squeeze

Central America’s Trade Squeeze | Global Finance Magazine

Deeper integration could attract more nearshoring, but governments will have to step up, too.

This article appears in the October issue of Global Finance Magazine.

With Panama joining Mercosur and Costa Rica wrapping up negotiations to join the Trans-Pacific Partnership, the rest of Spanish-speaking Central America risks being left behind.

Regional integration efforts have hitherto focused on custom unions, stock market interoperability, the Central American Integration System (SICA), the Central American Parliament, and the Central American Free Trade Agreement (FAUCA). 

“Panama’s accession to Mercosur as an associate state creates competitive pressure on the rest of Central America,” said Costa Rica-based financial analyst Daniel Suchar. “This could divert foreign direct investment that traditionally viewed Central America as a gateway to the Americas, forcing the other countries in the region to accelerate their own trade agreements to avoid falling behind.”

As a Mercosur member, Panama gains access to a market of 260 million people as well as value chains in Brazil, Argentina, and Uruguay, notably in logistics, financial services, and agribusiness. This opens the door to negotiations for a Central American bloc to join Mercosur, using Panama as a bridge.

“From a business perspective, the more connected, competitive, and open to trade Central America is, the greater the possibilities for developing regional value chains and attracting investment,” said Rosmer Jurado, president of the Union of Panamanian Industrialists.

Daniel Suchar Zomer,
Financial Analyst

Since last year, talk of a renegotiation of the Dominican Republic-Central America-United States Free Trade Agreement (CAFTA-DR) has been circulating among governments in the region. Should talks begin—the Dominican Republic is pushing hard for a trade deal—they would likely include proposals for further integration and increased rules and regulations. 

“A new agreement would be expected to include chapters on the digital economy, SMEs, resilient supply chains, and more stringent labor and environmental standards,” said Suchar. “A modernized CAFTA-DR should also address trade facilitation and regional cumulation of origin so that Central America can sell as a bloc and not as six separate countries.”

Opportunities in Nearshoring

Central America remains a diverse region, however, both politically and economically, which makes further integration challenging. Nicaragua is in danger of being frozen out of US trade after effectively banning elections, and Costa Rica has historically prioritized market diversification over Central American integration. Forging closer ties with the U.K. is part of its strategy to insert itself into high-value global production chains, particularly in medical devices, services, and technology.

The future of the Northern Triangle states—Guatemala, Honduras and El Salvador—is likely to be conditioned by their capacity to attract nearshoring and reduce non-trade costs. If they improve legal security, infrastructure, and energy, Suchar said, they can position themselves as alternatives for light manufacturing and textiles for companies leaving Asia. 

Nearshoring has been hailed as the region’s magic bullet; a 2024 report by the Center for Strategic and International Studies suggested that U.S. nearshoring alone could add at least $3.3 billion a year to Central American exports. But this is where governments will have to step up, Jurado noted. “Central America can take advantage of nearshoring,” he said, “but the opportunity will not automatically arise simply because of our location. The region must transform its proximity to the U.S. and its strategic position into concrete advantages: better infrastructure, lower logistics costs, specialized talent, competitive energy, trade facilitation, and clear rules for investment.”

Trade agreements, supply chain conditions, and geopolitical risk will all play a role. “Trade agreements are no longer just about tariffs,” said Suchar. “They focus on supply chain resilience, ESG standards, and geopolitics.”

Nic Wirtz is a contributing writer based in Guatemala.

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UAE bars Iranian airlines as US sanctions squeeze Iran’s aviation sector | Aviation News

Flights operated by Iranian airlines to and from the UAE suspended as part of broader efforts to enforce US aviation sanctions on Iran.

The United Arab Emirates has halted flights operated by Iranian airlines, joining several other countries in adopting United States sanctions aimed at pressuring Tehran’s aviation sector.

On Thursday, a statement carried by the Emirati WAM news agency said, “The General Civil Aviation Authority announced the suspension of all flights operated by Iranian airlines to and from the UAE.”

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It said the decision was “based on the US sanctions imposed on Iranian airlines preventing them from using airports around the world”.

The UAE has joined Oman, Iraq, Azerbaijan, Georgia and Turkmenistan in restricting or suspending access for Iranian airlines amid the new US sanctions threat.

Dubai, the UAE’s commercial hub, is a major destination for Iranian carriers, with multiple daily flights, a large Iranian community and close business links.

An Iran Airtour flight from Tehran to Dubai was cancelled shortly before its scheduled departure on Thursday morning, after tickets had already been issued, according to the AFP news agency.

The UAE, which was repeatedly hit by Iranian missiles and drones throughout the US-Israel war on Iran, suspended trade and financial exchanges with Iran last month.

On Wednesday, the UAE’s central bank blocked transactions involving Iran’s Bank Melli, claiming the financial institution had violated rules on money laundering, terrorism and arms proliferation.

The US Treasury announced sweeping sanctions on Iran’s aviation sector earlier this month, targeting 27 airlines and dozens of companies that support them. The measures aim to cut off Iran’s air links entirely, warning that any airport or company still servicing Iranian carriers risks being cut off from the US dollar system.

Iran’s Civil Aviation Organization spokesman Majid Akhavan said: “Diplomatic and aviation talks are under way to remove the restrictions and restore flights” to the UAE.

Akhavan added that Turkmenistan also turned back a flight from Tehran to Dushanbe on Thursday.

“Turkmenistan’s refusal to allow the Iranian aircraft to pass through its airspace meant the flight could not continue on its route and had to return,” Akhavan told the Iranian IRNA news agency.

Several smaller Iranian airlines continue flying to China and Armenia, both of which have resisted US pressure, while routes to Turkiye remain open for some carriers.

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Taylor and Tay Lautner welcome a new baby girl with a familiar name

What’s better than two Taylor Lautners?

On Wednesday, Taylor Lautner and his wife Tay Lautner (née Dome) announced the arrival of their first child in a shared Instagram post, a baby girl they named … drumroll please … Lennon Taylor Lautner.

“One week loving our sweet little Lenny,” the couple wrote in the Instagram caption. Lennon arrived Sept. 16, according to the social media post, which showed a partial image of the infant.

The new parents have been married since 2022 and met through the 34-year-old “Twilight” actor’s younger sister, Makena Moore.

They announced the pregnancy in March on their Instagram accounts, hinting that the future baby could share a matching name, with the photo carousel’s caption: “What’s better than two Taylor Lautners?”

A “weight lifted” off her shoulders when she shared the news, Tay said in April on her podcast “The Squeeze.” She was afraid the news would leak when she went among the public.

“It was really exciting that Taylor and I got to do that on our own terms,” Tay continued.

In June, the two revealed the baby‘s sex in an emotional Instagram Reel, with the “Twilight” actor later writing on his personal Instagram stories that his dream “has always been to become a girl dad,” according to People.

“All I wanted was a healthy baby but deep down this moment is what I was dreaming of. The weight that was lifted off my shoulders in this moment knowing that dream came true was unlike anything I’ve felt,” the actor wrote.

In her third trimester, Tay, a 29-year-old registered nurse who has been open about mental health, expressed her thoughts and feelings about pregnancy, sharing in an Aug. 12 episode of “The Squeeze” that she gained 50 pounds, experienced swelling and had stretch marks.

“Women don’t get enough credit for what we put our bodies through because it is truly just insane,” she said in the podcast. “Let the pregnant women live a little more. We need to just applaud them, praise them and give them a little more respect.”



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How an economic squeeze is changing everyday life and work for Iranians | US-Israel war on Iran News

Tehran, Iran – Amid dire fuel shortages and mounting economic challenges, the Iranian government is seeking cost-saving measures for government workers and other citizens to deal with the crisis.

On Saturday, the government set office attendance hours for 8am to 1pm from September 23 to the end of the current Iranian year (late March 2027), with the remaining contractual hours to be completed remotely.

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Agencies must also designate one day a week when employees and managers travel to work by public transport. In recent days, government ministers have released videos showing themselves using the metro to commute to work as part of the campaign.

Metro and bus rapid transit (BRT) systems will also be free of charge until mid-November in a bid to encourage commuters to leave their cars at home. Worn-out government vehicles will also be replaced with electric, gas-powered or hybrid alternatives, although this is expected to take years to implement.

The reopening of universities is expected to be staggered and partial, with some lessons shifted online by authorities.

Government-linked offices are required to switch off heating and turn off lights after working hours, while schools, universities, healthcare facilities and operational services are to follow separate arrangements to be announced later.

President Masoud Pezeshkian signed a directive on September 12 instructing government agencies to facilitate remote work for suitable employees to save on petrol, electricity and natural gas costs for the state.

“We have begun consumption savings with the government,” Pezeshkian said earlier this month. This is seen as effectively framing remote work and other measures for government workers as in line with other energy-saving measures that the government has asked of the rest of the population.

Resource-rich Iran has dealt with energy crises before, rooted in mismanagement and dated infrastructure, when similar cost-saving measures were implemented. But the added pressure of war with the United States and Israel has forced the government to think of creative solutions to energy shortfalls.

In early September, the cash-strapped government raised the price of fuel for the third tier of quotas for a second time in less than a year, meaning that people will pay double for any petrol use beyond 110 litres (29 gallons) per month. Imported vehicles and some other categories of cars are also limited to the most expensive tier of fuel.

For the first five months of the current Iranian year, which ended on August 22, average daily petrol production was 122 million litres while consumption was at 132 milion litres, highlighting a shortfall in supply versus demand. In the first half of the sixth month, the gap between production and consumption was around the same, at a 10 million litre shortfall.

The US naval blockade of Iran’s southern ports in place since July has halted fuel imports that previously helped balance the gap. The blockade has also stopped Iran from exporting its oil via supertankers transiting the Strait of Hormuz, affecting its foreign currency income. Crude stored on open waters beyond the blockade line is still being gradually sold to China.

Oil and gas facilities, petrochemical companies and major fuel depots were also bombed by the US and Israel, impacting production and distribution. Oil Minister Mohsen Paknejad said in early September that “a significant portion of production capacity has now been restored, and the process is continuing”.

As rampant inflation continues to squeeze most Iranians, data released this week by the Statistical Center of Iran also highlighted the damage the war with the US has dealt to the economy.

Iran experienced a massive 10.1 percent year-on-year fall in real gross domestic product (GDP) and a 26.4 percent fall in oil and gas extraction between late March and late June 2026, the centre’s data showed.

Including oil, industries and mining were down 14.7 percent, while construction was down by 6.4 percent, services overall by 4.8 percent, and transport, storage and communications by 17 percent.

The government has not released any information on how many workers are estimated to be affected by the remote work directive, or how it expected efficiency to be impacted.

But after decades of mismanagement, corruption and inefficiency among government-linked organisations, some Iranians believe it highlights a wider issue of state inefficiency.

“My unpopular opinion is that if 85-90 percent of government sector personnel are fired and 70 percent of ministries closed down, absolutely no problem will occur in the country,” a user named Mohsen wrote on X.

A man reacts to the camera while driving past a monument depicting the clenched fist of the late Iranian Supreme Leader Ayatollah Ali Khamenei, who was killed in the U.S. and Israel strike on Feb. 28, and a missile at the Islamic Revolution square in downtown Tehran, Iran, Tuesday, Sept. 15, 2026. (AP Photo/Vahid Salemi)
A man reacts to the camera while driving past a monument depicting the clenched fist of the late Iranian Supreme Leader Ayatollah Ali Khamenei, who was killed in a US-Israel strike on February 28, in downtown Tehran, Iran, on Tuesday, September 15, 2026 [Vahid Salemi/AP Photo]

Zabihollah Salmani, a deputy head of the Administrative and Employment Organisation of Iran, told reporters during a press conference in August that more than 2.43 million were on its payroll.

If council, fire brigades, social security and non-government organisation workers were included, this would bring the number to more than four million people. The average monthly pay for government personnel at the end of the previous Iranian year in late March 2026 was around 240 million rials ($104 at the current exchange rate).

Asked by reporters how many of these employees could potentially be taken off the payroll without hurting output, Salmani said, “We do not yet have these figures.” He added that agencies were being asked to submit that information.

About 1,075,000 people are on the payroll of the Education Ministry, including teachers and trainee staff, while 600,000 employees work under the Ministry of Health and its affiliated networks, according to official figures.

Amir-Hossein, a young man working at a research centre linked with the government-funded University of Tehran, said that since the start of the month, he had been assigned two days of remote work. Working hours were set for 7am-1pm before, but are to be shifted to 8am-1pm starting from Wednesday, per the government.

His work can be done on his laptop, but might require some coordination on the phone or short commutes to other centres, he said. Overall, the remote work lifestyle has been beneficial.

“Sometimes I get more work done than I would have at the office,” he told Al Jazeera, asking not to use his full name due to security reasons.

As Amir-Hossein regularly uses online ride-hailing services to commute to and from his job, working from home has been financially beneficial for him.

An Iran-based economist who spoke to Al Jazeera on background said the government measures are essentially crisis control at best, and not a long-term solution to the problem.

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