economic

June 12 (UPI) — Cuba’s government on Friday announced a broad package of economic reforms aimed at restructuring key aspects of the country’s economic model, just hours after the United States imposed a full financial blockade on state oil company Unión Cuba-Petróleo, or CUPET.

Speaking on state television, Cuban President Miguel Díaz-Canel defended the shift toward decentralization, saying that “these are times when change is necessary.”

The measures are part of the government’s 2026 Economic and Social Program, a roadmap inspired by the economic models of China and Vietnam. Havana says the plan is intended to address the island’s deep economic crisis, high inflation and widespread shortages of goods and services.

The reforms came only hours after U.S. Secretary of State Marco Rubio announced on X sanctions against CUPET, freezing all of the company’s assets under U.S. jurisdiction and prohibiting commercial transactions with it.

Rubio said that “Cuba’s communist elites have turned energy into a tool of social control and profit,” accusing the government of hoarding fuel supplies for its own benefit and using them to repress the Cuban people.

“President Donald Trump wants a new future for the Cuban people with greater freedom and opportunity,” Rubio wrote.

The secretary of state said the sanctions were justified because CUPET operates assets that were allegedly confiscated from U.S. owners decades ago. Washington also warned that foreign companies continuing to do business with the state oil company could face secondary sanctions.

Cuba announced the measures two days after the Miami Herald reported on a proposed commercial agreement between Florida-based Vanguard Energy and Cuban agencies to deliver 250,000 barrels of gasoline and diesel fuel intended exclusively for Cuba’s private sector, small and medium-sized enterprises and humanitarian organizations.

The arrangement included a five-year lease of state-owned storage tanks operated by CUPET. Under the proposal, Vanguard would retain ownership of the fuel to prevent it from being diverted to the Cuban government and would operate outside the island’s banking system.

However, within hours of the agreement becoming public, the U.S. State Department halted the shipment, saying the company did not possess a specific license authorizing the transaction and reaffirming that the Trump administration’s sanctions against Cuba remain fully in force.

Despite the tightening U.S. restrictions, Díaz-Canel rejected suggestions that the reforms were a response to pressure from Washington, describing them as a necessary internal restructuring effort.

The economic plan centers on decentralization and greater openness to investment. Municipal governments and state-owned companies will receive expanded authority over imports, exports and foreign currency management in an effort to reduce bureaucratic obstacles.

The government also plans to ease restrictions on private small and medium-sized businesses, open financial investment opportunities for Cubans living abroad and allow foreign companies to lease agricultural land to boost food production.

To support the reforms, Havana plans a significant reduction of the central bureaucracy, cutting the number of government ministries to 20 from 27 through mergers and eliminations.

Díaz-Canel said Cuba must move toward “new models and new actors” capable of making use of existing infrastructure, acknowledging that sectors such as tourism have been hurt by U.S. sanctions.

“We cannot focus only on the large international hotel chains when many of them, because of pressure from the United States government, have left the country,” he said. “We are developing real estate and tourism projects with new models and other actors that have not traditionally participated in these sectors.”

On energy policy, Díaz-Canel said Cuba would continue shifting toward solar power and renewable energy sources.

“We are going to eliminate, as much as possible, the restrictions that exist on vehicle imports,” he said. “We will continue prioritizing, through tariffs and pricing policies, the importation of electric vehicles powered by solar energy.”

Recent U.S. measures against Cuba have significantly tightened the decades-old embargo through Executive Order 14404 and additional restrictions targeting the energy sector, including CUPET. The sanctions also affect senior government officials, their relatives and military-linked entities.

Washington says the measures are intended to cut off revenue to the Cuban government, encourage political change and punish human rights abuses.

Cuban authorities argue that the restrictions have worsened an already severe economic crisis marked by chronic shortages and power outages that have lasted more than 48 hours in some parts of the island.

International organizations, including the United Nations, have warned about the humanitarian impact on the civilian population.

June 11 (Asia Today) — China’s renminbi, also known as the yuan, has strengthened sharply in recent months as Beijing seeks to elevate the currency’s global standing, but its rapid gains may create new risks for the Chinese economy.

The yuan recently reached its strongest level in three years and three months, prompting some Chinese media to describe the move as an advance by the currency. The trend is expected to continue for the time being.

According to recent reports by Chinese media, including National Business Daily, the yuan was poorly regarded until the end of the last century. Although the official exchange rate hovered around 8.2 yuan per dollar, the currency often traded at about 9 yuan per dollar on black markets in Beijing and other cities.

The yuan’s status began to change after China’s economy expanded rapidly in the early 2000s. After the 2008 global financial crisis weakened confidence in the U.S. economy, the yuan strengthened past 8 per dollar, then 7 per dollar, at times trading in the 6-yuan range.

The currency weakened again early last year and stayed around the 7-yuan level for about a year. Some analysts warned it could fall as low as 7.5 yuan per dollar.

Those concerns proved temporary. The yuan rebounded early this year and returned to the 6-yuan range. It strengthened further and traded around 6.77 yuan per dollar Wednesday, its highest level since Feb. 15, 2023, when it was at 6.8183 yuan per dollar.

Markets widely expect the yuan could strengthen further to around 6.5 per dollar. The currency was worth about 90 won at the end of the last century, but it now trades at about 225 won.

Several factors are driving the yuan’s gains. The prolonged war in the Middle East has increased demand for the yuan alongside the dollar, while China’s large trade surplus, supported by strong exports, has also lifted the currency.

A stronger yuan, however, is not necessarily good for China. It could become a burden for export-dependent companies by making Chinese goods more expensive overseas. Cheaper import prices could also deepen China’s chronic deflationary pressure, which remains a major concern for the economy.

Even so, Chinese economic authorities are not expected to intervene aggressively to slow the yuan’s rise.

Pan Gongsheng, governor of the People’s Bank of China, said during an economic news conference at the National People’s Congress in Beijing on March 6 that the yuan’s recent movement against the dollar reflected China’s stable economic recovery, weakness in the dollar index and a seasonal increase in corporate foreign exchange settlement.

Pan also said China did not need a yuan depreciation, signaling that authorities were comfortable with the currency’s strength.

The yuan’s transformation from a weak and undervalued currency into one with rising global influence has become increasingly difficult to ignore. But its continued ascent could create new pressure on China’s exporters and complicate Beijing’s fight against deflation.

— Reported by Asia Today; translated by UPI

© Asia Today. Unauthorized reproduction or redistribution prohibited.

Original Korean report: https://www.asiatoday.co.kr/kn/view.php?key=20260611010003994

As the World Cup nears, many Iranians say their normal enthusiasm for the event has been dampened by the co-host US’s war against their country as well as economic hardships.

Eurasian Economic Union (EAEU) countries are moving towards deeper economic integration through digitisation and AI, as leaders of the bloc met in Astana for a two-day summit.

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During the high-level talks, member states discussed creating a unified digital environment to build a seamless market across a shared economic space of more than 20 million square kilometres.

Delegations focused on trade, joint projects and the development of shared digital tools and AI systems designed to strengthen cooperation and reduce fragmentation across the bloc.

Last year, trade within the union more than doubled, while turnover with third countries rose by 72%, while around 90% of settlements are now conducted in national currencies, as EAEU states also mull a single transit system.

With digitisation driving developments across the union, Kazakhstan’s President Kassym-Jomart Tokayev said trade turnover between EAEU members could increase by around 6%, exceeding €85 billion this year, compared with €80 billion last year.

He added that GDP growth across EAEU countries is projected at around 2.5% for 2026–2027.

Now in its 12th year, the EAEU functions as a single integrated market and free trade zone for its five members – Russia, Belarus, Kazakhstan, Kyrgyzstan and Armenia.

The bloc already has agreements in place with a number of countries including Serbia, Vietnam, the UAE, Mongolia and Indonesia. China remains the bloc’s key partner, accounting for around one-third of external trade.

Integration through AI

Kazakhstan’s Tokayev said that during its chairmanship of the EAEU, the country has proposed the practical use of AI to help implement the bloc’s so-called four freedoms, with the aim of strengthening the competitiveness of member states.

Member states also proposed developing common principles for the responsible use of AI, as well as shared computing capacity and joint model development.

Meanwhile, Russia proposed a high-level AI get-together next year to further cooperation on domestic AI models and connecting its IT and energy infrastructure, according to Russian President Vladimir Putin.

On the ground, pilot projects are already being tested at the EAEU level.

In Kazakhstan, several AI-powered digital assistants have been developed by both government agencies and startups to help citizens navigate legal and regulatory systems more easily.

According to Deputy Minister of Artificial Intelligence and Digital Development Dmitry Mun, these AI legal assistants are designed to simplify legislation, reduce bureaucracy, and make regulatory systems more accessible for citizens and businesses.

Some of these tools are now being tested to streamline processes across member states.

Trade corridors and logistics modernisation

Around 85% of goods travelling from China to Europe are routed through the Middle Corridor, according to officials.

Artificial intelligence is increasingly being deployed alongside the TDN and the Digital Transport Corridor along the Trans-Caspian International Transport Route. Together, these measures are expected to increase non-commodity exports by around 30% over the next two years.

Kazakhstan’s Minister of Trade and Integration Arman Shakkaliyev said the country also aims to leverage major transport routes, including the Middle Corridor and the North–South Corridor, to build a fully integrated logistics ecosystem.

The goal, he said, is to position Kazakhstan as a key regional hub where transport routes converge and large export flows are consolidated.

The ambition is to develop a fully functioning system by 2030, with cargo volumes reaching around 10 million tonnes. Work is already under way, including railway modernisation and new infrastructure development.

Putin visit and bilateral agreements

The summit followed Putin’s state visit to Kazakhstan, during which the two countries signed seven key pillars of bilateral cooperation, along with a broader package of agreements covering energy, transport, finance, education and industrial development.

Russia remains Kazakhstan’s largest investor, with nearly €25 billion already invested and plans to increase that figure further. It is also building Kazakhstan’s first nuclear power plant, valued at around €14 billion.

Putin said the plant would account for around 20% of Kazakhstan’s electricity consumption, adding that financing conditions for such projects are in line with international practice.

He noted that the project supports Russian industrial capacity through equipment orders and long-term maintenance contracts, while also strengthening cooperation between the two countries in uranium and nuclear technology.

For Kazakhstan, officials say the project represents both energy security and a step towards moving beyond raw-material exports to high-value technological cooperation.

New research from the European Central Bank suggests that the economic impact of the Iran war may be affecting euro zone consumers more deeply and rapidly than previous geopolitical crises, raising concerns about inflation, slowing growth, and long term economic uncertainty across Europe.

According to ECB economists, European consumers appear to be reacting more sensitively to rising prices and economic instability because many households are still psychologically affected by the financial stress caused by the Russia Ukraine war and the energy crisis that followed in 2022.

The latest conflict involving Iran, triggered after United States and Israeli airstrikes earlier this year, caused major disruptions to global energy supplies and reignited fears of another inflation shock throughout Europe.

ECB researchers found that consumers quickly became more attentive to price increases even while inflation remained close to the central bank’s 2 percent target. Economists believe this reaction reflects growing public anxiety over repeated geopolitical and economic disruptions.

Why It Matters

The findings raise serious concerns for Europe’s economic recovery because consumer confidence plays a critical role in spending, investment, and overall growth.

When households become highly sensitive to inflation and uncertainty, they often reduce spending, delay purchases, and increase savings out of caution. This behavior can weaken economic activity and slow recovery across key sectors including retail, manufacturing, housing, and services.

ECB researchers warned that Europe may now face the risk of a more persistent stagflation environment, where inflation remains elevated while economic growth slows simultaneously.

The Iran war also exposed Europe’s continuing vulnerability to global energy shocks. Despite efforts to reduce dependence on Russian energy after the Ukraine conflict, Europe remains heavily exposed to disruptions in global oil and gas markets.

Although oil prices have recently eased amid hopes for diplomacy, they surged sharply earlier this year during the height of the Iran conflict, intensifying inflationary pressure across the euro zone.

Key Stakeholders

Several major stakeholders are directly affected by the growing economic uncertainty surrounding the Iran war and Europe’s inflation outlook.

European Central Bank

The ECB faces increasing pressure to balance inflation control with economic stability. Policymakers are now widely expected to continue raising interest rates in an effort to prevent inflation expectations from becoming entrenched among consumers and businesses.

European Consumers

Households across Europe remain at the center of the crisis. Rising living costs, energy prices, and borrowing expenses continue placing pressure on disposable incomes and consumer confidence.

Businesses and Industries

European businesses, particularly energy intensive industries, face higher operating costs and weaker consumer demand. Continued uncertainty may reduce investment activity and slow hiring across multiple sectors.

Energy Markets

Global oil and gas markets remain highly sensitive to developments in the Middle East. Any renewed escalation involving Iran could rapidly push energy prices higher again, directly affecting inflation and economic stability in Europe.

Governments Across Europe

European governments may face growing political pressure if inflation remains persistent while economic growth weakens. Policymakers could be forced to increase public spending or introduce additional support measures for households and industries.

Future Outlook

The coming months are likely to become a critical period for the euro zone economy as European policymakers attempt to manage the combined effects of geopolitical instability, inflation concerns, and slowing growth.

Much will depend on whether tensions in the Middle East continue easing or whether new disruptions emerge in global energy markets. A stable diplomatic environment could help reduce inflationary pressure and restore consumer confidence gradually.

However, ECB researchers warn that the psychological impact of repeated crises may continue shaping consumer behavior long after energy prices stabilize. Many Europeans who experienced financial stress during the Ukraine war now appear quicker to react to fears of inflation and economic instability.

The ECB is therefore expected to maintain a cautious but firm monetary stance in the near term, with additional interest rate increases remaining highly likely.

If inflation remains elevated while economic growth weakens, Europe could face a prolonged period of economic stagnation combined with reduced consumer spending and higher borrowing costs.

The situation highlights how modern geopolitical conflicts increasingly influence not only energy and security policy but also consumer psychology, market behavior, and long term economic confidence across global economies.

With information from Reuters.

The rise of artificial intelligence (AI) and the move toward a green transition built on renewable energy are fundamentally restructuring the global economy. While unleashing unprecedented opportunities, these developments also provide new geopolitical weapons due to the unequal distribution of critical minerals, in particular rare earths, the advanced technology and expertise involved in manufacturing, and the omniscient and inexorable role of the resulting products like semiconductors and batteries for the operation of today’s technologised societies. Thus, countries like China and the United States (US) increasingly seek to safeguard national access to these crucial components and products. This weaponization has implications for global business interests, supply chains, technological development and existing geopolitical tensions in the Middle East and between the US and China.

Semiconductors—the new oil?

Semiconductors, or advanced chips, have been likened to the oil of the 21st century. Just as in the 20th century, oil formed the basis for global economic activity, semiconductors form crucial parts of everything from critical infrastructure like 5G data networks, military technology like missiles and AI data centers, to smartphones, fridges and electric vehicles. Indeed, the semiconductor market, growing rapidly since the launch of large language AI models in 2022, is projected to hold a value of $1 trillion by 2030. Hence, whoever controls the supply of semiconductors holds the power to bring rivaling economies to a standstill. This capability is reinforced by the fact that advanced microchips, and the rare earths contained in them, lack ready substitutes.

Assuredly, oil still offers geopolitical leverage—brought to the fore by the current energy crisis resulting from the closure of the Strait of Hormuz. Yet, semiconductors offer a more potent geopolitical weapon. For example, European sanctions on Russian oil and natural gas following the invasion of Ukraine in 2022 has been largely ineffective in crippling the oil-reliant Russian economy, as Russia has been able to find alternative supply routes like the Caspian Sea and alternative buyers such as India, Türkiye and China. By contrast, semiconductor supply chains are more concentrated due to differential geography, and economic, technological and intellectual capital. For example, Taiwan produces over 90% of the world’s advanced chips, while China controls 60% of global rare-earth production, and 90% of mineral refinement. Similarly, the US enjoys supremacy in semiconductor manufacturing equipment (SME) and expertise, while the Netherlands is the world’s sole producer of extreme ultraviolet lithography required to imprint circuits on semiconductors. Hence, the highly concentrated supply chains of semiconductors gives a handful of countries significant strategic leverage as countries are willing to go far to secure access to these crucial components.

Capitalising on critical mineral supply

This power is reinforced by the fact that the majority of the planet’s critical minerals—such as copper, cobalt and lithium—used in semiconductors and batteries are concentrated in developing countries in Africa and Latin America like Brazil, Chile and the Democratic Republic of Congo (DRC). Thus, the capital-intensity of mineral extraction has allowed major powers like the US and China to expand their influence over supply chains through massive investment in the mining industries of these regions. Hence, supply chains are further concentrated in the hands of a few states, enhancing the weaponisability of these resources. This is bolstered by the rarity and geographic disparity of these elements, meaning that countries cannot easily find substitutes or alternative suppliers for these critical resources, should the aforementioned mineral ‘gatekeepers’ choose to wield their strategic leverage and restrict supply.

Global business caught in the crossfire

This development subjects international business activity, especially within emerging technologies like AI, to geopolitical tensions. For example, the US introduced export controls in 2022, banning US semiconductor company Nvidia from exporting its advanced H2000 chips to China to protect US technological dominance. And Nvidia is not an isolated case—in the last few years, the amount of US companies on the Commerce Department’s Entity List restricting exports has quadrupled. In effect, US companies are losing global competitiveness and access to China—one of the biggest markets in the world. This effect might be hard to reverse. Although the Trump administration relaxed export restrictions in early 2026, no Nvidia chips had arrived in China by mid-May. Part of the reason is that China in response to US restrictions has built up its domestic production, and legally favored domestic chips producers like Huawei to reduce its strategic vulnerability to foreign powers. For similar reasons, China prevented US-based Meta in 2025 from buying up Manus, a Chinese-founded AI company. Thus, business interests are highly susceptible to the weaponisation of concentrated critical supply chains in the geopolitical rivalry between US and China.

Semiconductors—beyond oil

Hence, semiconductors and related products may not simply be the economic and strategic, 21st-century equivalent of 20th-century oil, but may indeed hold greater geopolitical leverage than oil ever did. While the US dominates global oil production, China does not have to import oil from its geopolitical rival at the expense of Chinese strategic power—despite China relying on imports for over 70% of its oil—as diversified global energy markets allow for alternative energy sources like coal and natural gas, and alternative suppliers like the UAE, Iran and Qatar. By contrast, China’s ability to manufacture the most advanced semiconductors without the currently unique US SME is highly limited, with Chinese semiconductor development 3 years behind the US. Consequently, China accounts for over half of the semiconductor exports of US-allied Taiwan.

Taiwan in the crossfire

This in turn increases the strategic importance of the Taiwan dispute. While China has long claimed Taiwan to be part of China, the US endorses Taiwanese independence. The importance of semiconductors has cemented this conflict, with China desiring reunification to gain control over global semiconductor manufacturing, while the US for the same reason favors Taiwanese independence from China to maintain US access to its semiconductor supply, in extension of current efforts to induce TSCM to offshore its production to the US, and reduce semiconductor exports to China. Similarly, China has leveraged its global dominance of refined rare earths and battery production by introducing export restrictions on batteries, refined critical minerals, and rare earths in response to US SME restrictions, exploiting the fact that the US has limited ability to employ its SME to manufacture semiconductors without these Chinese inputs. In response, the US and its allies are scrambling for alternative access to critical minerals by expanding trade partnerships with mining countries like the DRC, investment in battery-production, and by launching Project Vault, a $12-billion investment to create a national critical minerals reserve.

The weaponisation capacity of semiconductors has only begun. As countries are approaching the deadlines of net-zero emissions goals outlined in the Paris Agreement, increased dependency on renewable energy will increase susceptibility to global supply chains for batteries, rare earths and semiconductors for products like EVs, solar panels and energy storage.

In the trunk of his battered 10-year-old Ford sedan, Larry Gross stores half a dozen scarred yellow folding chairs. The chairs, strewn among volleyballs, softball equipment and long-discarded papers, are essential equipment for a man who spends much of his life arranging and attending meetings.

Gross is a professional organizer, a man whose career is measured in meetings. He sets up his chairs everywhere in the tiny city of West Hollywood, in the dingy church office where he works, in the clean, well-lighted offices of City Hall, in cramped apartment common rooms and in sparsely furnished election headquarters.

What he accomplishes at those meetings often has immediate impact on the fortunes of the 16-month-old city. With the aid of a small band of young leftist activists and a loyal army of elderly Jewish tenants, Gross has built a potent grass-roots version of a political machine and become the city’s most commanding power broker.

Formidable Power Bloc

In the process, his Coalition for Economic Survival has transformed itself from a Los Angeles-based fringe pressure group with limited successes in rent control and street demonstrations into West Hollywood’s most formidable power bloc. No other organized group in the city wields as much influence or inflames as much controversy.

The coalition and its supporters have elected two of the city’s five council members–both of whom face reelection on April 8–and are priming for a third. Some of its volunteer members have wangled key appointments to the city’s commissions. Others have been hired in policy-making posts in the city’s fledgling bureaucracy.

“West Hollywood is (the coalition’s) oil gusher,” said Ron Stone, who led the city’s incorporation movement. “They’ve dug holes all over Los Angeles, but they never struck deep until they came to West Hollywood. They worked hard here and they deserve the rewards.”

The coalition’s primacy has alienated many of those who are accustomed to holding power. Landlords are roused to fury by the mere mention of Larry Gross’ name. Businessmen worry that the coalition’s continuing dominance will cost them profits. Rival politicians are jealous of the group’s clout. Even some council members seethe privately at the coalition’s refusal to compromise on minor political issues.

“CES is run by a very small group of people,” said Tony Melia, an insurance man who chairs a faction of moderate businessmen challenging the coalition for political supremacy in the April election. “They are a mystery to us all.”

Grist for Criticism

Nearly every move that the 34-year-old Gross makes as director of his coalition becomes instant grist for criticism: Passing folded notes to Mayor John Heilman and Councilwoman Helen Albert (both coalition members), Gross is accused of controlling their votes. Taping a flag over his office desk, he is branded a Communist (Gross described the flag, which has been taken down, as a United Farm Workers banner; his enemies say it was a hammer and sickle). Shaving his wispy beard and wearing suits instead of flannel shirts, he is said to be cleaning up his act for public consumption.

“People set me up as the enemy all the time,” Gross said. “They do it out of fear and envy. They really don’t have the foggiest notion of what CES is all about.”

Gross’ Hold on Coalition

Their obsession with Gross is hardly unwarranted. About 13 years after he founded the coalition with a group of peace activists and leftist leaders, Gross is the only original member left. Organizers and volunteers have come and gone, leaving because of “activist burnout,” because they needed a better-paying job or because of personal or philosophical conflicts. But Gross remains.

Although ostensibly a democratic organization, the coalition has remained securely in Gross’ control. His partisans say he is central to CES because of his natural leadership abilities; former members and enemies attribute his endurance to Machiavellian political cunning. But in the end, many who have watched Gross say he remains in control of the coalition because he simply is the coalition.

“Our success all trickles down from Larry,” said Jacqueline Balogh, the coalition’s membership director. “Without him, CES wouldn’t exist.”

Gross is a lean, fox-faced man who has a closet athlete’s fascination with competitive sports and a weakness for interrupting his organizing activities to attend Dodger and Laker home games.

He tries to keep his private life shielded from public scrutiny. “I don’t like the focus on me,” he said in a recent interview. “It’s the organization and what it has accomplished that’s important.”

Friends and former acquaintances say Gross lives in a sparsely furnished rented duplex in Echo Park. Five years ago, he made barely $500 a month at his job. These days, he makes more, but declines to reveal a figure. He still drives his decade-old Ford despite its growing list of automotive maladies.

His voice bears traces of a Queens accent that becomes thicker when he excitedly addresses crowds. “The landlords are trying to say rent control is not an issue in dis campaign!” he roared to an enthusiastic hall filled with senior citizens early this month. “The reason is dey don’t stand for strong rent control!”

Odd Man Out

The accent is one of the few facets of Gross’ activist life style that he has not polished. His is a career that began at Forest Hills High School in New York, where Gross found himself odd man out among fellow students in the late 1960s. “I was the only radical on campus,” he said.

He is the son of divorced parents. His father, a trade school teacher, lives in Miami; his mother, a volunteer with the Simon Wiesenthal Center, lives in Los Angeles, not far from West Hollywood. Both were influences on his burgeoning activism, his father as an active union member, his mother as a Holocaust survivor.

“What she went through outraged me whenever I thought about it,” Gross said.

Often joining older college students in peace marches at Central Park and other anti-Vietnam War activities, Gross graduated from high school with few prospects. He took a job as a clothing store salesman, but in 1972, came to Los Angeles to visit his mother, who had moved here.

Extending his stay by taking political science classes at Los Angeles City College, he became active in local efforts to drum up support for the impeachment of President Richard Nixon. Drifting between activist groups, Gross in 1973 became involved in new union of peace and civil rights organizations which was protesting Nixon’s cuts in social service budgets.

The umbrella group became the Coalition for Economic Survival. “They had a little flat on Vermont Avenue with a small file cabinet in the back,” said Rosa Factor, an early coalition volunteer. “It was real small-scale. Larry was a lot different in those days. His hair was long and frizzy, hippie-style.”

Strong Points

The group’s forte was picket line protest and street theater. Demonstrating against high milk prices in 1974, coalition organizers toured inner-city shopping centers, urging a boycott. Gross and his fellow activists spoke from the back of a pickup truck, where they mounted a purple papier-mache cow named “C. Brunel Cow” after then-state Agriculture Secretary C. Brunel Christensen. At a later demonstration, protesting a Pico-Union expansion of a Pep Boys warehouse complex, Gross and his followers marched to the chant: “Manny, Moe and Jack! We want our buildings back!”

At first preoccupied with consumer issues such as rising bus fares and utility costs, the coalition managed to win favorable coverage in newspaper and television reports. They had little influence, however, on the commissions which made the decisions.

Skyrocketing rents that accompanied Los Angeles’ real estate speculation fever in the late 1970s gave the coalition a ready-made issue. “We cut our teeth on rent control,” said Norman Chramoff, a former coalition member who now works in West Hollywood’s rent control administration. “That’s when CES membership grew and grew.”

The new members were senior citizens, outraged that their rents were doubling and tripling, often in the span of a year. After learning to live on fixed incomes, many elderly tenants became afraid that they would be evicted from apartments where they had lived for years.

Remembering the horrors of the Depression, many seniors feared a return to poverty. “Anybody who lived through the Depression can’t imagine how scared we were,” said Martha Newman, a woman in her 60s who is an ardent coalition supporter. “CES saved us from that.”

Limited Victories

The coalition promised relief from the surging apartment rental rates. In a series of political confrontations with landlords, the coalition won limited victories. Although it did not get the strong rent protections it wanted, the coalition did help push a moderate rent control law (4% annual rent increase) through the Los Angeles City Council. In Los Angeles County, the coalition pressured supervisors, but was only able to help pass an even weaker rent law in 1979 (7% annual increase).

In November, 1983, a coalition-sponsored referendum failed to persuade county voters to adopt a tougher rent control law. Because of overwhelming support among senior renters, the referendum did well in West Hollywood–passing there by a 5-1 ratio–but it was not enough to keep rent control alive. That vote, which led to the expiration of county rent control in 1985, set the stage for West Hollywood’s incorporation battle.

By that time, the coalition had made deep inroads into the city’s elderly community (estimated at 40% of the area’s population). Those inroads proved crucial in the 1984 incorporation election.

Gross estimates that 2,000 of the coalition’s 5,000 members are in West Hollywood. Political observers of all stripes in West Hollywood agree that in an election year campaign, the coalition can command upwards of 2,000 votes–a significant block among West Hollywood’s 19,000 registered voters.

“West Hollywood is sort of our flagship,” Gross said. “We have a tremendous opportunity here.”

The city’s elderly tenants also provide the coalition with much of its financial support. At coalition meetings, organizers pass around empty fried chicken buckets, which are often returned brimming with cash and checks.

Several allegations of discrepancies in the coalition’s finances were reported to county officials last year. But Candace Beason, a prosecutor in the county district attorney’s investigative division, said her department has declined to investigate them. “They were relatively minor complaints,” she said last week. “The case is closed.”

Since its incorporation victory in November, 1984–in which two coalition members, Heilman and Albert, were elected to the council and the coalition aided the election victories of council members Alan Viterbi and Valerie Terrigno–the coalition has worked to consolidate its power.

New Headquarters

Late last year, the group moved its headquarters from a cluttered office on Pico Boulevard in Los Angeles to a cluttered office in the Crescent Heights Methodist Church in West Hollywood. Working at night, amid old metal desks and boxes sagging with files, coalition organizers quickly felt at home in the new city.

But, as with nearly everything they do, coalition organizers found themselves under attack, this time just for moving into West Hollywood. Landlords, Republicans and businessmen tried to pressure church leaders and city officials to evict them but the CES has stayed put.

The coalition–and Gross, in particular–are under constant fire. During the 1984 incorporation election, he was branded a Communist by Jewish Defense League activist Irv Rubin. Rubin claimed then–and maintains today–that he has “inside information” proving that Gross visited Cuba as a guest of Fidel Castro.

Gross labels the charges “the ravings of the far right.” Despite continued whisperings about “hidden agendas,” landlords and other political enemies of the coalition have never proved their claims.

But at least half a dozen former coalition members say they were invited by some coalition organizers to attend Marxist study meetings and similar functions. One former member, Mark Siegel, who is now chief deputy to Los Angeles Councilman Joel Wachs, said that he was asked several times to join a Marxist study group. He declined.

“The thing is, (CES) was such a loose group,” Siegel said. “There were all kinds of philosophies floating around there. We certainly weren’t being directed from Moscow.”

Both Gross and Heilman also admit that some members have been philosophical Marxists. “But we have Republicans among our steering committee people, too,” Gross said. “We even have one person who sells Amway products. Should we throw them out for that? I don’t think it really matters.”

‘I’m Scared’

“Of course it matters,” argues Tony Melia, who heads West Hollywood for Good Government, the group opposing the coalition in the April elections. “We want officials who choose for us, without any hidden agendas. If the rumors I hear are true, then I’m scared.”

Gross and his followers have also been portrayed as dogmatic and unwilling to take part in the compromises that are the basic components of small-town politics. “That is my one real gripe with them,” said Councilman Stephen Schulte. “There’s no middle ground to them.”

To that criticism, Heilman responds: “I don’t call that being dogmatic,” he said. “We stand for certain principles. Why should we deviate from them?”

Arguments over covert Marxism and political rigidity, however, mask the nature of the real power struggle in West Hollywood. Perceived as the most influential organization in the city, the coalition’s apparent clout is envied by groups that have had less sway with the City Council.

“At least until this election is over, they (the coalition) have the appearance of the most-organized political entity in town,” Schulte said. “One doesn’t confront them lightly.”

Those who do can expect to become enemies. When Melia unveiled his Good Government group earlier this year, he portrayed it as a rival of the coalition for political clout in West Hollywood. Gross immediately branded the group as a “front for the landlords.”

While it is indeed probable that the landlords would prefer victories by Good Government candidates in the April election, Gross immediately set into motion “an us-versus-them situation,” according to community activist Bob Conrich.

Black and White

“They have no gray areas,” Conrich said. “Larry’s convincing his elderly constituency that the landlords are waiting behind every corner to gouge them. It’s an effective political tactic, but it’s dishonest and it sets this city up for the same situation in every election. Larry will set someone up as a tool of the landlords and then try to knock them down.”

Such was the case earlier this month, when coalition organizers filled a hall at Plummer Park with senior citizens and raised the threat that the city’s rent control ordinance was in danger. “This election is going to be a big battle,” Gross said. “They have the money. They had it last time. But we have the people.”

It has been harder for the coalition to bring out their people when the heat of an election has cooled. During last year’s rent control battle, landlords far outnumbered tenants at public hearings on the proposed law.

Still, in rent control votes and in pressing for an affordable housing policy with the city’s interim growth ordinance, the coalition lived up to its reputation. On other votes, though, without obvious backing of its elderly constituents, the coalition has found itself sometimes limited in its influence over council decisions.

That became embarrassingly obvious to coalition organizers when the council refused to exact concessions from the Pacific Design Center in return for a planned major expansion. Heilman and Albert, backed by coalition lobbyists, pushed for fees that would have paid for a day-care center and provided seed money for a community development corporation. But in the end, the two council members gave up their fight.

Close Votes

The coalition has even had trouble getting some of its members appointed to city commissions. In close votes in recent months, the coalition’s candidates for posts on the city’s Transportation and Human Services commissions were defeated and the coalition even was unable to prevent landlord leader Grafton Tanquary from winning a spot on the Affordable Housing Task Force.

Schulte, Melia and a number of other political observers say such defeats indicate a lessening of the coalition’s clout. “I don’t think they loom as high on the horizon as they did six months ago,” Schulte said. “They haven’t kept up the pressure.”

But Gross and other coalition members say those defeats were minor ones, offset by gains achieved in a less obvious area–political organizing among the city’s 89% tenant population. The coalition is trying to win more allies among the apartment dwellers for future elections.

In recent months, Gross and his fellow organizers have shown up weekly at apartment buildings scattered throughout West Hollywood for “house meetings,” small receptions where they explain the new rent control law to tenants and answer questions about other concerns.

Last month, Gross showed up at one building to explain the details of the city’s new rent law to six tenants. As a radio faintly played “The Poet and Peasant Overture,” Gross set up his folding chairs and waited for his small audience to arrive.

The meeting lasted just over an hour. The conversation did not get beyond the level of after-dinner chat. But in the eyes of many West Hollywood political observers, the coalition’s dependence on such seemingly insignificant meetings may provide the key to its future influence.

“They do the groundwork that no one else in West Hollywood is willing to do,” said Councilman Viterbi. “They’re out there all the time, making new contacts, renewing old ones. No one else in this city has the patience or the manpower to do that. As long as they keep it up, they’ll be a force to reckon with.”

Comments on the Coalition

Incorporation leader Ron Stone: “West Hollywood is (CES’) oil gusher.”

Rival coalition leader Tony Melia: “CES is run by a very small group of people. They are a mystery to us all.”

Councilman Stephen Schulte: “At least until this election is over, they (CES) have the appearance of the most-organized political entity in town. One doesn’t confront them lightly.”

Councilman Alan Viterbi: “They do the groundwork that no one else in West Hollywood is willing to do.”

More than 1,000 workers, union members and retirees marching toward downtown Caracas were blocked by riot police during a May Day demonstration. Chanting, “A bonus is not a salary,” they took to the streets in Caracas to protest the only-modest increase in the so-called comprehensive minimum wage, from the equivalent of $190 per month to $240. A short distance away, a small group of workers — convened by the Bolivarian Socialist Workers Federation of Venezuela — celebrated the raise. For the first time in over 20 years, the government had not organized a large rally. Instead, it provided a concert — a Festival for Peace — featuring dozens of international performers.

“People are really happy. They are dancing in the streets because there is a lot of money coming in through the big oil companies,” U.S. President Donald Trump said a few days later. His administration is still managing a political transition process following U.S. military attacks and the abduction of Venezuelan President Nicolás Maduro earlier this year.

But even ultraright-wing polling firms such as Meganálisis suggest Trump is wrong about the mood in Venezuela. According to the firm, the proportion of Venezuelans who are “grateful” to the U.S. for its intervention has dropped from 92% in January to just 47% in April. Trump’s attempt to cast himself as the savior of Venezuela’s economy isn’t working — especially as Venezuelans say they haven’t seen any improvements since January, nor since the U.S. imposed economically devastating sanctions in 2015.

Wages are too low

Rafael Venegas, Jacques Derose and Yrma Rivero have different work situations. Venegas works in the public sector, Derose is in the private sector and Rivero is self-employed. But all three have something in common: Their income is not enough to live on.

Venegas is 70 years old and has spent 14 years teaching undergraduate and graduate courses at the Central University of Venezuela, the country’s oldest and largest higher education institution. However, his latest proof-of-employment document, seen by Truthdig, shows his salary is the equivalent of $1.37 a month. Any benefits like severance pay, end-of-year bonus and holiday pay are calculated based on that amount.

At the same time, Venegas, who survived a stroke and who is looking after his 93-year-old mother, receives — as all public sector workers do — a monthly food bonus of $40, and what is called an “economic war bonus” worth $150. The explanation is as simple as it is complex: Venezuela’s legal minimum wage has been frozen at 130 bolivars (about 27 cents) a month for four years. To bring actual take-home income closer to a living wage, workers get monthly bonuses paid in bolivars at the official exchange rate. Together, these amounts are known as the “comprehensive wage” and are only for formal workers.

Thirty kilometers away, Derose, a 27-year-old who dropped out of the university to work at a hardware store in La Guaira, receives a comprehensive wage of $200 a month, which may sometimes go up to $230 or $260 if he takes on extra work loading or moving merchandise.

Derose, who does not have children, tells Truthdig that his income goes to food, transit and paying rent for a single room. The room costs $120, while an apartment in Caracas costs at least $250 a month.

“That’s why my other two brothers, though they’re older, are still living with our parents,” he says.

Meanwhile, Rivero travels around the city cleaning apartments to support herself, as well as her son’s university studies. 

“He got into a public university, but we spend a lot on transportation and food, not to mention medical expenses. Right now, my son has severe sinusitis, and an MRI of his sinuses costs $300,” she says.

She charges $30 to $40 for each deep clean, depending on the size of the property. She tries to have at least four clients a week in order to earn around $400 a month. As the highest earner of the three, Rivero’s situation illustrates why many young people are choosing not to study but to work informally or in trades instead.

All three workers tell Truthdig they use the same strategy to get by: working multiple jobs. Venegas earns intermittent extra income by proofreading books or giving workshops, Derose works as a bricklayer some weekends and Rivero sometimes irons or cooks. They all say that no one can get by on less than $400 a month, and a family of five requires at least $1,500.

According to the Caracas-based, union-run research center Center for Documentation and Social Analysis, the basic food basket for a family of five, which includes 61 essential products, reached $703.11 in March, a 7.2% increase from February. Venezuelans must also pay for transportation or gasoline, utilities, rent or condominium fees, medicine, clothing and much more.

Thousands of workers, especially in sectors like education, healthcare and public services, share this sentiment and have been protesting in the streets of Caracas for weeks, demanding a living wage. But how would that be achieved?

“It would be difficult to have a salary — not bonuses, but a legal minimum wage — that covers basic needs. But there are no ethical or economic reasons to keep it at 27 cents,” Hermes Pérez, economist and former head of the Exchange Desk at the Central Bank of Venezuela, tells Truthdig.

He says the legal minimum wage should be at least $300, but that’s not feasible for either the public or private sector. “The resources simply aren’t there, and since wages are practically zero, raising them to that level would be very expensive. But at least $70 or $100 would be possible. Furthermore, it’s estimated that Venezuelan revenues will grow significantly in 2026 compared to last year. We received $18 billion in oil revenues alone in 2025, and that amount could rise to $33 billion,” Pérez says. Despite attempts at diversification, oil remains Venezuela’s primary source of foreign currency, and the country is dependent on oil revenue to finance public spending.

Pérez stresses that a key indicator must be addressed regardless of how much salaries increase: inflation. “According to the Central Bank, Venezuela ended 2025 with an annual inflation rate of 465%, and by March 2026 it was already at 650%. That’s enormous. In Colombia, for example, inflation is around 5%, and in Latin America, in general, it’s in the single digits,” he says.

“It’s not just the isolated [price] increase of one or two things; it’s the generalized increase across the board. Given this context, it’s very difficult for the average worker to actually perceive any economic improvement.”

Economist Asdrúbal Oliveros agrees. He believes the country will enter a phase of recovery in purchasing power this year, but a “notably slow” one, as Venezuela must first increase incomes, sustainably reduce inflation and stabilize the exchange rate.

Venezuelan government response

On April 8, acting President Delcy Rodríguez took a stance for the first time on low wages and precarious working conditions in the country. She acknowledged some of the problems and noted that there are more pensioners (5.7 million) than formally employed workers (5.3 million), a figure that reveals the extremely high rate of informality that now prevails in Venezuela.

On May 1, Rodríguez then announced a 26% income increase through the country’s bonus system. This raised the comprehensive minimum wage — which includes the official minimum wage and bonuses — from $190 to $240 per month by increasing the economic war bonus by $50. For pensioners, the war bonus increased from $58 to $70. She also announced a one-off “professional recognition” bonus for the education, health and security sectors of around $195, with the exact amount varying by job.

Organizations such as the Professors Association of the Central University of Venezuela rejected “the policy of replacing salaries with bonuses,” which they argued do not affect workers’ social security contributions and “ignore merit, experience and seniority.” The workers also demanded respect for salary scales and collective bargaining agreements. 

The acting president acknowledged that the $240 increase is “insufficient” but said it is “a responsible increase” to improve purchasing power “without generating an excessive inflationary impact.” According to the Central Bank, annual inflation in Venezuela reached 130,000% in 2018, the peak of a four-year hyperinflationary period that ended in 2021. It was then that the government decided to freeze wages and implement a bonus policy to avoid a relapse.

However, some economists also attribute the high inflation rates to the uncontrolled issuance of money by the Central Bank to finance the fiscal deficit. Unions argue that the economy will not collapse from paying off labor liabilities like wages and benefits.

“For the past four years, salaries have been frozen and increases through bonuses have been meager. So, clearly, workers’ salaries or benefits haven’t contributed to causing the current inflation rates,” Venegas says. “There are millions of us in the public sector, but benefits are only received by those who retire, resign or are dismissed — a small amount per year.” 

Venegas believes the government and business leaders are currently colluding to try to reform the Organic Law of Labor and Workers (LOTTT) in order to eliminate the country’s social benefits system. 

The LOTTT, passed by then-President Hugo Chávez in 2012, is considered a bastion of workers’ rights. Among its provisions, it prohibits unjustified dismissal and subcontracting, provides 26 weeks of maternity leave, guarantees the right to work for women and people with disabilities and extends retirement pensions to all workers, including full-time mothers and the self-employed.

Now, businesspeople have argued at the Council of the International Labour Organization for reform of the LOTTT, especially Article 104, which defines what constitutes a salary, and Article 122, which establishes the basis for calculating social benefits and severance pay. They say the current model of accumulating social benefits would be structurally unsustainable if the legal minimum wage is increased.

The U.S. decides

Amid these debates, the acting Venezuelan president has said that the economic situation of workers will improve “progressively” thanks to restored relations with the U.S. and the recovery of oil production, which — after some relaxing of sanctions — has exceeded 1.2 million barrels per day.

“In 2025, Venezuela produced a similar average number of barrels, but they were sold at a 30% to 35% discount to get around the sanctions,” sociologist and political analyst Franco Vielma said on X. These discounts acted as a key economic incentive for private buyers and intermediaries to assume the high legal and financial risk of violating the sanctions imposed by the U.S. Furthermore, the price per barrel exceeded $126 at the end of April 2026, reaching its highest level in four years due to the conflict between the United States and Iran.

Rodríguez has said the latest salary increase is backed by oil and fuel oil income. But Venezuelans still do not know how much oil revenue they are receiving, where it is deposited, what percentage the U.S. is getting or what the new agreements mean.

In January, Trump stated that the U.S. would control Venezuelan oil sales, saying Venezuela would submit monthly budgets to the White House, which would then be reviewed by auditors. Rodríguez said at the time that citizens could track every oil dollar through a new website. However, this website has not materialized. 

The United States, after attacking Venezuela four months ago and, according to the Venezuelan Anti-Blockade Observatory, having imposed 1,081 sanctions on the country since 2015, has argued that increased oil income will benefit Venezuelans. Trump asserted in January that Venezuela would experience “an unprecedented economic upswing … It will earn more money in six months than in the last 20 years.”

In this regard, the U.S. Office of Foreign Assets Control issued 14 licenses in April that allow for the development of the Venezuelan oil sector and the possibility of conducting banking transactions with Venezuela, although each transaction requires OFAC approval. Payments in gold or cryptocurrencies are prohibited; Venezuela cannot trade with China, Russia, Iran, North Korea or Cuba; and the country’s frozen assets will not be released. Crucially, all revenues from oil and mineral exports must be deposited into accounts controlled by the U.S. Treasury Department, which then decides when and how much to return to Venezuela from its own resources.

Although the international media has framed this as a “lifting of sanctions,” the licenses granted by the U.S. are only conditional and temporary permits that allow some oil and banking operations in Venezuela. Executive orders blocking state assets and controlling and supervising the operations of the state oil company PDVSA remain in place, limiting the legal certainty that is necessary for long-term investments.

Many Venezuelans did believe the economic situation would improve after Jan. 3. In fact, some pollsters claimed that 70% to 80% of the population then had “hope for the future.” Now, in April, according to an AtlasIntel poll, 77% of Venezuelans rate the current economic situation as “bad,” and 76% hold a negative opinion about the state of the labor market. 

According to Datanálisis, economic despair also prevails, with 55% of those surveyed identifying inflation and low wages as their main problems. These worries are followed by devaluation and failures in the electrical system.

Datanálisis also found in April that 65% of the population agrees that Venezuela’s priority should be resolving the economic crisis above any political transformation or electoral process. However, Trump hinted on May 12 that beyond the current intervention, he’s also “seriously considering” making Venezuela the 51st U.S. state, posting a map of the country with a U.S. flag. Joke, threat or a reflection of how Trump already sees Venezuela, Venezuelans have much to worry about.

The views expressed in this article are the author’s own and do not necessarily reflect those of the Venezuelanalysis editorial staff.

Source: Truthdig

As petrol prices rise, new survey suggests economic confidence in the US is at -45, the worst since 2022.

Only 16 percent of Americans view the economy in the United States as “good” or “excellent”, a new Gallup poll suggests, as inflation continues to rise amid the war on Iran.

The survey, released on Friday, deepens US President Donald Trump’s political woes ahead of the midterm elections in November, which will determine whether his Republican Party can retain control of Congress.

The survey, dubbed Gallup’s Economic Confidence Index, showed confidence in the economy has dropped to -45.

Forty-nine percent of respondents said economic conditions are poor and 34 percent rated them as fair. At the same time, 76 percent said they think the economy getting worse, while 20 percent said it is getting better.

The index averages the results on economic conditions, currently at -33 and economic outlook, currently at -56.

It was the worst set of findings on the economy that the index recorded since 2022 when the cost of living rose after the COVID-19 pandemic and Russia’s invasion of Ukraine.

Petrol costs in the US have skyrocketed since the start of the conflict with Iran late in February. The average price of one gallon (3.8 litres) of gasoline has risen to $4.55 from less than $3 before the US and Israel launched the war.

According to official government reports, consumer prices overall rose in March and April due to the energy crisis.

Iran has responded to the US and Israeli strikes – which killed several top officials, including Supreme Leader Ali Khamenei, as well as hundreds of civilians – by closing the strategic Strait of Hormuz, sending oil and gas prices soaring.

The US has also imposed a naval siege on Iranian ports, deepening the strain on energy supplies across the world.

Despite the ceasefire that began in April, the blockades have persisted in the absence of a permanent end to the war, and Iran is now claiming sovereignty over Hormuz, which operated as a free international passageway before the war.

Parts of the strait run through Iranian and Omani territorial waters.

Although the US is one of the world’s largest oil producers, energy prices are set globally, so the disruption has spiked costs for American consumers.

As a candidate, Trump promised to be a president of “peace”, saying he would pursue “America first” policies that would prioritise domestic issues over foreign interventions.

But the US president joined Israel in attacking Iran without direct provocation. His administration argues that the military campaign is necessary to prevent Tehran from obtaining a nuclear weapon.

Iran denies seeking nuclear weapons. And Trump’s own intelligence chief Tulsi Gabbard has said that Tehran is not building a nuclear bomb.

Trump has repeatedly argued that the cost of the war is worth it, stressing that petrol prices will drop rapidly once the conflict is over.

Last month, the US State Department released a legal justification of the war, saying that Washington joined the conflict “at the request of and in the collective self-defence of its Israeli ally, as well as in the exercise of the United States’ own inherent right of self-defence”.

The Gallup survey on Friday is the latest in a series of negative polls for the Trump administration.

A New York Times/Sienna poll released earlier this week suggested that only 31 percent of voters approve of Trump’s handling of the war with Iran.

Earlier this month, the US president suggested the economic fallout from the war and its effect on people in the US do not play a role in his approach to Iran.

“I don’t think about Americans’ financial situation. I don’t think about anybody,” he said. “I think about one thing: We cannot let Iran have a nuclear weapon. That’s all. That’s the only thing that motivates me.”

Indonesian President Prabowo Subianto unveiled ambitious economic growth and fiscal deficit targets for 2027 while promising reforms aimed at restoring investor confidence and strengthening state institutions. The announcement comes after months of market concerns over government spending plans, policy uncertainty, and weakening confidence in Southeast Asia’s largest economy.

Government Sets Ambitious Economic Targets

Prabowo outlined a growth target of 5.8 percent to 6.5 percent for next year while aiming to lower the fiscal deficit to between 1.8 percent and 2.4 percent of gross domestic product. The government also expects inflation to remain under control and pledged to improve food security and attract greater investment.

Investor Confidence Faces Pressure

Indonesia has faced growing scrutiny from investors and rating agencies this year. Credit rating outlooks were downgraded due to concerns about policymaking credibility, fiscal discipline, and transparency. Market fears intensified after discussions around possible changes to the country’s long standing fiscal deficit ceiling and rising state spending commitments.

Commodity Control Plan Sparks Market Concerns

Prabowo confirmed plans to establish a new state agency to oversee exports of major commodities including coal, palm oil, and nickel. The government says the move is intended to reduce revenue losses and strengthen national control over natural resources, but investors worry it could disrupt pricing systems and reduce private sector profitability.

Private Sector Role Remains Important

Despite increasing state involvement in strategic sectors, Prabowo stressed that Indonesia still welcomes private companies and small businesses as partners in economic development. He called for cooperation between the government and the private sector to achieve long term prosperity.

Analysis

Indonesia’s latest economic strategy reflects a balancing act between ambitious state led development goals and the need to maintain investor confidence. While the government aims to accelerate growth and strengthen control over key resources, markets remain cautious about rising fiscal risks and unpredictable policy changes.

The proposed commodity export agency could significantly reshape Indonesia’s role in global resource markets because the country is one of the world’s largest exporters of coal and palm oil. However, stronger government intervention may create uncertainty for foreign investors and commodity traders.

At the same time, maintaining fiscal discipline will be critical as Prabowo moves forward with large welfare programmes and economic reforms. The success of his agenda will likely depend on whether the government can reassure markets while delivering growth, stability, and stronger institutional credibility.

With information from Reuters.

Tragic flooding has swept through communities in Douala, Cameroon’s economic capital. On  Monday, May 18, the disastrous incident caused a five-year-old child to drown as heavy torrential rains led to severe flooding in the country’s economic hub. 

The child was swept away in the Banya-Sable area, located in Douala’s 5th district.

“Trapped by the rapidly rising waters, the child was carried off by a strong current. The body was recovered a short time later and taken by the parents to the Ad Lucem hospital, where the death was confirmed,” said Nana Paul Sabin, an eyewitness.

The flooding affected the 5th, 4th, 3rd, and 2nd administrative districts, as well as residential and administrative areas such as Bonapriso and Bonanjo in Douala’s 1st district.

“The floods caused significant disruptions and blockages in traffic, and in certain locations, the water levels rose alarmingly due to drainage issues,” a resident from Douala’s 3rd district stated.

In response, the Douala Urban Council issued a statement urging residents to exercise caution in their daily activities. The council advised individuals in high-risk areas to limit non-essential travel, avoid flood currents, stay clear of unstable structures, and be especially vigilant with children.

“The Douala Urban Council also emphasises the importance of keeping drainage pathways clear and encourages civic responsibility to help preserve lives,” the communiqué read. 

It also noted that technical teams have been deployed to address the aftermath of the heavy rainfall.

“Let us stay alert, united, and responsible,” the statement concluded.

Optimism has been the name of the game since Operation Absolute Resolve took Maduro out. Such optimism doesn’t just come from Venezuelans, where polls showed support for the intervention, but also from the investment community, which has flocked into the country to assess all kinds of opportunities. Since then, oil revenues have increased, driven not just by output increments but also by favourable price tailwinds and sanctions relief, which meant the reintroduction of Venezuelan crude into the global market. Today, Venezuela is the second largest source of imported crude in the United States, something unthinkable five months ago.

The petro dollars haven’t come in by themselves. A mechanism was designed so American officials could control how and where those funds would be deployed in order to avoid the disappearance of half of all oil revenues, as was the case under the previous administration. Additionally, licenses were granted to the BCV, new laws were passed for the hydrocarbon and mining sectors, with new MoUs being signed with international energy companies. Even macroeconomic data sets have been released for the first time in over a decade. So much appears to have changed that even multilaterals (chiefly the IMF) reemerged as crucial partners for a potential debt restructuring and stabilization program. Optimism is granted and the illusion of recovery does not come without merit, given the changes the country has experienced in less than five months.

However, that mirage breaks against the harsh reality on the ground and macroeconomic indicators that tell a different story. A year-to-date inflation of 90%, a 70% depreciation of the official exchange rate, and a widening gap between multiple dollar rates that continues to punish businesses and individuals alike. Meanwhile, the Bolívar printing press is working overtime while BCV reserves remain flat, deepening macroeconomic uncertainty and destroying what little credibility the institution still retained.

The almighty bond market will need far more than an Instagram post to bite the bait. Sovereign creditors respond to numbers, rules, and enforceability. Venezuela remains deeply deficient on those fronts.

None of this reflects an economy that is stabilizing, despite the interim authorities having a golden opportunity to do so. Instead, it reflects a government trying to politically manage deterioration without implementing the reforms necessary to stop it. 

The current model is not designed to solve the crisis but to preserve political control while generating just enough liquidity, oil revenue, and international flexibility to postpone its inevitable collapse. The interim authorities continue to rely on the same mechanisms that created the disaster in the first place with an unsustainable monetary expansion, exchange-rate distortions, opaque fiscal management, and complete control over all institutions. So while oil revenues and external prospects may have improved, the underlying structure of the economy remains unchanged. 

Refusing to address the obvious

A country benefiting from stronger revenues should be rebuilding reserve buffers and restoring institutional confidence, and prioritizing the reconstruction of the essential services. Instead, every dollar is consumed by a State that remains just too large, too inefficient, and politically unwilling to reform. The central bank continues injecting Bolívares into an economy where there is effectively no confidence that the currency can preserve value over time, nor in the institutional capacity to sustain credible long-term policy.

This lack of confidence is central to understanding our persistent inflation problem. It is not solely driven by the irresponsible monetary expansion but by high money velocity resulting from the complete lack of credibility in our currency. As soon as businesses and individuals receive Bolívars, they rush to buy dollars, inventory, or any asset capable of preserving value, accelerating velocity and pushing inflation into a spiral. This is not speculation; it is rational economic behavior in response to the collapse of trust in the Bolívar. Without restoring that confidence, inflation will remain entrenched.

The foreign exchange market remains one of the clearest indicators of the country’s fragility. As the gap between the official and parallel rate distort prices throughout the economy. The widening gap between the official and parallel exchange rates distorts prices across the economy, leaving businesses struggling to establish stable cost structures or expansion plans. International investors also face enormous uncertainty regarding how those multiple rates affect their ability to move capital in and out of the country. Meanwhile, the BCV continues wasting precious dollar inflows trying to defend an artificial exchange rate that is fundamentally unsustainable. 

Without institutional legitimacy, no restructuring effort or investment cycle will prove durable or beneficial for the country.

Addressing these distortions may still be too politically costly for Rodriguez. Closing the gap would require a fiscal discipline alien to chavismo, while also dismantling one of the most important corruption mechanisms for rewarding insiders. 

The solution appears straightforward: transition toward a system in which dollar-auction pricing is transparent and the USD is allowed to float. Furthermore, the government should let the dollars circulate freely, letting businesses and individuals use the greenback for both transactions and contract setting. While alleviating the economic distortions, this will also contribute to slowing the velocity, and keeping inflation under control. Venezuela should pursue this approach while keeping the Bolívar alive so it can gradually recover credibility through discipline and a coherent fiscal and monetary framework. 

Yet the changes necessary to stabilize the economy are the same changes that would reduce the government’s discretionary control over the economy. As previously argued, setting an independent board in the likes of Petroleos de Venezuela or the Venezuelan Central Bank would threaten the political hegemony of the interim authorities across all institutions.

What sound debt restructuring implies

The next collision with reality, where fundamental flaws will be hard to conceal, lies in the newly announced debt restructuring process. Interim authorities are about to face the almighty bond market which will need far more than an Instagram post to bite the bait. Sovereign creditors respond to numbers, rules, and enforceability. And on those fronts, Venezuela remains deeply deficient.

Venezuela’s total debt is estimated at $200 billion or about 200% of GDP. Despite Venezuela receiving a license to be able to hire Centerview, one of the most prestigious boutique firms in the market, any meaningful and fair progress would be impossible without a coherent macroeconomic plan bound by institutional legitimacy and backed by multilateral oversight, particularly from the IMF.

For Venezuela to avoid setting itself up for failure through a restructuring process that could hinder its financial capacity to grow sustainably, the Fund becomes an indispensable partner. The IMF would need to conduct an assessment of the country’s current financial stance via an Article IV consultation that hasn’t been conducted since Chavez withdrew from the organization. This assessment would be a key piece in understanding Venezuela’s repayment capacity and debt sustainability, setting the base from where to negotiate towards an agreeable debt haircut, tenor, and coupon.

Nothing will come out of the great opportunity created by the January events if there is no fundamental change over the who and hows of economic management.

An IMF-backed restructuring would eventually demand fiscal transparency, monetary discipline, reserve accumulation, independent oversight, and credible institutional reforms. Additionally, creditors will call for legal certainty and enforceable agreements that provide confidence that rules will not arbitrarily change once capital enters the country, or years later when investors seek to exit . To provide such guarantees, Venezuela would need a legitimate political and legal framework capable of signing long-term agreements recognized both domestically and internationally 

Without institutional legitimacy, no restructuring effort or investment cycle will prove durable or beneficial for the country. Proceeding without these elements would leave the country exposed to holdout creditors and future arbitration battles. The cornerstone for avoiding that is a credible electoral timeline that renews and legitimizes the National Assembly and executive power.

Yet that process is also set to collide with the interim authorities’ apparent intention to manipulate political timing in their favor. The current leadership wants the benefits of the stability phase brought in by oil revenue, sanctions relief, and fresh capital without surrendering the mechanisms of control that produced the crisis in the first place.

That formula is destined to fail. The authorities are neither serious enough nor committed to making the necessary reforms. In the meantime, we can keep going over the distortion caused by the exchange rate, what new law is being proposed or the deceiving debt announcement from last week. But nothing will come out of the great opportunity created by the January events if there is no fundamental change over the who and hows of economic management.

Finance ministers from the Group of Seven met in Paris to address rising global financial instability triggered by a bond market selloff and concerns over inflation linked to the ongoing conflict involving Iran.

The meeting comes at a time when global bond markets from Tokyo to New York are under pressure, as investors anticipate that higher energy prices could force central banks to maintain or increase interest rates.

Officials are also preparing for a broader discussion on structural global imbalances and coordination ahead of an upcoming G7 leaders summit.

Bond Market Pressure and Inflation Concerns

Bond yields have risen sharply across major economies as investors reassess inflation risks. Markets are increasingly focused on whether rising energy costs will translate into sustained price pressures that limit the ability of central banks to ease policy.

French officials have described the current situation as a correction rather than a crisis, though they acknowledge growing sensitivity around sovereign debt levels and fiscal sustainability.

The volatility has raised concerns particularly in highly debt sensitive economies such as Japan, where bond market movements are closely watched for spillover effects.

Diverging Views Within the G7

Despite the shared concerns, divisions remain among G7 members over how to respond to global economic instability.

European officials have emphasized the need for coordinated, temporary, and targeted responses to market shocks, while acknowledging that consensus with the United States may be difficult.

Some members argue that global economic imbalances are becoming structurally entrenched, with consumption and investment patterns increasingly misaligned across major economies.

Global Imbalances and Structural Concerns

A central focus of the discussions is the growing imbalance in global economic activity. European officials argue that long term trends show excessive consumption in some economies, under consumption in others, and insufficient investment in parts of Europe.

These structural disparities are seen as contributing to persistent trade tensions, capital flow imbalances, and financial market instability.

Officials warn that without coordinated policy responses, these imbalances could eventually lead to more severe market corrections.

Critical Minerals and Supply Chain Strategy

Another key agenda item is the global competition over critical minerals and rare earth supply chains, which are essential for electric vehicles, renewable energy systems, and defense technologies.

G7 members are exploring ways to reduce dependence on dominant suppliers, particularly China, through coordinated investment, joint procurement strategies, and diversification of supply chains.

Proposals under discussion include pooled purchasing mechanisms, market monitoring systems, and industrial policy coordination to strengthen supply security.

Analysis

The G7 meeting highlights a convergence of financial instability and geopolitical fragmentation. Rising bond yields and inflation fears are no longer isolated market issues but are now directly linked to geopolitical disruptions in energy supply and global trade routes.

At the same time, disagreements within the G7 reflect deeper structural tensions in the global economy, particularly around debt levels, consumption patterns, and industrial policy priorities.

Efforts to coordinate on critical minerals signal a shift toward more strategic economic alignment among advanced economies, where supply chain security is becoming as important as price stability.

Overall, the meeting underscores a global transition toward a more fragmented and politically driven financial system, where economic coordination is increasingly shaped by geopolitical risk rather than purely market based forces.

With information from Reuters.

Hundreds of Tunisians have marched through the capital to denounce a worsening economic crisis and what they say is a widening crackdown on dissent. President Kais Saied is accused of undermining the country’s hard-won post-2011 revolution system.

Walt Disney Co.’s theme parks and cruise line business is holding steady despite national concerns about discretionary consumer spending and higher gas prices.

The Burbank media and entertainment giant’s experiences division reported $9.5 billion in revenue in its fiscal second quarter, up 7% compared with the same period a year ago.

The increase was due to higher guest spending at Disney’s domestic parks and experiences, which reported a 6% bump in revenue to $6.9 billion, and more capacity on the company’s cruise line with the introduction of two new ships. The segment saw a 5% increase in operating income to $2.6 billion for the three-month period that ended March 28.

Disney’s theme parks segment was under close scrutiny given the national conversation about rising consumer costs and gas prices due to the U.S.-Iran war. Analysts had wondered whether consumers would tighten their belts and forgo vacations given the higher travel costs.

Disney did see a 1% decline in attendance at its U.S.-based parks compared with the prior year, which the company attributed to “continued softness” in international visitors, but said it was starting to move past those issues. Company executives have previously said Disney pivoted marketing and promotional efforts to attract local visitors.

Last quarter, executives indicated that results in the company’s second fiscal quarter could be affected, in part, by “international visitation headwinds,” a nod to the lower number of foreign visitors now traveling to the U.S.

Though the heightened economic uncertainty around the world could have a “potential impact” on the business, Disney Chief Executive Josh D’Amaro and Chief Financial Officer Hugh Johnston said in a shareholder letter Wednesday that the company was “encouraged by current demand.” The company expected that fiscal third-quarter domestic attendance numbers would improve, they wrote.

The company’s overall earnings were powered by its entertainment business, which posted revenue of $11.7 billion, up 10% compared with the prior year’s quarter.

That growth was driven by big gains for Disney’s streaming services — Disney+ and Hulu — which raked in nearly $5.5 billion in revenue, an increase of 13% compared with 2025, thanks to higher subscription fees from user growth and more advertising revenue. Operating income for the streaming business jumped 88% to $582 million.

Disney’s entertainment segment also had a stronger quarter at the theatrical box office, with standout performances from 20th Century Studios’ “Avatar: Fire and Ash,” the animated sequel “Zootopia 2” and Pixar’s “Hoppers.”

Overall, the company reported $25.2 billion in revenue, a 7% bump from the prior year. Income before income taxes totaled $3.4 billion, an increase of 9% compared with the same period in 2025, while operating income rose 4% to $4.6 billion. Earnings per share, excluding certain items, was $1.57, compared with $1.45 a year earlier.

Disney’s sports segment, which includes ESPN, reported revenue of $4.6 billion, a 2% increase from the same period in 2025. It brought in operating income of $652 million, a 5% slide that the company attributed to higher sports rights costs and the absence of UFC pay-per-view revenue compared with last year.

Disney also alluded to the company’s view of artificial intelligence as a “meaningful long-term opportunity,” saying it could play a role in content creation and production, monetization, workforce productivity, consumer and guest experiences and enterprise operations.

“At the same time, we are committed to implementing AI in a way that keeps human creativity at the center of everything we do and respects creators and the value of our intellectual property,” D’Amaro and Johnston said in the shareholder letter.

After noting OpenAI’s closure of the text-to-video AI tool Sora, which Disney had planned to invest in, D’Amaro and Johnston said the company will “continue to explore” commercial opportunities with OpenAI and other companies.