is done on the Exchange.
“Among some of the crucial deliverables that the Board seeks to achieve is answering the basic requirements of why we exist! The Board is very clear that, if we must reposition the business, we need to get the basics rights! And that is, within the broader capital markets, the LuSE must facilitate capital formation, enable liquidity flows, and efficient resource allocation thereby anchoring Zambia’s economic development. We believe this is the reason we exist and hence we seek to aggressively reposition the way business is done at the exchange.”
The LuSE’s five-year strategic plan was therefore carefully curated to reflect the journey over the medium to long term. The strategic plan is themed “Sustainable Business Growth – Anchoring Capital Market and Economic Development.”
The theme was carefully chosen to reflect the LuSE’s commitment to meeting shareholder interests by creating an Exchange that experiences sustainable growth, meets the minimum requirements to attract liquidity, capital formation and remains relevant to the modern demands of a global exchange.
The strategy is driven by a vibrant and experienced management team to ensure that LuSE continues to adapt to current and future market trends and repositions itself as a force to reckon with in the regional context.
Some of the key milestones recorded in the last 12 months have been increased innovation and diversification of its product offering. The Exchange has introduced over the period two new instruments:
• Issuance of the first US Dollar denominated Real Estate Investment Trust (REIT) listed on the market
Issuance of the first Green Bonds listed on the market, culminating into a cumulative value of USD 200mn
In an effort to drive increased individual participation the Exchange has rolled out a Mobile Application which is accessible via the cellular phones. This initiative aims to
bridge the gap of financial inclusion and increase retail participation in the stock market.
“We continue to see clear water in volumes year on year via the transactions on our mobile application. This trend could be attributed to dominance of mobile payments in the Zambia’s payment landscape which continue to account for a significant portion of total retail payment value.”
Mr Kabaso stated.
He further stated that, by leveraging such digital platforms, the Exchange is poised to contribute to the national agenda of using a broad range of high quality and innovative financial products and services to serve the underserved communities in Zambia and lead these to the mainstream financial system.
And in line with Zambia’s Capital Markets Master Plan (CMMP), the LuSE has aligned itself for increased market activity and the following activities have since been lined up for execution over the short to medium term:
• Trading Hours: Trading hours on the exchange have been extended from 4 to 5 hours effective 2025. This is to allow for increased liquidity and participation from the investing public.
• Direct Market Access: The LuSE is expected to launch direct market access for its trading floor to allow investor to have increased visibility of the depth of the market in real time. This is anticipated will allow for quick capital formation and price discovery that would inform increased market liquidity.
• Simplifying the Listing Rules: The Exchange has also embarked on the revision of the listing rules to simplify and condense the current rule book for increased business activities both from issuers and investors.
Active Stakeholder Engagement: Currently, stakeholder engagements are being held annually to maintain open engagement with all our listed companies.
• Listed Companies’ Awareness Program: The LuSE has created listing awareness training programs for Boards of Directors and senior management teams of the listed companies in order to drive continued compliance of the listing rules.
• IPO Pipeline: In partnership with other key stakeholders, the LuSE is tracking an active pipeline of IPOs with increased possibility of near-term actualisation. Currently, 3 different IPOs are in the pipeline for the short term.
The LuSE is very confident that it will remain a luminary in the securities exchange market in Africa and remains an important pillar for Zambia’s economic solution over the medium to long term as it continues to mobilise patient
capital into productive economic sectors.
The Pan African Finance Awards awarded LuSE the “Securities Exchange of the Year & Most Innovative Multi-Asset Trading Platform - Zambia 2025”. This was after carefully consider factors such as impact, community engagement, sustainability, global integration and innovation shown by the nominees. Publicly available intelligence was gathered along with any verified supporting evidence provided by nominees.
In accepting the award, the LuSE Chief Executive Officer, Mr Nicholas Kabaso, expressed profound gratitude to the Pan Africa Finance Awards for recognising the immense work the team continues to put in place to redirect the narrative of the exchange. He believes this award is not just a piece of recognition for the LuSE but for Zambia as well! He further stated that its a strong affirmation of the exchanges unwavering commitment to progress, to embracing technological advancements, and to creating a capital market that is efficient, accessible, and truly serves the needs of issuers and investors. He also thanked the Board and Staff for their relentless support and hard work.
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Victor Becerra Professor of Power Systems Engineering, University of
Britain’s booming green energy generation has a costly side-effect: the national electricity system operator has had to compensate wind turbine operators that could have produced more clean electricity than the grid could take.
The cost of paying windfarms to temporarily switch off rose significantly in early 2025, surpassing £250 million in the first two months of the year. This figure not only includes these “constraint payments” to windfarm operators, but also payments to gas power plants to switch on and meet demand in the south of England that could theoretically be met by wind energy.
Wind power is often generated in remote areas like the Scottish Highlands, where there is low electricity demand. To transmit this power over long distances to areas of higher demand (mostly in the south of England) requires power lines, but these have transmission limits and there are not enough of them.
Britain will only make effective use of its energy potential if grid-scale energy storage keeps
pace with the expansion of new windfarms and other forms of intermittent renewable energy, such as solar.
Large-scale battery systems, pumped hydro and other storage methods could capture the excess energy injected by windfarms on windy days and release it when needed. But are these energy storage options arriving quickly enough?
Most British consumers will not see a significant change in how they use electricity with the introduction of planned storage installations, other than fewer blips in power quality, such as flickering or dimming lights.
You might spot these new energy storage facilities in rows of what look like shipping containers but are actually batteries. And the national grid (which serves England, Wales and Scotland – Northern Ireland has a separate electricity network) will be more capable of responding quickly to even minor variations in electricity supply and demand, meaning fewer headlines about curtailed windfarms.
The UK government is aiming to build up to 27 gigawatts of battery storage by 2030 (in 2023, battery capacity was estimated to be around 5 gigawatts). There are applications totalling 59 gigawatts of battery storage in the connections queue for 2030.
Some of these are speculative – introduced to secure connection slots and permissions, with the intention of selling the rights on. These connections will not necessarily be built, yet contribute to long delays in approvals.
As a result, the energy regulator Ofgem has been working with network operators to reform the connections queue. This includes new rules and more coordination between grid operators and project developers, as well as incentives (such as lower connection charges) to encourage battery developers to ensure their output can be adjusted to accommodate network constraints when necessary.
Having substantial grid-scale energy storage could help stabilise electricity prices, which might give households lower and less volatile bills. It would also reduce the need to fire up gas generators during supply lulls, lowering
the influence of expensive imported gas on electricity prices.
Storing excess renewable energy involves a range of technologies. Short-duration storage options such as batteries can supply energy ranging from seconds to a few hours. Longduration storage, such as pumped hydro, can supply energy for several hours, days or more.
Pumped hydro is the oldest long-duration storage technology. It involves storing vast amounts of energy by pumping water to a higher reservoir when electricity is plentiful, and releasing it to a lower reservoir through a turbine when needed. Dinorwig in north Wales and Cruachan in western Scotland are capable of storing 9 and 7 gigawatt-hours of energy, respectively.
Major expansions are planned, such as the new pumped hydro storage scheme Coire Glas in Scotland. Expected to be completed around 2030-31, it is designed to store 30 gigawatt-hours, adding vast reserves of energy to the grid.
Britain’s largest grid-scale battery installation, the Minety battery storage project completed in 2022 in Wiltshire, southern England, is capable of absorbing or delivering 150 megawatts – roughly equivalent to the power demand of 450,000 UK households.
While Britain is making progress with its storage infrastructure, other countries are scaling up rapidly. China has built huge pumped hydro stations and the US is deploying very large grid-scale batteries. Germany, meanwhile, is testing hydrogen storage to absorb the power from its onshore windfarms.
There is a drive by energy companies to develop new forms of long-duration storage. Along with hydrogen, liquid-air storage is capable of inter-seasonal storage. This would allow solar energy collected during the summer to be available for release during the duller autumn and winter months.
In liquid-air plants, excess electricity is used to cool air to a liquid which can then be stored in insulated tanks. When electricity is required,
the liquid air is heated and turned back into a gas, which moves a turbine and generates electricity. A 50-megawatt liquid-air plant planned near Manchester is expected to start commercial operation in 2026.
In hydrogen energy storage plants, surplus electricity powers an electrolyser that splits water molecules into hydrogen and oxygen. The hydrogen is stored and, when electricity is needed, fed into a fuel cell or turbine to generate the electricity. An example is the proposed Aldbrough facility in east Yorkshire, which is expected to be in operation by 2030 and will have a storage capacity of 320 gigawatt-hours. This facility will use three repurposed salt caverns originally developed to store natural gas.
Energy storage technology has become a serious business opportunity, with companies investing billions of pounds into building new facilities. The variety of projects in the pipeline suggests the UK will be better able to avoid curtailing wind energy in the future, even accounting for growth in wind power capacity. Paying windfarm operators to switch off may soon be a thing of the past.
More than half of the world’s population currently lives in cities and this share is expected to rise to nearly 70% by 2050.
It’s no wonder “smart cities” have become a buzzword in urban planning, politics and tech circles, and even media.
The phrase conjures images of self-driving buses, traffic lights controlled by artificial intelligence (AI) and buildings that manage their own energy use.
But for all the attention the term receives, it’s not clear what actually makes a city smart. Is it about the number of sensors installed? The speed of the internet? The presence of a digital dashboard at the town hall?
Governments regularly speak of future-ready cities and the promise of “digital transforma-
tion”. But when the term “smart city” is used in policy documents or on the campaign trail, it often lacks clarity.
Over the past two decades, governments around the world have poured billions into smart city initiatives, often with more ambition than clarity. The result has been a patchwork of projects: some genuinely transformative, others flashy but shallow.
So, what does it really mean for a city to be smart? And how can technology solve real urban problems, not just create new ones?
The term “smart city” has been applied to a wide range of urban technologies and initiatives – from traffic sensors and smart meters to autonomous vehicles and energy-efficient building systems.
But a consistent, working definition remains elusive.
In academic and policy circles, one widely accepted view is that a smart city is one where technology is used to enhance key urban outcomes: liveability, sustainability, social equity and, ultimately, people’s quality of life.
What matters here is whether the application of technology leads to measurable improvements in the way people live, move and interact with the city around them.
By that standard, many “smart city” initiatives fall short, not because the tools don’t exist, but because the focus is often on visibility and symbolic infrastructure rather than impact.
This could be features like high-tech digital kiosks in public spaces that are visibly modern and offer some use and value, but do little to address core urban challenges.
The reality of urban governance – messy, decentralised, often constrained – is a long way from the seamless dashboards and simulations often promised in promotional material.
But there is a way to help join together the various aspects of city living, with the help of “digital twins”.
Much of the early focus on smart cities revolved around individual technologies: installing sensors, launching apps or creating control centres. But these tools often worked in isolation and offered limited insight into how the city functioned as a whole.
CITY DIGITAL TWINS REPRESENT A SHIFT IN APPROACH.
Instead of layering technology onto existing systems, a city digital twin creates a virtual replica of those systems. It links real-time data across transport, energy, infrastructure and the environment. It’s a kind of living, evolving model of the city that changes as the real city changes.
This enables planners and policymakers to test decisions before making them. They can simulate the impact of a new road, assess the risk of flooding in a changing climate or compare the outcomes of different zoning options.
Used in this way, digital twins support decisions that are better informed, more responsive, and more in tune with how cities actually work.
Not all digital twins operate at the same level. Some offer little more than 3D visualisations, while others bring in real-time data and support complex scenario testing.
The most advanced ones don’t just simulate the city, but interact with it.
To manage urban change, some cities are already using digital twins to support long-term planning and day-to-day decision-making –and not just as add-ons.
In Singapore, the Virtual Singapore project is one of the most advanced city-scale digital twins in the world.
It integrates high-resolution 3D models of Singapore with real-time and historical data from across the city. The platform has been used by government agencies to model energy consumption, assess climate and air flow impacts of new buildings, manage underground infrastructure, and explore zoning options based on risks like flooding in a highly constrained urban environment.
In Helsinki, the Kalasatama digital twin has been used to evaluate solar energy potential,
conduct wind simulations and plan building orientations. It has also been integrated into public engagement processes: the OpenCities Planner platform lets residents explore proposed developments and offer feedback before construction begins.
If smart cities are going to matter, they must do more than sound and look good. They need to solve real problems, improve people’s lives and protect the privacy and integrity of the data they collect.
That includes being built with strong safeguards against cyber threats. A connected city should not be a more vulnerable city.
The term smart city has always been slippery – more aspiration than definition. That ambiguity makes it hard to measure whether, or how, a city becomes smart. But one thing is clear: being smart doesn’t mean flooding citizens with apps and screens, or wrapping public life in flashy tech.
The smartest cities might not even feel digital on the surface. They would work quietly in the background, gather only the data they need, coordinate it well and use it to make citizens’ life safer, fairer and more efficient.
China has been developing closer ties with countries in central Asia over recent years. Trade between China and the central Asia region grew to US$89 billion (£69 billion) in 2023, an increase of 27% on the previous year. Chinese trade rose with every country there except Turkmenistan.
In my paper from June 2024, which is part of a collection of studies looking at the impact of China’s sprawling belt and road initiative in low- and middle-income countries, I explored how Chinese investment is affecting Uzbekistan’s energy sector.
Chinese investment in Uzbekistan has grown significantly since 2020. By the end of 2022, it had reached US$4.5 billion, up from US$2.8 billion one year before. There are now over 3,450 Chinese companies in Uzbekistan, accounting for roughly 20% of all foreign companies in the country.
One of the main reasons for China’s expanding footprint in central Asia is to intensify energy cooperation. By becoming a major buyer, lender and investor in the region’s energy sector, China is hoping to reduce its dependence on countries such as Russia.
Central Asia has been politically and economically dependent on Russia since the Russian empire invaded the region in the 19th century. Much of its infrastructure was built to provide commodities like cotton and energy to Russia, with the latter selling it at high prices to Europe. This infrastructure has, until relatively recently, remained largely unchanged.
However, some central Asian countries have been able to reduce their dependence on Russia over the past decade or so. China has become the main importer of Uzbek gas, with a peak share of more than 80%. And Uzbekistan exported almost US$2 billion worth of goods to China in 2022, matching its volume of trade with Russia.
Investment in energy infrastructure is taking place in a reflection of these trade patterns.
Central Asia boasts significant reserves of oil and gas. But most of the region’s pipelines were traditionally directed towards Russia and, to a lesser extent, south-west to Turkey.
Pipelines have been built and maintained with China’s support that are directed towards the east. These pipelines have facilitated trade with China and have helped reduce operational waste in the energy sectors of Turkmenistan, Kazakhstan and Uzbekistan.
In 2025, China plans to resume the construction of a pipeline stretching from Turkmenistan through Uzbekistan, Tajikistan and Kyrgyzstan, pending the finalisation of a gas supply contract with Turkmenistan. This will further strengthen China’s energy ties with the region.
A few years ago, while I was carrying out fieldwork in Uzbekistan, I interviewed policy experts and those involved in the Uzbek en-
ergy industry. My interviewees saw deals with China as more reliable than Russia, which has in the past renegotiated the terms of long-term energy contracts with central Asian countries or has added unfair clauses in its favour.
In 2018, for example, the Uzbek government needed additional gas to meet domestic demand. Russia’s Lukoil energy company agreed to sell the gas from a joint Lukoil-Uzbek production facility to Uzbekistan, but at a hefty price. The Uzbek government incurred debt to Lukoil worth US$600 million.
Chinese involvement in the Uzbek energy sector is also having an indirect effect on Uzbekistan’s green economy. During the pandemic, Uzbekistan’s gas exports to China dropped significantly, exposing operators to the vulnerability of relying on a single energy source.
Gas exports to China have recovered since 2021. But this shock prompted policymakers to explore ways of diversifying Uzbekistan’s energy production away from fossil fuels. Over the past few years, Uzbekistan has invested over US$4 billion in renewable energy produc-
tion, with the technology and expertise often coming from China.
With the support of Chinese companies, vast solar power plants have been planned and developed near the Uzbek capital, Tashkent, as well as other cities like Navoi. Wind turbines have been supplied by Chinese firms for projects in Ferghana, near the border with Kyrgyzstan.
Chinese-led investment in the renewable energy sector has created further demand for skilled and semi-skilled labour, such as translators, logistics operators and engineers. My interviewees noted positive – albeit limited – effects on employment and wages in the sector.
There are, however, also drawbacks to Chinese involvement in central Asia’s energy sector. Uzbekistan’s gas trade with China is a possible source of political and economic vulnerability.
The export price of Uzbek gas is more prof-
itable for energy companies than the local subsidised price, so exports have taken priority over the domestic market. Uzbek consumers often have to contend with rationed gas supplies or no access to gas at all, especially during the winter when demand is at its highest.
This has led to dissatisfaction among the Uzbek population, especially in rural areas where people have had to resort to burning alternative sources of fuel like coal, firewood and animal dung. These energy sources are harmful to health and the environment.
Western sanctions on Russian oil and gas since 2022, when Russia launched its invasion of Ukraine, have also created further competition for Uzbek gas. Russian gas suppliers have sought alternative markets in Asia to circumvent the sanctions. Trade flow data shows that India, Turkey and even China have increased the amount of Russian fossil fuels they buy.
But, by and large, the state of play in the global energy market seems to be changing. Central Asia is in a strong position to benefit.
On the morning of Monday 28 April, nothing was out of the ordinary in peninsular Spain’s electricity system. Demand was at normal levels for the time of year, and was being easily met by the total generation capacity available.
The day before, the Spanish National Grid Network (REE, Red Eléctrica Española, commercially known as Redeia) had held its usual daily auction to determine which facilities would supply energy over the course of the following day. REE manages electricity distribution in Spain, and though formally a private company it is controlled by the Spanish State, which owns 20% of its capital. Its website states that:
“We are responsible for ensuring that electricity is always available wherever you need it and for making it sustainable by promot-
ing renewable energies. For all these reasons, Red Eléctrica is the backbone of the electricity system in Spain and the cornerstone of the ecological transition process that the country is undergoing.”
12:30: BUSINESS AS USUAL
At 12:30, most of the country’s energy demand was being covered by renewable sources, especially photovoltaic solar energy, which was contributing just over half of the total. This situation had been repeated throughout the month, as in Spain the combined capacity of solar and wind energy can, given the right conditions, cover the country’s entire electricity demand during the brightest hours in the middle of the day.
The country’s nuclear plants, as planned, were operating at half their usual capacity because, according to their owners, the high charges
they are subject to make them economically unviable during periods when the price of electricity is very low.
At that time the price of electricity on the official market was in the negative at around -1€/MWh. At these prices Spain was exporting electricity to Morocco, Portugal, and even France. In addition, much of the available energy was being used to pump water from low lying river basins into reservoirs – the only practical way to store energy on a large scale. However, this capacity has a limit and, with the reservoirs almost full, it cannot continue to be stored indefinitely.
12:33: SOMETHING STRANGE HAPPENS
In the five minutes between 12:30 and 12:35, something anomalous happened which is still yet to receive an official explanation: a sudden drop in the Iberian electricity grid causes a total blackout.
For the first few minutes confusion reigned, aggravated by the disruption of landline and mobile phone networks. Rumours circulated that other European countries were affected (I myself heard this on the battery-powered radio that I had rushed out to buy), and fingers were quickly pointed at a possible cyber-attack. I doubted this hypothesis, as the computer networks that control electrical systems are usually disconnected from the internet, and a Europe-wide grid outage would lead to something closely resembling an episode of Black Mirror.
After a few minutes my radio, my lifeline, announced that the blackout was limited to the Iberian peninsula, meaning the most likely cause was a technical failure.
When analysing the available data available from REE between 12:30 and 12:35, we can observe several unusual events.
A few minutes before the outage, fluctuations were observed in the grid, and there was a spike in wind power generation, which had been very low until then. France suddenly stopped importing electricity from Spain, perhaps because it detected a problem in the peninsular grid, and this deepened the imbalance between supply and demand.
At that point, the few operating nuclear power plants received an overload signal. In accordance with protocol, control rods were inserted and they were automatically shut down.
But what was most surprising was the behaviour of solar photovoltaics, which dropped sharply from generating 18,000 MW to just
8,000 MW in just a few seconds. Since the sun had not vanished, it must have been an automated command that switched off thousands of solar facilities.
REE sources indicate that the problem may have been triggered by the disconnection of some solar plants in southwest Spain, but the grid would normally be able to balance this out through regulation – the mechanism for balancing supply and demand. This was being done mainly with hydropower, as normal, but there came a point when this source had exhausted its adjustment capacity.
Current evidence therefore points to a problem in the synchronisation of the grid. All sources feeding power into the grid must be synchronised at the same frequency, 50 Hertz. To facilitate this synchronisation, stable base-load power is required, which is normally provided by nuclear and other large gas and hydroelectric facilities. These sources act as a natural buffer against disturbances, helping to keep the frequency stable in the face of sudden changes in generation or demand.
However, variable renewable sources, such as solar photovoltaic, do not have this capability. They generate direct current which is converted to alternating current at 50 Hertz, but they cannot react automatically to frequency variations.
At 12:33 there was little by way of stable source base in the Spanish grid and, in addition, the few nuclear power plants that were operating had been switched off when they detected a surge in the grid. Hydroelectric facilities were at the limit of their regulation capacity, and no provision had been made for the availability of gas-fired plants.
Fortunately, less than 10 hours later the electrical system had all but recovered. Nevertheless, the damage had been done, and its consequences are still lingering.
This unusual situation points to a perfect storm of poor grid management and inadequate connections of solar facilities to the grid, as well as other unknown faults. In my opinion, there is a good chance that the computer programmes in charge of managing these systems played an important role, as they may not have been suitably prepared for these kinds of situations.
Although the grid is divided into different zones that can be isolated from one another, all zones were affected when thousands of small solar facilities scattered throughout the grid were disconnected at once. In addition, the interconnection of mainland Spain with the European grid is weak, and a stronger connection to the stable French grid would facilitate the synchronisation of the Spanish grid.
Solar energy during the sunniest hours distorts all offers (at price or negative), making more stable sources economically unviable unless they have a guaranteed price, and discouraging their production. The question is therefore not one of renewables versus nuclear, but rather how much solar power can be in the grid at any given moment while also maintaining stability.
A more worrying root cause is the involvement of politics in REE, as its presidency is typically held by former ministers or high-ranking politicians. Its current president is Beatriz Corredor, a lawyer and a former housing minister, and REE is pursuing the somewhat politicised objective of “100% renewables”.
Within hours of the outage on 28 April, Spanish Prime Minister Pedro Sánchez raised suspicions that the origin of the blackout came from “private operators”, and he accused those arguing that more nuclear input would help stabilise the grid of being ignorant. Spain’s current EU-endorsed energy roadmap includes phasing out all nuclear power stations between 2027 and 2035.
Two days after the blackout, Corredor made public statements for the first time saying that an incident like this would not be repeated, a difficult assertion to make when the causes are still unknown.
It is essential that decisions on energy issues, such as “100% renewables”, have independent technical support that analyses and informs the public with rigour and transparency.
A rational analysis should not pit renewables against nuclear, and technical bodies such as REE should be run by people outside of political power structures, preferably with the appropriate technical training. The European Union should also have a coordinated energy policy, and a Europe-wide electricity grid designed to deal with outages or potential external aggression.
You cannot annex another country. This was the clear message given by the Danish prime minister, Mette Frederiksen, at a recent press conference with the outgoing and incoming prime ministers of Greenland. It did not appear aimed at Russian president Vladimir Putin, but at Donald Trump, the president of one of her country’s closest allies, who has threatened to take over Greenland.
Frederiksen, speaking in Greenland’s capital Nuuk, was stating something that is obvious under international law but can no longer be taken for granted. US foreign policy under Trump has become a major driver of this uncertainty, playing into the hands of Russian, and potentially Chinese, territorial ambitions.
The incoming Greenlandic prime minister, Jens-Frederik Nielsen, made it clear that it was
for Greenlanders to determine their future, not the United States. Greenland, which is controlled by Denmark, makes its own domestic policy decisions. Polls suggest a majority of islanders want independence from Denmark in the future, but don’t want to be part of the US.
Trump’s interest in Greenland is often associated with the island’s vast, but largely untapped, mineral resources. But its strategic location is arguably an even greater asset. Shipping routes through the Arctic have become more dependable and for longer periods of time during the year as a result of melting sea ice. The northwest passage (along the US and Canadian shorelines) and the northeast passage (along Russia’s Arctic coast) are often ice free now during the summer.
Breaking the Ice: Arctic Development and Maritime Transportation, www.arcticportal.org
This has increased opportunities for commercial shipping. For example, the distance for a container ship from Asia to Europe through the northeast passage can be up to three times shorter, compared to traditional routes through the Suez Canal or around Africa.
Similarly, the northwest passage offers the shortest route between the east coast of the United States and Alaska. Add to that the likely substantial resources that the Arctic has, from oil and gas to minerals, and the entire region is beginning to look like a giant real estate deal in the making.
The economic promise of the Arctic, and particularly the region’s greater accessibility, have also heightened military and security sensitivities.
The day before J.D. Vance’s visit to Greenland on March 28, Vladimir Putin, gave a speech at the sixth international Arctic forum in Murmansk in Russia’s high north, warning of increased geopolitical rivalry.
While he claimed that “Russia has never threatened anyone in the Arctic”, he was also quick to emphasise that Moscow was “enhancing the combat capabilities of the Armed Forces, and modernising military infrastructure facilities” in the Arctic.
Equally worrying, Russia has increased its
naval cooperation with China and given Beijing access, and a stake, in the Arctic. In April 2024, the two countries’ navies signed a cooperation agreement on search and rescue missions on the high seas.
In September 2024, China participated in Russia’s largest naval manoeuvres in the post-cold war era, Ocean-2024, which were conducted in north Pacific and Arctic waters. The following month, Russian and Chinese coastguard vessels conducted their first joint patrol in the Arctic. Vance, therefore, has a point when he urges Greenland and Denmark to cut a deal with the US because the “island isn’t safe”.
That the Russia-China partnership has resulted in an increasingly military presence in the Arctic has not gone unnoticed in the west. Worried about the security of its Arctic territories, Canada has just announced a C$6 billion (£3.2 billion) upgrade to facilities in the North American Aerospace Defense Command it operates jointly with the United States.
It will also acquire more submarines, icebreakers and fighter jets to bolster its Arctic defences and invest a further C$420 million (£228 million) into a greater presence of its armed forces.
SVALBARD’S FUTURE ROLE?
Norway has similarly boosted its defence presence in the Arctic, especially in relation to the
Svalbard archipelago (strategically located between the Norwegian mainland and the Arctic Circle). This has prompted an angry response from Russia, wrongly claiming that Oslo was in violation of the 1920 Svalbard Treaty which awarded the archipelago to Norway with the proviso that it must not become host to Norwegian military bases.
Under the treaty, Russia has a right to a civilian presence there. The “commission on ensuring Russia’s presence on the archipelago Spitzbergen”, the name Moscow uses for Svalbard is chaired by Russian deputy prime minister Yury Trutnev, who is also Putin’s envoy to the far eastern federal district. Trutnev has repeatedly complained about undue Norwegian restrictions on Russia’s presence in Svalbard.
From the Kremlin’s perspective, this is less about Russia’s historical rights on Svalbard and more about Norway’s – and Nato’s – presence in a strategic location at the nexus of the Greenland, Barents and Norwegian seas. From there, maritime traffic along Russia’s northeast passage can be monitored. If, and when, a central Arctic shipping route becomes viable, which would pass between Greenland and Svalbard, the strategic importance of the archipelago would increase further.
From Washington’s perspective, Greenland is more important because of its closer proximity to the US. But Svalbard is critical to Nato for monitoring and countering Russian, and potentially Chinese, naval activities. This bigger picture tends to get lost in Trump’s White House, which is more concerned with its own immediate neighbourhood and cares less about regional security leadership.
Consequently, there has been no suggestion – so far – that the US needs to have Svalbard in the same way that Trump claims he needs Greenland to ensure US security. Nor has Russia issued any specific threats to Svalbard. But it was noticeable that Putin in his speech at the Arctic forum discussed historical territorial issues, including an obscure 1910 proposal for a land swap between the US, Denmark and Germany involving Greenland.
Putin also noted “that Nato countries are increasingly often designating the Far North as a springboard for possible conflicts”. It is not difficult to see Moscow’s logic: if the US can claim Greenland for security reasons, Russia should do the same with Svalbard.
The conclusion to draw from this is not that Trump should aim to annex a sovereign Norwegian island next. Maritime geography in the north Atlantic underscores the importance of maintaining and strengthening long-established alliances.
Investing in expanded security cooperation with Denmark and Norway as part of Nato would secure US interests closer to home and send a strong message to Russia. It would also signal to the wider world that the US is not about to initiate a territorial reordering of global politics to suit exclusively the interests of Moscow, Beijing and Washington.
Every time you use your phone, open your computer or listen to your favorite music on AirPods, you are relying on critical minerals.
These materials are the tiny building blocks powering modern life. From lithium, cobalt, nickel and graphite in batteries to gallium in telecommunication systems that enable constant connectivity, critical minerals act as the essential vitamins of modern technology: small in volume but vital to function.
Yet the U.S. depends heavily on imports for most critical materials. In 2024 the U.S. imported 80% of rare earth elements it used, 100% of gallium and natural graphite, and 48% to 76% of lithium, nickel and cobalt, to name a few.
Rising global demand, high import dependency and growing geopolitical tensions have made critical mineral supply an increasing na-
tional security concern − and one of the most urgent supply chain challenges of our time.
That raises a question: Could the U.S. mine and process more critical minerals at home?
As a geochemist who leads Georgia Tech’s Center for Critical Mineral Solutions and an engineer focused on energy innovation, we have been exploring the options and barriers for U.S. critical mineral production.
WHAT’S STOPPING CRITICAL MINERALS FROM BEING PRODUCED DOMESTICALLY?
Let’s take a look at rare earth elements.
These elements are essential to modern technology, electric vehicles, energy systems and military applications. For example, neodymium is critical for making the strong magnets used in computer hard discs, lasers and wind turbines. Gadolinium is vital for MRI machines,
while samarium and cerium play key roles in nuclear reactors and energy systems such as solar and wind power.
Despite their name, rare earth elements are actually not rare. Their concentrations in the Earth’s crust are comparable to more commonly mined metals such as zinc and copper.
However, rare earth elements do not often occur in easily accessible, economically viable mineral forms or high-grade deposits. As a result, identifying resources with sufficiently high concentration and large volume is crucial for enabling their economic production.
The U.S. currently has only two domestic rare earth mining locations: Georgia and California.
In southeast Georgia, rare earths are being produced as a byproduct of heavy mineral sand mining, but the produced rare earth concentrates are shipped out of state and then abroad for refining into the materials used in
renewable energy technologies and permanent magnets.
The other location is in Mountain Pass, California, where hard rock mining extracts a rare earth carbonate mineral called bastnaesite. Yet again, much of the material is sent abroad for refining. As a result, the entire supply chain − from mining to final use in products − stretches across continents.
The U.S. relies heavily on imports for many of its critical minerals. China has been the primary import source for several of them, including rare earths, according to the U.S. Geological Survey’s 2024 data. Not all critical minerals are shown.
Meeting the U.S. demand for rare earth elements and other critical minerals from operations within the United States will require more than just opening new mines. It will require developing and scaling up new technologies, as well as building processing operations.
Historically, processing has largely taken place overseas because of the environmental impacts, energy demand and regulatory constraints.
THE POTENTIAL, BUT LONG ROAD, TO NEW MINES
Investment in exploration activity for critical minerals is rapidly increasing across the U.S.
In 2017 the U.S. Geological Survey launched the Earth Mapping Resources Initiative − known as Earth MRI − to identify potential sources of critical minerals within the country.
Some areas that appear promising for rare earth elements have lots of chemical weathering, in which rocks containing rare earth elements are broken down by reacting with water and air. Exploration is underway at several of these sites, including in locations in Wyoming and Montana.
Identifying a resource, however, is not the same as producing it.
Traditional mining can take a decade or two from exploration to production and up to 29 years in the U.S., the second-longest timeline in the world. Although this timeline could be changing under the current administration, companies might still face major uncertainties related to permitting, infrastructure development and, in some places, community opposition. Managing environmental impacts, such as air and water pollution and high water consumption and energy use, can further increase cost and extend project timelines.
Given that the exploration projects mentioned above are still in early stage, the U.S. needs
additional, parallel efforts that can bring resources to the market at an accelerated pace.
MINING THE MATERIALS WE HAVE ALREADY MINED
One of the fastest ways to increase U.S. rare earth production may not require digging new holes in the ground − but rather returning to old ones.
The Atlantic coast region stands out on the Earth MRI map as a particularly promising area. What’s even better is that this region has already established extensive mining activities and mature infrastructure, which allows for much faster speed to market.
Georgia has mineral sand deposits that are rich in titanium, zirconium, and rare earth elements. Titanium and zirconium − both used in aerospace, energy and medical applications − are already mined in Florida and Georgia. In southeast Georgia, rare earth elements found with these heavy mineral sands are already being recovered as rare earth concentrates.
Kaolin, a white clay used in paper, paint and porcelain, has been mined in Georgia for over a century, and it can also contain rare earth elements. Georgia generates more than 8 million tons of kaolin annually, making it the leading U.S. producer and a large exporter. This also comes with millions of tons of mining and processing residues, or what’s known as tailings.
Recent research studies suggest that there is significant potential for extracting rare earth elements in the tailings.
The tailings are already mined and sitting on the surface. There is no need to drill or blast. That means existing infrastructure, faster timelines and lower costs and than new mining operations.
Technological innovations, such as bioleaching, ligand-based extraction and separation and electrochemical separation, are now making mining these legacy wastes possible. New processing facilities could be built near existing kaolin or heavy mineral sand operations or former mine sites, bringing materials to market in a few years rather than decades.
This approach is part of a broader strategy known as “waste mining,” “urban mining” or “mining the anthropogenic cycle.”
It involves the recovery of critical minerals from existing waste streams such as mine tailings, coal ash and industrial byproducts. It is also part of building a circular economy, where materials are reused and recycled rather than discarded.
The U.S. has the potential to catalyse new domestic supply chains for materials essential to national security and technology. Waste mining and recycling are critical pieces to ensure the long-term sustainability of these supply chains.
Silicon Valley has been a universal symbol of innovation for decades. Because of its reputation, governments around the world have tried to foster their own versions by investing heavily in tech hubs.
These efforts, which include Silicon Beach in Los Angeles, Silicon Island in Malaysia and Silicon Roundabout in the UK, have not always worked. But some places, particularly parts of east Asia, have seen their own Silicon Valleys flourish.
China has the world’s second-largest venture capital market, scores of startups, and cutting-edge tech to challenge Silicon Valley. Japan and Korea have also become some of the most active corporate venture capital investors in the world.
At the same time, these challenger ecosystems possess some of the attributes of Silicon Valley in its heyday. More, in some ways, than Silicon Valley itself does these days.
The scale of Silicon Valley remains unparalleled, at least for now. In 2024, the region’s market capitalisation (the value of companies’ publicly traded shares) had reached US$14.3 trillion (£11 trillion). This is comparable to the entire GDP of China, the world’s second-largest economy.
But Silicon Valley is no longer a counter-cultural world of startups in garages, where small, disruptive organisations build world-changing products on a shoestring. It has morphed into a land of Goliaths, not Davids.
Cups of instant noodles have, for many, been replaced by açaí bowls, and office all-nighters with wellbeing workshops and digital detox retreats. Stalwart investors, such as Sequoia’s Mike Moritz, have complained that Silicon Valley tech workers have become “lazy and entitled”. Meanwhile, the work ethic and laser focus of tech workers elsewhere has advanced. About ten years ago, Chinese tech’s working hours were described as “996” –working from 9am to 9pm six days a week. They are now referred to as “007”, a schedule
where employees work from midnight to midnight, seven days a week.
‘GOOD ARTISTS COPY, GREAT ARTISTS STEAL’
The history of Silicon Valley is one of hungry challengers disrobing the big, boring incumbents. Apple raised equity investment from Xerox, then a leading print production corporation, and used the access to Xerox’s Palo Alto Research Center to take inspiration from the company’s plans for a computer that had a graphical user interface. Apple later refined the software for the Macintosh, giving it its edge.
In 1996, Jobs famously said:
“Picasso had a saying – ‘Good artists copy; great artists steal’ – and we have always been shameless about stealing great ideas.”
Today, the Goliaths leading Silicon Valley have huge intellectual property portfolios to de-
fend. And they are outraged when their tech is taken. OpenAI, the American company that made ChatGPT, has even asked the US government to declare Chinese AI firm DeepSeek “state controlled” and to outlaw its use in the US. Huawei and Bytedance’s TikTok have faced similar calls in the past.
In western media, much of the focus on the moment DeepSeek disrupted the AI landscape has been about how it rattled Silicon Valley. But there has been less coverage on how it has instigated instant rivals within China.
Days after Deepseek’s release, Chinese tech company Alibaba announced that its AI model was superior. And China recently launched Manus, a fully autonomous AI agent that fully replaces rather than assists humans.
China’s answer to Silicon Valley is what Taiwanese businessman, Kai-fu Lee, calls “gladiatorial entrepreneurship”. This is where founders constantly innovate because as soon as their product is released, they know it will be copied and reverse engineered. The system as a whole benefits from the intense
competition, the way Silicon Valley did in its ascent.
Silicon Valley used to be known for its counter culture and its outsized vision of how tech can transform the globe. This is epitomised by Masayoshi Son, a former student of Silicon Valley from east Asia who is the founder and CEO of Japanese firm SoftBank.
He first came to Silicon Valley in the early 1980s and quickly integrated into the Silicon Valley way of business. Son launched his own startup when he returned to Japan, modelled on what he experienced in the few years he lived in California. With this, Softbank was born as a software distributor.
SoftBank’s Vision Fund is now the largest venture capital fund in the world, with over US$100 billion (£77.5 billion) in capital. Son’s giant fund and impatient style of investing have contributed to change in Silicon Valley. Ballooning valuations and the use of explod-
ing term sheets (investment offers that expire within a matter of days) are increasingly the norm.
Son is stylised as a classic outsider. Gambling Man, a recently published book from the former editor of the Financial Times, Lionel Barber, details how Son is not “really Japanese” (he’s ethnically Korean) and has long touted this challenger narrative.
Now as one of the biggest investors in Silicon Valley, he is pushy, confrontational and has a huge vision for how technologies such as AI can change the world. He is the purveyor of that grand vision and an advocate for the risk-taking that is synonymous with “classic” Silicon Valley.
Meanwhile, China’s AI gladiators innovate constantly in their bid to overtake the once hungry American behemoths who are now forced to call on the state to help shore-up their position. The contrasting trajectories raise questions about who should now become more like whom if they are to win the global technology race.
Frédéric Fréry Professeur de stratégie, CentraleSupélec, ESCP Business School
Microsoft celebrates its 50th anniversary. This article was written using Microsoft Word on a computer running Microsoft Windows. It is likely to be published on platforms hosted by Microsoft Azure, including LinkedIn, a Microsoft subsidiary with over one billion users. In 2024, the company generated a net profit of $88 billion from sales worth $245 billion. Its stock market value is close to $3,000 billion, making it the world’s second-most valuable company behind Apple and almost on a par with NVidia. Cumulative profits since 2002 are approaching $640 billion.
And yet, 50 years ago, Microsoft was just a tiny computer company founded in Albuquerque, New Mexico by two former Harvard students, Bill Gates and Paul Allen, aged 19 and 22. The twists and turns that enabled it to become one of the most powerful companies in the world
are manifold, and can be divided into four distinct eras.
At the end of the 1970s, IBM was the computer industry’s undisputed leader. It soon realized that microcomputers developed by young Silicon Valley entrepreneurs, such as the Apple II, would eventually eclipse IBM’s mainframes, and so the IBM PC project was launched. However, it soon became clear that the company’s hefty internal processes would prevent it from delivering a microcomputer on schedule. It was therefore decided that various components of the machine could be outsourced using external suppliers.
Several specialized companies were approached to provide the operating system. They all refused, seeing IBM as the enemy
to be destroyed, a symbol of centralized, bureaucratic computing. Mary Maxwell Gates, who sat on the board of an NGO next to the IBM chairman, suggested the name of her son William, nicknamed Bill, who had just founded Microsoft, and the first contact was established in 1980.
The problem was that Microsoft was focused on a programming language called BASIC and certainly not specialized in operating systems. Not that this was ever going to be a problem for Bill Gates, who, with considerable nerve, agreed to sign a deal with IBM to deliver an operating system he didn’t have. Gates then purchased the QDOS system from Seattle Computer Products, from which he developed MS-DOS (where MS stands for Microsoft).
Gates, whose father was a founding partner of a major Seattle law firm, then made his next move. He offered IBM a non-exclusive contract
for the use of MS-DOS, which gave him the right to sell it to other computer companies. IBM, which was not used to subcontracting, was not suspicious enough: the contract brought fortunes to Microsoft and misery to IBM when Compaq, Olivetti and HewlettPackard rushed to develop IBM PC clones, giving birth to a whole new industry.
Success followed for Microsoft. It not only benefited from IBM’s serious image, which appealed to businesses, but also received royalties on every PC sold on the market. In 1986, the company was introduced on the stock market. Bill Gates, Paul Allen and two of their early employees became billionaires, while 12,000 additional Microsoft employees went on to become millionaires.
In the mid-1980s, microcomputers were not very functional: their operating systems, including Microsoft’s MS-DOS, ran with forbidding command lines, like the infamous C:/. This all changed in 1984 with the Apple Macintosh, which was equipped with a graphic interface (icons, drop-down menus, fonts, a mouse, etc.). This revolutionary technology was developed in Xerox’s research laboratory, even though the photocopy giant failed to understand its potential. On the other hand, Steve Jobs, Apple’s CEO, was largely inspired by it: to ensure the success of the Macintosh computer, Jobs asked Microsoft to develop a customized version of its office suite, in particular its Excel spreadsheet. Microsoft embraced the graphic interface principle and launched Windows 1 in 1985, which was soon followed by the Office suite (Word, Excel and PowerPoint).
Over the following years, Windows was further improved, culminating in Windows 95, launched in 1995, with an advertising campaign costing over $200 million, for which Bill Gates bought the rights of The Rolling Stones’ “Start Me Up”. At the time, Microsoft’s world market share in operating systems exceeded 70%. This has hardly changed since.
In 1997, Microsoft even went so far as to save Apple from bankruptcy by investing $150 million in its capital in the form of non-voting shares, which were sold back three years later. During one of his famous keynote speeches, Steve Jobs thanked Bill Gates by saying: “Bill, thank you. The world’s a better place.” This bailout also put an end to the lawsuit Apple had filed against Microsoft, accusing it of copying its graphic interface when designing the Windows operating system.
THIRD ERA: BUREAUCRATIZATION, INTERNAL CONFLICTS AND A FAILED DIVERSIFICATION STRATEGY
In the mid-1990s, computing underwent a new transformation with the explosion of the World Wide Web. Microsoft was a specialist in standalone PCs, with a business model based on selling boxed software, and it was ill-prepared for the new global networks. Its first response was to develop Internet Explorer, a browser developed from the takeover of the Mosaic
browser designed by the Spyglass company, a bit like MS-DOS in its day. Internet Explorer was eventually integrated into Windows, prompting a lawsuit against Microsoft for abuse of its dominant position, which could have led to the company’s break-up. New competitors, such as Google with its Chrome browser, took advantage of these developments to attract users.
In 2000, Bill Gates handed over his position as Microsoft CEO to Steve Ballmer, one of his former Harvard classmates, whose aim was to turn the company into an electronics and services company. Over the next fifteen years, Ballmer embarked on a series of initiatives to diversify the company by including video games (Flight Simulator), CD encyclopedias (Encarta), hardware (mice, keyboards), MP3 players (Zune), online web hosting (Azure), game consoles (Xbox), phones (Windows Phone), tablets and computers (Surface).
While some of these products were successful (notably Azure and Xbox), others were bitter failures. Encarta was quickly swamped by Wikipedia and Zune was no match for Apple’s iPod. Windows Phone remains one of the greatest strategic blunders in the company’s history. In order to secure the company’s success in mobile telephony and compete with the iPhone, Microsoft bought the cell phone division of Finland’s Nokia for $5.4 billion in September 2013. The resulting integration was a disaster: Steve Ballmer wanted Microsoft’s phones to use a version of Windows 10, making them slow and impractical. Less than two years later, Microsoft put an end to its mobile phone operations, with losses amounting to $7.6 billion. Nokia was sold for just $350 million.
One of the outcomes of Microsoft’s multiple business initiatives has been an explosion in the number of its employees, from 61,000 in 2005 to 228,000 in 2024. Numerous internal disputes broke out between different business units, which sometimes refused to work together.
These turf wars, coupled with pervasive bureaucratization and effortless profitability (for each Windows installation, PC manufacturers pay around $50, while the marginal cost of the license is virtually zero), have hindered Microsoft’s capacity for innovation. Its software, including Internet Explorer 6 and Windows Vista, was soon mocked by users for its imperfections, which were continually plugged by frequent updates. As some people noted, Windows is equipped with a “safe” mode, suggesting that its normal mode is “failure”.
FOURTH ERA: IS MICROSOFT THE NEW COOL (THANKS TO THE CLOUD AND OPENAI)?
In 2014, Satya Nadella replaced Steve Ballmer as head of Microsoft. Coming from the online services division, Nadella’s objective was to redirect Microsoft’s strategy online, notably by developing the Azure online web hosting business. In 2024, Azure became the world’s second-largest cloud service behind
Amazon Web Services, and more than 56% of Microsoft’s turnover came from its online services. Nadella changed the company’s business model: software is no longer sold but available on a subscription basis, in the shape of products such as Office 365 and Xbox Live.
Along the way, Microsoft acquired the online game Minecraft, followed by the professional social network LinkedIn, in 2016, for $26.2 billion (its largest acquisition to date), and the online development platform GitHub in 2018 for $7.5 billion.
Between 2023 and 2025, Microsoft invested more than $14 billion in OpenAI, the company behind ChatGPT, giving it a particularly enviable position in the artificial intelligence revolution. ChatGPT’s models also contribute to Microsoft’s in-house AI, Copilot.
Over the past 50 years, thanks to a series of bold moves, timely acquisitions and failed strategies to diversify, Microsoft has evolved significantly in its scope, competitive advantage and business model. Once stifled by opulence and internal conflicts, the company seems to have become attractive again, most notably to young graduates. Who can predict whether Microsoft will still exist in 50 years? Bill Gates himself says the opposite, but he may be bluffing.
Since its beginnings as a humble student start-up in 1998, Google has pulled off a meteoric rise. In 2025, its parent company, Alphabet, is a vast multinational technology conglomerate and one of the world’s most valuable companies. While much of Alphabet’s growth was internal, it also added to its empire through shrewd acquisitions, including of Android, DoubleClick and YouTube. Since 1998, it has acquired at least 267 companies.
Alphabet is a key player in many digital markets, including general search, browsers, online advertising, mobile operating systems and intermediation. Google Search, for example, is now the most widely used general search engine in the world. Globally, its market share has been at least 78% for the past 10 years.
Unsurprisingly, antitrust agencies, whose task is to protect competition, have been taking
a close look at Google’s conduct and that of other tech giants. While having market power is not illegal if it is the result of a superior product, protecting such a position by means that are not meritorious is.
In recent years, there has been growing concern that Google may be using anticompetitive means to protect and extend dominant positions in core digital markets. In 2017, 2018 and 2019, the European Commission fined Google over €8 billion for abusing dominant positions in key markets – more than any other Big Tech company to date. A fourth investigation into Google’s behaviour in the advertising technology market, in which the European Commission is likely to request structural changes to Google’s advertising business, is nearing completion. The national competition agencies of the EU member states have also actively enforced EU and
national abuse-of-dominance rules. Private antitrust class actions for damages are adding to Google’s woes.
In 2022, the EU enacted the Digital Markets Act (DMA) to create an additional tool for intervening against entrenched market power in core platform markets. The DMA regulates the behaviour of so-called gatekeeper companies, aiming to make markets more contestable for competitors and fairer for users. In September 2023, the European Commission designated Alphabet as a gatekeeper in no fewer than eight platform markets for the following services: Google Search, Google Maps, Google Play, Google Shopping, Google Ads, Chrome, YouTube and Google Android.
Within days of the DMA’s conduct rules becoming binding on Alphabet in March 2024, the European Commission opened the first noncompliance investigation to assess whether Google Search was continuing to
treat Alphabet’s own services more favourably than its rivals’, and whether Google Play prevented app developers from steering consumers to other channels for better offers.
The territorial scope of these rules is limited to services offered in Europe. They do not regulate how Google operates in the United States – this is subject to US antitrust law. Nonetheless, the European Commission’s enforcement actions have provoked the ire of the current US administration. In February 2025, the White House issued a memorandum titled “Defending American Companies and Innovators From Overseas Extortion and Unfair Fines and Penalties” that takes issue with European antitrust and regulatory measures against US companies. According to the Trump administration, the EU’s rules amount to non-tariff restrictions and unfair exploitation of US companies, and they interfere with American sovereignty. The memorandum stresses that Washington will not hesitate to impose tariffs and other actions necessary to mitigate the harm to the United States.
According to the European Union, such actions would amount to economic coercion and interfere with its legislative sovereignty to decide under what conditions services are offered on European soil. In 2022, likely with the possibility of a second Trump presidency in mind, it enacted the so-called Anti-Coercion Instrument, which allows the European Commission to impose a wide range of “response measures”, including tariffs and restrictions on imports, exports, intellectual property rights, foreign direct investment, and access to public procurement. Such response measures could be imposed on US digital services.
The situation has the potential to further escalate the risk of a trade war between Europe and the United States. However, the dispute over tech regulation does not appear to be about substantive antitrust principles per se.
In 2020, the US House of Representatives issued a bipartisan report stressing the need for the United States to address the lack of competition in digital markets and the monopoly power of dominant platforms like Amazon, Apple, Facebook and Google. The Federal
Trade Commission and the Department of Justice subsequently brought antitrust lawsuits against all four companies, most of which are still pending.
The Department of Justice filed two separate antitrust suits against Google in 2020 and in 2023. In the first case, a Washington DC district court in August 2024 found Google guilty of violating section 2 of the Sherman Antitrust Act, and established that Google had attempted to protect its monopoly power in the market for general search through anticompetitive means. Judge Amit P. Mehta is now determining appropriate remedies, and the Department of Justice recently reiterated its request that the judge break up Google.
The second US case against Google is still pending. The accusations in it are similar to those underlying the European Commission’s ongoing investigation into Google’s behaviour in the market for advertising technology. While the case was initiated during the Biden administration, it has not (yet) been shut down since Trump returned to power. It’s also worth noting that the new head of the Federal Trade Commission has stressed that Big Tech is a main priority of his agency. There seems to be concern on both sides of the Atlantic that Google has been restricting competition. The crux of the discord, most likely, is that European regulators are telling US companies what to do – even if on European territory.
The European Commission appears determined to keep enforcing its antitrust rules and the DMA. On March 19, 2025, it informed Alphabet that its preliminary assessment had shown that Google’s behaviour in search and in the Google Play Store was incompatible with the DMA. Also, the first noncompliance decisions against Apple and Meta under the DMA are expected shortly – even though the fines may well stay below the maximum 10% of a company’s global annual turnover allowed by the act, in view of its novelty.
Europe is not an insignificant market for Google and other US tech companies. In 2024, Google reportedly generated 29% of its global revenue, or $100 billion, in Europe, the Middle East and Africa. Europe has no equivalents to Google or other Big Tech companies, and the EU today imports 80% of its digital technology. In September 2024, the Draghi Report issued a stark warning to bloc leaders, highlighting waning geopolitical stability and the need for Europe to focus on closing the innovation gap with the US and China in advanced technologies. Less than five months later, the European Commission published the Competitiveness Compass, a roadmap to restoring Europe’s dynamism and boosting economic growth. Strong measures from the White House in retaliation for European antitrust and regulatory enforcement might just give this process additional impetus. President Trump cannot make European tech great again, because it never was great. But his policies may unintentionally help make it so.
Gregory H. Shill Professor of Law & Michael and Brenda Sandler Faculty Fellow in Corporate Law, University of Iowa
When Congress passed a law in 2024 to ban TikTok unless it came under U.S. ownership, lawmakers argued that the app’s Chinese parent company posed national security concerns. The Trump administration, which had granted the viral video app a reprieve shortly after taking office in January 2025, extended that pause again on April 4 after the Chinese government reportedly scuttled a planned deal.
Regardless of how this all shakes out, the TikTok fight underscores deeper concerns
about who controls social media in the United States.
Given that worry, it might surprise Americans to learn that nearly every social media giant is controlled by just one or two men. For example, Mark Zuckerberg controls Meta, which owns Facebook, Instagram and WhatsApp, while Larry Page and Sergey Brin control Alphabet, which owns YouTube and Google.
What does “control” mean? These companies are publicly traded – anybody can buy or sell their shares – but a legal mechanism known as dual-class stock gives founders extra votes
in shareholder decisions. The dual-class structure crowns these men “corporate royalty,” as one former U.S. Securities and Exchange Commission commissioner has put it, granting them near-absolute control of corporate policy and resources without requiring them to take on commensurate financial risk.
While TikTok is unusual in many respects, the way it vests power in one man is actually quite banal. TikTok’s parent company, ByteDance, is privately held, but it’s reportedly controlled by a co-founder, Chinese national Zhang Yiming, via a dual-class structure.
As a professor of corporate law, I’d urge policymakers and the public to consider the societal risks of a system that allows a single person to wield full control over a major corporation through dual-class stock.
In a standard single-class structure – where voting power tracks the amount of company equity a shareholder owns – someone seeking total control of a company must ordinarily spend a lot of money buying up shares, which also means assuming a lot of risk. This “skin in the game” requirement limits how much influence a single person can exert on a company.
That safeguard is informal, not mandatory, and dual-class structures do away with it. Ascendant among Silicon Valley firms since Google’s 2004 initial public offering in the U.S. and recently legalized in the U.K., the dual-class model is fiercely debated in corporate governance circles. To date, however, its downsides have been understood only as a problem for shareholders, not society, despite broad and bipartisan concern about the influence of Big Tech.
Let’s pick on Meta as an example. Zuckerberg reportedly owns just 13.5% of the company’s equity, but because he owns 99.7% of the supervoting shares, he controls 61% of the company’s votes.
This setup gives him a lock on corporate policy as a controlling shareholder, even though he only owns a bit over one-eighth of Meta stock by value. He has full control of the company
without placing anywhere near an equivalent amount of money at risk.
You don’t have to be the parent of an Instagram-addicted teenager to see that Meta has generated what might be described as social costs. For example, Amnesty International has alleged that Facebook algorithms “substantially contributed to the atrocities perpetrated by the Myanmar military” in 2017. Facebook has also been criticized for promoting misinformation during past U.S. elections and for suppressing embarrassing stories about Hunter Biden.
These examples underscore broader social concerns around content moderation, privacy and tech titans’ outsized political influence. Notably, Zuckerberg – who has been associated with progressive causes in the past – has moved to embrace President Donald Trump strongly in recent months and asked for Trump’s support for Meta in a legal battle with the European Union.
In a 2023 law journal article, I noted that recent Supreme Court decisions expanding corporate constitutional rights stand to give company founders unprecedented power to shape society. While the rise of founder-controlled social media giants with distinct political agendas has gotten a lot of attention, the widening scope of what is deemed protected corporate speech and religious exercise hasn’t been a part of that conversation.
I think there’s a real possibility that these two
streams will converge, granting constitutional protection to “founder kings” who wish to leverage company resources for private agendas. Two recent legal developments raise the stakes.
First, the courts – and in particular the Supreme Court under Chief Justice John Roberts – have been expanding corporate constitutional rights, which could allow dual-class founders to carve out exceptions to generally applicable laws.
Second, recent legal changes in Delaware – which despite its tiny size is the leading corporate law jurisdiction in the U.S. – could make it easier for dual-class controlling shareholders to exercise power within their companies.
To get a sense of the potential consequences, suppose the controlling shareholder of a dual-class company were to cause it to defy a federal mandate – for example, a requirement to offer health insurance plans that cover contraception – on the grounds that complying would violate their religious beliefs. The Supreme Court in Hobby Lobby v. Burwell recognized exactly this sort of faith-based exception for a large family-owned but privately held business.
Would it recognize such an exception for a company like Snap? The company, best known for its app Snapchat, is publicly traded, but just two men, Robert Murphy and Evan Spiegel, control 99.5% of the voting power.
We can’t be sure. Hobby Lobby is different from Snap in many ways. Yet what they have in common is the ability of their owners to plausi-
bly claim a unitary speech or religious exercise interest that would not characterize a typical large business. Snap’s public owners have no say at all – zero votes – in the company’s affairs. If the controllers of Snap asserted a religious basis for exempting the company from a regulation – and to be clear, this is a purely hypothetical example – the courts might well indulge the claim.
The judicial system’s expanding view of corporate constitutional rights – seen not just in Hobby Lobby but in Citizens United v. FEC and a number of more recent and ongoing cases in state and lower federal courts – could empower founders to leverage their businesses for private agendas. Whether or not this is likely for Snap in particular, the combination of the dual-class model and changes in the law would seem to leave the door open.
ELON MUSK VS. THE DUAL-CLASS MODEL
A fitting contrast might be none other than Twitter – renamed X after Elon Musk acquired it and who recently merged it into xAI, another Musk-led venture.
As a privately held company, xAI is not required to file public investor reports, and much about its ownership structure remains opaque. But
let’s assume the company is majority-owned by Musk in a conventional single-class structure – the type Twitter had before he bought it. Given a chance to provoke, Musk has consistently proved eager to raise his hand. Couldn’t he use his control to get X or xAI – we’ll stick with “X” for simplicity – to exercise the same vast control that Murphy and Spiegel could at Snap, or Zuckerberg at Meta?
YES – BUT WITH A SUBTLE YET IMPORTANT DIFFERENCE.
There’s a certain logic to X’s key corporate decisions being vested in Musk. Quite famously, he ponied up US$44 billion to buy the entire company. Legal prohibitions on the deployment of private resources for influence are confined to a small universe of cases –antitrust, bribery, certain types of campaign contributions. Those resources include businesses, which are a form of property, that are owned by wealthy individuals or groups. With limited exceptions, people can use their own property as they wish.
In a dual-class company, though, controllers use other people’s property as they wish. They can get the immense legal, economic and organizational power of the corporate form without having to put much skin in the game.
BEYOND TIKTOK: THE CONVERSATION THE US SHOULD BE HAVING
Traditionally, questions of rich-guy influence have been seen through the lens of politics, taxes or public regulation. But seeing them as questions about the exercise of private corporate control makes clear the special social challenges posed by dual-class stock.
Wall Street has mostly accepted the bargain: ironclad insulation of Zuckerberg in exchange for rock-solid Meta returns. But this debate is not only of interest for the investment community. Everyone has a stake in its outcome.
It’s fair for the public to question the wisdom of allowing company founders to leverage the resources and newly jumbo-sized constitutional rights of large corporations in service of a special agenda – be it for a foreign government, a political party or a religious faith – that isn’t even connected to classical purposes of the corporation or advantages of the dual-class model.
The distinctive risks posed by TikTok are mostly unrelated to its share structure. But the debate over the ban-or-sell law offers a reminder: The powers created by dual-class stock aren’t unique to Chinese control. America’s homegrown founder kings wield them, too.
Predicting whether or not companies will be successful is crucial for guiding investment decisions and designing effective economic policies. However, past research on high-growth firms – enterprises thought to be key for driving economic development – has typically shown low predictive accuracy, suggesting that growth may be largely random.
Does this assumption still hold in the AI era, in which vast amounts of data and advanced analytical methods are now available? Can AI techniques overcome difficulties in predicting high-growth firms? These questions were raised in a chapter I co-authored in the De Gruyter Handbook of SME Entrepreneurship,
which reviewed scientific contributions on firm growth prediction with AI methods.
According to the Eurostat-OECD (Organisation for Economic Co-operation and Development) definition, high-growth firms are businesses with at least 10 employees in the initial growth period and “average annualised growth greater than 20% per annum, over a three year period”. Growth can be measured by the firm’s number of employees or by its turnover. A subset of high-growth firms, known as “gazelles”, are young businesses – typically start-ups –that are up to five years old and experience fast growth.
High-growth firms drive development, innovation and job creation. Identifying firms
with high-growth potential enables investors, start-up incubators, accelerators, large companies and policymakers to spot potential opportunities for investment, strategic partnerships and resource allocation at an early stage. Forecasting outcomes for start-ups is more challenging than doing so for large companies due to limited historical data, high uncertainty, and reliance on qualitative factors like founder experience and market fit.
HOW RANDOM IS FIRM GROWTH?
Accurate growth forecasting is especially crucial given the high failure rate of start-ups. One in five start-ups fail in their first year, and two thirds fail within 10 years. Some start-ups can also contribute significantly to job creation:
research analysing data from Spanish and Russian firms between 2010 and 2018 has shown that while “gazelles” represented only about 1-2% of all businesses in both countries, they were responsible for approximately 14% of employment growth in Russia and 9% in Spain.
High-growth firms are “widely considered essential for stimulating economic growth and employment” but are difficult to identify. Stakeholders need accurate growth predictions to help optimize decision-making and minimize risks by identifying firms with the highest potential for success.
In an effort to understand why some firms grow faster than others, researchers have looked into various factors including the personality of entrepreneurs, competitive strategy, available resources, market conditions and macroeconomic environment. These factors, however, only explained a small portion of the variation in firm growth and were limited in their practical application. This led to the suggestion that predicting the growth of new businesses is like playing a game of chance. Another viewpoint argued that the problem of growth prediction might stem from the methods employed, suggesting an “illusion of randomness”.
As firm growth is a complex, diverse, dynamic and non-linear process, adopting a new set of methods and approaches, such as those driven by big data and AI, can shed new light on the growth debate and forecasting.
AI OFFERS NEW OPPORTUNITIES FOR PREDICTING HIGH-GROWTH FIRMS
AI methods are being increasingly adopted
to forecast firm growth. For example, 70% of venture capital firms are adopting AI to increase internal productivity and facilitate and speed up sourcing, screening, classifying and monitoring start-ups with high potential. Crunchbase, a company data platform, claims that internal testing has shown that its AI models can predict start-up success with “95% precision” by analysing thousands of signals.
These developments promise to fundamentally change how investors and businesses approach decision-making in private markets.
The advantages of AI techniques lie in their ability to process a far greater volume, variety and velocity of data about businesses and their environments compared to traditional statistical methods. For example, machine learning methods such as random forest (RF) and least absolute shrinkage and selection operator (LASSO) help identify key variables affecting business outcomes in datasets with a large number of predictors.
A “fused” large language model has been shown to predict start-up success using both structured (organized in tables) fundamental information and unstructured (unorganized and more complex) textual descriptions. AI techniques help enhance the accuracy of firm growth predictions, identify the most important growth factors and minimize human biases.
As some scholars have noted, the improved prediction indicates that perhaps firm growth is less random than previously thought. Furthermore, the ability to capture data in real time is especially valuable in fast-paced, dynamic environments, such as high-technology industries.
Despite AI’s rapid progress, there is still considerable potential for advancement. Although the prediction of high-growth firms has been improved with modern AI techniques, studies indicate that it continues to be a challenge. For instance, start-up success often depends on rapidly changing and intangible factors that are not easily captured by data. Further methodological advances, such as incorporating a broader range of predictors, diverse data sources and more sophisticated algorithms, are recommended.
One of the main challenges for AI methods is their ability to offer explanations for the predictions they make. Predictions generated by complex deep learning models resemble a “black box”, with the causal mechanisms that transform input into output remaining unclear. Producing more explainable AI has become one of the key objectives set by the research community. Understanding what is explainable and what is not (yet) explainable with the use of AI methods can better guide practitioners in identifying and supporting high-growth firms.
While start-ups offer the potential for significant investment returns, they carry considerable risks, making careful selection and accurate prediction crucial. As AI models evolve, they will increasingly integrate diverse and unstructured data sources and real-time market signals to detect early indicators of potential success. Advancements are expected to further enhance the scalability, accuracy, speed and transparency of AI-driven predictions, reshaping how high-growth firms are identified and supported.
Women are South Asia’s ‘Silent Contributors’–
As a child, I lived with my grandmother in a rural village in Sri Lanka where women often played an active economic role – working in sectors like farming, technology, sewing, household work or some other area. These days across South Asia, businesses led by women are on the rise, with online platforms making it easier for entrepreneurs to start with minimal investment.
If more women could be encouraged into employment in the region, it would, of course, bring wider benefits. For instance, it’s estimated that if women’s participation in India’s workforce reached 50% from its current level of 31%, the country’s annual growth rate could increase by 1.5 percentage points.
Female entrepreneurs in South Asia have been described as “silent contributors”, as their input to the economy and society is still not properly understood. And when their
contributions go unrecognised, women can be denied access to education and career development.
Not only that, but it can lead to women having fewer opportunities for leadership roles, financial security, and professional growth. It may discourage the participation of other women, or limit their progress in industries and societies that could benefit from greater female representation.
Research often points to factors such as a lack of education, technical expertise, gender discrimination and low self-esteem as reasons female entrepreneurs may be demotivated.
But after reviewing several studies, I realised there’s a deeper, more complex issue. I identified a three-pillar effect that discourages women from entrepreneurship.
These are socio-cultural barriers, which in-
clude traditional gender roles and societal expectations; economic and financial constraints such as limited access to funding; and regulatory and institutional challenges like legal obstacles and a lack of support systems.
These three pillars create significant hurdles for women who are trying to build their businesses.
A study looking at Mumbai, India, found that limited affordable transport can significantly reduce women’s chances of entering the workforce or starting a business.
For example, some Indian and Sri Lankan women are expected to stay close to home to take care of children or elderly relatives. This limits their ability to travel to markets or participate in other work. There is also the issue of poor access to education and technical skills that can hold women back in terms of development and building a business.
These barriers are starting to receive more recognition and were depicted in the award-winning film The Great Indian Kitchen. This 2021 film in the Malayalam language tells the story of a young woman who is expected to follow traditional gender roles after her marriage. The film highlights the social norms that often deter women from working or seeking education.
Most women entrepreneurs in South Asia work in the informal sector. This includes street vending, agriculture, retail and home-based industries like sewing. But these sectors and enterprises often remain unregistered and are not captured in official economic data.
For example, women in cities like Delhi in India and Colombo in Sri Lanka sell products like vegetables or handmade jewellery on the streets. Often, these women do not have legal businesses or commercial registration numbers. This limits their access to loans, so-
cial security and more formal markets. Across South Asia, only 25% of women have a bank account, compared with 41% of men – the biggest gender gap in the world.
Nepal, however, has made strides in financial inclusion, particularly in closing the gender gap. According to Nepal’s financial inclusion report in 2023, women’s access to formal financial services the previous year was at 89% while men’s stood at 90% – showing that change is possible.
The lack of education and technical training often restricts women’s ability to develop skills and entrepreneurial nous. But it can also expose them to exploitation by officials who can prey on their lack of legal knowledge, forcing them to face bureaucratic hurdles and corruption.
Another thorny issue is that in some cultures it is unacceptable for women to hold seniority or authority over men. Often, government policies and programmes focus on male entrepreneurs, overlooking women’s issues. These include childcare needs or safety concerns.
In Sri Lanka, female-owned businesses face significant challenges in accessing key government incentives simply because of limited awareness. A big issue is that women in rural areas often do not hear about funding programmes, grants and financial schemes.
South Asian women’s economic contributions continue to be damaged by social, cultural and institutional limitations. It is vital to recognise these contributions and bring them into the formal economic system. This should ensure that female entrepreneurs get their rightful place in the broader economic arena.
For 200 years, we’ve been warned of unchecked population growth and how it leads to environmental instability. On the other hand, today some countries face decreasing populations, alongside increasing proportions of elderly people, causing economic instability.
These two facets of population crises — explosions and declines — are occurring in different parts of the world, and have a global impact on the environment and on economies. Discussions about achieving economic and environmental sustainability must consider population changes, technology and the environment, given these concepts are closely interwoven.
Population explosions and declines are related to both environmental and economic instability; some countries make reactionary choices
that trade off short-term domestic economic progress over the environment.
In 1798, English economist Thomas Malthus warned of a population explosion, inferring that population growth will outstrip agricultural production. Malthus’s ideas became re-popularized by American scientist Paul R. Ehrlich in his book published at the height of population growth in the 1960s. Both predicted that a population explosion would cause shortages in resources and escalating environmental damage.
Like Malthus, Ehrlich was criticized for a crisis “that never happened” because human ingenuity, a byproduct of population, overcomes the worst fears of environmentalists. This counter-argument relies on technological ad-
vances making more efficient use of resources while lowering the environmental impacts.
This is best exemplified by efficiency gains of agriculture that have continued to feed a growing world. Ehrlich’s predictions of cumulative environmental damage are best illustrated by the growing intensity of climate change and species loss as the global population continues to grow even though the current growth rate is slower than it was in the 1960s.
Unified growth theory describes how economies change over the long term. It starts with a period of slow technological progress, low income growth and high population growth. Over time, these conditions give way to a modern growth phase, where technology improves quickly, income rises steadily and population growth slows as societies go through a demographic transition towards stable population sizes.
Technological progress positively contributes to national economies over the long term. However, early adoption of green technology often relies on finance and government incentives that may imply short-term economic burdens. Yet when green technology is implemented and coupled to slowing population growth, it leads to decreasing national environmental footprints that pave a way towards joint environmental and economic sustainability.
Declining populations cause inverted age pyramids with larger numbers of elderly people. These shifting demographics cause economic instability. They also constrain technological progress and social security.
Population declines work against the gains described by unified growth theory. Presently, 63 countries have reached their peak population and 48 more are expected to peak within 30 years. Fears of population decline are also being forecast at the global scale.
The global population is predicted to peak between the mid-2060s to 2100, stabilizing at 10.2 billion from its present 8.2 billion.
In their book, Empty Planet, political scientist Darrell Bricker and political commentator John Ibbitson warn that zero population growth will happen even faster. They argue once a country decreases its fertility to below replacement (2.1 children per woman), the social reinforcements of increasing urbanization, costs of raising children and increased empowerment over family planning make it almost impossible to increase the birth rate.
For highly affluent countries, the per capita GDP is decreasing as the proportion of elderly in the population increases. Although this pattern doesn’t hold when less affluent countries are added, the figure demonstrates tangible economic impacts for countries grappling with aging populations.
Affluent nations facing decline can react to economic instability in ways that counter global economic and environmental sustainability.
In the past, affluent nations were the drivers of green technology. However, economic instability from population declines can cause reluctance to invest, adopt and share green technology crucial for mitigating environmental damage at the global scale.
The issue is compounded by the fact that many countries overlook how their own decline in population growth contributes to economic instability. They instead focus on short-term solutions to their economic situation that may include unsustainable resource use.
Left unaddressed, the real issue of population decline becomes unresolved, allowing social anxieties against immigration and global trade to grow. This can exacerbate the issue halting technology sharing, slowing economic growth and increasing economic inequality and environmental damage.
The above is exemplified by policies now being implemented by the United States. Where immigration was previously used as a backstop against low fertility, growing cultural backlash to immigration pressures rooted in anxiety about economic uncertainties have generated new policies causing the deportation of millions of immigrants and closing borders. This will most likely accelerate a population decline in the U.S., as highlighted by a Congressional Budget Office report.
At the same time, the U.S. is shifting its energy policy away from increased shares of renewable, green energy sources back to a focus on fossil fuels that will worsen climate damage.
Climate damage costs are currently two per cent of global GDP, and may increase to between two to 21 per cent of some countries’
incomes by the end of the century. The growing applications of artificial intelligence (AI) and its high energy use will add to climate damage. AI may also contribute to the economic challenges related to population decline if it replaces, rather than supports, labour.
Finally, tariff wars add new barriers against green technology sharing.
CANADA’S LOWERED IMMIGRATION
Canada, which already has a low fertility rate and is reacting to the U.S. trade war, has its own challenges. This year, immigration targets were decreased by 19 per cent. The lack of support for and subsequent removal of the carbon tax and possible extension of pipeline infrastructure could generate similar delays in the transition away from fossil fuels.
In the most recent federal election, discussions about environmental policy were largely side-tracked by economic issues.
Our research indicates that Canada and other affluent nations need to establish longer-term solutions to economic instabilities that mitigate environmental damage while promoting sustainable national and global economies.
The United Nations Sustainable Development Goals offer pathways for economic, social and environmental sustainability. However, realizing these goals requires society to fully acknowledge the intertwined relationships between population growth, economy, environment and international technology-sharing in ways that transcend short-term national interests and reactionary policies.
The past decade has seen strong momentum from social and natural sciences as well as international organizations, business and civil society. Unfortunately, the current climate of economic uncertainty is halting this progress — unless the public can force broader discussions about sustainable approaches back into the political sphere.
Max Lacey-Barnacle Senior Research Fellow, Science Policy Research Unit, University of Sussex
Across the world, the transition to a green economy is under threat. Growing antipathy towards the costs of tackling climate change, stoked especially by right-wing populists, undermines ambitions to reach net zero emissions by 2050.
In the UK, leader of the opposition Kemi Badenoch recently described achieving net zero by 2050 as “impossible”, stating that it would bankrupt the country. Reform, a major rival to the right of Badenoch’s Conservative party want to scrap the UK’s net zero targets altogether.
A new vision of net zero is urgently needed.
To help fund the UK’s transition to a green economy, the UK government seeks to attract private investment from international corporations that are not based in the UK.
The Indian company Tata Group is investing £4 billion in electric vehicles (EVs) and battery production in the UK. Danish company Orsted has invested £15 billion in UK offshore windfarms in the last decade. French company EDF Energy has invested £4.5 billion in net zero technologies and infrastructure in the UK.
This approach comes with considerable risks. Profits can be extracted out of local economies, which benefits the shareholders of international corporations, not UK businesses.
Ownership can also change between private entities and move even further afield. Last year, Orsted sold stakes in four UK offshore wind farms to a Canadian investment company.
But there’s an alternative that directly strengthens the resilience of the UK’s economy. Community wealth building is a model of economic development that ensures any profits
generated from new green industries is recirculated within the local economy.
To make this happen, communities need support from so-called “anchor institutions”. These are large organisations that are “anchored” to their local economy and cannot relocate, because their ownership structure is tied to a particular location. Think universities, hospitals or local government institutions.
Within this approach, anchor institutions procure goods and services from nearby suppliers, so they circulate money locally and strengthen regional supply chains.
This concept originated over a decade ago in the US. It’s since been applied in Canada, Australia, Ireland and the Netherlands.
For the past four years, I’ve been exploring how community wealth building is becoming
embedded in the UK’s fast-growing green economy.
In north-west England, Preston city council retained the procurement spend of anchor institutions located in Preston city to the tune of £112.3 million in 2020 – £74 million more than in 2012/13.
In Oldham in northern England, the council supported the development of community-led energy plans in two neighbourhoods, Sholver and Westwood. The plans outlined what a decarbonised heat, electricity and transport system would look like for each area. The council launched a website to share energy efficiency advice. The council also helped to set up two local community energy projects.
Oldham Community Power installed solar panels on five primary schools and a community building to reduce their energy bills. Saddleworth Community Hydro have used
excess profits from the sale of renewable electricity in 2023 to fund £58,000 worth of local sustainability projects.
The council in Lewes in southern England have committed to using community wealth building to transition towards net zero. Hundreds of houses have been retrofitted to increase their energy efficiency, with retrofit contracts arranged with local companies. EVs are being used to collect food waste. New sustainable housing is being built by local tradespeople using locally sourced materials wherever possible.
The Lewes Climate Hub hosts community events and green business workshops in a council-owned property. Procurement spend by local anchor institutions has also doubled from £5m in 2020 to £10m in 2024.
In North Ayrshire, Scotland, two municipally owned solar PV farms on council-owned land have generated a £13 million budget surplus. This has been redirected towards addressing fuel poverty by making low-income homes
more energy efficient. The council’s new green jobs fund has supported over £1.14 million of investment into 65 businesses to enable a range of sustainability related measures.
Encouragingly, more plans to bring together community wealth building and net zero continue to emerge. In London, partnerships between anchor institutions and community energy organisations could be integral to developing 1,000 community energy projects across the capital by 2030.
Successful scale-up of community wealth building will require strong leadership, political commitments and supporting strategies that align with the green economy. Already, some initiatives are beginning to generate wealth through the green economy and keeping it in local communities, rather than ownership and profits going to distant corporations.
To counter a rising opposition to net zero in the UK, prioritising community-focused visions that revive local economies will be vital.
London, New York and Paris have been named the world’s most dynamic and liveable cities. This is according to a new ranking of global cities that highlights Europe’s ability to balance sustainability and growth in its urban centres.
The IESE Cities in Motion index looks at 183 cities in 92 countries, and ranks them in nine key areas: human capital, social cohesion, economy, governance, environment, mobility and transportation, urban planning, international profile and technology. It’s different from other indices in that it takes into account so many metrics – more than 100 – on everything from ease of starting a business to number of museums and art galleries, internet speed and commute times.
The idea is to systematically gauge what makes a city the sort of place where people
want to live and work. This is important not just for the quality of life of habitual residents, but also because location is vital for attracting global talent, especially among younger generations.
The top 10 cities in the 2025 edition were London, New York, Paris, Tokyo, Berlin, Washington DC, Copenhagen, Oslo, Singapore and San Francisco.
The top three all do particularly well in human capital, which includes features like educational and cultural institutions. They also score highly on international profile, which looks at indicators of global interest, such as the number of airport passengers and hotels.
Beyond those two areas, London cements its status as a global hub of high-level innovation
and development, also standing out for governance and urban planning. The UK capital is somewhat weaker in social cohesion, where it came 20th, though not nearly as bad as second-place New York, which ranked 127th out of 183 cities in this category – among the lowest of developed countries. New York does, however, stand out for its economic performance, and does very well in mobility and transportation.
Paris, meanwhile, performs well across many metrics, including urban planning as well as international profile and human capital.
We’ve been calculating the index for a decade now, and European cities consistently perform well. This year, five of the top 10 cities – London, Paris, Berlin, Copenhagen and Oslo – are European.
We adjust the index on a regular basis in order to make sure that we’re measuring what’s relevant. For example, this year we introduced new metrics on women’s leadership, renewable energy sources and green spaces, as well as on availability of coworking spaces.
There’s no single reason behind Europe’s success, but there are patterns. Its large global metropolises, such as London and Paris, offer advanced technology, international communities and diversified economies in services, technology and finance. They have generally stable political systems and reasonable urban planning, along with advanced public and private transport options. However, while highly diverse, they also suffer from income inequalities.
In addition to these mega cities, Europe is home to a large number of sustainable and culturally vibrant cities of many sizes. All the Spanish cities included in the index (10 in total, including Madrid and Barcelona) are part of this cluster.
These are mature economies that prioritise sustainability over rapid growth, seeking to balance liveability and stability. They also have steady political systems, a commitment to green policies and urban planning strategies that give weight to sustainable infrastructure that enhances liveability.
They do well in social cohesion, with high levels of integration and relatively low levels of inequality. In terms of technology, they are steady adopters but they are not, for the most part, trailblazing innovators.
It’s also interesting to note the performance
of North American cities, which show that economic might and technological prowess don’t always translate into more liveable metropolises. US cities dominate the economic dimension – eight of the top 10 in economic performance are American – but there’s not a single American city in the top 10 for social cohesion or environment. They do well in our ranking – New York, Washington, San Francisco, Chicago and Boston are all in the top 20 – as would be expected of high-income cities, but their performance in different areas varies widely.
Meanwhile, developing countries continue to struggle to break into the top ranks. In Latin America, the highest-ranked city is Santiago (89th), followed by Buenos Aires (117th) and Mexico City (118th). In Africa, Cape Town (156th) is the top-ranked city. At the very bottom of the ranking are Lagos, Lahore and Karachi.
In this tenth edition, we are starting to see greater homogeneity of cities, suggesting that urban planners are learning how to confront similar social, economic and geopolitical challenges. Here are some of our recommendations for how they can improve further:
Adaptive and participatory planning: Cities should adopt an approach to planning that is both inclusive and adaptive. This means actively engaging residents, businesses and organisations in identifying priorities, and establishing mechanisms to respond to unexpected developments.
Sustainability as a core principle: A commitment to environmental sustainability and
innovation in urban planning is key. Cities should pursue policies that reduce carbon emissions, such as adopting renewable energy. Their strategies must also factor in environmental impact and preparedness for extreme climate events, such as wildfires or floods.
Economic and social resilience: To address economic inequalities and a lack of social cohesion, cities should implement policies that foster economic equity, such as incentives for small businesses and job training programs that improve access to employment. They should also develop community support networks that strengthen social ties and promote the integration of vulnerable groups.
Inclusive technology: To close the digital divide, cities should develop a robust technological infrastructure that ensures connectivity across all urban areas and provides digital skills training for residents. Open data platforms that enhance transparency and encourage citizen participation can play a key role in this.
International cooperation: Cities should actively participate in international networks to foster mutual learning and best practices, and to collaborate on joint projects.
Continuous measurement: Metrics are essential, both to track progress and to benchmark against other cities with similar characteristics. While cities should develop their own performance dashboards with relevant indicators, our index can serve as an initial framework for identifying key dimensions and the most important indicators.
Around the world, more and more electric vehicles are hitting the road. Last year, more than 17 million battery-electric and hybrid vehicles were sold. Early forecasts suggest this year’s figure might reach 20 million. Nearly 20% of all cars sold today are electric.
But as more motorists go electric, it creates a new challenge – what to do with the giant batteries when they reach the end of their lives. That’s 12 to 15 years on average, though real-world data suggests it may be up to 40% longer. The average EV battery weighs about 450 kilograms.
By 2030, around 30,000 tonnes of EV batteries are expected to need disposal or recycling in Australia. By 2040, the figure is projected to be 360,000 tonnes and 1.6 million tonnes by 2050.
Is this a problem? Not necessarily. When a battery reaches the end of its life in a vehicle, it’s still got plenty of juice. Together, they could power smaller vehicles, houses or, when daisy-chained, even whole towns.
For this to work, though, we need better information. How healthy are these batteries? What are they made of? Have they ever been in an accident? At present, answers to these questions are hard to come by. That has to change.
Old EV batteries have huge potential. But it’s not going to be easy to realise this.
That’s because it’s hard to get accurate data on battery performance, how fast it’s degrading and the battery’s current state of health – how much capacity it has now versus how much it had when new.
Unfortunately, vehicle manufacturers often make it difficult to get access to this crucial information. And once a battery pack is removed, we can’t get access to its specific data.
This comes with real risks. If a battery has a fault or has been severely degraded, it could catch fire when opened or if used for an unsuitable role. Without data, recyclers are flying blind.
Reusing EV batteries will only be economically viable if there’s sufficient confidence in estimates of remaining capacity and performance.
Without solid data, investors and companies may hesitate to engage in the repurposing market due to the financial risks involved.
EXTRACTING MINERALS FROM A BATTERY
EV batteries are full of critical minerals such as
nickel, cobalt, lithium and manganese. Nearly everything in an EV battery can be recycled –up to 95%.
Here, too, it’s not as easy as it should be. Manufacturers design batteries focusing on performance and safety with recyclability often an afterthought.
Battery packs are often sealed shut for safety, making it difficult to disassemble their thousands of individual cells. Dismantling these type of EV batteries is extremely labour-intensive and time-consuming. Some will have to be crushed and the minerals extracted afterwards.
EV batteries have widely differing chemistries, such as lithium iron phosphate and nickel manganese cobalt. But this vital information is often not included on the label.
Used EV batteries fall into three groups based on their state of health:
High (80% or more of original capacity): These batteries can be refurbished for reuse in similar applications, such as electric cars, mopeds, bicycles and golf carts. Some can be resized to suit smaller vehicles.
Medium (60-80%): These batteries can be repurposed for entirely different applications, such as stationary power storage or uninterruptible power supplies.
Low (below 60%): These batteries undergo shredding and refining processes to recover valuable minerals which can be used to make new batteries.
Researchers have recently succeeded in estimating the health of used EV batteries even without access to the battery’s data. But access to usage and performance data would still give better estimates.
An EV battery is a remarkable thing. But they rely on long supply chains and contain critical minerals, and their manufacture can cause pollution and carbon emissions.
Ideally, an EV battery would be exhausted before we recycle it. Repurposing these batteries will help reduce how many new batteries are needed.
If old batteries are stockpiled or improperly discarded, it leads to fire risk and potential contamination of soil and water.
Right now, it’s hard for companies and indi-
viduals to access each battery’s performance data. This means it’s much harder and more expensive to assess its health and remaining useful life. As a result, more batteries are being discarded or sent for recycling too early.
Recycling EV batteries is a well-defined process. But it’s energy-intensive and requires significant chemical treatments.
At present, many battery manufacturers are wary of sharing battery performance data, due to concerns over intellectual property and other legal issues. This will have to change if society is to get the fullest use out of these complex energy storage devices. But these changes are unlikely to come from industry.
In 2021, California introduced laws requiring manufacturers to give recyclers access to data and battery state of health. Likewise, the European Union will require all EV batteries to come with a digital passport from January 2027, giving access to data on the battery’s health, chemistry and records of potentially harmful events such as accidents or charging at extreme temperatures.
Australia should follow suit – before we have a mountain of EV batteries and no way to reuse them.
Vast amounts of renewable energy are needed to produce green hydrogen, a new form of energy made by splitting water molecules into hydrogen and oxygen using renewable power.
Green hydrogen is a type of clean energy that could reduce greenhouse gas emissions by replacing fossil fuels in energy-intensive industries. These industries include cement, fertiliser and steel production.
The scale of projected investments globally is huge. The Hydrogen Council, an association of major corporations including the multinational mining company Anglo American, Bosch engineers, the chemicals and engineering giant
Linde and many others, lists 1,400 announced projects worldwide and announced investments of US$320 billion.
European governments are looking to import green hydrogen from countries like Chile and South Africa that have enough sun and wind to set up the huge power plants required.
They’re also planning to build a very large network of green hydrogen pipelines across the continent. By the 2030s, the amount of green hydrogen imported by the European Union may reach 10 million tonnes a year.
Chile needs green hydrogen so that it can stop using fossil fuels in copper mining. The country also wants to become a major exporter of
green hydrogen derivatives, such as green ammonia and renewable methanol.
South Africa sees green hydrogen as an export opportunity but, more importantly, as a means to decarbonise its large heavy-industry and mining sectors, which depend on climate-damaging coal-based energy. The chemicals giant Sasol and the steel producer ArcelorMittal could be the first big industrial corporations to use green hydrogen.
However, both countries lack the billions of US dollars needed to set up green hydrogen industries. If they take out large-scale loans to help finance the projects, this could raise debt to unsustainable levels.
We are economists who have analysed policies, especially de-risking measures, to promote the green hydrogen industry in Chile and South Africa. De-risking means that the state guarantees attractive and reliable conditions to bring in private investors, also supporting them with low-interest credit.
By reviewing national strategy papers and further legislation, and through interviews with business people and politicians, we found that de-risking could actually be financially problematic for the two countries.
Our research found that tax incentives and credits are questionable ways to support the industry. This is because they attract investment in green hydrogen projects without overcoming more fundamental economic and political insecurities. These deficiencies include the lack of infrastructure for green hydrogen, specialised local suppliers and market uncertainty regarding demand and prices.
We suggest that South Africa and Chile concentrate on creating a business environment favourable to foreign investment that also puts local firms and local labour on a firmer footing to participate in green hydrogen projects. There is also a need for countries in the global north to take on a bigger share of the financial risks involved with setting up green hydrogen projects.
Chile and South Africa have taken numerous steps to promote the green hydrogen industry. Chile’s National Green Hydrogen Strategy
provides a clear guideline on how to develop the industry. It identifies market opportunities and supportive measures that the state should take. University programmes in engineering and chemistry have been adapted to train the future workforce of the wider green hydrogen sector.
The Inter American Development Bank, the European Investment Bank, Germany’s KfW Development Bank and the World Bank have contributed to Chile’s US$1 billion Green Hydrogen Fund. The government is hoping to increase this fund to US$12.5 billion.
However, it will be essential to avoid taking on excessive liabilities because, in the worst case, loans provided to private companies that are not paid back may bankrupt the state.
In South Africa, the 2021 Hydrogen Society Road Map proposes that firms involved in green hydrogen production set up together in clusters. Existing special economic zones, which have dedicated infrastructure and other advantages for investors, are likely to become the locations of these clusters. University and other training programmes have been launched.
The Green Hydrogen Commercialisation Strategy sets out ambitious production targets, including exports of 1 million tonnes a year by the 2030s.
Again, a key issue is financing. South Africa’s Just Energy Transition Investment Plan is based on a US$7 billion funding package from the UK and EU to grow the renewable energy sector.
The idea is that this amount will attract a bigger group of private sector investors to fund renewable energy, green industrialisation and decarbonisation projects. But only 4% of the US$7 billion consists of grants that do not have to be repaid. The bulk of the amount is made up of loans that could aggravate South Africa’s already considerable debt burden.
For countries in the global north to move away from fossil fuel energy, they’ll need to buy green hydrogen from countries such as Chile and South Africa. So it is essential that these wealthier countries take on a larger share of the risks of setting up green hydrogen projects. This will help green hydrogen host countries to avoid being caught in a debt trap.
Wealthier countries could sign long-term purchase agreements. This would mean that green hydrogen producers in Chile and South Africa would be assured of having buyers at fixed prices. First steps in that direction have been taken by Namibia and Germany.
Our research emphasises the need to promote development in the countries that will produce and export green hydrogen. This must happen in addition to a more just international burden sharing.
Rather than tax cuts and cheap loans, less expensive and more lasting measures need to be taken to facilitate participation of local players in green hydrogen projects. The creation of such benefits is also important to offset negative environmental and social effects of these projects.
Established to be a true indicator of excellence, the Pan Finance Awards identifies organisations and individuals who have excelled in their fields. Our awards directory serves to shine a spotlight on and also applaud these leading examples of best practice.
2025
4Tax specialises in international tax solutions, streamlining global investment by eliminating tax, succession, and accounting complexities. From planning to implementation and ongoing maintenance, we ensure seamless management of investment structures. With over 1,000 projects completed in 10+ countries, we provide global expertise and proprietary processes, ensuring clients remain fully compliant with tax and regulatory obligations. Our approach prioritises tax optimisation while preserving wealth for future generations.
Our International Tax Planning service covers the entire project lifecycle, tailoring strategies based on clients’ investment goals, capital allocation,
and family structure. We design and implement customised solutions, including the creation, restructuring, or enhancement of offshore entities.
Through our Offshore Entity Maintenance service, we handle corporate, tax, and accounting compliance, ensuring regulatory adherence. Our support alleviates the burden of complex tax and succession planning, allowing investors to focus on core business activities and wealth growth. By combining expertise, efficiency, and proactive strategies, 4Tax simplifies global wealth management, providing peace of mind to international investors.
BEST PAYROLL FINANCING SERVICES - USA 2025 -
BEST PAYROLL FUNDING PROVIDER - USA 2025ENTREPRENEURIAL FINANCING PARTNER OF THE YEAR - USA 2025 -
Advance Partners is a champion of next-level staffing firm growth. We solve the inherent cash flow challenges staffing firms face with unlimited funding that you’ll never outgrow, competitive rates, and access to a
suite of strategic services, including acquisition support/guidance, and HR and payroll support provided by our globally trusted parent company, Paychex.
In the current era of digital finance, electronic currencies have become central to global markets, making seamless access to trading and investment platforms essential. Partnering with a reliable international broker is critical for an efficient and secure trading experience.
Established in 2007, AMarkets is a reputable global online broker trusted by over one million active clients. The company boasts an extensive affiliate network, with more than 3,000 partners operating around the globe.
Consult Group Worldwide (CGW) is a global alternative investment intermediary and boutique consultancy, specialising in sourcing, originating, and structuring fixed-income opportunities for financial professionals and institutions.
Established in 2012, CGW operates with an unwavering commitment to transparency, integrity, and strategic innovation — enabling its trusted global network of Independent Financial Advisors (IFAs), Wealth Managers, and Institutional Capital Partners to access high-performing, non-correlated private credit products.
With nearly $708M in capital raised, CGW’s proprietary S.O.S. Model — Sourcing, Originating, Structuring — positions the firm at the forefront of alternative investment consulting.
CGW’s expertise is exemplified in its Ultra-Short-Term Notes, a revolutionary product providing investors with 12–20% fixed returns over 120–180 days, backed by 100% capital protection through asset-backed litigation finance strategies. As global markets face increased volatility, CGW continues to bridge the gap between traditional finance and next-generation investment solutions, fostering long-term partnerships with its global network across the UK, Europe, Middle East, and Asia.
CrossFi is redefining financial access through a decentralized ecosystem that bridges traditional finance and Web3. Built for global citizens and underserved markets, CrossFi offers a seamless user experience where digital assets meet real-world utility. With a non-custodial architecture at its core, users can securely earn, spend, and grow their wealth—without intermediaries or borders.
At the heart of the CrossFi offering is a powerful suite of interoperable products: a global spending app with stablecoin support, crypto debit cards, synthetic asset trading (xAssets), and on-chain lending (PhoLend). All products are designed for freelancers, entrepreneurs, and digital natives across Latin America, Southeast Asia, MENA, and beyond.
CrossFi is more than a DeFi platform—it’s a movement to democratize financial tools, enhance economic inclusion, and empower individuals in regions where traditional banking falls short. Backed by robust compliance (PCI DSS), a growing developer ecosystem, and a commitment to community-driven growth, CrossFi is poised to become the Web3 neobank of the future.
CrossFi’s mission is clear: financial sovereignty for all.
Learn more at www.crossfi.org
ELIA Investment Advisors is a Zurich based wealth management company, founded in 2019 by a team of financial industry specialists with extensive experience in covering the investment needs of an ultra wealthy clientele at top tier international financial institutions.
They joined forces sharing the same enthusiasm about financial markets, and the same vision about how wealth management should be conducted. The tagline “Investing. As it shouid be” incorporates the core principles of this investment approach.
ELIA Investment Advisors elevates private wealth management to a truly
institutional level without compromising on investment flexibility and the ability to develop bespoke investment solutions, by tapping all available markets and instruments, in a unique, active, innovative, though disciplined manner.
A highly engaging team along with a fully aligned compensation model, supplement our innovative investment approach and build the pillars for a transparent, honest and successful longer term relationship with our select clientele.
BEST CONFIGURABLE BANKING PLATFORM - USA 2025PAYMENT TECHNOLOGY INNOVATOR OF THE YEAR - USA 2025 -
An award-winning global financial technology innovator powering credit, debit, prepaid, core banking, and money movement solutions, i2c unifies banking and payments in an all-in-one platform, transforming product personalization with a customer-centric architecture and accelerating speed-to-market with proprietary self-serve building block solutions. With i2c’s highly configurable, future-forward technology, banks, credit unions and fintechs can deliver best-in-class banking and payments solutions.
Leading brands globally trust i2c to help them deploy differentiated financial offerings in an evolving and competitive market to elevate customer experiences and drive scalable growth. Powered by innovation and driven by trust for more than 20 years, i2c blends modern ingenuity with expert reliability to supercharge exceptional experiences across millions of users and billions of transactions worldwide.
For more information, visit www.i2cinc.com and follow us at @i2cinc.
SECURITIES EXCHANGE OF THE YEAR - ZAMBIA 2025MOST INNOVATIVE MULTI-ASSET TRADING PLATFORM - ZAMBIA 2025 -
The Lusaka Securities Exchange Plc (LuSE) is Zambia’s main securities Exchange. We remain very central to the national economic aspirations of being a platform where ideas meet capital and anchor sustainable business growth and wealth creation. We offer our clients wide access to capital markets and liquidity across different asset classes. We operate a broad range of equity, fixed income, and exchange-traded funds/ exchange-traded products. For 30 years now we pride in providing a platform that has connected buyers and sellers through financial products, supported by world-class technology and regulatory oversight.
The LuSE, whose formation was part of the government’s economic reform program, aims at developing the financial and capital markets in order to support and enhance private sector initiative and attract foreign portfolio investment through recognition of Zambia and the region
as an emerging capital market with potentially high investment returns. Another important role of the Exchange is to facilitate the divestiture of Government ownership in parastatals and realization of the objectives of creating a broad and wide shareholding ownership by the citizenry via a fair and transparent process. The LuSE’s activities are regulated by its own regulations and by-laws, along with the rules, orders and guidance of the Securities and Exchange Commission.
The LuSE has made great strides since its inception. It is now more than a platform for trading shares and bonds as demonstrated by some companies from across the spectrum of the industry that has used it to raise the public capital for expansion and in the process sustained and created new products and jobs.
STRATEGIC GROWTH PARTNER OF THE YEAR - MENA 2025 -
At Manhattan Private Credit Markets, we connect investors to high-quality private credit opportunities with institutional-grade risk management. Our platform focuses on financing asset-backed and specialty finance portfolios — all underpinned by rigorous underwriting and proprietary capital protection strategies. We specialize in private credit investments
that offer Fixed Returns supported by embedded protection mechanisms. Our platform connects investors to curated private credit deals — like portfolios of business loans, receivables, and other asset based loans — with clear risk profiles and strong downside safeguards.
CORPORATE FINANCE ADVISORY OF THE YEAR - MIDDLE EAST 2025 -
At Tawuniya, we are committed to shaping the future of cooperative insurance in Saudi Arabia. Established as the first national insurance company licensed under the Cooperative Insurance Companies Control Law, we have built a legacy of trust and excellence for nearly four decades. Operating in full compliance with Islamic Shariah principles, we offer a diverse range of over 60 insurance products, including health, motor, property and casualty, travel, marine, aviation, and energy insurance, serving individuals, businesses, and government entities across the Kingdom.
Our Corporate Finance function plays a central role in ensuring financial
stability, strategic growth, and sustainable operations. With a disciplined approach to business planning, investment strategy, and risk management, we maintain strong liquidity and capital efficiency while supporting our broader objectives. Through comprehensive financial modelling, treasury operations, and data-driven insights, we align our financial structure with Tawuniya’s long-term vision, enabling growth, innovation, and operational excellence.
As we move forward under Strategy 2025, we remain focused on expanding our digital capabilities, strengthening our service offerings, and driving financial and economic progress in line with Saudi Vision 2030.
tpay is the leading micro-payments connector in the Middle East, Turkey, and Africa (META), enabling businesses to accept payments through Direct Carrier Billing (DCB) and other alternative methods. Since 2014, tpay has built the region’s largest digital monetization network—connecting 46 operators, 47 wallet providers, over 1,000 merchants, and a reach exceeding 800 million users.
With a platform processing more than 1.5 billion transactions each month, tpay empowers global digital merchants to localize payments, increase conversions, and expand into high-growth markets. The solu-
tion supports a wide range of micro-payment use cases across gaming, content, streaming, e-learning, real-life services and other essential digital services.
At the heart of tpay’s mission is a commitment to financial inclusion—enabling users, many of whom are unbanked or underserved, to participate in the digital economy. Backed by strong local partnerships, deep regulatory expertise, and direct integrations, tpay continues to shape the future of online payments in META.
Founded in 2010 and headquartered in Hong Kong, UPWAY GROUP is a multinational enterprise group with financial technology as its core driving force. Its business covers four major sectors: Brokerage Business, Financial Technology, Liquidity Business and Physical Gold Business. It
has established branches in six core financial hubs around the world (Hong Kong, Sydney, Taipei, Kuala Lumpur, Dubai, and Jakarta) and has more than 350 professional talents.
