Trending Now
We have updated our Privacy Policy and Terms of Use for Eurasia Group and its affiliates, including GZERO Media, to clarify the types of data we collect, how we collect it, how we use data and with whom we share data. By using our website you consent to our Terms and Conditions and Privacy Policy, including the transfer of your personal data to the United States from your country of residence, and our use of cookies described in our Cookie Policy.
Economy
A woman cleans thick mud, in the aftermath of floods caused by heavy rains, in Sedavi, near Valencia, Spain, November 3, 2024.
210: Spanish Prime Minister Pedro Sánchez and King Felipe VIhad to cut short visits to flood-ravaged Valencia on Sunday after furious crowds “heckled and attacked” Sanchez and pelted Felipe with mud. Many locals feel authorities failed to heed warnings of torrential rains and act before floods tore out bridges and sent walls of water crashing through hillside communities, killing over 210 people.
34: Butter prices in Moscow have risen by 34% since the start of the year to 239.96 roubles (US$2.45), according to receipts reviewed by Reuters, as defense spending on Russia’s war with Ukraine drives up costs (official figures show a more modest but still painful 25.7% rise). Shoplifting has also soared, with some stores now placing the staple food in anti-theft containers. Talk about guns vs. butter!
35: Argentina’s central bank on Friday lowered its benchmark interest rate to 35% from 40%, its first cut in nearly six months as monthly inflation declined to 3.5% in September from 25.5% last December. While good news for consumers, economists say the move makes it harder for President Javier Milei to lift currency controls and won’t help his government negotiate a new deal with the IMF.
943,000: Marriage registrations in China dropped by nearly a million in the first nine months of 2024 compared to the same period in 2023, totaling 4.747 million couples. Economic uncertainty and high prices are prompting many young Chinese not to tie the knot, undermining Beijing’s efforts to boost a shrinking population.
6: Cell phones, sake, and cycling don’t mix! Cyclists who text and ride in Japan could face six months in jail or a fine of 100,000 yen (US$655) under a new law, and drinking and riding could net a term of up to three years or a penalty of 500,000 yen (US$3,278).54.35: Pro-EU incumbent Maia Sandu won reelection in Moldova on Sunday with 54.35% of the vote, a resounding victory that gives Sandu a mandate in her pursuit of accession to the European Union. Russia attempted to sway the election by backing Sandu’s anti-EU opponent, but Moldovans in the diaspora seem to have played a key role in ensuring Sandu stayed in power.
Hard Numbers: Aramco invests, Japan frets, Perplexity gets popular — and sued, UK sentences man in deepfake case
June 16, 2023 - Paris, France: Saudi Arabia s crown prince Mohammed Bin Salman arrives at the Elysee palace for his meeting with French President Emmanuel Macron.
25: When surveyed, only 25% of Japanese respondents said that AI makes them nervous — the lowest mark of any of the 32 countries that Ipsos polled recently. But the country has been very slow to adopt AI or lean fully into its research. Stanford’s count of the “foundation models” for generative AI found that 182 of them originated in the United States, while none originated in Japan. The country is open to AI, but its tech sector just isn’t diving in yet.
350 million: Perplexity is an ascendant AI search engine — it fielded 350 million user queries in September alone. That’s a big uptick considering users asked only 500 million questions in all of 2023. As it’s grown, the company has come under fire from news publishers. Dow Jones, which publishes the Wall Street Journal, sued Perplexity last week alleging copyright violations. In response, Perplexity CEO Aravind Srinivas said he won’t pay to license content from news publishers but is discussing a revenue-sharing agreement similar to how Spotify pays musical artists.
18: In a landmark court decision, a judge in the United Kingdom sentenced a 27-year-old man to 18 years in prison for using AI to create child sexual abuse material. The man pleaded guilty to using a US-based service called Daz 3D to transform real photos of children into explicit deepfakes in violation of British law.A key artificial intelligence industry body has released a long-awaited definition that could affect how different AI models are viewed — if not regulated. The Open Source Initiative, a public benefit corporation, sets standards for what constitutes open-source systems in the technology industry. Over the past year, the group has investigated a big question: What constitutes open-source AI?
Meta has been one of the leading voices on open-source AI development with its LLaMA suite of large language models. But some critics have argued it isn’t truly open-source because it has licensing rules about how third-party developers can use its models and isn’t fully transparent about its training data.
Now, according to the new definition, an AI system must meet these four requirements to be considered open-source:
- It can be used by any person and without having to ask for permission
- Outsiders need to be able to study how the system works and inspect its components
- Developers need to be able to modify the system
- Users need to be able to share the system with others with or without modifications — for any purpose
Meta took issue with the new definition, maintaining that its models are, in fact, open-source. “There is no single open-source AI definition, and defining it is a challenge because previous open-source definitions do not encompass the complexities of today’s rapidly advancing AI models,” a company spokesperson told TechCrunch.
Still, the definition could help regulators and international organizations differentiate between open- and closed-source (or proprietary) models. That’s important. Recently, California lawmakers got pushback for advancing a bill requiring AI developers to have a “kill switch” for shutting down their models — something critics called a “de facto ban on open-source development.” (The bill was ultimately vetoed by Gov. Gavin Newsom.)
As the candidates make their final arguments in the 2024 US Presidential Election, the economy is front and center on the minds of voters. Despite all signs indicating stable and above-trend growth in the US, many Americans feel uncertain about how well the economy is doing, said Robert Kahn, Managing Director of Global Macro-Geoeconomics at Eurasia Group. He discussed the gap in US economic perception versus reality with GZERO’s Tony Maciulis at the IMF and World Bank Annual Meetings in Washington, DC, in a Global Stage interview. Kahn noted that heightened political polarization has skewed views of economic performance while lingering geopolitical shocks and high prices add to concerns. Kahn emphasized that there is an element of worry around the “legacy of the pandemic…that Vice President Harris is just really struggling to overcome” even though underlying data proves otherwise. The two also discussed former President Trump's accusations that the Federal Reserve is "playing politics" with interest rates and what the impact would be globally if Trump were, as president, to assert a heavier hand in decision-making at the central bank.
IMF Managing Director Kristalina Georgieva speaks to the media during an International Monetary and Financial Committee press briefing on Friday, Oct. 25, 2024.
“The world now faces a low-growth, high-debt trajectory,” said Georgieva. Governments in developing countries now face a “trilemma” of needing to increase spending – sometimes by as much as 14% – while being unable to raise tax revenues as they face fiscal buffers exhausted by the COVID-19 pandemic and its aftermath. And she acknowledged that the Fund’s projections include “a severe, but plausible scenario” in which global public debt could exceed the baseline by some 20%.
That risk is compounded by growing political opposition to free trade, which Georgieva characterized as a “retreat from global economic integration driven by both national security concerns and the anger of those who lost out.” Reduced trade will hamper growth and push countries to borrow more to make up the difference.
These pressures pose the highest risk for sub-Saharan Africa, already struggling with high debt and lacking the levels of growth necessary to get ahead. Speaking at a separate event on Friday, the IMF’s Africa Director Abebe Selassie said the region will likely grow by 4.2% in 2025, well below the 6-7% growth rates enjoyed previously. “This pace is not sufficient to significantly reduce poverty or to recover ground lost in recent years, let alone address the substantial developmental challenges ahead,” he said.
So what can be done? World Bank President Ajay Banga gave an introspective prescription at the closing plenary: Simplify, simplify, simplify. “Development delayed is development denied,” he explained while outlining progress on reducing the time the World Bank takes to approve projects from an average of 19 to 12 months, and faster where possible. The Bank has made a substantial improvement — they’re down to 16 months — but time is money, as the saying goes, and more haste will make the Bank’s programs more effective in Banga’s view.
On the IMF’s side (often more concerned with stabilization than development), Georgieva outlined three tools: rebuilding fiscal buffers in vulnerable economies, investing in growth that can ease debt burdens, and taking a cooperative approach across borders.
Of course, much depends on factors outside the control of these development finance institutions. We’re watching how the results of the US election, the roiling debt and property market problems in China, and the conflicts in Ukraine, the Levant, Sudan, and elsewhere affect the outlook.
Delegates at the IMF and World Bank Annual Meetings have been giving rosy outlooks to the press while the cameras are rolling, but GZERO Senior Writer Matthew Kendrick heard a different story in private settings. He told Tony Maciulis that the global outlook depends heavily on US policy continuity — which is highly unlikely under a second Trump administration — and successful efforts in China to revive its own floundering economy.
It’s not all doom and gloom, though. Delegates are eager to point to success stories, including in Ukraine and Sub-Saharan Africa, highlighting how the world’s leading development banks can make a real impact on some of the most fragile economies and vulnerable populations.
Watch to learn more about what Matt heard on the ground.