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People bathe in the sun under parasols on a beach near the city of Larnaca, Cyprus, on August 11, 2024.

Christoph Reichwein/dpa via Reuters Connect

HARD NUMBERS: UAE carries Cyprus’ water, China toughens trade stance, Trump admin ignores court order, Americans expect price hikes, Germany’s economy remains stagnant, South Korea’s ex-leader indicted

15,000: The United Arab Emirates is literally helping Cyprus navigate troubled waters by providing portable desalination plants to the Mediterranean island free of charge so it can supply enough water to the deluge of tourists set to visit this summer. The Emirati nation’s plants will reportedly produce 15,000 cubic meters of potable water per day. It’s unclear if the UAE is receiving anything in return – it seems happy to go with the flow.

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Jess Frampton

Trump’s 4D checkers, China’s opportunity, climate hopes, and more: Your questions, answered

Welcome to another edition of my mailbag, where I attempt to make sense of our increasingly chaotic world, one reader question at a time. If you have a burning question for me before I go back to full-length columns, ask it here and I’ll answer as many as I can in next week’s newsletter.

Let’s dive in (with questions lightly edited for clarity).

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From left to right, Prime Minister of Bavaria Markus Soeder, Chairman of the CDU Friedrich Merz, Heads of the SPD Lars Klingbeil, and Saskia Esken arrive at a press conference after successful coalition negotiations in Berlin, Germany, on April 9, 2025.

Emmanuele Contini/NurPhoto via Reuters

Germany’s Friedrich Merz strikes grand coalition deal

Germany’s leading establishment parties reached a grand coalition deal on Wednesday, bringing Europe’s largest economy a step closer to having a formal government amid severe domestic and global challenges.

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Volkswagen export cars are seen at the port of Emden, Germany, beside a VW plant.

Fabian Bimmer/File Photo

Trump hits global auto sector hard with new tariffs

On Wednesday, ahead of what Donald Trump is calling “Liberation Day,” when the administration plans to unveil a series of “reciprocal” tariffs, the president signed an executive order levying 25% tariffs on automobiles and auto parts made outside the United States. The tariffs will come into effect on April 2.

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REUTERS

Germany's new parliament faces historic challenges

On Tuesday, newly elected members of the Bundestag took their oaths and their seats at ahistoric moment for Germany. Friedrich Merz of the center-right CDU/CSU remains in talks with the center-left SPD in hopes of forming a government in the coming weeks. This next government, which Merz will lead as chancellor, must revive a limping domestic economy, shift Germany’s energy supply, and rebuild broken infrastructure while meeting the urgent security challenges posed by Russian aggression on one side and an American retreat from the transatlantic relationship on the other. A constitutional change authored by the previous government has enabled a strong surge in state spending that can spur major new investments in all these projects.
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- YouTube

Is Europe finally ready to defend itself?

Carl Bildt, former prime minister of Sweden and co-chair of the European Council on Foreign Relations, shares his perspective on European politics from Tabiano, Italy.

How serious is Europe about really beefing up its defense and rearming?

It is very serious indeed, although it's different in different parts of Europe. If you look at the EU countries, they have been increasing their defense spending over the last few years by roughly a third. That's a hell of a lot of money.

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Germany's chancellor-in-waiting and leader of the Christian Democratic Union party Friedrich Merz reacts as he attends an extraordinary session of the outgoing lower house of parliament, the Bundestag, on March 18, 2025.

REUTERS/Annegret Hilse

Germany’s vote to boost military spending makes history

Since the end of World War II, the subject of military buildout has been politically taboo – first in West Germany and then in reunified Germany. But Russia’s invasion of Ukraine and hints that US President Donald Trump might pull support for Kyiv and take a reduced role in NATO have changed German minds.

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German Chancellor-in-waiting Friedrich Merz speaks to the media after he reached an agreement with the Greens on a massive increase in state borrowing just days ahead of a parliamentary vote next week, in Berlin, Germany, on March 14, 2025.

REUTERS/Axel Schmidt

Germany drops debt brake, passes preliminary agreement to boost defense, infrastructure, and climate spending

Germany’s election-winning center-right Christian Democratic Union/Christian Social Union, led by Friedrich Merz, and the Social Democrats have reached a preliminary agreement with the Green Party on a deal to exclude defense spending from the country’s constitutional debt break and establish a dedicated $545 billion fund for infrastructure investments. The agreement also includes allocating $108.7 billion for the climate and economic transformation fund.
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