This is an unofficial transcript meant for reference. Accuracy is not guaranteed.
JIMMY LOVAAS, HOST:
Welcome to the Factal Forecast, a look at the week’s biggest stories and what they mean from the editors at Factal. I’m Jimmy Lovaas.
Today is July 25.
In this week’s forecast we’ve got rising tensions between Israel and Yemen, a presidential election in Venezuela, the US increasing tariffs on some Chinese imports, Ukraine’s foreign debt and Italy’s controversial migrant centers in Albania.
You can also read about these stories and more in our weekly newsletter, which you’ll find a link to in the show notes.
Israel-Yemen tensions
Information compiled by Agnese Boffano
JIMMY: Up first, we’ll take a look at the rising tensions between Israel and Yemen. For more on that I’ve got fellow Factal editor Agnese Boffano.
JIMMY: Hello, Agnese.
AGNESE: Hey there, Jimmy.
JIMMY: Well, Agnese, seems like things in the Middle East got a little more heated this weekend after some Israeli strikes inside Yemen. What can you tell us about all that?
AGNESE: Yeah, it was certainly unprecedented, what happened this weekend. So what actually happened was that on Saturday afternoon, Israel sent multiple jets including F-15s and F-35s to conduct multiple strikes on the Yemeni port city of Hodeidah which targeted multiple points including a fuel depot which caught fire and actually took multiple days to come fully under control, that was how big it was. And the health ministry then, the one that operates in the areas controlled by the Houthis in the north, they said that at least six people were killed as a result of these attacks and more than 80 other people were also injured. And what was quite unprecedented as well was that Israel, as you know, Israel very rarely comments on its overseas operations, as we’ve seen in the past, it’s been conducting strikes in Syria, for example, for years without ever really acknowledging being behind them. But this time the Israelis were quite quick to comment on this particular event, claiming that, as they said, the port of Hodeidah is used to smuggle Iranian drones that have been used by the Houthis to hit cities in Israel over the past few months, mostly especially in the Red Sea city of Eilat but more recently, and more significantly as well, a day prior to the strikes in Yemen, a Houthi-claimed drone was used to target a building in central Tel Aviv which managed to go largely undetected by the defense systems there and ended up killing one person and injuring 10 others.
JIMMY: Well what’s the latest on all this? Any new developments?
AGNESE: Yeah, I mean, there’s since been a few incidents involving the two countries, for example a day after - the Houthi military spokesperson said that they targeted Eilat, the city that i mentioned earlier, with a number of ballistic missiles which were shot down by Israel’s long-range, the Arrow-3 missile defense system as most of those tend to be done, and likewise a Liberia-flagged ship did sustain some damage over the weekend as well – this time it was in a combined ballistic and drone attack off the Yemeni coast, but that just seems to be more of, you know, for the lack of better wording, the “usual” attacks that we’ve seen over the past few months.
JIMMY: Well what sort of reactions have you seen to this apparent escalation?
AGNESE: I think the most important reactions I’d say have been from the two parties involved. So, Israel has definitely been capitalizing on this incident, you know, the videos that we saw of this enormous terminal burning has had huge propaganda validation for the Israeli public who were appalled at the idea that a single drone could travel over 1,000 miles – over 1,300 miles – and actually hit something in Tel Aviv. And then on the other hand, the spokesperson for the Houthis has given multiple televised addresses since then and not only have they vowed to retaliate for the attacks, as tends to be their rhetoric with anything regarding Israel, but they’ve also vowed that, you know, this latest incident, will not affect the group’s position on striking Israel which they claim they’ve been doing in support of Gaza and the Palestinians as the war there continues beyond nine months now, approaching its 10 months you know in Gaza, with no clear path to achieving some sort of ceasefire and no clear path to have any sort of advancement of the negotiations or see a full Israeli withdrawal.
JIMMY: Well, considering all that, what do you think folks ought to be watching for next then?
AGNESE: I mean, first of all, I don’t think that this particular attack is likely to deter the Houthis from continuing their operations either on Israeli soil or on disrupting maritime passage in the Red Sea, which as you know they claiming to be targeting ships with ties to Israel even though very often that direct link, you know, is not always established. But why I say it’s not likely to deter future attacks from happening is that first of all, military targets have been getting struck by coalition forces over the last few months in Yemen, especially in Hodeidah, where we’ve seen multiple US and UK forces stationed in the area striking the several missile development centers and missile warehouses that the Houthis have there. And yet the group has proved to be quite moldable in adapting and moving their storage units while also managing to expand the range of these missiles. The fact they’re reaching Israel, it is quite unprecedented. And if we’re talking about this particular depot as well that was hit I don’t think this will have that big an impact on the military capabilities of the houthis. You know, the Israelis definitely played this incident up but you know when we’re talking about modern warfare the line between civilian and military infrastructure is not often drawn by a straight line, and so in this case I think the power station, for example, which was one of the targets that was struck, is not likely to diminish and impact Yemen’s missile production as much as it’s going to affect the access of electricity, for example, to the homes who are actually relying on that. The port of Hodeidah as well, even though it has been speculated to be the incoming vessel of a lot of the weapons used by the Houthis from Iran, it is also a vital port through which much needed aid does enter the northern areas. So all this to say that what we should be watching for next is probably a continuation of these usual types of attacks from both sides that will consolidate or even deepen the wound if you wish of this already very active front confronting Israel on top of Gaza, on top of Lebanon, and on top of the other Iran-backed groups that are operating in the region. But having said this, I think we’re not necessarily looking at an immense escalation, you know, between the two because as we’ve said multiple times and also in previous podcasts as well, neither Israel nor Iran really want to engage into anything more serious than what they’re doing now. So really, I think the only change I envision will probably be in Yemen itself on anything except for the military capability of the Houthis, definitely the aid sector and humanitarian situation in Yemen is likely to be even more volatile, and perhaps more interestingly and I think this is more on a speculation level, but politically I think the Houthis are definitely on the path to galvanize a lot more support towards the idea at least of a unified Yemen, you know as opposed to the current set up where you have a Saudi-backed government in the south and the Houthis who control much of the north. But yeah, that’s just a long term political speculation about Yemen and we’ll definitely have to see.
JIMMY: Well, Agnese, I guess we’ll pause there for today then, but as usual, thank you so much for keeping us up to speed on the region. Always appreciate it.
AGNESE: Thanks, Jimmy.
Venezuela presidential elections
Information compiled by Owen Bonertz
JIMMY: Venezuela will hold a presidential election on Sunday. Incumbent President Nicolas Maduro will face former diplomat Edmundo González Urrutia.
Maduro came to power after a tight election in 2013 as the chosen successor of late socialist icon Hugo Chavez.
The 2018 election was boycotted by the opposition to protest Maduro’s democratic backsliding and authoritarian tendencies.
And then, shortly after Maduro’s inauguration in 2019, the leader of the country’s National Assembly, Juan Guaido, made a failed attempt to seize power with the backing of the United States.
Also of note, Venezuela’s economic performance since 2013 has been among the world’s worst, with hyperinflation climbing above 300 percent a year and with food insecurity at all time highs.
Now, the limited polling that exists has shown that González could win decisively, but it remains to be seen if Maduro would surrender power in the event of a loss or launch another protracted presidential crisis like that of 2019.
González is actually the third candidate put forward by the center-right opposition, as 2023 primary election winner María Corina Machado and her replacement Corina Yoris were both disqualified from seeking office.
Thus far, at least 24 members of the opposition’s campaign have been jailed or are seeking asylum.
US says tariff increases on Chinese EVs, batteries and chips to start
Information compiled by Jeff Landset
JIMMY: A drastic increase on tariffs for some Chinese goods, notably electric vehicles, is set to come into force in the US next Thursday.
In 2020, the Trump administration, along with Canada and Mexico, replaced NAFTA with the USMCA trade agreement.
Part of that agreement lets Chinese vehicles enter the US at a lower tariff rate as long as they are assembled in Mexico.
Chinese EV companies, because of large government subsidies, have outpaced the US in producing electric vehicles at a lower price, making significantly more than any other country in 2023.
So, in May, President Biden announced the tariff on Chinese EVs would be increased significantly to 102.5 percent.
The European Union followed suit by announcing a 38.1 percent tariff on Chinese EVs.
Now, Biden has said what China is doing is not competition, but “cheating.”
Lawmakers have expressed concerns of cheap Chinese electric vehicles flooding the US market via Mexico and at least one nonprofit called it an “extinction-level event” for the auto industry.
Still, this comes at a time when EV sales are lagging in the US. That means another avenue to reduce usage of fossil fuels will likely be shut down because of the ongoing trade dispute with China.
Ukraine payment moratoriums expire
Information compiled by Alex Moore
JIMMY: A two-year agreement to freeze Ukraine’s foreign debt will expire next Thursday.
The deal was initially struck in 2022 in the months following Russia’s full invasion of Ukraine. It froze payments on $20 billion in international bonds.
And with Ukraine’s economy collapsing following the invasion, the agreement helped Ukraine save $6 billion. It also initiated the beginning of a slight recovery in 2023 after fending off Russia’s attempt to conquer Kyiv.
Now, Ukraine struck an unprecedented agreement earlier this week to restructure its debt, marking the first time a country has done so in the midst of a full-scale war.
The debt restructuring is key to stabilizing Ukraine’s economy as it continues to struggle as the war with Russia drags on with no end in sight after two-and-a-half years.
Italy's Albanian migrant center to open up
Information compiled by Agnese Boffano
JIMMY: Italy’s Prime Minister Giorgia Meloni has announced that the controversial migrant centers being built in Albania will be operational starting next Thursday.
As you may recall, Meloni and Albanian Prime Minister Edi Rama reached an agreement on the project last November, worth about $728 million. The deal gives Italy access to two facilities in Albania – one in Shengjin and another in Gjader.
These facilities, administered by Italian authorities, are set to operate as reception centers for up to 3,000 migrants who arrived on Italian soil and are in various stages of their asylum-seeking processes.
Now, since her election as prime minister in October 2022, Meloni has continued to push forward with anti-immigration policies.
Those policies include a much contested legislation change seeking to limit activities of rescue organizations operating in the Mediterranean.
Meanwhile, Italy’s interior ministry says government actions to combat immigration arrivals have led to a 60% decrease of migrants in the first six months of 2024, compared to the same period last year.
Despite this, rights groups have long described the route from North Africa to the central Mediterranean as an incredibly busy and perilous journey, leading to more than 3,000 deaths in 2023 alone.
JIMMY: One final note for you, the podcast will be taking next week off. So, our next episode will be out on Aug. 8.
In the meantime, we are a 24-7 newsroom, so be sure to follow us on Twitter, or X as it’s called now, where we’ll still be posting breaking news.
As always, thank you for listening to the Factal Forecast. We publish our forward-looking podcast and newsletter each Thursday to help you get a jump-start on the week ahead. Please subscribe and review wherever you find your podcasts. We’d love it if you’d consider telling a friend about us.
Today’s episode includes work from Factal editors Owen Bonertz, Jeff Landset, Alex Moore and Agnese Boffano. Our interview featured editor Agnese Boffano and our podcast is produced and edited by me – Jimmy Lovaas. Our music comes courtesy of Andrew Gospe.
Until next time, if you have any feedback, suggestions or events we’ve missed, drop us a note by emailing hello@factal.com
This transcript may be updated or revised in the future. Accuracy and availability not guaranteed.
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Music: 'Factal Theme' courtesy of Andrew Gospe
