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Growing pains and absent leaders hang over Brics summit

Enlarged bloc struggles to find agreements as group reckons with ideological and geographical tensions


As the group has grown from five countries to 11, cracks have opened up between its democratic and autocratic members © Mauro Pimentel/AFP/Getty Images

The Brics bloc of developing nations likes to boast that it represents nearly half the world’s population, but its annual summit this weekend in Brazil will highlight a major drawback of its fast expansion: the difficulty of reaching agreement.

The bloc — comprised until 2023 of Brazil, Russia, India, China and South Africa — has more than doubled in size, as Saudi Arabia, Egypt, Iran and others took its membership from five countries to 11. Some new members have injected fresh divisions into the Brics, which was already struggling for coherence and split between democracies and autocracies.

Around half the group’s leaders plan to skip the Rio de Janeiro summit, including two of the most prominent: Chinese President Xi Jinping and Russia’s Vladimir Putin.

While Putin is busy with the invasion of Ukraine, China has given no explanation for Xi’s absence, throwing a question mark over the event and its ability to make meaningful agreements. His number two, Premier Li Qiang, is set to attend in his stead.

Heightened Middle East tensions mean the leaders of Egypt, Saudi Arabia, the UAE and Iran are not expected to come.


About half of the group’s leaders will not attend the Rio summit, including Chinese President Xi Jinping and Russia’s Vladimir Putin © Maxim Shemetov/Pool/AFP/Getty Images

The Brics acronym was coined by Lord Jim O’Neill, then chief economist at Goldman Sachs, in a 2001 paper about the power of the world’s emerging economies. Brazil, Russia, India and China later moved to create a forum for co-operation, leading to a summit in 2009. South Africa joined in 2011.
Concerns over the bloc’s unwieldy new membership surfaced at a Brics foreign ministers meeting in April. Attendees failed to agree a statement, as tensions flared over who should hold a putative future African UN security council seat.

The first five Brics had previously edged towards suggesting it should go to South Africa. But new members Ethiopia and Egypt disliked that idea.

“You import tensions into Brics by adding these new members,” said Oliver Stuenkel, an associate professor at the School of International Relations at the Fundação Getúlio Vargas think-tank in São Paulo.

Some Brics nations, meanwhile, are pursuing other foreign policy paths. India is bolstering defence and trade ties with western democracies. It has recently agreed trade pacts with the UK and Australia, and is in talks with the EU and the US, the latter in an attempt to fend off President Donald Trump’s threat of a 26 per cent tariff on Indian goods.

India and the US have also stepped up their ties on defence, technology and science in recent years as an anti-China bulwark.

“For India, Brics is the plan B when there are questions about the reliability of partners elsewhere,” said Constantino Xavier, a senior fellow at the Centre for Social and Economic Progress, a think-tank in New Delhi. “The Chinese and particularly the Russians are taking the Brics over, and India knows it has lost influence.”

Host nation Brazil is hoping to steer the gathering towards less controversial areas. These include initiatives on infectious diseases, discussions on artificial intelligence and — with one eye on Brazil’s hosting of the annual UN climate summit in November — funding for green energy.

Mindful of the need to avoid provoking an unpredictable US president, diplomats say the Brics statements are likely to skirt controversial topics that could trigger Washington’s ire. A recent statement by the bloc expressed “grave concern over the military strikes” against Iran, but avoided mentioning the US or Israel.

Before the weekend a sticking point in negotiations over the leaders’ statement was the conflict between Iran and Israel, with Tehran pushing for a harder position, according to a person with knowledge of the matter. Other impasses in the talks related to reform of the UN Security Council and the issue of Palestine, though there was optimism that a consensus would be reached, they added.

At a meeting of the New Development Bank, a multilateral lender founded by the Brics, Brazilian president Luiz Inácio Lula da Silva raised the topic of a “new trade currency”. President Trump has warned the group’s members of steep tariffs if they create an alternative to the US dollar.

Indian Prime Minister Narendra Modi is due to attend the Rio summit but Xi’s absence will hang over the meeting. Keen to downplay the impact, Brazilian diplomats point out that Xi attended Brazil’s G20 summit in Rio less than eight months ago and that Lula met him in Beijing only in May.

But in Beijing, Xi’s non-attendance has sparked speculation over whether his health is up to the long trip or whether he has other undisclosed commitments.

Filling the room instead will be 10 new Brics “partner nations”, a category created last year in part to allay Indian and Brazilian concerns about accepting new members too quickly. They include Belarus, Cuba and Bolivia, as well as Asean nations Vietnam, Thailand and Malaysia.

For China, whose struggling economy is heavily dependent on exports for growth, the main goal will be to win support for the rules-based multilateral trading system in the face of growing US protectionism.

“If the Brics can produce some sort of co-ordinated economic response or statement that would be a very real achievement,” said Zhu Feng, professor of international relations at Nanjing University.

But another Chinese scholar, who did not wish to be named discussing sensitive issues for the Chinese leadership, said the increasingly fractured nature of the Brics made its ability to produce such outcomes less and less likely.

“Rather than working together to beat America,” he said, the Brics members had all “accepted US unilateralism” and were engaged in one-to-one talks with Washington, in some cases, such as Vietnam, at China’s expense.

Pension and housing policy is a war on Britain’s young

Residential property has become a tax-free retirement fund that excludes younger generations


Thanks in part to the tax system, housing has been transformed from a place to live into a de facto tax free retirement fund © Mike Kemp/In Pictures via Getty Images

The writer is the Conservative MP for Tonbridge

For centuries, this country has upheld an unspoken social contract. That each generation will create a better future for the next. That deal is now broken. This is the result of decades of policy choices that have systematically benefited one generation — the baby boomers — initially stimulating the economy but now choking it as wealth is transferred from young to old. Two bad policies in particular have influenced this trajectory. The first was a set of regulatory changes over two decades ago that in effect compelled pension funds to liquidate their investments in domestic UK companies and replace them with government bonds. 

That decision destroyed the core social contract that makes pensions work: the idea that the old profit from the energy of the young. Instead of fuelling living minds and ideas, wealth has been channelled into the dead hand of the state through gilts. Today, over 60 per cent of private sector defined benefit pension assets sit in gilts, with just 1 per cent in UK equities. This has starved British enterprise of long-term domestic capital, driving innovative companies like Arm Holdings and DeepMind to seek foreign investment, siphoning the wealth they create overseas.

Second, and even more detrimental to younger generations, is a set of policies that have artificially created a highly damaging cult of housing. For many decades, too few houses have been built in the UK. Thanks in part to the tax system, housing has been transformed from a place to live and raise a family into a de facto tax free retirement fund that excludes the young. More than 56 per cent of the UK’s total housing wealth is owned by those over 60, while home ownership among those under 35 has collapsed to just 6 per cent. This has had profound social and economic consequences as fewer people marry and have children, further impairing long-term demographic regeneration. The result? More than 80 per cent of the growth in real per capita wealth over the past 30 years has come from appreciation of real estate, not from the financial investment that powers the economy.

Michael Tory, co-founder of Ondra Partners, has argued that this capital misallocation has created a self-reinforcing cycle, weakening our national and economic security. Without productive capital, we are wholly dependent on foreign investment and imported labour, straining housing supply and public services. These distortions can only be corrected through a rebalancing of our national capital allocation that puts long-term national interest above narrow electoral calculation. That means levelling the investment playing field to reduce the taxes on those whose long-term savings and investments in Britain’s future actually employ people and generate growth. Along with building more houses and stricter migration controls, this would bring home ownership into reach for younger generations.

Leaving property as the only lifetime capital gains exemption has distorted UK capital allocation. Private residence relief, which exempts primary residences from taxation and was costed by the Treasury at over £30bn in the 2023-24 tax year, should no longer be sacred. Reconsidering PRR would enable the wholesale rebalancing we need, including a lifetime capital gains exemption on investments in UK companies, eliminating stamp duty on share transactions and raising the UK company-supporting Isa contribution limit. This would incentivise British families to invest in businesses rather than buildings.

Finally, the pension system requires fundamental reform. Channelling more of our nation’s savings back into powering UK companies, technology and entrepreneurs would fuel the industrial renaissance our economy requires and generate better long-term returns for pensioners too. Much of this won’t be popular. The current system serves many vested interests. But if we want the economy to grow we can no longer defend frozen assets; the country’s future is on the line.

In Europe, Economists See a Chance to Rise on the Global Stage

Central bankers who gathered in Portugal this week focused on ways that Europe could improve its competitiveness with the United States and China.


Christine Lagarde, president of the European Central Bank, on Tuesday at the bank’s forum in Sintra, Portugal, which had a sense of calm amid the chaos in the world.Credit...European Central Bank

Among central bankers, the word “uncertainty” is at risk of becoming a cliché, as they run out of ways to convey the heightened volatility they face trying to set interest rates, from trade policies to escalating conflicts in the Middle East. They’ve reached for “exceptional uncertainty” and “unpredictability.”

Despite these worries, the policymakers and other economists who gathered this week in Sintra, Portugal, for the European Central Bank’s annual conference had an air of calm.

It helped that as the main day of the conference got underway on Tuesday, data showed that inflation in the euro area averaged 2 percent in June, matching the central bank’s target. For the three previous years, inflation was firmly above the target and the European Central Bank had engaged in an aggressive campaign to bring it down.

“We are at 2 percent,” Christine Lagarde, the E.C.B. president, said. “I’m not saying mission accomplished, but I say target reached.”

Rather than fret more about inflation, the attendees focused on the steps that the region should take to improve its competitiveness with both the United States and China, like making it easier for people to move jobs and access capital across borders. Many of the ideas have circulated for years, but this time there was hope that European lawmakers would follow through with action.


A supermarket in Paris. Inflation in the euro area averaged 2 percent in June, matching the central bank’s target.Credit...Violette Franchi for The New York Times

Underpinning the discussion was a belief that President Trump’s economic policies have created an opportunity for Europe to bolster its own position in the global economy.

“As Europeans, and particularly in Germany, we are quite good at analyzing issues,” said Joachim Nagel, the president of the Bundesbank, Germany’s central bank. “However, when it comes to implementing solutions, we tend to be quite risk-adverse and thus sluggish in our reaction time.”

But, he added, “I am increasingly getting the impression — also from the discussions here in Sintra — that we are now on the move.“

The confident tone had been established at the outset of the conference on Monday, when the central bank said its monetary policy had held up well in the past few years, despite an unexpected surge in inflation. The bank made only small tweaks to its approach to setting policy and said the 2 percent target would remain. “It’s a strategy for all circumstances,” Ms. Lagarde said.


Construction workers in Barcelona, Spain. European unemployment is historically low, at about 6 percent.Credit...Albert Gea/Reuters

The European Central Bank’s policymakers have increasingly tried to convince colleagues at the European Commission, the executive branch of the European Union, and other lawmaking institutions to make structural changes. Their goal is to strengthen the region’s internal market, so that Europe’s size could be properly used to compete with the United States and China.

Early on, the conference included an exploration into Europe’s labor market by Benjamin Schoefer at University of California, Berkeley. He argued that though European unemployment was historically low at about 6 percent, there was much less productivity growth than in the United States, where wage growth has been slower. That’s because people stayed in their jobs for a long time, partly because pension systems and severance protections discouraged people from switching.

The presentation raised fierce defenses of the European labor market and questions about whether the U.S. labor market was the best aspirational model. But scrutiny of the strengths and weaknesses in Europe and firm recommendations for how the region can close the gap with more productive countries was repeated throughout the week.

The debate over competitiveness continued with the final paper. It exposed how China had become a rival to Europe by specializing in the sectors where the European Union had an advantage, like high-tech areas of machinery and robots. While the United States was decoupling from China, Europe was getting closer despite the technological competition.


A street in Berlin. Workers in Europe stayed in their jobs for a long time.Credit...Patrick Junker for The New York Times

“China is not just catching up to the euro area, it’s actually converging,” said Ana Maria Santacreu, an economist at the Federal Reserve Bank of Saint Louis. “It’s becoming a direct competitor.”

“The path forward is not new,” she added. “Deepening the single market can help Europe use its size to create more output and more innovation.”

For Piero Cipollone, an E.C.B. executive board member, the takeaway was: “Don’t blame others, don’t blame trade for your problems. Put in order your own house.”

These economists can agree on what needs to be done, but they are not wholly responsible for putting them in place nor convincing their citizens or local political parties that they are essential. Between sessions, many participants noted that the recommendations were familiar and that Europe had repeatedly failed to follow through.

Still, the conference ended on a buoyant note about the future, in which the European Union is bigger with strong economic growth. “It’s up to us to do it, we can do it,” Philippe Aghion, a professor at Collège de France and London School of Economics, said in the last session.

“I’m very optimistic,” he added, as the room filled with spontaneous applause.

China criticises Donald Trump’s trade deal with Vietnam

US president’s focus on punishing ‘trans-shipment’ of goods draws Beijing’s ire

(...) China’s commerce ministry on Thursday said it was “conducting an assessment” of the US-Vietnam trade deal, adding: “We firmly oppose any party striking a deal at the expense of China’s interests.”

“If such a situation arises, China will take resolute countermeasures to safeguard its legitimate rights and interests,” the ministry added.

Scores of countries are racing to reach trade deals with the US before the July 9 deadline, when Trump’s suspended “reciprocal” tariffs will come into effect.

Vietnam, one of the world’s most trade dependent countries, had a particularly strong incentive to act quickly to avoid US tariffs. The US buys 30 per cent of its exports.

But the extent of the final tariffs agreed and the additional levy on trans-shipping reflected the heavy price for Hanoi to seal the agreement, analysts said.

“The new US-Vietnam deal is not just about trade; it is clearly aimed at China . . . it is meant to block the flow of Chinese goods that often move through Vietnam to dodge existing US duties,” said Julien Chaisse, an expert on international economic law at the City University of Hong Kong.

“This fits a much wider trend: the US is lining up bilateral deals with countries near China to tighten economic co-operation and, at the same time, [make] it harder for Beijing to stretch its supply chain influence.”

Many south-east Asian nations had prospered during the US-China trade war by offering alternative manufacturing and export hubs for Chinese companies seeking to evade US tariffs. But capitalising on this “China plus one” strategy translated into large trade surpluses in goods with the US.

“The key lesson for other countries from this deal, and that agreed previously by the UK, is that they will be expected to curtail some trade with China,” said Capital Economics’ chief Asia economist Mark Williams and senior Asia economist Gareth Leather in a note.

“That will be seen as a provocation in Beijing, particularly if similar conditions are included in any other deals agreed over coming days.”

Analysts warned that the Vietnam deal, as well as others that Beijing deems as endangering its interests, could also undermine US-China trade talks. Trump recently claimed a tariff truce with Beijing had been signed, but concerns remain over Chinese restrictions on the flow of rare-earth exports and US export controls on advanced technology such as semiconductors.

“This could certainly lead to a renewed escalation of US-China trade tensions if the US insists on very stringent restrictions by third parties on imports from China,” said Frederic Neumann, chief Asia economist at HSBC. (...)

Trump announces trade deal with Vietnam

(...) Separately, the Trump family has recently announced development projects in Vietnam.

The country's government approved a plan by the Trump Organization and local business Kinh Bac City Development to invest $1.5bn in hotels, golf courses and luxury real estate.

The Trump Organization is also scouting for locations to build a Trump Tower in Ho Chi Minh City.

Trump initially imposed steep levies on trading partners around the world in April , citing a lack of "reciprocity", but then announced a pause where they were all lowered to 10%.

Many countries then approached the US to negotiate trade deals, according to the White House.

Since April, Washington had so far only announced a pact with Britain and a deal to temporarily lower retaliatory duties with China.

Canned Foods Giant Del Monte Files for Bankruptcy Protection

The 139-year-old company saw steep sales slides as consumers shift to cheaper or healthier food options.


Photo: Getty Images

Del Monte Foods, the 139-year-old company best known for its canned fruits and vegetables, is filing for bankruptcy protection as U.S. consumers increasingly bypass its products for healthier or cheaper options.

Del Monte has secured $912.5 million in debtor-in-possession financing that will allow it to operate normally as the sale progresses.

“After a thorough evaluation of all available options, we determined a court-supervised sale process is the most effective way to accelerate our turnaround and create a stronger and enduring Del Monte Foods,” CEO Greg Longstreet said in a statement.

Del Monte Foods, based in Walnut Creek, California, also owns the Contadina tomato brand, College Inn and Kitchen Basics broth brands and the Joyba bubble tea brand.

The company has seen sales growth of Joyba and broth in fiscal 2024, but not enough to offset weaker sales of Del Monte’s signature canned products.

“Consumer preferences have shifted away from preservative-laden canned food in favor of healthier alternatives,” said Sarah Foss, global head of legal and restructuring at Debtwire, a financial consultancy.

Grocery inflation also caused consumers to seek out cheaper store brands. And President Donald Trump’s 50 percent tariff on imported steel, which went into effect in June, will also push up the prices Del Monte and others must pay for cans.

Del Monte Foods, which is owned by Singapore’s Del Monte Pacific, was also hit with a lawsuit last year by a group of lenders that objected to the company’s debt restructuring plan. The case was settled in May with a loan that increased Del Monte’s interest expenses by $4 million annually, according to a company statement.

Del Monte said late Thursday that the bankruptcy filing is part of a planned sale of company’s assets.

Putin to Trump: Russia won't abandon its goals in Ukraine

Russian President Vladimir Putin and his United States counterpart Donald Trump held a phone call for almost an hour on Thursday, during which the two leaders addressed the ongoing war in Ukraine as well as the situation in the Middle East.

According to Kremlin aide Yuri Ushakov, Putin reaffirmed Russia's stance, insisting Moscow would not abandon its aims of addressing what he called the "root causes" of the conflict. Trump, for his part, again emphasized the need for a rapid cessation of hostilities.

Despite speculations, Ushakov said the issue of halting US arms supplies to Ukraine was not brought up. He also noted that while a potential in-person summit was not discussed, "the idea is hanging in the air" and could be formalized if needed.

Singapore Tightens Property Measures to Cool Housing Market

Singapore introduced fresh measures to tame housing prices, raising the stamp duty for those who sell their private homes within four years.

The changes take effect for all private residential properties purchased from Friday, according to a joint statement from the Ministry of National Development, Ministry of Finance and Monetary Authority of Singapore late Thursday.

The holding period for homes which will incur a seller’s stamp duty will be extended to four years from from three. The rates payable will rise to 16% from 12% within the first year.

“In recent years, the number of private residential property transactions with short holding periods has increased sharply,” the agencies said in the statement. “In particular, there has been a significant increase in the sub-sale of units that have not been completed.”

Private home prices in the city-state climbed 0.5% in the second quarter from the previous three months, rising for a third straight period. The preliminary figures released earlier this week suggest Singapore’s property market remains resilient even after sales of new homes slowed in recent months.

Singapore has sought to tackle the property price surge in recent years, prompting authorities to implement cooling measures. This included higher levies on foreign purchases in 2023 and adding curbs on public housing last year.

Cost-of-living pressures including housing affordability were among key concerns raised by voters in the lead-up to a national election held in May.

The revised levies will not affect public housing owners as they are already subject to a minimum occupation period for their homes.

China’s central bank seeks European lenders’ advice on low interest rates

People’s Bank of China asks for tips on fighting ‘Japanification’ amid low inflation


The request suggests the Chinese central bank is concerned about a multiyear deflationary environment © Jason Lee/Reuters

China’s central bank has asked European financial institutions for advice on dealing with the effects of low interest rates, as the world’s second-largest economy risks slipping into a prolonged period of low inflation.

The People’s Bank of China has sent “ad hoc” requests to at least two European banks this year for insights on the impact of low to zero interest rates on the banking systems in their home countries, according to people familiar with the requests.

The move suggests the Chinese central bank is concerned about a multiyear deflationary environment, which would threaten bank profits and financial stability — similar to what many European countries experienced last decade.

“This kind of request is precautionary,” said one of the people who received a request from the PBoC. “You need to know how to manage [zero rates].”

Chinese policymakers have unleashed multiple rate cuts over the past year, slashing the benchmark policy rate to 1.4 per cent from 1.8 per cent and the one-year benchmark lending rate by 0.5 percentage points to 3 per cent in an effort to stimulate sluggish domestic demand amid slowing economic growth.

“From the recent moves by the PBoC you can see that its mindset is changing,” said Richard Xu, an analyst at Morgan Stanley, adding that the central bank was “[paying] attention to the negative impact of low rates”.

Some policy advisers to the PBoC are concerned that further cuts would have a diminishing effect in boosting credit demand or consumption. The Chinese economy has been teetering on the edge of a deflationary spiral, with the inflation rate in negative territory for the past four months.

The PBoC’s readout of its second quarter monetary policy meeting, released last week, said the Chinese economy “still faces difficulties and challenges, such as insufficient domestic demand, persistent low prices, and various hidden risks”.

The central bank also hinted at a less aggressive rate cutting stance, tweaking the phrasing of its policy outlook from “cutting [the] reserve requirement ratio and rates at appropriate time” to “implement the policy with more flexibility in the intensity and pace”. Analysts understood the change to suggest lower chances of a rate cut in the near term.

The people familiar with the PBoC’s messages described them as open-ended requests for information about how governments and banks navigated low interest rates to avoid damaging their financial systems and broader economies.

European countries underwent a decade of extremely low interest rates between the 2008 financial crisis and the coronavirus pandemic, hitting bank profitability.

The PBoC request highlights concern among some economists of a long period of insufficient domestic demand, similar to the ‘lost decades’ in Japan, which endured an extended period of stagnating living standards and weak growth for more than two decades from the early 1990s.

“It shows they are learning and getting ready,” said an economist at one of the European institutions that received a request.

The person added that PBoC still had some room for manoeuvre, given that China’s benchmark one-year low prime rate remained at 3 per cent.

Chinese financial authorities have expressed alarm over falling bond yields, warning that regional lenders were exposed to interest rate risks of the kind that preceded the collapse of Silicon Valley Bank in 2023.

China’s 30-year bond yield has dipped from 2.42 per cent to 1.86 per cent in the past year, while the 10-year bond has shed more than 0.5 percentage points to 1.65 per cent.

Market participants have suggested investors seeking safer, higher-yielding assets in expectation of lower economic growth could push bond yields down further. Bond yields move inversely to prices.

One person at a European asset manager said that it had received a request from Chinese state banks and insurers in the first quarter of 2025 about how to mitigate the impact of low rates.

Their response, which included suggestions to increase purchases of higher-risk assets such as equities and lower-fee products such as exchange traded funds, was later briefed to PBoC via the state banks, the person said.

The PBoC declined to respond to a request for comment.

Full EU-US trade deal ‘impossible’ before deadline, says Ursula von der Leyen

European Commission president aims for less detailed ‘agreement in principle’


Ursula von der Leyen: ‘It’s a huge task because we have the largest trade volume globally between the EU and the United States, €1.5tn [annually] — very complex and a huge quantity’ © Yves Herman/Reuters

A final EU-US trade deal is “impossible” before July 9, so the two sides are aiming for a less detailed “agreement in principle”, European Commission president Ursula von der Leyen said on Thursday ahead of talks in Washington.

The EU and US are edging closer to a tentative agreement following almost three months of negotiations to avert Donald Trump’s threat to impose 50 per cent tariffs on goods from the EU next week.

“It’s a huge task because we have the largest trade volume globally between the EU and the United States, €1.5tn [annually] — very complex and a huge quantity,” she told a press conference.

“What we are aiming at is an agreement in principle,” she added, saying the 90 days that were allowed for talks made “an agreement in detail impossible”.

The UK had also agreed to an agreement in principle with the US, she said. “As far as I am informed there are only two countries so far that have concluded with an agreement in principle.” The US announced a deal with Vietnam on Wednesday.

However, both deals left US “reciprocal” tariffs in place. Vietnam accepted 20 per cent and the UK 10.

EU trade commissioner Maroš Šefčovič is in Washington today for talks to push for a deal before the July 9 deadline, after which Trump has threatened to increase “reciprocal” tariffs to 50 per cent. He will meet US Treasury secretary Scott Bessent, and then jointly commerce secretary Howard Lutnick and trade representative Jamieson Greer.

Lutnick has said that countries without deals will get increased tariffs after July 9.

EU diplomats have told the Financial Times that the bloc will probably accept 10 per cent across-the-board levies but still wanted to get cuts to the sectoral tariffs on products such as steel, at 50 per cent, and vehicles and vehicle parts at 25 per cent.

It was willing to commit to buying more US goods to cut its trade surplus.

Friedrich Merz, the German chancellor, who is under huge pressure from his car industry, repeated his call last week for a swift deal.

“This is not about a finely crafted, comprehensive trade agreement with the USA negotiated down to the last detail,” he said.

“What is at stake here is the rapid resolution of a customs dispute, particularly for our country’s key industries — the chemical industry, the pharmaceutical industry, mechanical engineering, aluminium, steel and the automotive industry . . . We need a quick result now. Better quick and simple than long and complicated, with negotiations dragging on for months.”

The UK secured a quota of 100,000 vehicle exports annually with 10 per cent tariffs. UK exports of jet engines and other aerospace components to the US are also spared from American levies.

It dropped its tariffs on bioethanol just from the US, and increased quotas for US beef imports.

US tariffs cover about €380bn of annual EU trade with the US, equivalent to about 70 per cent of the total.

America is considering extending higher sectoral levies to goods including copper, lumber, aerospace parts, pharmaceuticals, chips and critical minerals, which would cover almost all EU trade.

ASÍ ES EL PLAN DEL EJECUTIVO
El Gobierno no quiere okupas: Sareb deberá liberar los pisos antes de pasarlos a Sepes

Sepes elige los mejores activos, como la cartera de Árqura, y deja para el final el traspaso de los pisos sociales. Sareb seguirá operando como empresa en liquidación más allá de 2027


https://images.ecestaticos.com/LjiFOIlj4glJaXvVwLXclZEkjcc=/0x0:996x747/1440x1080/filters:fill(white):format(jpg)/f.elconfidencial.com%2Foriginal%2F624%2F15f%2Fea2%2F62415fea291f55d4f63f2c885db9e835.jpg

Reparto Salomónico. El Gobierno ha decidido pasar a Sepes, embrión de la futura promotora pública, los mejores activos de Sareb y dejar al banco malo a cargo de los cerca de 10.000 millones de euros en activos tóxicos que todavía guarda en sus entrañas, la herencia más envenenada de la crisis financiera.

Dar salida a todos estos suelos e inmuebles es la base del papel que tendrá el banco malo a partir de septiembre, cuando presentará su nuevo plan estratégico. Pero, además, Sareb deberá dar servicio a Sepes, empresa pública de suelo que se va a convertir en la nueva promotora estatal.

La compañía liderada por Leire Iglesias carece del equipo y los sistemas informáticos necesarios para gestionar todo el volumen de activos que el Gobierno ya ha aprobado traspasarle: 40.000 viviendas construidas y 2.600 suelos, donde está previsto levantar otros 55.000 pisos.

Para evitar un colapso, la idea que hay actualmente sobre la mesa es que Sareb continúe operando como empresa en liquidación el tiempo necesario hasta terminar de completar todo el plan. Por los compromisos que asumió el Estado español con Bruselas cuando se creó el banco malo, este deberá liquidarse en el año 2027, hito que se cumplirá.

Pero entrar en liquidación no significa necesariamente desaparecer, sino que puede estar operando durante años bajo esta fórmula hasta completar la salida de todos los activos. Y, en este caso, además, hasta que la futura promotora pública tenga suficientemente asentados los cimientos.

De hecho, Sareb empezará desde ya a dar servicios a Sepes. Primero, con el traspaso de las primeras 13.000 viviendas ya construidas y sin inquilino que se irán transfiriendo a lo largo del último trimestre de este ejercicio y durante el próximo, y de otras 5.000 casas que ya tienen gente viviendo con contratos de alquiler en regla.

Sepes no recibirá ninguna vivienda con okupas. Al contrario, los cerca de 3.400 pisos ilegalmente habitados que tiene Sareb seguirán en el banco malo hasta que se completen los lanzamientos y se puedan recuperar las viviendas. Será a partir de ese momento cuando se pasarán a la nueva promotora pública. Un trabajo que llevará años hasta tenerlo completado.


Okupas de los edificios de La Ruïna y el Kubo en Barcelona. (EFE/Alejandro García)

Además, Sareb cuenta con 7.700 alquileres sociales ya vigentes y hasta 9.000 aprobados, que serán las últimas viviendas en ceder a Sepes. El motivo es que estos hogares exigen una gestión muy intensa por todos los planes de acompañamiento, y la promotora pública carece de plantilla para eso.

El plan que anunció la ministra de Vivienda, Isabel Rodríguez, el pasado martes, fue que Sepes iba a crear una plataforma con entidades del Tercer Sector, que se encargará de atender a toda esta población vulnerable. Pero, hasta tener listo este modelo, seguirán bajo el paraguas de Sareb.

Además, hay cerca de 10.000 pisos, de los 40.000 que se pasarán a Sepes, que todavía están en proceso de transformación y a los que también les queda un largo recorrido. En estos casos, Sareb tiene préstamos impagados cuyo colaterales (garantía) son esas casas, viviendas que tiene identificadas y que prevé ejecutar en un futuro, pero todavía no son suyas.

Reparto salomónico

Sepes ha elegido los mejores suelos de Sareb para promover otras 55.000 viviendas, un terreno donde ha sido especialmente exquisito, ya que se ha quedado el grueso de las parcelas de Árqura, promotora que era la joya de la corona de Sareb, valorada en 800 millones de euros.

En cambio, la futura inmobiliaria pública apenas ha cogido activos de Proyecto Viena, otra cartera que tenía organizada Sareb para sacar a la venta justo cuando el Ejecutivo decidió parar todo para hacer el traspaso a Sepes. En este caso, los suelos son mucho peores y están ubicados en zonas con poca demanda.

Por el contrario, los activos que se quedará Sareb y que en ningún caso irán a Sepes son 6.800 inmuebles terciarios (edificios de oficinas y comerciales, fundamentalmente), 17.800 obras en curso y unos 22.000 suelos, en su inmensa mayoría industriales y rústicos, aunque también hay alguno residencial.

Con la venta de esos inmuebles, el banco malo deberá seguir pagando cada año, hasta su total desaparición, los intereses de su deuda, una factura que todavía ronda los 29.000 millones de euros. 

Fannie, Freddie chief urges Congress to investigate Powell

The overseer of Fannie Mae and Freddie Mac called Wednesday for Congress to investigate Federal Reserve chair Jerome Powell, accusing the central bank chief of lying to Congress.

In a Wednesday statement, Federal Housing Finance Agency (FHFA) administrator Bill Pulte accused Powell of lying to lawmakers during testimony before the Senate Banking Committee last week.

Pulte said Powell lied to members of the Banking panel when answering questions about renovations to the Fed’s Washington, D.C. headquarters, which have drawn criticism from Republican lawmakers.

When pressed by senators on the Fed’s alleged $2.5 billion renovation plan, Powell said some of the more fanciful inclusions were part of older plans and have since been scrapped. Others costs, such as repairing elevators that go directly to board member’s offices and marble fixtures, were basic upkeep of features that have always been in the building, he said.

Pulte, however, accused Powell of deliberately misleading senators with “deceptive” testimony, and argued his statements were enough to qualify as adequate cause to fire him.

“This is nothing short of malfeasance,” he said.

Pulte has waged an unprecedented campaign from the helm of one independent financial regulatory agency to oust the head of another.

As head of the FHFA, Pulte is responsible for overseeing the financial stability of Fannie and Freddie and working with fellow regulators, such as Powell, to protect Americans from major financial shocks.

Pulte, however, has spent weeks following Trump’s lead and attempting to drum up pressure on Powell to resign over the Fed chief’s handling of interest rates.

Trump and Pulte both claim the Fed is hurting the U.S. economy by keeping its baseline interest rate at a moderate level of 4.25 percent to 4.5 percent. Pulte has specifically pointed to slowness in the housing market, where average 30-year fixed mortgage rates are close to 7 percent.

But housing interest rates are just one of many factors the Fed must consider when fulfilling its legal obligation to keep inflation stable and unemployment as low as possible.

Pulte said his campaign against Powell is a natural extension of his job overseeing Fannie and Freddie, which packages U.S. mortgages into investment products.

“As Chairman of Fannie Mae and Freddie Mac, I can tell you that Jay Powell is hurting the housing market by being Too Late to lower rates. He needs to resign, effective immediately,” Pulte said last week.

Pulte, the grandson of one of the country’s most successful housing developers, also has considerable personal wealth tied to the housing market and home construction. He disclosed more than $80 million in assets related to housing, property management or air conditioning and heating companies in his 2025 financial disclosure form.

¿Dónde están los casi 400.000 pisos turísticos de España? El mapa, calle a calle

En algunas zonas de grandes ciudades las viviendas para turistas llegan a ser más del 30%: los datos del INE* permiten ver la última foto antes de la entrada en vigor del registro obligatorio para estos alojamientos

En España hay cerca de 400.000 viviendas destinadas al alquiler turístico. A nivel nacional suponen un 1,38% del total, pero en algunos distritos de grandes ciudades superan el 10%, y en calles concretas pueden representar más del 30% del parque residencial.

En el siguiente mapa puede verse, calle a calle, la distribución de estos alojamientos en la última fotografía disponible, antes de que, a partir de este martes, estos pisos tengan que contar por ley con un número de registro para poder anunciarse. Esto permitirá identificar los que operan fuera de la legalidad.

Los datos los recopila el Instituto Nacional de Estadística dos veces al año a partir de los anuncios en plataformas como Airbnb o Booking. Se agregan por sección censal y se expresan como porcentaje de viviendas turísticas sobre el total disponible. La cifra puede cambiar incluso a diario, pero el mapa refleja la oferta de agosto de 2024, el mes con más anuncios. Entonces se alcanzó un récord: 397.000 pisos turísticos, impulsados por la temporada alta. En noviembre, el dato más reciente, la cifra bajó ligeramente hasta los 368.295.

El nivel de detalle de los datos permite identificar con precisión las zonas más afectadas por la vivienda turística. Marbella es la ciudad de más de 100.000 habitantes con mayor proporción de secciones censales donde más del 5% de las viviendas se destinan a visitantes: un 30%. Detrás aparecen Cádiz (22%) y Málaga (12%). Es en esta última donde se concentran los casos más extremos: en las zonas de las calles Carreterías y Álamos o en el barrio de La Merced, las viviendas turísticas superan el 25% del total. En algunas calles del centro, son más de la mitad. No por casualidad, el Ayuntamiento local ha reconocido oficialmente la saturación turística que sufre.

En otras ciudades andaluzas como Granada, Córdoba o Sevilla también hay distritos céntricos donde más del 10% del parque residencial se dedica al turismo. En Madrid, el distrito Centro concentra más de 8.000 pisos turísticos, un 9,3% del total. Alrededor de la Puerta del Sol hay calles donde ese porcentaje se triplica.

En Barcelona, Ciutat Vella y el Eixample son las zonas con más peso de la vivienda turística: 2,8% y 2,9%, respectivamente. El Eixample, más extenso, suma unos 4.000 alojamientos, cuatro veces más que Ciutat Vella.(...)

Switzerland stirs Brexit ghosts in push for EU access

Referendum looms on single market deal that includes concessions on money, migration and judicial power


After more than a decade of talks with Brussels, Switzerland has reached a deal to keep and improve its access to the EU’s single market. © Fabrice Coffrini/AFP/Getty Images

A proudly independent European nation confronted with a stark political choice: keep EU single market access but only by making financial payments, taking migrants and giving up judicial power.

This time the question is not one for Brexit Britain — but Switzerland.

After more than a decade of grinding talks with Brussels, the Alpine country has reached a deal to keep and improve its access to the EU’s single market.

But the agreement — which will be put to a referendum — includes all the same thorny issues that have bedevilled the UK-EU relationship, including budget contributions, migration policy and the role of foreign judges.

Nearly 1,000 pages of text, unveiled last month after a deal was signed in December, would finally anchor Switzerland more firmly to the world’s largest single market.

But even the six market access agreements, which try to bring order to the tangle of previous arrangements, would still be on top of about 120 additional sectoral agreements that remain in place.

If approved, the new framework binds Switzerland to mirror changes to EU legislation in areas including the regulation of goods, migration, electricity and transport — or face retaliatory measures. Bern would have little influence over how the rules develop, but it would be obliged to pay €375mn annually into the EU budget.


© Fabrice Coffrini/AFP/Getty Images

Switzerland could be readmitted as an associate member into the bloc’s Horizon Europe science programme and become part of the nuclear science body Euratom and the student exchange scheme Erasmus.

The pact in many ways parallels the UK’s struggle of balancing sovereignty with EU market access. In May, the EU and UK agreed a number of changes from fisheries to energy as part of a relationship “reset”.

“There has been a pick-up in engagement and interest by the British in the negotiations we have been having with Brussels,” said one Swiss official.

The negotiations also come as both London and Bern are seeking deeper defence and security ties with the bloc after President Donald Trump’s threats to withdraw US guarantees that have underpinned Europe’s security since the second world war.

“The EU’s public position has long been that the Swiss and UK negotiations are separate, but in practice EU negotiators were keen to avoid setting precedents in one negotiation that might affect the other,” said Anton Spisak, an associate fellow at the Centre for European Reform.

He added it was “no surprise” the same EU officials were involved in the Swiss negotiations and the recent UK-EU reset. There were nearly identical outcomes on issues like food safety (SPS) and governance in both agreements.

Now Switzerland will have to accept or reject the deal, a process that will take several years.

First will be a public consultation process until the autumn, then the text — possibly with some amendments — will be handed to parliament to start debating next year. The government aims to hold the referendum by June 2027, otherwise national elections later that year will push it into 2028.

The “dynamic alignment” — automatic adoption of changes to EU laws — are on six key areas: mutual recognition of goods standards, electricity, food safety, air and land transport and freedom of movement. Bern can lobby Brussels and EU members when they work on updates to those rules, but has no say in the final outcome and faces sanctions if it fails to implement the changes.

This will be uncomfortable for many Swiss given their deeply entrenched system of direct democracy.
“The Swiss have always followed these updates anyway. But they want to have the ability to choose. That is the key difference for us,” said one Zurich-based financier.

The agreements include an arbitration clause that ensures disputes are resolved by an independent panel — rather than unilaterally by EU courts — to address Swiss concerns over sovereignty and legal autonomy.

But when the case involves EU law, the arbitration panel must ask the European Court of Justice, the bloc’s top court, for a binding interpretation.


© Fabrice Coffrini/AFP/Getty Images

Carl Baudenbacher, a lawyer and expert on international business law, argued the ECJ would be the true legal authority behind the scenes.

“The arbitrators are legally obliged to ask the CJEU in the most important cases and the judgment is legally binding on the arbitration panel. It is essentially camouflage,” he said.

Like in the UK, ECJ jurisdiction and the “dynamic” adoption of EU laws are becoming lightning rods for Switzerland’s own Eurosceptic movement.

“The dynamic takeover of EU law and ECJ rulings ultimately changes the system of direct democracy in Switzerland. It downgrades our competitiveness,” said Kompass/Europa chief executive Philip Erzinger. The anti-EU group, started by private equity billionaires and other entrepreneurs, is gathering signatures to launch an initiative for the public vote on the matter.

“For example, you don’t need an agreement on free movement of people to hire people from foreign countries,” Erzinger added.

Switzerland’s far-right SVP is against the deal though it had found support on the left. The centrist parties such as the Liberals are yet to take a stance.

There is also a question of punishment if Switzerland votes no. In 2021, when Switzerland walked away from talks, the EU retaliated by downgrading Swiss participation in the Horizon Europe. That could happen again if the deal was not ratified by the end of 2028.

EU trade commissioner Maroš Šefčovič has refused to be drawn on possible action. But EU officials told the Financial Times that maintaining the status quo was not an option.

Swiss officials say the erosion of the existing bilateral agreements could have serious long-term ramifications, for example in terms of Swiss export capacity, security and transport between Switzerland and EU countries.

“If there is a No [vote], the EU feels this needs to be the end of the road for the bilateral way and the special treatment for Switzerland,” said an official familiar with thinking in Brussels.

Others, however, think it is high time to do a deal with Switzerland’s largest trading partner.

“We have been living with this drama since the 90s. Europe is our biggest trading partner and we need to solve the problem institutionally as opposed to sector by sector,” said Jean Keller, head of Geneva-based fund manager Quaero Capital.

“Yes, we need to make sure things like workers’ rights are protected, but finally finding a framework that is durable for us to do business in Europe is imperative.”

US dollar suffers worst start to year since 1973

Donald Trump’s trade policies and rising debt levels have sparked decline of more than 10% in first half of 2025



The US dollar is headed for its worst first half of the year since 1973, as Donald Trump’s trade and economic policies prompt global investors to rethink their exposure to the world’s dominant currency.

The dollar index, which measures the currency’s strength against a basket of six others including the pound, euro and yen, has slumped more than 10 per cent so far in 2025, the worst start to the year since the end of the gold-backed Bretton Woods system.

“The dollar has become the whipping boy of Trump 2.0’s erratic policies,” said Francesco Pesole, an FX strategist at ING.

The president’s stop-start tariff war, the US’s vast borrowing needs and worries about the independence of the Federal Reserve had undermined the appeal of the dollar as a safe haven for investors, he added.

The currency was down 0.2 per cent on Monday as the US Senate prepared to begin voting on amendments to Trump’s “big, beautiful” tax bill.

The landmark legislation is expected to add $3.2tn to the US debt pile over the coming decade and has fuelled concerns over the sustainability of Washington’s borrowings, sparking an exodus from the US Treasury market.

The dollar’s sharp decline puts it on course for its worst first half of the year since a 15 per cent loss in 1973 and the weakest showing over any six-month period since 2009.

The currency’s slide has confounded widespread predictions at the start of the year that Trump’s trade war would do greater damage to economies outside the US while fuelling American inflation, strengthening the currency against its rivals.



Instead, the euro, which several Wall Street banks were predicting would fall to parity with the dollar this year, has risen 13 per cent to above $1.17 as investors have focused on growth risks in the world’s biggest economy — while demand has risen for safe assets elsewhere, such as German bonds.

“You had a shock in terms of liberation day, in terms of the US policy framework,” said Andrew Balls, chief investment officer for global fixed income at bond group Pimco, referring to Trump’s “reciprocal tariffs” announcement in April.

There was no significant threat to the dollar’s status as the world’s de facto reserve currency, Balls argued. But that “doesn’t mean that you can’t have a significant weakening in the US dollar”, he added, highlighting a shift among global investors to hedge more of their dollar exposure, activity which itself drives the greenback lower.

Also pushing the dollar lower this year have been rising expectations that the Fed will cut rates more aggressively to support the US economy — urged on by Trump — with at least five quarter-point cuts expected by the end of next year, according to levels implied by futures contracts.

Bets on lower rates have helped US stocks to shake off trade war concerns and conflict in the Middle East to reach record highs. But the weaker dollar means the S&P 500 continues to lag far behind rivals in Europe when the returns are measured in the same currency.

Big investors from pension funds to central bank reserve managers have stated their desire to reduce their exposure to the dollar and US assets, and questioned whether the currency is still providing a haven from market swings.

“Foreign investors are requiring greater FX hedging for dollar-denominated assets, and that has been another factor preventing the dollar from following the US equity rebound,” said ING’s Pesole.

Gold has also hit record highs this year on continued buying by central banks and other investors worried about devaluation of their dollar assets.

The dollar slump has taken it to its weakest level against rival currencies in more than three years. Given the speed of the decline, and the popularity of bearish dollar bets, some analysts expect the currency to stabilise.

“A weaker dollar has become a crowded trade and I suspect the pace of decline will slow.” said Guy Miller, chief market strategist at insurance group Zurich.