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The global health landscape is marked by fundamental contradictions. Scientific innovation is accelerating at an unprecedented pace, yet many of the world’s most urgent health needs remain unmet. New drugs, diagnostics, and therapies are constantly being developed, but they remain largely inaccessible to the countries and communities that need them most. This is a crisis of equity, leadership, and imagination, and addressing it demands nothing less than an overhaul of the dominant model of medical research.As matters stand, medical-research agendas and standards are largely dictated by funders in the Global North. Breakthroughs often depend on data from lower-income countries – which bear the brunt of the global disease burden – but credit for them is typically awarded to elite Western institutions.But researchers, clinicians, and institutions in the Global South possess deep firsthand knowledge of the diseases afflicting local populations. They know which diagnostics and treatments can work in low-resource settings, and how to navigate local health systems. When they lack the opportunity to bring their expertise and insight to bear in setting research priorities or guiding research and development strategies, outcomes suffer.Consider diagnostics, which is essential for disease management and surveillance. Global health experts often advocate expanding access to molecular diagnostics, which use in vitro techniques to analyse markers in the genome and proteome. But these approaches are costly and impractical in resource-limited settings, especially during disease outbreaks.Global medical research and development must be reoriented toward equity and impact. This means not just giving countries a seat at the table, but letting them lead the research that primarily affects them. One of the most powerful levers for such a transformation is the public-private partnership (PPP) model, including not-for-profit product-development partnerships (PDPs) to advance the delivery of health products for poverty-related and neglected diseases, such as malaria and tuberculosis.Over the past two decades, PDPs have played a crucial role in improving global health, by bringing together governments, philanthropies, industry, academia, and NGOs to tackle diseases for which there were no market incentives to develop solutions. Organisations like the Drugs for Neglected Diseases initiative, the Foundation for Innovative New Diagnostics, and the Medicines for Malaria Venture have proven that collaborative, public-interest-driven models can fill gaps left by the for-profit sector.But this model appears to have lost its way. Nowadays, PDPs often appear to be entwined with large multinational companies, disconnected from countries’ health priorities and focused on the needs and demands of the Global North, with many using development pipelines and regulatory approaches designed for North American or European markets.Meanwhile, ballooning overhead costs are being met with shrinking funding. It does not help that many PDPs remain headquartered in expensive Western cities like Geneva or London, with staffing that does not reflect the communities being served. To remain relevant, PDPs must be led by the countries they serve and headquartered in the Global South, with both cost structures and regulatory pathways being adapted to local realities.Fortunately, such models are already emerging. In Malaysia, the International Affordable Diagnostics and Therapeutics Alliance (IA-DATA), a locally driven initiative, recently began clinical trials on a repurposed antimalarial drug called artesunate for use against cervical pre-cancer and colorectal cancer, which represent a significant disease burden in developing countries. By combining existing medicines with regional clinical expertise, IA-DATA bypassed the need for expensive new chemical entities, thereby accelerating progress.IA-DATA and its platform for global collaboration, the South-South Diagnostic Alliance (SSDxA), are also seeking to democratise access to diagnostics – the often-neglected sibling of therapeutics – by decentralising research and development. Already, SSDxA (one of the authors is Director) is connecting scientists, manufacturers, and regulators from across Malaysia, Brazil, Sri Lanka, Thailand, and Vietnam.The SSDxA’s recent analysis of dengue diagnostics revealed that, while molecular assays can be useful, lateral flow tests are more accessible and affordable in affected regions. As developing-country researchers have often pointed out, these rapid tests, which were critical in managing the Covid-19 pandemic, offer a viable and scalable solution in low-resource settings.The role of regulators must not be underestimated. Malaysia’s National Pharmaceutical Regulatory Agency was among the first in the world to approve the use of ravidasvir, a hepatitis C drug developed through South-South co-operation. Instead of waiting for endorsement from Western regulatory authorities, Malaysia worked with partners from the Global South to approve this low-cost treatment. The drug has since been added into the World Health Organisation’s list of essential medicines.Many countries in the Global South, including Malaysia, Thailand, Brazil, Jordan, and South Africa, have what it takes to lead this transformation in medical research, including robust public-health systems, internationally accredited regulatory bodies, political will, and cost advantages. But they will need to introduce policy reforms that facilitate the registration and operation of organisations with a regional or global nonprofit mandate – not least so that they can attract sufficient foreign investment, including from the Global North.A global rebalancing of medical research does not mean excluding Western partners, which still have a vital role to play, directing not only resources, but also expertise toward locally driven R&D agendas. This vision aligns with the Yamoussoukro Consensus on South-South Co-operation, adopted by the G77 in 2008: While North-South co-operation remains essential, developing countries must set their own priorities for collaboration and evaluate progress on their own terms.Empowering countries to lead medical research is not charity; it is a strategic necessity. Beyond righting historical inequities, it would unlock the next frontier of equitable and effective healthcare for all. – Project SyndicateSanjeev Krishna is Professor Emeritus of Molecular Parasitology and Medicine at City St George’s University of London and a visiting professor at the Universiti Malaya Affordable Diagnostics and Therapeutics.Jean-Michel Piedagnel is Director of the South-South Diagnostic Alliance (SSDxA).

US Health Secretary Robert F Kennedy Jr said Thursday that firing a top government scientist was "absolutely necessary" as he faced blistering criticism from Democrats urging him to resign over his steps to curb vaccines.The Senate hearing, marked by sharp exchanges that often erupted into shouting matches, came days after the ouster of Sue Monarez, the former director of the Centres for Disease Control and Prevention (CDC).Her dismissal, accompanied by several high-level resignations and hundreds of earlier layoffs, has plunged the nation's premier public health agency into turmoil.In his opening remarks, Kennedy tore into the CDC's actions during the coronavirus (Covid-19) pandemic, accusing the agency of failing "miserably" with "disastrous and nonsensical" policies including masking guidance, social distancing and school closures.Kennedy said that the CDC, during the pandemic, had lied to Americans, pointing to recommendations on mask wearing, vaccine boosters and social distancing and statements that the vaccine would prevent transmission."I need to fire some of those people and make sure this doesn't happen again," he said."We need bold, competent and creative new leadership at CDC, people able and willing to chart a new course," he said, touting the health department's new focus on chronic disease and promoting prevention.Monarez, the CDC director whom Kennedy previously endorsed, accused the secretary of a "deliberate effort to weaken America's public-health system and vaccine protections" in a *Wall Street Journal op-ed Thursday.Kennedy's explanation for her firing – as he told Senator Elizabeth Warren – was simply: "I asked her, 'Are you a trustworthy person?' And she said, 'No.'"Once a respected environmental lawyer, Kennedy emerged in the mid-2000s as a leading anti-vaccine activist, spending two decades spreading voluminous misinformation before being tapped by President Donald Trump as health secretary in his second administration.Since taking office, he has restricted Covid-19 shots to narrower groups, cut off federal research grants for the mRNA technology credited with saving millions of lives, and redirected funding toward research on debunked claims linking vaccines to autism.Ron Wyden, the top Democrat on the Senate Finance Committee leading the hearing, set the tone by demanding Kennedy be sworn in under oath – accusing him of lying in prior written testimony when he pledged not to limit vaccine access."It is in the country's best interest that Robert Kennedy step down, and if he doesn't, Donald Trump should fire him before more people are hurt," Wyden thundered.However, Republican committee chairman Mike Crapo shot down the request, praising Kennedy's focus on chronic diseases such as obesity.The exchanges only grew more ill-tempered.Democratic Senator Maria Cantwell branded Kennedy a "charlatan" over his attacks on mRNA research, while Kennedy accused Senator Maggie Hassan of "crazy talk" and "making things up to scare people" when she said that parents were already struggling to get Covid-19 vaccines for their children.Vaccines have become the flashpoint in an ever-deepening partisan battle.Conservative-leaning Florida on Wednesday announced that it would end all immunisation requirements, including at schools, while a West Coast alliance of California, Washington and Oregon announced they would make their own vaccine recommendation body to counter Kennedy's influence at the national level.Republicans mostly closed ranks around Kennedy, though there was some notable dissent.Senator Bill Cassidy, a physician whose support was key to Kennedy's confirmation, criticised his cancellation of mRNA grants.He was joined by fellow Republican doctor Senator John Barrasso and Senator Thom Tillis.Cassidy pressed Kennedy on whether Trump deserved a Nobel Prize for Operation Warp Speed, the public-private partnership that sped Covid-19 vaccines to market.Kennedy agreed that Trump should have received the prize but in nearly the same breath, praised hydroxychloroquine and ivermectin, drugs championed by conspiracy theorists that have been proven ineffective against Covid-19.

Long-dated bonds are facing renewed selling pressure, ramping up borrowing costs around the world and creating a headache for investors and policymakers.Yields on 30-year US Treasuries were around 5% in early September, a level last reached in July. Those on Japan’s 20-year notes climbed to their highest since 1999, while yields on 30-year UK gilts jumped to levels last recorded in 1998. French and Australian government bonds are among the others experiencing a selloff too.The rising yields signal investors are demanding extra compensation for holding government debt in the face of spiralling budget deficits and sticky inflation. The mounting worry is that politicians lack the ambition, or even the ability, to rein in their countries’ debt, while central banks may struggle to combat the mix of sustained price pressures and ebbing economic growth.What’s been happening with long-dated bonds?Traders usually buy and sell bonds based on the relative appeal of their fixed coupon payments. The longer there is until a bond “matures,” the more that can go wrong in the interim. Long-term bonds with a duration of between 10 and 100 years tend to offer higher interest rates than shorter-term treasury bills that are repaid in less than a year, to compensate buyers for the additional risk.When a country’s economic outlook worsens, bond yields typically fall. This is because a weaker economy encourages central banks to shift their focus from combating inflation to stimulating economic activity. That means a bias toward lowering benchmark interest rates, boosting the relative appeal of bonds versus cash in the bank.But lately, yields for long bonds have been rising. In the US, that’s in part because the economy has slowed, not collapsed, and inflation has remained stronger than forecast.Why are there concerns about debt and deficits?Governments across the world loaded up on cheap debt after the 2008 global financial crisis, then borrowed even more to cope with Covid-19 lockdowns and accompanying recessions. Global debt reached a record $324tn in the first quarter of 2025, driven by China, France and Germany, according to the Institute of International Finance.A surge in inflation since the pandemic made that scale of borrowing harder to sustain. Major central banks raised interest rates and wound down their bond-buying programs, known as quantitative easing, which were designed to lower borrowing costs. Some central banks are now even actively selling the debt they accumulated via quantitative easing back into the market, adding further upside pressure to yields.The concern is that if bond yields stay high and governments fail to get their fiscal houses in order, the cost of servicing some of that debt will just keep climbing.In the US, the cost of President Donald Trump’s sweeping tax-and-spending law is a further worry for bond investors. The One Big Beautiful Bill Act could add $3.4tn to the US deficit over the next decade not accounting for dynamic effects such as the potential growth impact according to the Congressional Budget Office, which provides nonpartisan analysis of US fiscal policy.Moody’s Ratings stripped the US of its last-remaining top credit score in May, citing fears that the ballooning national debt and deficit will damage the country’s standing as the preeminent destination for global capital.What’s been driving the recent bond selloff?As well as the lingering debt strains, politics have been a major factor.After criticising Federal Reserve Chair Jerome Powell for not cutting interest rates more quickly, Trump’s move to oust Fed Governor Lisa Cook has deepened concerns around the central bank’s independence. The worry is that Trump succeeds in replacing Cook and others with officials more inclined to lower borrowing costs regardless of inflation risks.A deluge of corporate debt sales isn’t helping either, as this can sometimes siphon demand from government bonds. Both companies and sovereign borrowers across the world sold at least $90bn in investment-grade debt in early September, as parts of global credit markets neared or toppled records in one of the busiest weeks this year.September is also a traditionally bad month for longer-dated bonds as traders return from their summer break and readjust their portfolios. Government debt globally with maturities of over 10 years posted a median loss of 2% in September, according to data compiled by Bloomberg.The mix of risks is pushing the so-called “term premia” what investors demand for the uncertainty of holding bonds for longer ever higher.Why is a spike in long bond yields a problem?Investors want the bond market to be safe and boring, as these assets are what many of them hold to ensure a rock-solid stream of income to balance out the volatility of higher-risk, higher-reward investments such as technology stocks.When longer-term yields jump, they feed into mortgages, auto loans, credit card rates and other forms of debt, squeezing households and companies, and thus broader economies.And if long bond yields stay high for longer, it will gradually affect how much it costs a government to borrow money. That, and any accompanying deterioration in economies, could mean a “doom loop” in which debt levels climb even higher no matter what governments do with tax and spending.At times, rebellions in markets can even lead to the fall of governments as seen in the UK in 2022 after then-Prime Minister Liz Truss’s mini-budget, which included billions in unfunded commitments, roiled the bond market and led investors to drive up borrowing costs. In the early 1990s, so-called bond vigilantes were said to be powerful enough to force President Bill Clinton to rein in US debt.Where could things go from here?It’s not clear what a prolonged period of higher borrowing costs would mean for the mountain of long-term debt that governments binged on during 15 years of ultra-low interest rates. The upward shift in yields is already leading to new phenomena with unpredictable consequences.One example: Japan’s government bonds used to have such low yields that they acted as a kind of anchor by adding downward pressure on yields the world over. But they’ve shot higher in recent months, adding to the volatility in global bond prices and attracting foreign investors to Japanese debt in significant numbers. This could mean fewer buyers for debt sold by other nations.In the UK, the pressure is mounting on Chancellor Rachel Reeves to show she’s on top of the nation’s finances in an upcoming budget.In the US, there’s still concern that post-pandemic inflation isn’t yet under control and that Trump’s tariffs could add further inflationary pressure that exacerbates the bond yield spike. On the other hand, his trade war may also dampen economic activity, leading the Fed and other central banks to cut interest rates.Or both could happen, whereby there’s a surge in prices accompanied by falling economic output or zero growth a situation known as stagflation. This would add to the uncertainty over monetary policy, forcing the Fed to choose between supporting growth or suppressing inflation.Is this a taste of the future for long bond yields?Jamie Rush, Tom Orlik and Stephanie Flanders of Bloomberg Economics argue that politics and structural forces could potentially make 10-year Treasury yields of 4.5% the new normal.That comes as decades of decline in the “natural” interest rate the real interest rate that would prevail if the economy were operating at full employment with stable inflation have already ended, and partially reversed.“In the years ahead, the natural rate is set to edge higher still,” Rush, Orlik and Flanders wrote in a book, The Price of Money, published in August 2025. “If risks from debt, climate, geopolitics, and technology crystallise, it could rise quite a lot.”

Bahrain’s Mumtalakat and Abu Dhabi’s CYVN Holdings took full ownership of McLaren Racing Tuesday in a deal some media reports said valued the reigning Formula One champions at more than $4bn.No financial details were given in a McLaren Group statement confirming the purchase of all shares held by MSP Sports Capital, funds managed by O’Connor Capital Solutions, Ares Sports, Media and Entertainment funds and Caspian Funds.Sky News earlier reported the sale of the 30% stake would value the team at more than £3bn ($4.05bn).Bahrain sovereign wealth fund Mumtalakat will remain the majority shareholder with CYVN, majority-owned by the government of Abu Dhabi, having a non-controlling stake.CYVN created McLaren Group Holdings last April after completing its acquisition of sportscar maker McLaren Automotive.McLaren Racing runs teams in Formula One, US-based IndyCars and will enter the World Endurance Championship from 2027.US-based investment group MSP and others took a significant minority stake in 2020, when McLaren were in need of funds during the Covid-19 pandemic.The deal, for a maximum 33% stake by 2022, valued the British racing outfit at £560mn at the time. Since then McLaren have emerged as a dominant force in the sport, winning the constructors’ title last year for the first time since 1998 and on course to win both titles this season.“Our suite of minority investors came on board in 2020 and we thank them for their tremendous support over the past few years as we set McLaren Racing on a path to commercial growth and financial stability,” said McLaren Group Executive Chairman Paul Walsh.He said the simplified ownership structure “strengthens our ability to future-proof the business and capture new growth opportunities.”MSP Sports Capital CEO Jeff Moorad and chairman Jahm Najafi will vacate their seats on the McLaren Racing board.Ares Management said in a statement the proceeds from the transaction “will be used to return capital to investors and further strengthen its position as an experienced investor across the sports ecosystem”.

The world is on the cusp of a historic global health accord. On April 16, 2025, World Health Organisation (WHO) member states forged a draft Pandemic Agreement after more than three years of negotiations. Adopted at the World Health Assembly in May, the agreement aims to make the world safer from future pandemics by strengthening global health infrastructure and collaboration. It also outlines clear targets and timelines to bolster health systems and prevent catastrophic health disasters like Covid-19. As WHO Director-General Dr Tedros Adhanom Ghebreyesus noted, this “generational accord demonstrates that even in a divided world, countries can unite for a shared response to shared threats”. Lessons learned from Covid The devastation wrought by Covid-19 was the undoubted catalyst for this agreement. In December 2021, amid the pandemic’s peak, WHO member states created an Intergovernmental Negotiating Body (INB) to develop a convention, agreement or other international instrument for pandemic prevention, preparedness and response. Over 13 formal rounds, countries gradually built consensus on a legally binding framework. These negotiations took place against a backdrop of high stakes and tensions as countries grappled with mistrust in the aftermath of Covid-19, geopolitical frictions, rampant misinformation, and even the withdrawal of the United States from the process. Despite the challenges, this marks only the second time in WHO’s 75-year history that member states have created a binding international health accord. After adoption by the WHA, the agreement will require signatures and ratifications from 60 countries to enter into force. Reaching this point was far from straightforward. One major sticking point was how to ensure fair access to vaccines, medicines, and other tools during pandemics, so that wealthy countries do not hoard supplies at the expense of poorer ones. Article 11 of the draft (on tech transfer) proved especially contentious, with hours spent debating how to help developing countries produce vaccines, diagnostics, and treatments. The final text encouraged countries to promote tech transfer on mutually agreed terms — an outcome some poor nations worried may be too weak. Ambitions on intellectual property waivers were tempered by opposition from some wealthy nations and industry, illustrating the delicate balance struck in the draft. Another obstacle was the question of Pathogen Access and Benefit Sharing (PABS). This refers to rules for rapidly sharing outbreak samples and data in addition to ensuring countries providing those pathogens receive benefits (like vaccines). Countries agreed in principle to a framework ensuring that 20% of pandemic supplies will be set aside for equitable distribution. However, the detailed PABS annex is yet to be finalised, meaning further negotiations will continue even after the main agreement’s adoption. This unresolved issue underscores how complex questions of equity and trust still need to be ironed out. What the draft Pandemic Agreement proposes The draft WHO Pandemic Agreement is ambitious in scope. It establishes priorities and targets for pandemic prevention, preparedness and response, and commits signatories to a range of supporting actions. For the first time ever, a global health treaty explicitly embraces a “One Health” approach that recognises the interconnected health of humans, animals, and environment. This means countries will co-ordinate across sectors to better detect and curb diseases that jump from animals to humans – the source of most new pandemics. From there, the draft agreement underscores that strong national health systems are the foundation of pandemic preparedness, and countries should therefore fully invest in public health infrastructure, workforce training, and service delivery so they can respond swiftly to emergencies. It also envisions mobilising a skilled global health emergency workforce and financial mechanisms to fund preparedness efforts. In essence, nations recognise that preparedness requires sustained political and financial investment – something the agreement seeks to galvanise. At its heart, the treaty is about ensuring a more equitable and effective global response when the next pandemic hits. The draft obligates governments to attach conditions to publicly funded Research and Development (R&D) requiring vaccines or drugs developed with taxpayer money be made accessible and affordable globally. Additionally, the agreement would establish a global supply chain and logistics network to co-ordinate allocation of critical supplies and prevent crippling bottlenecks or hoarding of items like masks and personal protective equipment. Notably, the agreement takes care to affirm national sovereignty and dispel concerns about overreach. It explicitly states that nothing in the treaty gives WHO authority to dictate countries’ domestic health measures or laws. It cannot impose lockdowns, travel bans, or vaccine mandates. Such clauses were included to reassure governments and sceptics that the accord will respect each nation’s right to implement health policies as it sees fit. Challenges and opportunities While the agreement’s drafting is a diplomatic triumph, significant challenges lie ahead. Despite being formally adopted in May 2025, states will have 18 months to decide whether to formally join (ratify) the treaty. This process could take several years — more than enough time for another pandemic to strike. As former New Zealand Prime Minister Helen Clark urged, leaders “should be investing now in pandemic preparedness... We can’t afford another pandemic, but we can afford to prevent one”. Achieving the treaty’s vision will therefore require continuous political commitment and funding starting immediately. Implementation also faces significant geopolitical and financial headwinds. The United States’ absence casts an alarming shadow. Many worry that without the world’s biggest economy - not to mention the WHO’s largest donor - on board, funding and compliance could suffer. Others nevertheless see the wider consensus as a show that with or without the US, countries are committed to working together. Washington’s stance could evolve with political changes. In the meantime, however, the rest of the world’s commitment underscores a broader point: the WHO’s reliance on a few major donors has been a vulnerability, and diversifying support is crucial. A policy breakthrough, but not a panacea On reflection, the agreement represents a major policy breakthrough in global health governance. For the first time, the world will have a comprehensive framework dedicated to pandemics, treating them as existential global security threats requiring a unified response. The agreement’s adoption reaffirms the WHO’s coordinating role and provides a platform for holding countries accountable to improve their capacities. It embodies hard-won consensus on principles like solidarity, fairness, and the notion that no country should be left behind when a health emergency strikes. Yet no treaty alone can guarantee global health security. Implementation will be the real test. Countries must follow through on investing in their healthcare systems, training health workers, building vaccine manufacturing hubs, and sharing data transparently. The treaty provides mechanisms for financing and other tools, but these need political will to function. Another critical factor is sustained funding and donor confidence in WHO and global health initiatives. The pandemic agreement arrives at a time when multilateral agencies have been battered by funding uncertainties – not least due to the US funding cutbacks and withdrawal. The hope is that this new agreement, by demonstrating global unity and a clear plan, will improve relations between donors and inspire increased investment in pandemic preparedness. A successful pandemic accord could convince both wealthy countries and philanthropies that their money will be used effectively to build a safer world — potentially unlocking more generous contributions. The example of Qatar’s flexible funding and growing roster of mid-sized donors show a trend of broader support that needs to continue. Realising the entire draft’s aspirations ultimately requires continued political resolve, resources, and inclusive collaboration. The involvement of all nations – big and small – will be necessary to operationalise the agreement’s provisions and keep momentum. Multilateral success stories like this treaty are rare, and thus precious. As Dr Tedros said, the agreement is a victory for public health, science and multilateral action. Now the world must translate words on paper into action. Dr Esmat Zaidan is Associate Professor and Associate Dean for Academic AffairsDr Diana AlSayed Hassan is Assistant Professor, both at Hamad Bin Khalifa University’s College of Public Policy. (This piece has been submitted by HBKU’s Communications Directorate on behalf of its authors. The thoughts and views expressed are the authors’ own and do not necessarily reflect an official University stance). About Hamad Bin Khalifa University Innovating Today, Shaping TomorrowHamad Bin Khalifa University (HBKU), a member of Qatar Foundation for Education, Science and Community Development (QF), is a leading, innovation-centric university committed to advancing education and research to address critical challenges facing Qatar and beyond. HBKU develops multidisciplinary academic programs and national research capabilities that drive collaboration with leading global institutions. The university is dedicated to equipping future leaders with an entrepreneurial mindset and advancing innovative solutions that create a positive global impact. For more information about HBKU, its colleges, research institutes, and initiatives, please visit www.hbku.edu.qa

During a year of tumultuous events in geopolitics, much of the global economy, and stock prices, have remained buoyant. This may not be the contradiction it appears. Despite what appears to be significant potential for economic disruption, some investors have adopted an attitude of ‘nothing ever happens’, to counter a tendency to over-react to events provoking headlines that have – or may have – little lasting economic impact. The buoyancy of the stock market despite geopolitical tensions and trade wars highlights the risk of over-reacting to the news. Some investors adopt a mantra of ‘nothing ever happens’ – but are they under-estimating looming risks? The ‘nothing ever happens’ mantra is not a matter of ignoring global events, but rather coolly assessing the actual economic impact. Of course, some turbulent events in geopolitics are notable more for their potential, than the short-term reality. Threats or hints of nuclear weapons being used are unlikely to lead to an actual nuclear war, but the risk of nuclear weapons being fired in anger is not zero, so it is one to watch. In the financial markets, weak signals that could herald a shock on the scale of 2008 are observable – high valuations in the stock market, also in crypto at a time of weak regulation – but it is impossible to gauge if these signals are a harbinger of an impactful crash, or whether they remain weak. And if there is a shock, could it occur this year, or in five years’ time? If one looks historically at the events that have had a major economic impact, there have been few. Examples include the oil price shocks of 1973-74 and 1979-81 which led to stagflation in many economies, and the financial crash and banking bailouts of 2008 – although the impact of the latter was largely confined to western economies which had banks directly exposed; Gulf countries were largely unaffected. Of greater impact globally was the Covid-19 pandemic of 2020-22, owing the strict lockdowns. It is long established in the academic disciplines of cognitive behavioural psychology and behavioural finance that, as a species, we are more drawn to dramatic and negative developments than benign ones; loss aversion is more powerful than the prospect of gains, and bad or shocking news is effective as clickbait. This means that the discipline of staying informed through news media can result, paradoxically, in a skewed understanding of global developments. Complicating the issue is that much news is gathered through social media that is not fact-checked. In its 2024 Global Risks Report, the World Economic Forum cited disinformation as the most serious destabilising factor for the short-term, citing the use of deepfake videos and other misuses of AI. These phenomena lend weight to the idea of downplaying the significance of narratives shaped by headlines. Another element is that, far from ‘nothing’ happening, there is too much. The projections from early 2025 by many economists of the impact of President Trump’s tariff policy have been way off, with a typical estimate of 0.1% reduction of GDP for each 1% added to tariffs proving to be inaccurate. The issue may be the sheer complexity and interconnectedness of the global economy, which makes it is doubtful that it can be modelled or projected in a meaningful way. Economic historians note that protectionist policies were likely a significant cause of the Great Depression in the 1930s. In the 2020s, trade of goods is, proportionately, a smaller part of the economy, compared with services, including much activity that is online. Entrepreneurialism and business growth are now global phenomena. It would probably be impossible accurately to quantify this proportion, but one proxy indicator is that only around 17% of the earnings on the S&P 500 are directly affected by tariffs, according to an analysis by Deutsche Bank. Moreover, while the US is the biggest market, it is around 24% of global GDP, compared with over 40% in the 1960s. There is a risk that the ‘nothing ever happens’ movement could under-estimate the impact of a succession of developments which, individually, may not amount to much but which cumulatively can become impactful. These include President Trump’s tariffs, his firing of the head of the Bureau of Labor Statistics, the rise of public debt in the US and other western economies, the concentration of stock market gains within just a few tech firms, Trump’s threats to the chairman of the Federal Reserve, his deregulation of crypto. Some of these individually may be judged to be of minor significance, but the accumulation may be beginning to be felt. Of these, probably of greatest long-term significance is rising debt, which means an increasing proportion of government expenditure being devoted to interest payments placing pressure on public services, and the progressive erosion of value of fiat currencies. The prices of tangible assets, such as gold, property and land, have been appreciating. This slow, long-term development will almost certainly become of greater magnitude, in economic terms, than many of the more dramatic developments that prompt headlines. The author is a Qatari banker, with many years of experience in the banking sector in senior positions

US Senator Bernie Sanders has called on Secretary of Health and Human Services Robert F Kennedy Jr to resign, days after a senior public health official was fired and four others resigned in disputes over Kennedy's unorthodox opposition to vaccines.Sanders, an independent senator from Vermont who caucuses with Democrats, wrote in a *New York Times guest essay that Kennedy is "endangering the health of the American people now and into the future”.This week, Kennedy ousted the director of the Centres for Disease Control and Prevention (CDC), Susan Monarez, less than a month into her tenure, deepening disarray at the nation's main public health agency.Monarez had refused to adopt new limitations on the availability of some vaccines urged by Kennedy, saying they went against scientific evidence.Four other senior CDC officials resigned in protest, citing anti-vaccine policies and misinformation promoted by Kennedy and his team; hundreds of their colleagues walked out of the CDC's headquarters in Atlanta in support of the departing leaders.Sanders, the ranking member of the Senate's health committee and an opponent of Kennedy's confirmation earlier this year, wrote that Kennedy ousted Monarez because she refused "to act as a rubber stamp for his dangerous policies”."Despite the overwhelming opposition of the medical community, Secretary Kennedy has continued his longstanding crusade against vaccines and his advocacy of conspiracy theories that have been rejected repeatedly by scientific experts," Sanders wrote.He said that vaccines for diseases such as polio and coronavirus (Covid-19) had saved hundreds of millions of lives around the world.A spokesperson for Kennedy did not respond to a request for comment.Kennedy, a lawyer and prominent anti-vaccine advocate, ran an unsuccessful campaign for the presidency last year.He espouses healthy eating, natural foods and exercise, but also frequently shares his theories about vaccines and other medical issues that many doctors and scientists say are groundless and drawn from the conspiratorial fringe.On Wednesday, Kennedy baffled doctors when he said he kept seeing children walking through airports that he had diagnosed as "overburdened with mitochondrial challenges, with inflammation", based on their faces and body movements.President Donald Trump, a Republican, nominated Kennedy to become the health secretary earlier this year and he was sworn in in February.Kennedy emphasised in a congressional hearing in May that he did not think Americans should ever take medical advice from him.

A Latin term that used to be little-known outside the world of customs brokers has become the stuff of headlines this year. That’s thanks to a decision by US President Donald Trump to end the tariff-free treatment of “de minimis” merchandise that had been in place for almost 90 years.The phrase — which loosely translates as “too small to matter” — refers to small packages shipped directly to consumers from abroad, millions of which arrive in the US every day. Qualifying as de minimis came with a huge perk: no customs declarations and no duties.This worked to the advantage of Chinese dis-count marketplaces such as Shein Group Ltd and Temu, which have tapped Americans’ appetite for buying cheap clothing, toys, electronics, and more, online. But the tariff exemption came to an end for packages from mainland China and Hong Kong on May 2, and ceased for the rest of the world on August 29.US consumers now face the prospect of higher prices and a longer wait for their orders. Ahead of the de minimis changes taking effect in August, many postal operators paused US-bound parcel shipments, citing a lack of clarity over how the tariffs will be collected.What was the US de minimis exemption?For a package to qualify, it had to have a re-tail value of no more than $800, which was high compared with other countries. The threshold in Canada is C$150 ($109) for parcels from the US and Mexico to be exempt from customs duties and C$20 ($15) for those from elsewhere, while in the European Union it’s €150 ($175). China, for its part, generally waives duties on packages worth up to about $7.The exemption in the US dated back to 1938, when Congress tweaked tariff rules to drop duties on low-cost items to avoid unnecessary expense for little reward, or, as one former Treasury official put it, “spending a dollar to collect 50 cents.” The exemption started at $1, where it stayed for decades before rising to $5 in 1990, $200 in 1993 and then jumping to $800 in 2016 during the Barack Obama presidency.What do the new rules mean for US consumers?The end of the de minimis exemption doesn’t mean Americans can’t order small packages from abroad. What’s changed is that the goods will be channelled through customs and incur levies.Sellers could absorb the additional costs or they could pass them on to consumers — either indirectly through a higher retail price, or directly by making buyers pay the duty.Shein and Temu raised prices on a wide range of products — from dresses to kitchenware — ahead of the tariffs kicking in on May 2. The average price of 98 products listed on Shein tracked by Bloomberg News increased by more than 20% by early May from two weeks prior.Elsewhere, South Korean beauty retailer Olive Young — which has been capitalising on the social media-fuelled popularity of Korean skincare products among American consumers — said it would add a 15% duty to all US orders at the checkout from August 27.The end of the de minimis carve-out could dis-proportionately impact lower-income households in America. Almost 75% of direct shipments imported by the poorest zip codes were de minimis, compared to 52% for the richest zip codes, according to analysis from the National Bureau of Economic Research using data from 2021.Could the end of the de minimis exemption cause supply chain disruption?Mail carriers in more than two dozen countries, including Australia, Singapore and Norway, temporarily suspended shipments to the US ahead of the August 29 de minimis cutoff date, as they grappled with how the new system will be implemented.The restrictions imposed by Deutsche Post and DHL Parcel Germany — part of DHL Group, one of the world’s largest couriers — reflected uncertainty over “how and by whom customs duties will be collected in the future, what addition-al data will be required, and how the data transmission to the US Customs and Border Protection will be carried out,” according to a company statement.Postal services have never had to handle this amount of paperwork before. The packages that enter the US now have to have a customs declaration that details the contents of the parcel, the value, and the country of origin of the goods — not just where they’re shipped from, but where they were made.Beyond the near-term disruption from potential backlogs, many e-commerce deliveries are likely to become slower because the added costs will make air cargo — already an expensive way to move freight — a potentially unprofitable mode of transportation for low-cost goods.Rather than fly on a plane and take a couple of days to arrive, a package might instead take a three-week journey on a container ship from China to the US West Coast.Which companies will be most affected by the de minimis carve-out disappearing?Low-cost online retailers such as Temu, Shein and Alibaba Group Holding Ltd’s AliExpress used the de minimis exemption for years to expand in the US — a trend that was supercharged by the Covid-era boom in e-commerce.Cross-border online retail has been a lifesaver for many Chinese manufacturers running on wafer-thin profit margins as spending by domestic shoppers plunged during the pandemic and never really recovered.Shein pioneered the model of targeting cost-conscious Americans with $2 blouses and $10 shirts during the pandemic, and Temu jumped in around 2022 with its “Shop Like a Billionaire” catchphrase. TikTok Shop, the shopping platform of the popular video app, is a more recent entrant.The end of the de minimis exemption appears to have had a dampening effect on US demand. Shein’s weekly sales dropped by as much as 23% year-on-year in late June before staging a recovery, according to Bloomberg Second Measure, which analyses credit and debit card transactions in the US. Temu saw a deeper decline — its weekly sales slumped by more than a third year-on-year in June and had yet to rebound to the prior year’s levels by mid-August.It’s not just the bottom line of the Chinese marketplaces that will be impacted by the de minimis changes. The exposure to tariffs will also hit “dropshippers,” who use e-commerce platforms to fulfil orders and send goods directly to customers, as well as small US businesses that have been importing products in batches under the $800 threshold to avoid tariffs. Small international businesses selling into the US will be affected too, including those using marketplaces such as eBay Inc and Etsy Inc.There are fears that the end of the de minimis exemption in the US could spur a flood of cheap goods, particularly those from China, to be sent to other countries instead. Amid concerns about domestic producers being undercut, markets including the UK are reviewing their own duty-free treatment of low-value imports.How have Trump’s de minimis changes evolved?Within days of taking office, the Trump administration suspended the de minimis rule for mainland China and Hong Kong. However, it soon delayed the change while the US Postal Service wrestled with how to implement the policy.The suspension was effectively reimposed on May 2, hitting buyers of packages worth up to $800 arriving from mainland China and Hong Kong with either a levy equivalent to 120% of their value or a flat fee of $100.When the US and China later announced an agreement to lower triple-digit tariffs on each other’s imports, Trump signed an executive order cutting the de minimis duty to 54%, while maintaining the flat fee.Then, on July 30, Trump said the de minimis ex-emption would end for items sent from anywhere in the world, although gifts valued at less than $100 will remain duty-free. According to a White House fact sheet, starting August 29, a posted package will be taxed in one of two ways:* The importer can pay a percentage levy on the parcel’s value. This is equivalent to the pre-vailing tariff rate the US has assigned to goods from the country of origin as part of Trump’s broader trade war.* Or, for the first six months of the new policy, the importer can pay a flat duty ranging from $80 to $200 per item, depending on the applicable country-specific tariff rate.What effect has the US de minimis exemption had?With the threshold as high as it was in the US, around 4mn small packages claiming de minimis exemptions crossed into the US every day in 2024, according to US Customs and Border Protection. These parcels often went unchecked be-fore being transferred to a truck for delivery directly to the consumer’s doorstep.This helped Americans access lots of cheap merchandise sold by e-commerce retailers in China. It also strained global supply chains, raised air cargo costs and swamped border enforcement efforts.The packages are thought to be one of the ways illegal drugs such as fentanyl have been smug-gled into the US and how other goods have entered the country in violation of rules against imports from regions known for human-rights abuses.The administration of President Joe Biden was well on its way to cracking down on de minimis abuses before he lost his re-election bid in November 2024, so Trump’s decision to eliminate the exemption wasn’t a complete surprise.How much trade did the de minimis rule affect?The de minimis exemption affected quite a bit of trade in both volume and value, with both rising exponentially. Such packages used to be confined to t-shirts and small electronics, but they’ve expanded to include bigger-ticket items such as electric bikes retailing for $799.According to a White House fact sheet, the number of individual shipments to the US claiming de minimis exemptions surged to nearly 1.4bn in 2024, up from 134mn a decade earlier. While China officially reported about $23bn worth of small parcel exports to the US last year, Nomura Holdings Inc estimates as much as $46bn of US-bound packages came from the country. (There’s a discrepancy because with so many parcels, it’s hard to count all of them in official statistics.) That’s still just a small fraction of the value of total US goods imports, which last year surpassed $3.2tn. Consequently, the suspension of the de minimis ex-emption isn’t expected to have a major effect on the US economy.

People mostly mix between digitisation and digitalisation. However, in business matters and services it would be very important to differentiate between digitisation and digitalisation.Understanding the key differences between these two terms is essential when formulating business strategy. Also, there are some legal implications here regarding data protection, authenticity of the docs for evidence purposes and acceptance before Courts.In brief, digitisation means to convert something into a digital format, and usually refers to encoding of data and documents. While, digitalisation means to convert business processes to use digital technologies, instead of similar things or offline systems such as paper or whiteboards.In a nutshell, digitisation refers to information, while digitalisation refers to processes.Appreciating the difference is important because they are genuinely different things to business matters, each requiring different resources, approaches and tools. Whether you are using the term digitise or digitalise, make sure you are referring to the right thing to avoid confusion, misunderstandings and could be legal repercussions.Digitisation is basically the process of taking analogue information, such as documents, sounds or photographs, and converting into a digital format that can be stored and accessed on computers, mobile phones and other digital devices.In business, digitisation may involve scanning old documents into PDFs, converting printed photographs into image files, or transforming printed reports into meaningful data that can be manipulated and analysed. Some digitisation projects may include going back over years of business records and information and converting them into a digital format for easy reference and other logistical purposes. The original content may be stored or destroyed, or may degrade over time, as in the case of magnetic tapes.In other cases, it may be that any new information being captured in a business is now created and stored primarily in a digital format, with any physical forms being only secondary copies. We have to mention that, the law regulates this process of keeping the old data and storing them in magnetic tapes. This is sensitive work to be undertaken by experienced personnel and requires careful attention, as courts may ask for them.For digitalisation, there is still some debate around the exact meaning, which means that people sometimes use it to describe digitisation. However, the general consensus is that digitalisation refers to the conversion of processes or interactions into their digital equivalents. And because all business processes and interactions involve people in some way, it would be more accurate to say that digitalisation is the reorganisation of these business activities around digital technologies.Examples include moving from sending physical letters via the postal service to using email, or from having in-person meetings to using online video conferencing tools. The Zoom meetings were very helpful and useful during Covid-19 and sure will continue for practical reasons.Digitalisation of a business is also likely to be an ongoing exercise, as new technologies emerge that allow further digitalisation of processes and interactions in many times and for many purposes.I believe, the distinction between digitisation and digitalisation is clear. However, the mixture is there which makes unnecessary confusion. Dr AbdelGadir Warsama Ghalib is a corporate legal counsel. Email: [email protected]

Following the Fourth International Conference on Financing for Development in June, we reached a breakthrough moment. Governments, international financial institutions, and civil-society organisations, recognising the need to tackle today’s debt and development crises, are ready for action ahead of the United Nations General Assembly (UNGA) in September. Recent reports that we each co-authored – Healthy Debt on a Healthy Planet, the Jubilee Report, and the Report of the UN Secretary-General’s Expert Group on Debt – along with many other experts’ work, have definitively established the severity and urgency of these intertwined crises and their devastating consequences. In 2024, developing countries paid $25bn more to external creditors than they received in new disbursements. That means 3.4bn people – or more than 40% of the world’s population – live in countries that spend more on interest payments than on health or education. As aid flows decline, climate change and nature loss accelerate, and global growth slows, developing countries’ debt vulnerabilities will only increase, as will the threats to people’s well-being, the planet, and global stability. Not only do many recognise the severity and urgency of the problem, they also agree on how we got here. The global financial system is not designed to meet the needs of people and the planet. Given historical inequities and low bargaining power, developing countries consistently face high borrowing costs and uneven incidence of prudential regulation. Without measures to ensure transparency, accountability, and strategic investment planning, borrowing and lending policies have failed to mobilise the productive investments that drive sustainable growth. Moreover, capital flows are highly volatile, with money flooding into developing countries during booms and flooding out in the wake of shocks. Meanwhile, the laws and policies governing debt restructurings have long encouraged delay, not resolution. The situation has only worsened in recent years. In response to Covid-19, the countries that could afford to spend huge amounts to support their citizens did so, but the lack of a global safety net meant that developing countries could do nothing of the kind. While new allocations of the International Monetary Fund’s Special Drawing Rights (the IMF’s reserve asset) helped somewhat, they were insufficient. Moreover, recent efforts to address debt distress, such as the G20 Common Framework, have fallen drastically short. Restructurings continue to move slowly and remain opaque, with outcomes largely determined by differentials in bargaining power between countries and their creditors. And restructuring now requires co-ordination among a wider array of players – including the Paris Club of sovereign creditors, newer bilateral lenders like China, and ever more private creditors. This makes restructuring processes even more complicated. Even when relief comes, it often arrives too late and achieves too little. Given the complexity of the crisis, there is no silver bullet. But nor are we at any loss for effective, practical solutions. To attack root causes, we should accelerate efforts to reform how the World Bank and IMF conduct debt-sustainability analyses. The current approach is not inclusive, does not account fully for climate- and nature-related risks, and does not consider the use of funds. Addressing these and other issues might seem technical, but the impact would be significant. For too long, flawed frameworks have held back the kind of productive borrowing that is needed to improve human capital, increase infrastructure investment, and strengthen climate resilience. At the same time, there is a strong case for creating new structures and institutions, starting with a Borrowers’ Club. Since lenders have been co-ordinating for decades, borrowers can hope to compete only if they do the same. Such co-ordination would enhance their collective bargaining power and ensure that their interests are considered. It could also provide a platform for everything from South-South learning to technical assistance and enhanced debt management. Past attempts at co-ordination among borrowers have featured a lack of resolve. But there is new momentum. We now need to move forward by establishing shared strategic goals, a governance structure, and adequate funding. To improve the restructuring process, we also need to change the incentives for both creditors and debtors. One option is to incorporate into the Common Framework automatic debt-service standstills for countries that face unsustainable debt burdens. The IMF could also use its policy of lending into arrears to guarantee that multilateral financing serves its purpose, rather than being used for repayment of distressed bonds that need to be restructured. It makes no economic sense – nor is it just – that after a devastating hurricane, scarce funds flow to remote creditors instead of to those who urgently need food and shelter. Reforming the legislation that governs restructurings to deter holdouts must be high on the common agenda. That includes changing the “compensatory” pre-judgment interest rate in New York State for debts in arrears, which has been fixed at 9% since 1981 (when inflation was 8.9%), and introducing caps on recovery. It is no mystery why creditors do not currently rush to the negotiating table. Across these key solutions – reforming debt-sustainability analyses, establishing a Borrowers’ Club, and improving the time and depth of restructuring – what matters as much as the idea is the strength of the commitment to it. In 2000, efforts by a powerful global coalition helped to deliver significant relief for low-income countries. But today’s reality demands that we adopt much broader and deeper reforms to solve the immediate crisis affecting low-income countries, and many middle-income countries as well, prevent future crises, and promote growth, job creation, and prosperity. As we look toward the UNGA in September, we should be focused on driving progress on these practical solutions. — Project Syndicate Martín Guzmán, a former minister of economy of Argentina, is a professor at the School of International and Public Affairs at Columbia University and a member of the Pontifical Academy for Social Sciences and of the Jubilee Commission at the Vatican.Mahmoud Mohieldin, UN Special Envoy on Financing the 2030 Sustainable Development Agenda and Co-Chair of the Expert Group on Debt, is a former minister of investment of Egypt (2004-10), former senior vice-president of the World Bank Group, and former executive director of the International Monetary Fund.Vera Songwe, a nonresident senior fellow at the Brookings Institution, is Founder and Chair of the Liquidity and Sustainability Facility and Co-Chair of the Expert Review on Debt, Nature, and Climate.

Beyond the TarmacThe Asia-Pacific region’s aviation industry is back on the growth trajectory.The International Air Transport Association (IATA), the global body of airlines, predicts 9% growth for Asia-Pacific in 2025.Which means, a region that has struggled to shrug off the strictures of Covid-19 is once again posting the highest growth rate in the world.Aviation in Asia-Pacific supports $890bn in GDP and 42mn jobs, with the potential to increase to $2.3tn in GDP and 62mn jobs by 2043.Analysts say rising middle-class populations, particularly in China, India, Indonesia, Vietnam, and the Philippines, are fuelling demand for both domestic and international travel.Asia is the epicentre of global e-commerce (China and Southeast Asia leading), driving robust demand for air cargo and integrated logistics.Asia-Pacific is home to some of the world’s most dynamic tourism markets. Countries like Thailand, Japan, Vietnam, and Australia continue to record strong inbound flows. Analysts believe regional tourism agreements and visa liberalisation policies are expected to boost connectivity.The UNWTO and IATA forecast Asia-Pacific to contribute more than half of global passenger growth over the next two decades.“Most countries have crossed the line of pre-COVID figures and are experiencing increasing air travel demand,” says Sheldon Hee, IATA’s Regional Vice President for Asia-Pacific.“Four of the most populous countries in the world are in our region and all are young, emerging economies with a fast-growing middle class. We are even seeing some significant visa relaxation policies.“But the resumption of growth comes with challenges,” he adds. “The profit margin for 2025 is expected to be just 1.9%, or $2.60 per passenger. Aviation in Asia-Pacific must become more economically robust to meet demand with a high level of customer service delivered cost-efficiently.”Airport and airspace capacity are naturally the main considerations. On the positive side, there are at least 90 new airports under construction or in the planning stage, including significant gateways in Australia, India, and Vietnam. Each is a sign that the relevant government has aviation development on its agenda.“But there is more room for collaboration,” says Hee. “Airlines don’t need over-investment in facilities that would require deeper cost recovery. Development must be calibrated correctly, and airlines must be part of the conversation so that investments are correctly staged.”To assist passenger throughput — especially amid narrow margins — digitalisation in both passenger and cargo operations is essential. Every efficiency will count.Digitalisation and contactless travel centred on IATA’s ‘One ID’ will also be key enablers in enhancing the customer experience.India’s ‘Digi Yatra’, a facial recognition system for verified domestic customers, is leading the way but interoperability will be critical.Meanwhile, airspace is also being upgraded across the region but there is a notable bottleneck in the Bay of Bengal where aircraft get bunched for a variety of factors.The different levels of maturity in this diverse region mean there are also plenty of areas still reliant on older equipment, which leads to inefficiencies on a broader scale.Air cargo is an important part of needed capacity as Asia-Pacific is a major origin point for the booming e-commerce trade. Cargo revenues are often critical to the profitability of a flight, and this is certainly the case in Asia-Pacific.Trade barriers and tariffs could change traditional flows but demographic conditions and the desire to trade more within the region mean there are multiple opportunities for air cargo ahead.Although the outlook remains positive for this sector, there are inefficiencies to address. Paper is still commonplace in the region and optimisation based on the ONE Record has plenty of room for growth.“The industry is also doing a lot of work to make the carriage of dangerous goods (DG), and particularly lithium batteries, safer,” says Hee. “Good progress is being made but this work is especially pertinent to Asia-Pacific given the manufacturing in the region. We must educate the upstream shippers about the need for correct DG packaging and documentation.”IATA said it continues to work with governments and aviation authorities to promote the benefits of aviation and the business case for unlocking capacity.Undoubtedly, Asia-Pacific will remain the fastest-growing aviation region globally, led by China and India. Regional connectivity, tourism, and cargo are estimated to expand strongly.That said, the region’s air traffic management systems need modernisation to handle rising volumes efficiently and safely. Despite expansion, congestion at major airports in the region remains a major concern.

US President Donald Trump’s ongoing public pressure on the Federal Reserve marks a striking challenge to central bank independence in a developed economy, a necessary safeguard to set interest rates based on the economy’s needs.In the US, the Fed’s independence has largely been respected by lawmakers in the modern era.But for months, Trump has repeatedly criticised Fed Chair Jerome Powell for keeping interest rates steady. Trump, who wants rates cut, has vowed to replace Powell - whose term as chair ends in 2026 - with someone more compliant.Late on Monday, Trump moved to oust Fed Governor Lisa Cook following allegations that she falsified mortgage documents, a dramatic escalation in the president’s battle for more control over the US central bank that unnerved investors.The Fed’s independence traces its roots to the Treasury-Fed Accord of 1951, which separated monetary policy, the management of money supply, from fiscal policy, government decisions about taxation and spending. That ended a period in which the central bank was pressured by the US Treasury to keep interest rates artificially low.The Fed sets interest rates without needing approval from the president or Congress. While it is accountable to lawmakers and its leadership is appointed by the president and confirmed by the Senate, the long, staggered terms of the Board of Governors and the chair help insulate the Fed from short-term political pressures.While presidents over the years have privately expressed frustration to the Fed leadership over the level of interest rates, they generally have refrained from publicly criticising the central bank.In the decades since the Fed gained independence, other central banks around the world have gained similar autonomy in setting rates free of political interference.The most common argument for independence is that it allows monetary policy experts to make decisions that prioritise long-term economic stability over short-term political gains.But following the 2008 financial crisis, critics accused central banks of having failed to anticipate the collapse of the housing bubble.Central banks again became a lightning rod for criticism after the inflation crisis triggered by the Covid-19 pandemic forced them to escalate interest rates in 2022.Critics accused them of missing the initial inflation buildup and then being too slow to respond as living costs soared.More recently, as economic growth has slowed, central bankers have come under political pressure to bring rates down.The end result has been renewed scrutiny of the judgment of officials, their accountability to executive and legislative branches of governments, and the transparency of their decision-making processes.Investors value the Fed’s status as an independent organisation. Without it, the central bank’s pledge to keep inflation in check lacks credibility.In the US, the Supreme Court has shielded Fed officials from being directly removed by the president without cause, which has quieted Trump’s threats to fire Powell.Yet the president is able to put his stamp on the central bank by nominating new people to vacancies.The Federal Reserve’s annual gathering in Jackson Hole last week also highlighted the political pressures weighing on the Fed.Global central bankers gathered at the US mountain resort over the weekend were starting to fear that the political storm surrounding the Fed may engulf them too.If the world’s most powerful central bank were to yield to that pressure, or Trump finds a playbook for removing its members, a dangerous precedent would be set from Europe to Japan, where established norms for the independence of monetary policy may then come under new attack from local politicians.A scenario in which the Fed sees its ability to counter inflation is jeopardised by a loss of independence could be taken as a direct threat to their own standing and to economic stability more broadly.