Economy

Protests in Iran have petered out. Tens of thousands have been arrested. And those accused of supporting the unrest have had business assets seized and are being pursued on “terrorism” charges. The authorities – for now – have reasserted control.

Yet, in the shadow of the apparent calm, the very same grievances that sparked the unrest remain, leaving Iran with little choice but to make tough compromises to win sanctions relief and fix the economy or face further upheaval, experts say. With a battered economy, a weakened network of regional allies and the looming threat of a US attack, Iran is at a crossroads.

“This is not a stable status quo – it’s just not tenable,” said Ali Vaez, director of the Iran Project at the International Crisis Group. “I am not predicting that the system will hit rock bottom tomorrow, but it’s in a spiral and from this point on, it can only go down if it refuses to change”.

The recent demonstrations erupted in late December when protests over a currency collapse morphed into a nationwide upheaval calling for the overthrow of the Islamic republic – Iran’s system of governance.

The authorities’ response led to one of the most violent confrontations since the country’s 1979 revolution.

Iranian state media said the protests had left 3,117 people dead, including 2,427 civilians and members of the security forces. US-based human rights activists say that more than 4,500 people have been killed. Al Jazeera was not able to independently verify the figures.

Economic crisis

Protests in past years, such as the unrest sparked by a fuel price hike in 2019 or the women-led demonstrations in 2022, were followed by the state dispensing subsidies and loosening up on social restrictions. But this time around, it has limited options for addressing the distress that sparked the recent demonstrations.

Due to decades of international sanctions, as well as mismanagement and corruption, the Iranian rial’s value has nose-dived, and oil revenues have shrunk. Inflation last year peaked at more than 42 percent, according to International Monetary Fund data. By comparison, the rate was at 6.8 in 2016 – a year after Iran and world powers signed a deal that curbed Iran’s nuclear activities in exchange for sanctions relief. US President Donald Trump pulled out of the deal in 2018 – during his first term in office – and reimposed sanctions.

On top of that, Iran suffers from electricity outages and chronic water shortages, making life increasingly difficult for the average citizen.

To get some sanctions relief, Iran needs to negotiate a deal with the Trump administration. But that would require Khamenei making concessions on what have been Iran’s core foreign policy pillars, namely its nuclear programme, ballistic missiles and supporting a network of allies across the region.

They have been key components of Iran’s “forward defence” strategy – a military doctrine aimed at preventing fighting from reaching Iranian territory. Changes to any of these elements would represent a profound shift in the security architecture built up by Khamenei. While in the past, the supreme leader has shown openness to partially curbing the nuclear programme, concessions over missiles and the so-called axis of resistance have been non-negotiable.

“It is unclear whether Iran is willing to formally accept restrictions” on these three elements, said Mohammad Ali Shabani, an Iran analyst and editor of news site Amwaj.media. “As Trump has threatened a renewed bombing campaign if Iran resumes enrichment, Khamenei seems paralysed in his decision-making,” he added.

Trump has said that he wants Iran to dismantle its nuclear infrastructure entirely, an option that Iran has ruled out, insisting that its enrichment programme is for civilian purposes.

Concerning support for non-state actors in the region, Iran has been working on reconfiguring that network following the war last June with Israel, said Halireza Azizi, visiting fellow at the German Institute for International and Security Affairs.

Israel has, in the past few years, degraded the arsenal and decapitated the leadership of what was Iran’s strongest ally in the region, Lebanon’s Hezbollah. Non-state actors in Iraq have become more involved in that country’s political system and, therefore, more cautious, and the regime of Bashar al-Assad in Syria has collapsed. And finally, Iran itself was directly attacked by Israel, the first time it has faced a full-scale attack from its chief regional enemy.

After that war, a heated debate on the actual benefit of working with non-state actors ensued in Iran, Azizi said. The argument that prevailed was that Iranian soil had been struck only after regional allies were weakened, and not before.

“So the policy 1769252794 is to double down and try to revive that network” with some modification, Azizi said.

The focus, he said, has shifted to working with smaller groups in Iraq, find new ways to transfer weapons to Hezbollah and rely more on the Houthis in Yemen. It is too soon, and information is too limited, to assess whether the protests and the threat of a US strike have changed that calculus, but official channels indicate that there have been no modifications.

Is change inevitable?

Talks between Iran and the US are not off the table. At the height of the protests, tensions soared after Trump hinted that he was about to strike Iran over what he said was Iran’s brutal crackdown. But he toned down the rhetoric after Gulf Arab nations pushed him to refrain from attacking Iran – a move they fear would plunge the region into chaos.

On Thursday, Trump signalled that channels between Washington and Tehran were open. “Iran does want to talk, and we’ll talk,” he said during a speech at the World Economic Forum in Davos.

But his remarks came as the US moves military assets to the Middle East, likely an attempt to strong-arm Iran into a deal. “We have a massive fleet heading in that direction, and maybe we won’t have to use them,” Trump said on Friday.

Still, should Iran end up making major concessions, the perception of security and legitimacy may be hard to restore. For years, the implicit social contract between the Iranian people and the system has been based on the guarantee of security at the expense of social and political freedom. But that pillar of legitimacy was shattered by last year’s war with Israel, when at least 610 people were killed in Iran over 12 days.

“The social contract between state and society in Iran has withered over the decades, and with the disruptions to basic services over the past year amid electricity and water crises, the provision of security is now also under question,” Shabani said. “To ensure its longevity, the Islamic Republic is thus faced with the broader challenge of having to explain to the public what it can provide, and why it must continue to exist”.

According to Azizi, a transformation has already started with the political system moving from a clerical into a military leadership as the Islamic Revolutionary Guard Corps – an elite force established after the 1979 Islamic Revolution – has grown into the country’s most powerful economic and political actor.

“After the death or removal of Khamenei, we are not going to see the Islamic Republic as we know it,” Azizi said.

“Whether that it’s gonna give more impetus to the people to come to the streets to initiate regime change, or it’s going to result in a Soviet-style scenario of regime transformation with the security establishment reemerging in a different form, that is an open question, but change is inevitable.”

Hundreds of businesses are closing their doors in Minneapolis, Minnesota, in the midwestern United States, as anti-ICE protesters continue to call for the federal agency to leave the city as part of a large-scale economic protest that has been named The Day of Truth and Freedom.

Friday’s walkout includes small businesses, unions, faith groups, and educators across the city, which has become a focal point of the US Immigration and Customs Enforcement (ICE) agency’s aggressive actions. The call, organised by a coalition of community groups, also urges a suspension of consumer spending.

“It is time to suspend the normal order of business to demand immediate cessation of ICE actions in MN,” the group organising the protest wrote on its website.

There are solidarity marches in cities across the US, including New York City, Los Angeles, Salt Lake City, Seattle, among others.

At the Minneapolis protest, the group is also planning a march that begins at 2pm local time (20:00 GMT) and ends at the Target Center — an arena in downtown Minneapolis.

Eyes on Target

The big-box retailer, in particular, has been in the crosshairs of organisers because of the company’s close ties to Minneapolis, where its headquarters are located, and it is the state’s fourth-largest employer.

The group is calling for Target stores to exercise protections under the Fourth Amendment, which would mean federal agents do not have the legal authority to enter a residence or place of business without a warrant signed by a judge.

In a document shared with organisers, the group pointed to two incidents of concern. One on January 8, when Customs and Border Patrol aggressively forced two US citizens onto the ground and subsequently detained them while working at a store in Richfield, Minnesota, a suburb of Minneapolis, and another three days later in nearby St Paul, where Customs and Border Patrol Chief Greg Bovino entered a store with other agents.

“Where Target leads, others follow. Our state is under occupation from federal agents, and they are attacking Minnesotans quite literally inside of Target stores. We need Target to stand with Minnesotans against these attacks,” the document said.

Target has been quiet about the protests and calls from its workers to take a stance. The company sent a memo to staff, according to Bloomberg News, warning of potential disruptions.

The pressure by anti-ICE protesters is the latest in a wave of pushback against the retail giant by progressives in the past year. There was a call for boycotts after the company rolled back its diversity, equity and inclusion initiatives, which the company later attributed to a reason for a downturn in sales in early 2025.

The looming tensions have not made a dent on Wall Street, as the company’s stock is up 1.3 percent in midday trading.

Target did not respond to Al Jazeera’s request for comment.

The political response

“The Trump Administration’s immigration enforcement operations have resulted in countless dangerous criminal illegals being removed from the streets – including rapists, murderers, burglars, drunk drivers, and more. Making American communities safer will create an environment in which all businesses can thrive in the long term and their customers can feel safe. Joe Biden and Democrat leaders should’ve never let countless dangerous criminal illegals enter our country to begin with. And now the Trump Administration is cleaning up the Democrats’ mess,” White House spokesperson Abigail Jackson told Al Jazeera in a statement.

When pressed for a response to this reasoning and asked whether ICE would commit to holding accountable agents who break the law, the White House declined to provide additional comment.

The allegations concerning the agency’s conduct have led to the protests, including claims that ICE’s actions violated First and Fourth Amendment protections and threats towards protesters.

Among them are the fatal shooting of Renee Good, a case that has drawn scrutiny from civil liberties advocates, and the Department of Justice’s decision not to investigate the agent behind the shooting, which has invoked further outrage. One of the economic blackout’s calls is to hold Jonathan Ross, the agent who shot and killed Renee Good, legally accountable.

“I understand why people are choosing to participate in the January 23 blackout, and I support those decisions. At the same time, our small businesses, especially immigrant-owned businesses, are under a lot of pressure right now, and they could really use our support. However you choose to show up, I hope we keep our neighbours and local businesses in mind,” Minneapolis Mayor Jacob Frey said in a statement provided to Al Jazeera.

Representatives for Governor Tim Walz did not respond to Al Jazeera’s request for comment.

The BoJ held off on hiking its headline rate on Friday as expected, following signs of panic in Japan’s bond market this week.

Just last month, the Japanese central bank raised its key interest rate to 0.75%, a 30-year high, in a bid to normalise fiscal policy after a long era of near-zero or negative rates.

In its latest update, the BoJ also lifted its GDP growth expectations for 2025 to 0.9% and to 1% for this fiscal year. Both figures represent an increase from the 0.7% forecasted previously.

The decision to hold allows the Japanese economy to digest the December hike but it does not fully address the fear that spooked global markets this week, namely surrounding Japan’s national debt and political instability.

This Tuesday, Japanese bonds suffered a historic rout, with the yield on the 40-year note surpassing the 4% mark for the first time since 2007. The 30-year bond yield also rose almost 30 basis points during the session, to roughly 3.9%, the highest level on record.

The catalyst for the sell-off was Prime Minister Takaichi’s announcement on Monday that snap elections will be held on 8 February, and the pledge to suspend the 8% consumption tax on food for two years, in an attempt to woo voters.

The annual revenue from the tax is roughly ¥5tr (€31.5bn), and with markets already concerned about Japan’s debt-to-GDP ratio hovering near 240%, the highest in the developed world, the prospect of an unfunded tax cut has become controversial.

Prime Minister Takaichi also unveiled a spending package of roughly ¥21.5tr (€115bn), further fuelling criticism of fiscal recklessness.

These domestic policy decisions have drawn uncomfortable comparisons to Liz Truss’s disastrous “mini-budget” of unfunded tax cuts in the UK, back in 2022.

Politics vs. Economics

Sanae Takaichi took office in October 2025 becoming Japan’s first female prime minister, following the resignation of her predecessor, Shigeru Ishiba, after a series of political setbacks.

Takaichi’s party, the ruling right-wing Liberal Democratic Party (LDP), lost its majority in the upper house. The long-standing coalition with the centrist party, Komeito, which withdrew over a political funds scandal, collapsed.

Nonetheless, the LDP formed a new coalition with the centre-right Japan Innovation Party (JIP), and under Takaichi’s leadership, it has held a slim majority and enjoyed high approval ratings, particularly among young voters.

The ruling coalition now aims to leverage Prime Minister Takaichi’s popularity in the snap elections to lock in a fresh mandate.

During her speech this Monday, Takaichi proclaimed: “I am putting my position as prime minister on the line. I want the people themselves to decide whether they are willing to entrust Takaichi Sanae with the task of running our nation.”

Takaichi’s opponents merged at the start of this year, forming the Centrist Reform Alliance (CRA), and are trying to capitalise on voter anger over the cost of living.

The proposed food tax cut was Takaichi’s ace in the hole, a direct transfer to households struggling with inflation. Instead, it has so-far backfired, driving up mortgage rates and corporate borrowing costs via the bonds.

The “Abenomics” ideology, the loose fiscal and monetary policy championed by Takaichi’s mentor, the late Shinzo Abe, supports the narrative that an inflationary spike may be brewing. The CPI rate has already hovered above the central bank’s 2% target for four years.

Even so, volatility seemed to have somewhat subsided on Thursday as government officials talked down the panic, with Chief Cabinet Secretary Minoru Kihara insisting the administration is “keeping a close eye” on bond movements.

However, the yield on the 10-year government bond is still at its highest level since 1999, at around 2.25%.

Impact on global markets

Fears of a ballooning deficit, just as the BoJ is tapering its decades-long bond-buying programme, have severe implications for global markets.

For many years, investors worldwide have enjoyed the so-called “yen carry trade”. This is a strategy of borrowing money in Japanese yen, which typically has very low interest rates, to invest in assets denominated in currencies with higher returns, like US dollars.

Investors profit from the difference, or the “spread”, between the low interest they pay on the loan and the high interest they earn on the investment.

Conversely, if the Japanese yen suddenly strengthens or the BoJ raises interest rates, the cost of repaying the loan spikes, often forcing investors to panic-sell their assets to cover their debts.

The rout that Japanese bonds experienced on Tuesday also forced a violent repricing in other markets throughout the following days, causing US Treasury yields to jump.

The US is particularly affected as Japan is the largest foreign holder of their debt, with over $1tr (€850bn) in US Treasuries.

Speaking at the World Economic Forum in Davos this Wednesday, US Secretary of the Treasury, Scott Bessent, stated: “It’s very difficult to disaggregate the market reaction from what’s going on endogenously in Japan.”

Secretary Bessent also completely dismissed the idea that the “Greenland crisis” was responsible for any volatility in US markets, emphasising that the primary pressure remains the fiscal shift currently unfolding in Tokyo.

Prime Minister Takaichi’s policies involve massive government spending to stimulate economic growth which fans inflationary risks. This could ultimately mean further hikes from the BoJ and more unwinding of the yen carry trade.

The $5bn lawsuit alleges JPMorgan abruptly closed multiple accounts in 2021 cutting off Trump & his firms from access to funds.

United States President Donald Trump has sued banking giant JPMorgan Chase and its CEO Jamie Dimon for $5bn, accusing JPMorgan of debanking him and his businesses for political reasons after he left office in January 2021.

The lawsuit was filed on Thursday in Miami-Dade County court in Florida. It alleges that JPMorgan abruptly closed multiple accounts in February 2021 with just 60 days’ notice and no explanation. By doing so, Trump claims JPMorgan cut the president and his businesses off from millions of dollars, disrupted their operations and forced Trump and the businesses to urgently open bank accounts elsewhere.

“JPMC debanked [Trump and his businesses] because it believed that the political tide at the moment favored doing so,” the lawsuit alleges.

In a statement, JPMorgan said that it “regrets” that Trump sued them but insisted they did not close the accounts for political reasons.

“We believe the suit has no merit,” a bank spokesperson said. “JPMC does not close accounts for political or religious reasons. We do close accounts because they create legal or regulatory risk for the company.”

The White House said it will refer the matter to the president’s outside counsel.

Banks have faced growing political pressure in recent years, particularly from conservatives who argue that lenders have improperly adopted “woke” political positions and, in some cases, discriminated against certain industries, such as firearms and fossil fuels.

That pressure has intensified during Trump’s second term, with the Republican president claiming in interviews that some banks refused to provide services to him and other conservatives. The banks have denied the allegation.

A US banking regulator said last month that the nine largest US banks in the past had placed restrictions on providing financial services to some controversial industries in a practice commonly described as “debanking”.

Last year, JPMorgan said it was cooperating with inquiries from government agencies and other entities regarding its policies and procedures in light of the Trump administration’s push to scrutinise banks over alleged debanking.

Reputational risk

US regulators have examined themselves to see if overly strict supervisory policies discouraged banks from providing services to certain sectors.

Trump-led officials have also moved to loosen oversight, with federal bank regulators last year saying they would stop policing banks based on so-called “reputational risk”.

Under that approach, supervisors could penalise institutions for activities that were not explicitly prohibited but could expose them to negative publicity or costly litigation.

Banks have increasingly complained that the reputational risk standard is vague and subjective, giving supervisors wide discretion to discourage firms from providing services to certain people or industries.

The industry has also argued that regulators need to update anti-money laundering rules, which can force banks to close suspicious accounts without giving customers an explanation.

The Ellison-owned media giant will now give investors until February 20 to consider its bid.

Paramount Skydance has extended the deadline for its hostile tender offer for Warner Bros Discovery by a month, buying time to persuade investors that its bid is superior to one from Netflix.

The Ellison-owned media company on Thursday moved the deadline to February 20 to consider its $77.9bn offer to buy Warner shares for $30 apiece in cash. The bid has a total enterprise value of more than $108bn, including debt.

The extension marks the second time Paramount has pushed out the deadline since challenging Warner’s merger agreement with Netflix last month.

Earlier this month, Warner’s board rejected an amended Paramount bid that included $40bn in equity personally guaranteed by Larry Ellison, Oracle’s co-founder and father of Paramount CEO David Ellison. Larry Ellison is also a close ally of US President Donald Trump.

As of late Wednesday, Paramount said more than 168.5 million Warner shares had been tendered in support of its offer. That remains far below the 50 percent threshold needed to gain control of the company, which has about 2.48 billion shares outstanding in its Series A common stock.

“Once again, Paramount continues to make the same offer our Board has repeatedly and unanimously rejected in favor of a superior merger agreement with Netflix,” Warner said in an emailed statement on Thursday, adding that it is “clear our shareholders agree”, as more than 93 percent have so far rejected “Paramount’s inferior scheme”.

In December, Netflix agreed to buy Warner’s studio and streaming business for $72bn. This week, it switched its offer from a cash and stock combination to an all-cash deal that the companies say is more straightforward and will speed the path to a shareholder vote by April. Including debt, the enterprise value of that deal is about $83bn, or $27.75 per share.

Paramount, however, argues its offer is better and has accused Warner’s leadership of a lack of transparency with shareholders.

On Thursday, the company said Warner’s board was “rushing to solicit shareholder approval” for the Netflix merger, warning that debt from a previously announced spinoff of Warner’s networks business could reduce the eventual payout to shareholders.

The battle for Warner is complicated by the fact that Netflix and Paramount are seeking different assets.

A successful deal would reshape Hollywood by handing control of franchises from Friends to Batman, along with the HBO Max streaming service, to a single buyer.

Netflix deal lingers

Netflix’s bid covers only Warner’s studio and streaming business, including HBO Max and its TV and film production arms. Paramount’s offer, by contrast, is for the entire company, including its news and cable operations, potentially putting CNN under the same roof as CBS.

If Netflix prevails, Warner’s networks would be spun off into a separate company called Discovery Global under a previously announced plan.

A sale of Warner Bros Discovery is expected to be lengthy and face intense antitrust scrutiny. Politics are likely to play a role under Trump, who has made unprecedented suggestions about his personal involvement in the approval process.

The Ellisons have argued that their relationship with Trump gives them an easier regulatory path. Netflix co-CEO Ted Sarandos said on a post-earnings call on Tuesday that the company has made progress toward securing the necessary approvals.

On Wall Street, Paramount Skydance is up 1.9 percent, Warner Bros Discovery is down 0.4 percent. Netflix is tumbling down 2.5 percent in midday trading.

Long Beach’s bet on the Olympics to help reshape its economy has attracted at least one sportswear company to the port city.

Speedo’s parent company, Pentland Brands, plans to move its North American headquarters from Orange County to Long Beach, which has emerged as a hub for aquatic sports for the upcoming Summer Olympics in Los Angeles.

The privately held, U.K.-based company that manages a portfolio of fashion and sportswear brands — including outdoor gear brand Berghaus and cycling apparel brand Endura — plans to move to a 25,000-square-foot facility at Aero Long Beach this summer.

Pentland Brands’ North American headquarters has since 2015 been located in a 69,000-square-foot office in Cypress, a company spokesperson said in an email.

The company cited the Olympics as a driving factor in its decision to move.

“Being based in Long Beach places Speedo — a brand trusted by swimmers on the world stage — at the heart of one of the world’s most anticipated sporting events,” the company said in a statement.

Bo Martinez, the city’s economic development director, said in a statement that Pentland’s relocation to Long Beach is “a powerful vote of confidence” that strengthens the city’s efforts to “diversify the local economy, create more high-quality jobs and build an ecosystem where creative, forward-thinking companies can thrive.”

Pentland Brands’ Long Beach facility, which will accommodate more than 130 employees, is expected to include a dedicated Speedo showroom, open office space and rooms for product design, according to the statement.

Long Beach will host 11 sporting events during the 2028 Olympics, which are scheduled to run July 14 through July 30, according to an April statement from the city.

Many are water sports, including coastal rowing, open-water swimming, beach volleyball, sailing, artistic swimming and water polo. Also on the lineup are non-water sports such as sport climbing, handball and target shooting.

Events will be spread across seven venues, including temporary buildings as well as the Long Beach Arena, which hosted events during the 1984 Olympics, and Marine Stadium, built for the rowing events of the 1932 Olympics.

Long Beach will also host seven events for the 2028 Paralympics, scheduled to take place from Aug. 15 to Aug. 27, according to the city’s website.

Long Beach Councilman Daryl Supernaw said in an email to The Times he was “thrilled” for the company behind Speedo to move into his district, which encompasses neighborhoods around the Long Beach Airport.

“It is an ideal company to help diversify our economy and [reinforce] the City’s long history in aquatics,” Supernaw wrote.

Long Beach in 2023 unveiled plans to spend over $900 million on infrastructure over the next five years, with about $200 million earmarked for Olympics-focused projects.

Long Beach Mayor Rex Richardson told The Times in 2024 that he considered the Olympics an opportunity for his city, which has long relied on oil revenue, to “build a new economy.”

Pentland Brands is a division of the Pentland Group, which was founded in the 1930s as the Liverpool Shoe Co.

In the 1990s, Pentland acquired Speedo International and Speedo Australia. In a move to consolidate the global swimwear brand, the company bought Speedo North America from apparel company PVH Corp. for $170 million ahead of the Tokyo Summer Olympics that were postponed to 2021.

Speedo is a major Olympic sponsor and has partnerships with the national swimming governing bodies in the U.S., Canada, China and Australia, among others.

The Australian swimwear brand traces its origins to 1928, when Scottish immigrant Alexander MacRae produced a sleeveless Racerback swimsuit.

Speedo’s tight-fitting suits sparked a brief controversy at the 1932 Los Angeles Olympics, when a complaint was filed about Australian swimmer Clare Dennis’ exposed shoulders, according to the Daily Telegraph. The complaint was dismissed and the teenager went on to win gold in the 200-meter breaststroke.

US allies reacted to President Donald Trump’s threats to take over Greenland on Tuesday, with Canadian Prime Minister Mark Carney telling delegates at Davos that it was time to imagine a future without US leadership.

US has moved to assert strict control over the production and sale of Venezuelan oil since attacking the country this month.

The United States military announced that it has seized a seventh Venezuela-linked oil tanker, as the US tightens its control over the production and sale of the country’s considerable oil resources.

US Southern Command (SOUTHCOM), which oversees military operations in Latin America, said on Tuesday that it captured the Motor Vessel Sagitta as part of its blockade on oil vessels leaving and entering the country.

“The apprehension of another tanker operating in defiance of President Trump’s established quarantine of sanctioned vessels in the Caribbean demonstrates our resolve to ensure that the only oil leaving Venezuela will be oil that is coordinated properly and lawfully,” SOUTHCOM said in a statement.

It added that Tuesday’s tanker seizure occurred “without incident”, sharing a video appearing to show US forces flying towards the vessel and landing on its deck.

The US began seizing sanctioned tankers on December 10, as part of a campaign of increasing pressure on Venezuela.

Tensions between the US and Venezuela came to a peak on January 3, when US President Donald Trump authorised a predawn military operation to abduct his Venezuelan counterpart, Nicolas Maduro.

In the lead-up to that operation, Trump and allies like Stephen Miller had been increasingly vocal about laying claim to Venezuelan oil, given the US’s history of prospecting for petroleum there in the early 20th century.

But by 1971, Venezuela had nationalised its oil industry. Efforts to expropriate assets from foreign oil companies in 2007 have further fuelled criticism from the Trump administration, which considers Venezuelan oil “stolen” from US owners.

Legal experts, however, largely consider such arguments a violation of Venezuelan sovereignty.

Trump has nevertheless said the US will control Venezuela’s oil and has used the threat of further military attacks to pressure Venezuela’s government into compliance.

The Trump administration has also placed steep sanctions on Venezuela’s economy, as part of a trend stretching back to the Republican leader’s first term as president.

The US has framed the tanker seizures as a way of enforcing those sanctions, although the legality of using military force to enforce economic penalties is disputed.

Trump and his officials have said that the sale of Venezuelan oil on the world market will be dictated by the US and that the proceeds from those sales will be placed in a US-controlled bank account.

Trump has also used control over Venezuela’s oil to ratchet up pressure on Cuba, for which access to Venezuelan oil is an important economic lifeline.

The US president told reporters on Tuesday at a White House briefing that he has taken 50 million barrels of oil from Venezuela.

“We’ve got millions of barrels of oil left,” he said at the White House. “We’re selling it on the open market. We’re bringing down oil prices incredibly.”

Interim Venezuelan President Delcy Rodriguez, meanwhile, said that her country had received $300m from recent oil sales. In her inaugural state of the union address last week, she signalled that her administration would reform the country’s hydrocarbon law to allow more foreign investment in future.

United States President Donald Trump has made a range of claims about the state of the US economy.

In a long and meandering address to the media on Tuesday, the first year anniversary of his second term as president, Trump’s claims ranged from there being “no inflation” in the US to drug prices being slashed by as much as 600 percent. Most claims were factually inaccurate.

Al Jazeera examined some of his statements on the economy:

Core inflation has been at 1.6 percent for the past three months, and there is “no inflation”.

Both claims are false. Core inflation in November and December stood at 2.6 percent year over year, according to the Bureau of Labor Statistics (BLS).

A core consumer price index (CPI) report was not released for the month before due to the federal government shutdown, the longest in US history.

Overall, inflation rose by 2.7 percent compared with the same period last year.

Drug prices under Trump’s “most favored nation” programme are down by “300, 400, 500, 600 percent”.

This is incorrect. While the programme is intended to lower drug prices, reductions beyond 100 percent are mathematically impossible.

A 100 percent price reduction would mean a product is free. Anything beyond that would require pharmaceutical companies to pay consumers to take their products.

Pending Supreme Court ruling on tariffs:

Trump addressed a pending Supreme Court case that will rule on the legality of his use of the International Emergency Economic Powers Act (IEEPA) to impose tariffs. He claimed the US would have to return money if the court rules against his administration.

This is partially accurate but unclear. If the court rules against the administration, the US would need to refund some of the money importers paid in tariffs. In September, Secretary of the Treasury Scott Bessent said the government could be required to refund roughly half of the tariffs it collected.

The White House’s economic adviser, Kevin Hassett, has said the administration is exploring alternative legal avenues to impose tariffs if the court blocks the current plan.

Former President Joe Biden “did not do tariffs”.

This is false. Biden imposed multiple tariffs during his administration. In 2022, he imposed 35 percent tariffs on Russian imports as part of sanctions following Moscow’s full-scale invasion of Ukraine.

In 2024, Biden raised tariffs on Canadian lumber to 14.5 percent from 8.5 percent, continuing a Trump-era policy.

That year, he also imposed tariffs on China, including 100 percent on electric vehicles, 25 percent on steel and aluminium, and 50 percent on semiconductor chips.

Trump administration removed more than 270,000 bureaucrats from the federal government, but they are going to the private sector. 

The federal government has cut 277,000 jobs since January 2025, according to the BLS. But data shows limited growth in the private sector, especially in tariff-exposed industries.

In the most recent jobs report, the US economy added 50,000 jobs. The biggest gains were in food service, which added 27,000 jobs, and healthcare, which added 34,000 jobs.

The US economy added 584,000 jobs in 2025. This is significantly lower than the two million created the year before, under Biden.

Gas prices are at $1.99 per gallon in some states

This is inaccurate. According to the American Automobile Association (AAA), which tracks gas prices, the average price for a gallon of gas is $2.82. The cheapest gas prices are in the state of Oklahoma, at $2.31.

More car factories are being built in the US now than ever before.

Oxford Economics tracks private construction spending on transportation equipment factories. In 2025, nominal spending on manufacturing structures related to transportation equipment was down from its peak in 2024, it said.

Trump has been making claims like this for close to a year. Auto industry experts have long said they are exaggerated, because while companies, including Hyundai and Stellantis, have increased investments in US manufacturing, these are additions to existing plants.

Oxford Economics, which tracks private construction on transportation equipment, found that “nominal spending” in 2025 was trending downwards after hitting a peak during the final year of the Biden administration.

After United States President Donald Trump threatened a trade war against European countries which oppose his bid to acquire Greenland, Europe is now considering deploying a “trade bazooka” – a powerful, multilayered instrument in its arsenal of economic deterrents.

Norway says its prime minister has received a message from Trump hinting that Oslo’s failure to award him the Nobel Peace Prize is at least partly to blame for his stance.

Here is more about Trump’s tariff threat to Europe, alongside Europe’s response.

What was in Trump’s Norway letter over Greenland?

Norwegian Prime Minister Jonas Gahr Store’s office confirmed on Monday that he had received a message from Trump in which he wrote: “Considering your Country decided not to give me the Nobel Peace Prize for having stopped 8 Wars PLUS, I no longer feel an obligation to think purely of Peace.”

Trump added: “Although it will always be predominant, but can now think about what is good and proper for the United States of America.”

Trump reiterated that he does not believe Denmark can keep Greenland secure from Russia or China.

“The World is not secure unless we have Complete and Total Control of Greenland,” he wrote.

What tariffs has Trump threatened against Europe?

In a post on his Truth Social platform on January 17, Trump wrote that he had subsidised Denmark and other European Union countries by not charging them trade tariffs.

He wrote that, starting from February 1, exports to the US from Denmark, Norway, Sweden, France, Germany, the United Kingdom, the Netherlands and Finland would all be subject to a 10 percent levy.

On June 1 this year, the tariff would be increased to 25 percent, he said. “This Tariff will be due and payable until such time as a Deal is reached for the Complete and Total purchase of Greenland,” Trump wrote.

“The United States has been trying to do this transaction for over 150 years. Many Presidents have tried, and for good reason, but Denmark has always refused.”

Danish and Greenlandic leaders have repeatedly stated that the autonomous territory of the Kingdom of Denmark is not for sale, and recent demonstrations on the island have opposed Trump’s push to acquire it.

Why does the US want to buy Greenland?

The US interest is longstanding: after buying Alaska in 1867, Secretary of State William Seward unsuccessfully tried to buy Greenland. In 1946, President Harry Truman secretly offered Denmark $100m for Greenland, but Copenhagen refused, and the proposal became public only decades later.

During World War II, the US occupied the island and built military facilities, maintaining a presence today at Pituffik Space Base.

Greenland, a sparsely populated Arctic island of 56,000 people – mostly Indigenous Inuit – is geographically in North America but politically part of Denmark, making it part of Europe. Greenland withdrew from the European Community (EC/EU) in 1985 after it gained home rule, but maintains a special association with the EU as an Overseas Country and Territory (OCT), which grants limited internal market access and EU citizenship to Greenland’s residents through Denmark.

Its position between the Arctic and North Atlantic oceans provides the shortest air and sea routes between North America and Europe, making it crucial for US military operations and early-warning systems, especially around the Greenland-Iceland-UK gap, according to the Trump administration.

Greenland’s economy relies mainly on fishing, locals oppose large-scale mining, and there is no oil or gas extraction. However, it has large deposits of minerals, including rare-earth metals, which are necessary for the manufacture of technology, including smartphones and fighter planes. The island has therefore drawn increasing interest from leading powers as climate change opens up new shipping lanes in the Arctic.

How has Europe responded to Trump’s tariff threat?

Many nations in Europe want to pursue diplomatic options with the US before retaliating with tariffs of their own, but have not ruled it out.

“Our priority is to engage, not escalate. Sometimes the most responsible form of leadership is restraint,” European Commission spokesperson Olof Gill said on Monday.

However, Gill warned that “the EU has tools at its disposal and is prepared to respond should the threatened tariffs be imposed”.

The 27 members of the EU convened for an emergency meeting on Sunday to discuss their response to Trump’s threat.

In a joint statement on the same day, the eight countries targeted by Trump with new tariffs said they “stand in full solidarity” with Denmark and the people of Greenland, a semi-autonomous Danish territory.

“Building on the process begun last week, we stand ready to engage in a dialogue based on the principles of sovereignty and territorial integrity that we stand firmly behind,” Denmark, Finland, France, Germany, the Netherlands, Norway, Sweden and the UK said in the statement.

“Tariff threats undermine transatlantic relations and risk a dangerous downward spiral. We will continue to stand united and coordinated in our response. We are committed to upholding our sovereignty.”

During an address to the nation on Monday, Prime Minister Keir Starmer said the UK believes Greenland is part of Denmark and its future must be determined by Greenland and Denmark only.

“Applying tariffs on allies for pursuing the collective security of NATO allies is completely wrong. We will of course be pursuing this directly with the US administration,” Starmer said. However, he stated repeatedly during his address and questions from the media afterwards that, for now, he is not in favour of launching retaliatory tariffs against the US. “A tariff war is not in anyone’s interests.”

This week, German Chancellor Friedrich Merz also urged dialogue, warning that a tariff war would hurt both sides of the Atlantic Ocean.

“We want to avoid any escalation in this dispute if at all possible,” Merz said. “We simply want to try to resolve this problem together.” He did not rule out using tariffs if absolutely necessary, however.

European Commission President Ursula von der Leyen and European Council President Antonio Costa wrote identical, but separate X posts, saying: “Tariffs would undermine transatlantic relations and risk a dangerous downward spiral. Europe will remain united, coordinated, and committed to upholding its sovereignty.”

Some European leaders have been more bullish about how to respond to Trump’s threats, however, and called on the EU to activate a never-before-used economic tool designed to face down coercion from states outside the EU.

David van Weel, the foreign minister of the Netherlands, said during an interview on Dutch television on January 18: “It’s blackmail what he’s doing … and it’s not necessary. It doesn’t help the alliance [NATO], and it also doesn’t help Greenland.”

“The Anti-Coercion Instrument (ACI), designed precisely for such cases, must now be used,” German MEP Bernd Lange, who chairs the European Parliament’s trade committee, said in a post on X.

“I call on the European Commission to activate it immediately.”

During the emergency EU meeting on Sunday, French President Emmanuel Macron also requested that the bloc activate the ACI, also known as a “trade bazooka”, according to news reports.

What is the ACI, or trade bazooka?

The trade bazooka is a legal mechanism that the EU proposed late in 2021 and adopted in 2023 to protect European countries from economic pressure by non-EU countries.

By the end of his first term in January 2021, Trump had launched a trade war against several of Washington’s leading trading partners, including the EU, which faced US tariffs on steel and aluminium exports.

In December 2021, China blocked Lithuanian goods from entering Chinese ports after Lithuania was deleted from China’s electronic customs declarations system. This was in retaliation for Lithuania’s decision to allow Taiwan, which China considers its territory, to open a de facto embassy in Vilnius under the name “Taiwanese Representative Office”. China’s block also applied to exports from other EU member states when the goods contained Lithuanian components or were linked to Lithuania.

The bazooka idea was proposed in the EU on December 8, 2021, as China was blocking goods.

It was, therefore, adopted in 2023 with countries like China in mind, rather than allies like the US, Erica York, vice president of federal tax policy at the Tax Foundation, told US media.

“The ACI restricts the access of US corporations to sell products in the European market. This is the European Union’s most powerful economic weapon,” Jo Michell, a professor of economics at the University of the West of England in Bristol, told Al Jazeera.

“It includes fees and charges on imports of goods and services, restrictions on US investment into the EU and a possible ban on public sector contracts for US companies.”

Essentially, the trade bazooka involves a series of measures, including steep retaliatory tariffs and increased customs duties. If applied to the US, the EU could limit or block access for US goods, services or companies to its single market.

It could also place restrictions on exports and imports through quotas or licences. Additionally, the EU could impose measures restricting the US’s use of EU‑based financial infrastructure, increasing funding costs for US banks and firms which depend on doing business in Europe.

How would the ACI be implemented?

A last‑resort deterrence measure, it has never been implemented before. There are several steps that must be taken before it can be deployed.

The process begins when a company, another party in the EU or the Commission itself files a complaint alleging economic coercion from a country outside the EU. The European Commission then launches a formal investigation into the allegation, which it is supposed to complete within four months.

If the commission finds that economic coercion is indeed taking place, it will first try to resolve the issue through diplomacy. If those efforts fail, the EU can move towards activating the ACI.

To do so, a “qualified majority” – at least 15 of the EU’s 27 countries representing at least 65 percent of the bloc’s population – must support the move. This gives countries with larger populations, such as Germany, France and Italy, significant influence.

Once a proposal to trigger the bazooka is on the table, member states have up to 10 weeks to say yes or no. In total, the entire process can take up to a year before the bazooka fully comes into effect.

“The EC may be able to move relatively quickly given the urgency of the situation, but the implementation vote may be months rather than weeks away,” Michell said.

What effect could the ACI have on the US and Europe?

The US runs a significant trade deficit with the EU in terms of goods. This means it imports more from the EU than it exports.

In 2024, the EU exported 531.6 billion euros ($603bn) in goods to the US and imported products worth 333 billion euros ($377.8bn), resulting in a trade surplus for the EU of almost 200 billion euros ($227bn).

The picture is different for services, however. The US had a surplus of more than 109 billion euros ($124bn) in services as of 2023, with notable IT exports, led by large US tech companies, intellectual property and financial services.

The bazooka could therefore hit the US where it hurts, allowing Europe to go beyond traditional tariffs on goods and restrict or tax US services instead.

“Imposing restrictions on the large US tech companies would be particularly painful for the US, and would likely hit share prices. The US is also exposed in areas such as pharmaceuticals and aerospace,” Michell said.

However, the bazooka would hurt workers and consumers in Europe as well. Restrictions on services would mean limited choices or higher prices for US services. Additionally, retaliatory tariffs on US goods as well would mean increased prices for those, too.

What will Europe choose to do?

UK financial media reported this week that the bloc is considering imposing 93 billion euros ($108bn) in tariffs on US goods.

“Imposing 93 billion of tariffs is the first line of defence,” Mohit Kumar, chief European economist at New York-based investment banking and capital markets firm Jefferies, told Al Jazeera.

“Anti-coercion measures need a qualified majority [in the EU]. Germany has already said that it would prefer negotiations. Hence, my base case remains that the bazooka is unlikely to be used,” Kumar said.

“My base case remains that cooler heads will prevail. A solution where the US gets exclusive mineral rights and increased military presence in Greenland but its sovereignty remaining as is could be a way forward,” Kumar said.

Published on
20/01/2026 – 8:14 GMT+1

Eurogroup’s session in Brussels this Monday confirmed Croatia’s Boris Vujčić as the successor to Spain’s Luis de Guindos, whose eight-year mandate at the ECB expires in May.

While the nomination must still undergo consultative hearings at the European Parliament, and a review by the ECB’s Governing Council, this process is mostly protocol.

Vujčić is expected to take office on 1 June and become Christine Lagarde’s right-hand man.

The decision defied predictions and dismissed the European Parliament’s recommendations.

The Croatian beat five other candidates for the job, including the favourite to win, Finland’s Olli Rehn, and the Parliament’s favoured choices, Portugal’s Mário Centeno and Latvia’s Mārtiņš Kazāks.

Following the meeting, the president of the Eurogroup, Kyriakos Pierrakakis, said there was “an agreement on both the process and the person which is a sign of institutional maturity on the background of an exceptional number of candidates and past experiences”.

For Croatia, the promotion of its central bank governor to the ECB’s Executive Board is a swift ascent. The country only adopted the euro in 2023 and is the second-newest member after Bulgaria, which integrated the single currency at the start of this year.

Croatia’s infancy in the eurozone stands in stark contrast to the veteran status of the man who shepherded the nation through its transition.

Currently serving his third term, Vujčić has led the Croatian National Bank since 2012, playing a key role in negotiating the country’s accession to the EU in 2013 and overseeing the adoption of the euro a few years ago.

A “moderate hawk”

The ECB vice president makes a substantial contribution to the Governing Council’s financial stability analysis, influencing interest rate decisions, and also substitutes the President whenever necessary.

In the technical jargon of central banking, Vujčić is frequently classified as a “moderate hawk”.

Vujčić is a seasoned economist who has repeatedly cautioned against lingering inflation threats, pushing for a slow and measured reduction in interest rates to guarantee that price stability is firmly reinstated.

However, the Croatian’s colleagues have also previously described him as pragmatic, data-driven, and relatively predictable.

The Eurogroup likely sees Vujčić as someone who will not focus on political optics and instead help the ECB steadily navigate the tail end of its post-pandemic inflation fight.

The great reshuffle of the ECB

Despite Vujčić’s appointment being meaningful for Croatia, the vice presidency is not among the most desired roles in the ECB.

In fact, the EU’s major member states did not even propose candidates for this nomination, as they prepare for the many seats that become vacant next year.

The positions of president, chief economist, and head of market operations, will all be available in 2027.

The EU’s “big four”, Germany, Spain, France and Italy, are all expected to compete for those spots, aiming to preserve their controlling influence over the ECB.

It is a much more public show of support than Powell has previously displayed, but comes as Trump threatened Fed chair with criminal indictment.

United States Federal Reserve Chair Jerome Powell will attend the Supreme Court’s oral argument in a case involving the attempted firing of Fed governor Lisa Cook, an unusual show of support by the central bank chair.

The high court is considering whether US President Donald Trump can fire Cook, as he said he would do in late August, in an unprecedented attempt to remove one of the seven members of the Fed’s governing board. Powell plans to attend the high court’s Wednesday session, according to a person familiar with the matter, who spoke on condition of anonymity.

It is a much more public show of support than the Fed chair has previously shown Cook. But it follows Powell’s announcement last week that the Trump administration has sent subpoenas to the Fed, threatening an unprecedented criminal indictment of the Fed chair. Powell — appointed to the position by Trump in 2018 — appears to be casting off last year’s more subdued response to Trump’s repeated attacks on the central bank in favour of a more public confrontation.

Powell issued a video statement on January 11 condemning the subpoenas as “pretexts” for Trump’s efforts to force him to sharply cut the Fed’s key interest rate. Powell oversaw three rate cuts late last year, lowering the rate to about 3.6 percent, but Trump has argued it should be as low as 1 percent, a position few economists support.

The Trump administration has accused Cook of mortgage fraud, an allegation that Cook has denied. No charges have been made against Cook. She sued to keep her job, and the Supreme Court on October 1 issued a brief order allowing her to stay on the board while they consider her case.

If Trump succeeds in removing Cook, he could appoint another person to fill her slot, which would give his appointees a majority on the Fed’s board and greater influence over the central bank’s decisions on interest rates and bank regulation.

Over the past year, United States President Donald Trump has unleashed a slew of policies that have upended businesses, supply chains and jobs.

Yet the US economy seems to be growing at a healthy clip, and the unemployment rate is in a safe zone.

The reality, experts say, is that the stock market boom has helped to mask deeper underlying problems in the economy.

Since taking office, Trump has imposed a range of tariffs on countries, including key trading partners, leading to predictions of inflation skyrocketing, manufacturing screeching to a halt and unemployment soaring.

None of those scenarios came true.

Inflation, while above the Federal Reserve’s target, was a modest 2.7 percent in December.

The unemployment rate was relatively low, at 4.4 percent, last month. Gross domestic product (GDP) grew at 4.3 percent in the third quarter of 2025, the fastest in two years.

“The shock and awe we anticipated just didn’t materialise,” Bernard Yaros, lead US economist at Oxford Economics, told Al Jazeera.

Yaros said the limited fallout could be attributed to the relative lack of retaliation by other countries and the stock market rally that quickly followed Trump’s dialling back of the steepest tariffs announced on “liberation day“.

Since Trump’s April 2 announcement, the stock market, which is heavily weighted towards the “magnificent seven” tech companies, has risen nearly 30 percent, boosting Americans’ paper wealth and encouraging households to loosen their purse strings.

Gains in net wealth have driven almost one-third of the rise in consumer spending since the COVID-19 pandemic, Oxford Economics said in a research briefing in October.

At the same time, the gains have not been distributed evenly.

The top 10 percent of earners are now estimated to account for roughly half of all spending, the highest proportion since officials began compiling data in 1989, according to Moody’s Analytics.

“The gains are going a lot to people in higher income brackets – they are the ones who have the stock portfolios – and are going to people in sectors and occupations tied to AI,” Marcus Noland, executive vice president of the Peterson Institute for International Economics, told Al Jazeera.

“But, these numbers mask the unevenness in the growth in this economy.”

Net decline of workers

A careful parsing of the data reveals that unevenness. For instance, despite the impressive GDP numbers, that growth is not being accompanied by an increase in hiring.

While hospitality and healthcare added workers last year, retail, manufacturing and construction – sectors that rely heavily on migrants – all shed jobs.

As a result of the Trump administration’s mass deportation of undocumented immigrants and tightening of legal migration pathways, the US last year experienced negative net migration for the first time in at least half a century, according to a Brookings Institution analysis.

“And through this very public and brutal way of going about deportations, they have discouraged illegal immigration, but also intimidated immigrants in the US,” Noland said, adding that the US workforce is projected to see a net decline of two million workers this year.

The “bifurcation” in the US economy is also being felt across the business world, with smaller companies lacking the deep pockets to stockpile inventories or negotiate with suppliers in the face of increased tariffs.

“The surge in policy uncertainty this year has had an outsize effect on smaller firms,” Oxford Economics said in a November report.

These firms are also seeing little benefit from the boom in the artificial intelligence (AI) industry since revenues have been driven by capital-intensive chip manufacturing and cloud services.

While AI proponents believe the world is on the cusp of huge gains in productivity that could dramatically raise living standards, there are concerns about large numbers of people being put out of work.

“This could be the new norm – jobless growth. That’s one reason people are not feeling so great,” Yaros said.

“While a lot of hype about AI and productivity benefits from AI are still to come, we think that is a risk to the labour market if it continues to hold back hiring.”

United States President Donald Trump has promised to steadily increase tariffs on European countries that have opposed his move to acquire Greenland, escalating a dispute over the semiautonomous Danish territory he has long coveted.

So what is behind Trump’s push to control Greenland, the world’s largest island, and how have Washington’s NATO allies responded?

What is Trump’s tariff threat over Greenland?

In a post on his Truth Social platform on Saturday, Trump wrote that he has subsidised Denmark and other European Union countries by not charging them tariffs.

“Now, after Centuries, it is time for Denmark to give back – World Peace is at stake! China and Russia want Greenland, and there is not a thing that Denmark can do about it.”

Trump added that “the National Security of the United States, and the World at large, is at stake.”

Trump wrote that starting on February 1, Denmark, Norway, Sweden, France, Germany, the United Kingdom, the Netherlands and Finland will be charged a 10 percent tariff on all their exports to the US.

On June 1, the tariff is to be increased to 25 percent, he said. “This Tariff will be due and payable until such time as a Deal is reached for the Complete and Total purchase of Greenland,” Trump wrote.

Trump additionally wrote: “The United States has been trying to do this transaction for over 150 years. Many Presidents have tried, and for good reason, but Denmark has always refused.”

Is Trump the first US president to seek control of Greenland?

Leaders in Denmark and Greenland have consistently insisted that Greenland is not for sale. In the past few days, Greenlanders have been protesting against Trump’s wishes to acquire Greenland. Yet Trump has pushed for acquiring the Arctic territory since his first term, and he is not the first US president to pursue such a purchase.

After buying Alaska from Russia in 1867, then-Secretary of State William H Seward unsuccessfully sought to buy Greenland. During World War II, the US occupied Greenland after Germany’s invasion of Denmark and built military and radio facilities there. It maintains a permanent presence today at the Pituffik Space Base in the northwest.

In 1946, while Greenland was still a Danish colony, President Harry S Truman secretly offered Denmark $100m for the island, but Copenhagen refused. The proposal became public only in 1991.

American citizens do not support Washington acquiring Greenland, polls have indicated. This week, a Reuters/Ipsos poll of US residents showed less than one in five respondents support the idea of acquiring Greenland.

Why does Trump want Greenland?

The location and natural resources of the island make it strategically important for Washington.

Greenland is geographically part of North America, located between the Arctic Ocean and the North Atlantic Ocean. It is home to 56,000 residents, mostly Indigenous Inuit people.

Greenland’s capital, Nuuk, is closer to New York City – about 2,900km (1,800 miles) away – than the Danish capital, Copenhagen, located 3,500km (2,174 miles) to the east.

It is a NATO territory through Denmark and an EU-associated overseas territory with residents holding EU citizenship.

Its location offers the shortest air and sea routes between North America and Europe, making it strategically vital for US military operations and missile early-warning systems. Washington has also sought more radar coverage around the Greenland-Iceland-UK gap to monitor Russian and Chinese movements.

Greenland is rich in minerals, including most of the EU’s listed “critical raw materials”, but there is no oil and gas extraction, and many Indigenous residents oppose large-scale mining. The economy mainly depends on fishing.

As climate change opens up more of the Arctic, major powers such as the US, Canada, China and Russia are increasingly interested in its untapped resources.

How has Europe responded to Trump’s tariff threats?

All 27 members of the EU will convene for an emergency meeting on Sunday to discuss their response to Trump’s threat.

UK Prime Minister Keir Starmer responded in a post on X on Saturday, saying: “Our position on Greenland is very clear – it is part of the Kingdom of Denmark and its future is a matter for the Greenlanders and the Danes,” Starmer wrote.

“Applying tariffs on allies for pursuing the collective security of NATO allies is completely wrong. We will of course be pursuing this directly with the US administration.”

European Commission President Ursula von der Leyen also responded in an X post, saying: “The EU stands in full solidarity with Denmark and the people of Greenland. Dialogue remains essential, and we are committed to building on the process begun already last week between the Kingdom of Denmark and the US.

“Tariffs would undermine transatlantic relations and risk a dangerous downward spiral. Europe will remain united, coordinated, and committed to upholding its sovereignty.”

European Council President Antonio Costa shared a post identical to von der Leyen’s on his own X account.

EU foreign policy chief Kaja Kallas wrote on X: “China and Russia must be having a field day. They are the ones who benefit from divisions among Allies.”

Kallas added: “Tariffs risk making Europe and the United States poorer and undermine our shared prosperity.”

David van Weel, the foreign minister of the Netherlands, said during an interview on Dutch television on Sunday: “It’s blackmail what he’s doing, … and it’s not necessary. It doesn’t help the alliance [NATO], and it also doesn’t help Greenland.”

European and South American leaders say pact sends ‘clear signal’ amid concerns over global tariffs, isolationism.

European and South American officials have signed a major free trade agreement, paving the way for the European Union’s largest-ever trade accord amid tariff threats and deepening uncertainty around global cooperation.

The deal finalised on Saturday between the 27-nation EU and South America’s Mercosur bloc creates one of the world’s largest free trade areas after 25 years of negotiations.

The agreement, designed to lower tariffs and boost trade between the two regions, must now gain the consent of the European Parliament and be ratified by the legislatures of Mercosur members Argentina, Brazil, Paraguay and Uruguay.

“We choose fair trade over tariffs, we choose a productive long-term partnership over isolation,” EU chief Ursula Von der Leyen said at the signing ceremony in Paraguay’s capital, Asuncion.

Paraguay’s President Santiago Pena also praised the treaty as sending “a clear signal in favour of international trade” in “a global scenario marked by tensions”.

Brazilian Foreign Minister Mauro Vieira said it was a “bulwark … in the face of a world battered by unpredictability, protectionism, and coercion”.

The deal received a greenlight from most European nations last week, despite opposition from farmers and environmental groups, who have raised concerns over a surge of inexpensive South American imports and increased deforestation.

Thousands of Irish farmers protested last week against the agreement, accusing European leaders of sacrificing their interests.

But the leaders in Paraguay said the pact would bring jobs, prosperity, and opportunities to people on both sides of the Atlantic.

Together, the EU and Mercosur account for 30 percent of global GDP and more than 700 million consumers. The treaty, which eliminates tariffs on more than 90 percent of bilateral trade, is expected to come into force by the end of 2026.

The deal will favour European exports of cars, wine and cheese, while making it easier for South American beef, poultry, sugar, rice, honey and soya beans to enter Europe.

Reporting from Paraguay on Saturday, Al Jazeera’s Latin America editor Lucia Newman explained that the Mercosur countries make up a “huge area that produces enormous amounts of agricultural [products] and raw minerals” that the EU wants.

“Here in South America, they are very, very keen because [the deal] will open up an enormous market for them in Europe – but with more stringent conditions than they’ve had until now. So that will need some accommodating,” Newman said.

She added that it is critical to note the “geopolitical message” that European and South American leaders were sending to the United States and other parts of the world by signing the deal.

“And that is, that this is a gesture to support multilateralism at a time, as Von der Leyen said, when isolationism and tariffs are trying to rule the world,” Newman said.

Just before the signing ceremony, US President Donald Trump announced new tariffs against several European countries over their opposition to his push to take control of Greenland.

The US leader has refused to rule out taking military action to seize the Arctic island – a semi-autonomous territory that is part of Denmark – fuelling widespread international concern and protests.

It would create one of the largest free-trade zones in the world, connecting markets with more than 700 million people.

A trade pact between the European Union and the Mercosur trading bloc has been agreed after almost 25 years of talks.

That’s despite opposition from farmers in several European countries.

The deal is seen as part of Europe’s effort to curb its economic reliance on China.

And it comes against the backdrop of President Donald Trump’s tariffs on countries around the world and his recent military intervention in Venezuela.

Also, will Big Oil invest in Venezuela?

Plus, are Greenland’s vast resources profitable?

Washington seeks improved access to strategic chip industry of island nation, over which China claims sovereignty.

Taiwan and the United States have struck a trade deal that will see the island nation boost tech and energy investments in the US in exchange for lower tariffs.

In a statement announcing the deal late on Thursday, the US Commerce Department said Taiwan’s semiconductor and technology businesses will invest at least $250bn in the US. In exchange, it said Washington will reduce its general tariff on imports of Taiwanese goods from 20 percent to 15 percent.

The deal illustrates an ongoing push by the US to improve access to Taiwan’s semiconductor industry. The island nation holds a dominant position in the supply of the chips used in advanced digital technology across the world and, therefore, a critical component in the global economy, but it faces Chinese claims over its sovereignty.

President Donald Trump announced a 32 percent tariff on Taiwanese goods as part of his sweeping “Liberation Day” tariffs last spring, a rate he later lowered to 20 percent.

The Commerce Department said the “historic” deal “will strengthen US economic resilience, create high-paying jobs, and bolster national security”.

In addition to investing $250bn in building and expanding advanced semiconductor, energy, and artificial intelligence production and innovation capacity in the US, Taiwan will provide at least the same amount in credit guarantees for additional investment by its businesses in the US semiconductor supply chain.

Silicon shield

Taiwan stressed that it would remain the world’s main semiconductor supplier.

The island’s chip industry has long been seen as a “silicon shield” protecting it from an invasion or blockade by China – which claims the island is part of its sovereign territory – and an incentive for the US to defend it.

“Based on current planning, Taiwan will still remain the world’s most important producer of AI semiconductors, not only for Taiwanese companies, but globally,” Economic Affairs Minister Kung Ming-hsin told reporters on Friday, the AFP news agency reported.

Production capacity for the advanced chips that power artificial intelligence systems will be split about 85-15 between Taiwan and the United States by 2030 and 80-20 by 2036, he projected.

Reacting to the accord, Beijing expressed its stern opposition.

“China consistently and resolutely opposes any agreement … signed between countries with which it has diplomatic relations and the Taiwan region of China,” China’s Ministry of Foreign Affairs spokesperson said, urging Washington to abide by Beijing’s one-China principle.

United States President Donald Trump announced a healthcare plan that would replace government subsidies for insurance with direct payments into health savings accounts for consumers, an idea that some experts have said would hurt lower-income Americans.

The Trump administration on Thursday called on Congress to pass legislation to codify Trump’s most-favoured-nation drug price deals and to make more medicines available for over-the-counter purchase.

“This will lower healthcare costs and increase consumer choice by strengthening price transparency, increasing competition, and reducing the need for costly and time-consuming doctor’s visits,” the White House said in a release outlining the order.

Trump’s framework, dubbed “The Great Healthcare Plan” and outlined in a White House fact sheet, includes an insurance cost-sharing reduction programme that could reduce the most common Obamacare plan premiums by more than 10 percent and replaces government subsidies for insurance with direct payments to Americans.

The White House did not provide details on how much money it planned to send to consumers to buy insurance, or whether the funds would be available to all “Obamacare” enrollees or only those with lower-tier bronze and catastrophic plans.

The idea mirrors one floated among Republican senators last year. Democrats largely rejected it, saying the accounts would not be enough to cover costs for most consumers. Currently, such accounts are used disproportionately by the wealthiest Americans, who have more income to fund them and a bigger incentive to lower their tax rate.

White House press secretary Karoline Leavitt was asked at her briefing on Thursday whether the president could guarantee that, under his plan, people would be able to cover their healthcare costs.

“If this plan is put in place, every single American who has healthcare in the United States will see lower costs as a result,” she said without elaborating.

“These are common-sense actions that make up President Trump’s great healthcare plan, and they represent the most comprehensive and bold agenda to lower healthcare costs to have ever been considered by the federal government,” Leavitt also said.

The White House said that the plan would not affect people with pre-existing conditions.

The plan also targets pharmacy benefit managers and requires insurance companies to disclose the profits they take from premiums and the frequency of denials.

Companies would publish their rate and coverage comparisons on their websites in “plain English” as well as the percentage of revenues paid out to claims compared with overhead costs and profits. They would also be required to publish the percentage of claims they reject and the average wait times for routine care.

“Instead of just papering over the problems, we have gotten into this great healthcare plan, a framework that we believe will help Congress create legislation that will address the challenges that the American people have been craving,” US Centres for Medicare & Medicaid Services Administrator Mehmet Oz told reporters on a White House briefing call.

The White House also did not provide a timeline for implementation, and a deeply divided Congress is unlikely to pass major healthcare legislation quickly.

Providers and insurers who accept Medicare or Medicaid money would also have to post their pricing and fees.

Obamacare looms

The announcement comes as millions of Americans face higher healthcare costs this year, with open enrolment for most federally subsidised Obamacare plans closing on Thursday.

On average, premium costs will increase to $1,904 in 2026 from $888 in 2025, according to health policy firm KFF, a far greater jump than the savings promised in the Trump plan.

Congress remains divided on whether and how to reinstate generous COVID-era tax credits that expired at the end of last year.

Retroactive expanded federal subsidies are still possible, and there is a group of bipartisan lawmakers negotiating a potential extension, but Republicans remain divided on whether they should do so.

The Trump administration wants funding to go directly to consumers using health savings accounts, Oz said, rather than to insurers, a position also adopted by Congressional Republicans who oppose extending the Obamacare subsidies.

Trump has said he may veto any legislation to extend the subsidies, and the plan makes no mention of them.

“This does not specifically address those bipartisan congressional negotiations that are going on. It does say that we have a preference that money goes to people, as opposed to insurance companies,” the White House official said.

Trump has long been dogged by his lack of a comprehensive healthcare plan as he and Republicans have sought to unwind former President Barack Obama’s signature legislation, the Affordable Care Act. Trump was thwarted during his first term in trying to repeal and replace the law.

When he ran for president in 2024, Trump said he had only “concepts of a plan” to address healthcare. His new proposal, short on many specifics, appeared to be the concept of a plan.

On Wall Street, healthcare insurance provider stocks surged on the news of the looming plan. UnitedHealthcare is up 0.8 percent in midday trading. Humana is up higher at 3.5 percent than the market open, and Oscar Health is up 6.4 percent.

Pharmaceutical stocks, on the other hand, are trending lower. Eli Lilly is down by about 3.7 percent, AbbVie tumbling 1.9 percent below the market open, and Bristol Myers -Squibb is down by 0.9 percent. Johnson and Johnson, on the other hand, does remain in positive territory at about 0.3 percent higher than the market open.

But car makers have urged an extension to the USMCA, saying it is crucial to US auto production.

US President Donald Trump says the United States-Mexico-Canada Agreement (USMCA) is not relevant to the US, but that Canada wants it, as he pushed for companies to bring manufacturing back home.

“There’s no real advantage to it; it’s irrelevant,” Trump said about the trade agreement on Tuesday, during a visit to Detroit, Michigan.

“Canada would love it. Canada wants it. They need it.”

Detroit’s three big automakers, Ford, General Motors and Stellantis, are heavily reliant on supply chains that include significant parts production in Mexico and Canada, and all three produce hundreds of thousands of vehicles annually in both countries.

Major car makers, including Tesla, Toyota and Ford, in November also urged the Trump administration to extend USMCA, saying it is crucial to US auto production.

The American Automotive Policy Council, representing the Detroit Three automakers, said the USMCA “enables automakers operating in the US to compete globally through regional integration, which delivers efficiency gains” and accounts “for tens of billions of dollars in annual savings”.

Mark Reuss, president of General Motors, said at an event on Tuesday, “Our supply chains go all the way through all three countries. It’s not simple. It’s very complex. The whole North American piece of that is a big strength.”

Trump made his comments as he toured a Ford factory in Dearborn, Michigan, ahead of a speech he is delivering on the economy in Detroit on Tuesday.

“The problem is, we don’t need their product. You know, we don’t need cars made in Canada. We don’t need cars made in Mexico. We want to take them here. And that’s what’s happening,” he said.

Stellantis said in November that under the 15 percent tariffs with Japan, US vehicles complying with North American content rules “will continue to lose market share to Asian imports, to the detriment of American automotive workers”.

The USMCA is up for review this year on whether it should be left to expire or another deal should be worked out.

The trade pact, which replaced the North American Free Trade Agreement in 2020 and was negotiated during Trump’s first term as president, requires the three countries to hold a joint review after six years.

On Wall Street, two of Detroit’s major automakers are trending downwards. Ford is 0.25 percent below the market open and Stellantis is down 2.9 percent, while General Motors is up by 0.6 percent.

US media reports say tariffs will be cut to 15 percent in exchange for TSMC investment.

Taiwan and the United States have reached a “general consensus” on a trade pact that would reduce US tariffs on Taiwanese exports, officials in Taipei have said.

Taiwan’s Office of Trade Negotiations said on Tuesday that the outlines of a deal had been reached following months of negotiations with US officials.

“The goal of the US-Taiwan tariff negotiations has always been to seek reciprocal tariff reductions without stacking tariffs, and to obtain preferential treatment under Section 232,” the office said in a statement, according to the AFP news agency.

The trade office did not immediately respond to Al Jazeera’s request for comment.

US President Donald Trump announced a 32 percent “reciprocal tariff” on Taiwanese exports in April, before lowering the rate to 20 percent in August pending further negotiations.

Countries have made pledges to boost investments in the US in exchange for tariff relief since Trump launched his trade war last year.

Japan and South Korea last year agreed to invest $550bn and $350bn, respectively, to see their tariff rates cut from 25 to 15 percent.

Taiwan’s trade office did not provide details on the deal, but Bloomberg and The New York Times reported that the self-governing island’s tariff rate would be lowered to 15 percent.

As part of the deal, the Taiwan Semiconductor Manufacturing Company (TSMC) would agree to build at least four more production facilities in the US state of Arizona, according to Bloomberg and The New York Times, which cited unnamed officials.

TSMC, the world’s largest chipmaker and supplier to companies such as Nvidia and Apple, said in March that it planned to spend $100bn on new fabrication and packing plants in the US, bringing its total investment in the country to $165bn.

Due to its strategic importance, the chipmaker has been under pressure from Washington since 2020 to expand production outside Taiwan.

The US fears that a blockade of Taiwan by China, which claims the island as its territory, could cut off access to TSMC’s chips.

While TSMC has agreed to build new production facilities in the US, Japan, and Germany, it continues to make its most advanced chips in Taiwan.

Almost 15,000 nurses walked off the job in New York City, demanding better working conditions, marking the largest nurses’ strike in the city’s history as contract negotiations failed to gain traction.

Workers walked off the job early on Monday morning across three private hospital systems in the largest city in the US, Mount Sinai, Montefiore and NewYork-Presbyterian.

“After months of bargaining, management refused to make meaningful progress on core issues that nurses have been fighting for: safe staffing for patients, healthcare benefits for nurses, and workplace violence protections,” the New York State Nursing Association said in a statement on Monday.

“Management at the richest hospitals in New York City are threatening to discontinue or radically cut nurses’ health benefits,” the nursing group added.

NewYork-Presbyterian reported a net income of $547m in 2024. Mount Sinai reported $114m, while Montefiore reported $288.62m, according to ProPublica’s nonprofit tracker, which monitors the finances of nonprofit organisations, which these three hospitals are.

Striking nurses claim hospital management has threatened to cut healthcare benefits. The union alleges that hospitals are attempting to roll back safe staffing standards. Al Jazeera was unable to independently verify the validity of these claims.

In 2021, New York state signed into law a requirement that hospitals establish committees at every facility to outline staffing plans by division, including a minimum one-to-two nurse-to-patient ratio in critical care units, as strains on the healthcare system became amplified during the early months of the COVID-19 pandemic.

“You can’t divorce this from the experience of COVID in New York. COVID tested our healthcare system and tested nurses in particular. They last went on strike in 2023 and continue to face chronic understaffing, leaving them feeling overextended,” Lindsey Boylan, a community activist at the picket line on Monday morning, told Al Jazeera.

In 2023, after a three-day strike, nurses successfully pushed hospital systems, through arbitration, to enforce those standards across all hospital units.

The union alleges that hospitals are walking back the standards and that hospital management has failed to agree to requests to strengthen protections for workers amid a rise in workplace violence. Union representatives told Al Jazeera that the requests include installing metal detectors at hospital entrances.

The strike comes amid heightened concerns about hospital safety following an active shooter incident at a Mount Sinai hospital in November and a fatal shooting at a NewYork-Presbyterian Hospital in Brooklyn last week.

Mount Sinai has also allegedly disciplined nurses who raised concerns about alleged union-busting, resulting in a complaint filed with the National Labor Relations Board in October.

Al Jazeera reached out to NewYork-Presbyterian, Montefiore and Mount Sinai hospitals for comment.

“We’re ready to keep negotiating a fair and reasonable contract that reflects our respect for our nurses and the critical role they play, and also recognises the challenging realities of today’s healthcare environment. We have proposed significant wage increases that keep our nurses among the highest paid in the city,” a spokesperson for NewYork-Presbyterian Hospital told Al Jazeera in a statement.

When pressed for specifics, the hospital did not respond. The union told Al Jazeera the hospital offered nurses $4,500 in single lump-sum payments that could be used towards healthcare benefits, staffing, or wages.

Representatives for Mount Sinai Hospital and Montefiore did not reply to requests for comment.

Unified nurses

“The fact that the people who provide healthcare need to be asking for healthcare is ironic and infuriating,” Alex Bores, a state assembly member and congressional candidate in New York’s 12th district, told Al Jazeera. Bores was at the picket line in the early hours of Monday.

“The energy was incredible. It was 6am and still dark, but people were marching and chanting. Everyone was energised and ready for the fight. There was no hesitation and no fear. It was clear the nurses were unified and prepared to go the distance,” Bores added.

The strike comes at the height of a severe flu season in New York, with hospitalisations reaching record highs. During the week of December 20, nearly 9 percent of emergency room visits were for the flu. Rates have since begun to decline, according to city health data.

“This [the severe flu season] leads to an increase in the number of people who need to be seen in emergency rooms and hospitals. As a result, staffing needs are actually higher, making this a particularly difficult time to not have all healthcare professionals available,” said Bruce Y Lee, a professor of health policy and management at the CUNY Graduate School of Public Health & Health Policy.

For the week of January 3, the most recent data available, flu cases fell to 5 percent of emergency department diagnoses.

Healthcare demands may give nurses added leverage in negotiations.

“I think there’s a lot of leverage at this time. New Yorkers understand the role nurses played during COVID and beyond, and with a very difficult flu season now under way, we are all aware of how important nurses are, and how overextended they are,” Boylan added.

The political test

The strike poses a major political test at both the city and state levels. Governor Kathy Hochul is up for re-election, and pro-labour Zohran Mamdani’s recent mayoral win in New York City has increased pressure on the governor to side with progressives across the state.

“My top priority is protecting patients and ensuring they can access the care they need. At the same time, we must reach an agreement that recognises the essential work nurses do every day on the front lines of our healthcare system,” Hochul said in a statement on Sunday night.

Representatives for the governor did not respond to requests for additional comment after nurses officially began striking.

The strike comes early in Mamdani’s administration and marks a significant political test for the city’s new mayor, who has historically been pro-labour.

“There were so many people, it was flooding both sides of the street,” Boylan added.

In response to a request to the mayor’s office for comment, senior spokesperson Dora Pekec referred Al Jazeera to a post that Mamdani published on X on Sunday evening, ahead of the strike.

“No New Yorker should have to fear losing access to health care — and no nurse should be asked to accept less pay, fewer benefits or less dignity for doing lifesaving work. Our nurses kept this city alive through its hardest moments. Their value is not negotiable,” Mamdani wrote.

On Monday, the mayor joined picketers outside a hospital in Manhattan.

“This strike is not just a question of how much nurses earn per hour or what health benefits they receive, although both of those issues matter deeply. It is also a question of who deserves to benefit from this system,” Mamdani said at a news conference.

The spokesperson did not respond to our request for further comment.