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📰 The influence of Milei's 'chainsaw economics'

📰 The influence of Milei's 'chainsaw economics'

and EU launches joint weapons bid for Ukraine

Billy Robinson & Ross Crabtree
July 29, 2025

Hello and welcome back.

From Brussels today, EU allies launch a joint arms initiative to bolster Ukraine’s defence while Brussels and Abu Dhabi accelerate bilateral trade talks in an effort to bypass the stalled EU-GCC agreement. In East Asia, the Philippine army claims to have killed seven NPA rebels and declares the insurgency near collapse, as Cambodia and Thailand reach a ceasefire agreement brokered in Malaysia.

Our lead story turns to West Africa where climate shocks and rising insecurity are fuelling an escalating struggle over water.

More details below ⤵️

Top 5 Stories

1️⃣ 🇲🇾 🇰🇭 🇹🇭 Cambodia and Thailand agree to ceasefire: Thailand and Cambodia have agreed to an unconditional ceasefire beginning midnight Monday. Artillery fire subsided just before the truce, bringing hope to evacuees displaced by the most intense fighting since 2008–2011. Nearly 300,000 people have been uprooted, with at least 38 killed. Peace talks, hosted in Malaysia with U.S. and Chinese involvement, led to a joint commitment to de-escalate and resolve lingering territorial tensions. Both sides seek favourable trade deals with the U.S., amid pressure from President Trump’s tariff threats. Military officials are set to meet Tuesday, with broader diplomatic talks planned for August. Despite mutual accusations of ceasefire violations, the truce marks a critical step toward stability, welcomed by the UN and ASEAN.

2️⃣ 🇬🇧 🇺🇸 Trump announces global tariff hike from 15 to 20% for non-deal trading partners: President Donald Trump announced that countries without bilateral trade deals with the U.S. will soon face a default tariff of 15–20% on exports, surpassing the 10% rate introduced in April. Speaking alongside British Prime Minister Keir Starmer at Turnberry, Trump said around 200 nations will be formally notified of the “world tariff” rate. The move follows a major trade pact with the EU, involving a 15% tariff, $600 billion in European investments, and $750 billion in U.S. energy purchases. Similar deals have been struck with Japan, Britain, Indonesia, and Vietnam, while talks with others—including India and Canada—are ongoing. Trump has justified the sweeping tariffs as a simpler alternative to negotiating individual agreements, aiming to curb trade deficits and pressure countries into swift bilateral deals ahead of Friday’s deadline.

3️⃣ 🇵🇭 Philippine army kills seven NPA rebels as military declares insurgency near collapse: Philippine troops killed seven New People’s Army (NPA) fighters on Sunday in Masbate province, following an earlier clash that left two rebels dead. The 30-minute gunfight in Uson town also led to the recovery of rifles and grenade launchers, with eight insurgents escaping and now being pursued. The military claims the communist insurgency, active for over five decades, is nearing defeat. Army spokesman Maj. Frank Roldan called the operation a decisive blow, urging remaining guerrillas to surrender. Officials say fewer than 900 rebels remain, down from 25,000 at the insurgency’s peak. Peace talks collapsed under President Duterte, with trust eroded by continued violence on both sides.

4️⃣ 🇦🇷 Milei’s austerity measures threaten to reshape South American fiscal politics: Argentina’s economic overhaul under President Javier Milei has produced sharp cuts and fiscal tightening, dubbed ‘chainsaw economics’, that are controversial but increasingly influential. Despite widespread poverty and strained public services, inflation has dropped from 290% in April 2024 to 39% in June 2025, and GDP is forecast to grow over 5% after years of recession. Milei’s reforms—marked by deep spending cuts, a budget surplus, and a stable peso—have improved market confidence, though risks remain, including rising import-fuelled deficits. Across South America, Argentina’s model is shaping political and fiscal debates. In Brazil and Colombia, where public debt is rising and spending is rigid, a Milei-style correction may be inevitable.

5️⃣ 🇪🇺 🇺🇦 EU allies launch joint weapons bid for Ukraine: Several EU countries plan to seek tens of billions of euros in loans under the bloc’s new €150 billion Security Assistance Facility for Europe (SAFE), designed to jointly procure weapons for Ukraine and strengthen European defences. The scheme, part of the Commission’s ReArm Europe initiative, aims to expand the EU’s defence capacity and reduce its dependence on U.S. military support. Countries like Poland, Greece, and France are applying, while others—such as Germany and Sweden—are opting out. SAFE offers long-term, low-interest loans repayable over 45 years, with up to 15% available as advance payments. Though some nations hesitate due to debt concerns, joint procurement promises lower costs and closer integration with Ukraine’s defence industry. Brussels anticipates over 20 states will apply.

Major Story

🇬🇲 🇲🇱 🇳🇪 🇧🇫 CLIMATE AND CONFLICT CONVERGE IN WEST AFRICA’S WATER WARS

Water has long been a casualty of war, but it is now becoming an instrument of it. From Ukraine to Yemen, water systems are targeted and exploited, not as collateral damage but as tools of coercion. The Pacific Institute reports a 50% surge in water-related violence in 2023. Despite this, international bodies continue to view water through the lens of development or environment—ignoring its mounting role in global insecurity. As climate change accelerates scarcity, extremists fill governance vacuums with survivalist patronage, particularly in fragile regions like the Sahel.

A regional powder keg

In Gambia, where climate change is pushing saltwater inland, a third of rice paddies may soon be unusable. Demand is rising across the region while rainfall declines. More than 25% of Gambians lack access to safe drinking water, sparking internal migration and rural-urban strain. Violent clashes between herders and farmers over water and land have surged across the central Sahel. While Gambia has thus far resisted extremism through interfaith harmony, high youth unemployment and deteriorating living conditions are making it increasingly vulnerable.

The situation is worse in Mali, Niger, and Burkina Faso, where state collapse has enabled militant expansion. Without urgent cooperation, Gambia and Senegal—both downstream from this instability—risk becoming the next frontlines.

The failure of existing frameworks

Despite nearly two-thirds of the world’s freshwater crossing borders, there is no comprehensive global agreement to manage it. Many treaties, such as the Nile Waters Agreement, are outdated and exclusionary. Past attempts at regional integration—like the Senegambia Confederation—collapsed due to mistrust and institutional weakness. The message is clear: water knows no borders, yet the world treats it as if it does. New, enforceable treaties are essential—ones that include real-time data-sharing, climate forecasting, and conflict de-escalation mechanisms. But governance frameworks alone won’t suffice unless underlying drivers—climate shocks, failing states, and public distrust—are addressed.

Local action, global resonance

Hope lies in grassroots resilience, writes Gambian statesman Abdoulie Ceesay. Civil society groups across West Africa are stepping up where governments falter. The Muslim World League’s Faith for Our Planet initiative trains faith leaders to promote climate action and equitable water use. Nigerian and Malian mediators are resolving disputes where foreign peacekeepers have failed. These hyperlocal efforts have greater legitimacy and staying power than top-down interventions.

The international community must now back these efforts with legal muscle, urges Ceesay. Weaponising water should be codified as a crime under international law. Without clear consequences, abuses will persist and desperation will fester.

Other News

1️⃣ 🇳🇱 🇮🇱 Netherlands adds Israel to threat watchlist alongside Russia and Iran: For the first time, Israel has been added to the Netherlands' Threat Assessment of State Actors, joining Russia and Iran on a national security watchlist. The report, issued by the National Coordinator for Terrorism and Security (NCTV), cites attempts by Israel to manipulate Dutch public opinion through propaganda and irregular diplomatic channels. A key incident involved the Israeli Ministry of Diaspora Affairs directly sending documents to Dutch journalists, bypassing protocol and endangering local individuals. The move follows violent riots in Amsterdam by Maccabi Tel Aviv fans and growing tensions over Israel's war on Gaza. The report also condemned threats made by Israel and the United States against the International Criminal Court in The Hague. Once a close ally, the Netherlands is increasingly critical of Israel’s conduct and influence operations.

2️⃣ 🇮🇶 🇮🇷 PMF fighters clash with police over ministry post in Baghdad: A deadly gunfight erupted in Baghdad’s Karkh district after fighters from the Popular Mobilisation Forces (PMF) stormed a Ministry of Agriculture building to block a new director’s appointment. One police officer was killed and nine others injured before 14 PMF members were detained. The PMF, a state-sanctioned umbrella of mostly Iran-aligned Shia militias, has been formally integrated into Iraq’s military but continues to wield independent power. The Interior Ministry condemned the attempt to impose authority by force, while Prime Minister Mohammed Shia al-Sudani launched an investigation. The fighters involved belonged to brigades linked to Kata’ib Hezbollah, whose leadership said they would not escalate further. The confrontation underscores Iraq’s fragile security order and the ongoing power struggle between state institutions and entrenched paramilitary forces with close ties to Tehran.

3️⃣ 🇪🇺 🇦🇪 Brussels and Abu Dhabi accelerate trade talks to bypass stalled EU-GCC agreement: The European Union and United Arab Emirates have launched formal negotiations for a bilateral free trade agreement, aiming to cut tariffs and boost investment, digital commerce, and green tech cooperation. With EU-UAE trade reaching €161.7 billion in 2023, both sides see this deal as a strategic pivot. For the UAE, it enhances global influence and supports its economic diversification agenda. For Brussels, the deal offers a faster route than the long-stalled EU-GCC framework. Analysts warn, however, that bilateralism may further undermine collective Gulf bargaining power and fragment regional cohesion. While some see the agreement as a potential catalyst for reviving broader EU-GCC talks, others argue it reflects the UAE’s preference for asserting strategic autonomy over multilateral coordination. Either way, momentum now lies with Brussels and Abu Dhabi.