Weekend Box #127: Milton Sparks Election Whirlwind, TikTok in Trouble & more

Editor's Note

?Welcome to The Weekend Box, Audley’s round-up of interesting or obscure political, business, and cultural news from around the world.

At the end of every busy week in Westminster, ministerial private offices ask their departments to submit papers to the ‘weekend box’ for Ministers and Secretaries of State to catch up with over the weekend. Similarly, we would like to send you into the weekend with a few stories to catch up with at your leisure.

So, let’s delve inside The Weekend Box.

Milton Stirs Election Pressure

At the time of writing, four people have been by killed Hurricane Milton. The third storm to hit Florida this year and said to be one of the most dangerous in history, it has taken out power for more than 3 million people, unleashed winds of 100mph, and released more than 18 inches of rain in some areas. The scale of the damage won’t be clear for several days, but insurers have warned that losses could reach $60bn.

?Despite this, the incident hasn’t unleashed as much damage as some models predicted. Governor Ron?DeSantis told reporters that events were “thankfully not the worst case scenario”.

?With the election less than a month away and the result anyone’s guess, Milton has unsurprisingly become a political issue. On Monday, Vice President Harris called DeSantis “selfish” for refusing to take her call, while he hit back at her for “trying to parachute in” and “politicize” events.

?Hurricane politics is well-trodden ground in US history, and has already been an issue in this race. Milton’s September precursor, Hurricane Helene, killed over 230 people in six states and sparked debate about the effectiveness of the emergency response system, reigniting?discussion about the need for a national catastrophe insurance program.

?In speeches and on social media, Trump weighed in to accuse?Biden’s administration of allowing the Federal Emergency Management Agency (FEMA) to direct resources to housing assistance for migrants and therefore lacking funds for disaster response. Biden has hit back at hurricane misinformation, including Trump’s claims that Democrats were “going out of their way to not help people in Republican areas” of the state.

?Milton is now moving over the Atlantic and expected to dissipate. The same can’t be said for US political tensions.

Image Credit: Un Yarat. License.

A Balancing Act in Laos

This week, the Association of Southeast Asian Nations (ASEAN) held its summit in Laos, with tensions over Myanmar, the South China Sea, and US-China rivalry dominating discussions. The ASEAN grouping, comprised of ten Southeast Asian countries, is the world's fifth-largest economy, with a combined GDP of US$3.8 trillion. The bloc is expected to rise to fourth place by 2030. As the region’s strategic importance grows,? ASEAN is facing an increasingly challenging high wire act balancing its interests with great powers, including China, India, Japan, Russia and the US.?

?Myanmar remains a significant thorn in ASEAN’s side. Since the military coup in 2021, a civil war has continued, undermining ASEAN’s efforts to broker peace through a diplomatic proposal called the ‘Five-Point Consensus’. While Malaysia and Singapore push for tougher measures against Myanmar’s junta, countries like Thailand take a more cautious approach, adding to regional divisions.?

?The South China Sea dispute is another major?flashpoint. While China continues to build its military presence and assert ever-growing territorial claims, ASEAN members are split. Nations like Vietnam and the Philippines, who have a direct stake in the contested waters, urge for a firm stance, while others, such as Cambodia, are more aligned with Beijing’s position.?

?This ongoing US-China competition also adds a layer of complexity. Both nations are in attendance, with US Secretary of State Antony?Blinken pushing for a ‘free and open Indo-Pacific’ while Chinese Premier Li Qiang highlights economic investments. Eager to avoid being caught in the middle, ASEAN finds itself navigating these rivalries carefully.?

?Japan’s newly elected Prime Minister Shigeru?Ishiba is also in attendance, sparking speculation that he would float his controversial idea of an Asian NATO. While Japanese officials have downplayed the likelihood it will be raised at the summit, the idea may get some airing behind closed doors.?

Image Credit: Gunawan Kartapranata. License.?

Rio Tinto Goes Long on Lithium

The Anglo-Australian mining giant confirmed a huge investment in lithium this week, with the acquisition of U.S. based?Arcadium Lithium. The $6.7bn deal will see Rio Tinto become the third largest producer of lithium in the world and signals a long-term strategy focused on producing the minerals required for a low carbon energy transition.

?The largest consumer of lithium is the car industry, and as growth in the electric car market has stalled there is currently a glut of lithium supply. Car manufacturers cite falling demand for?EVs and the challenges of meeting multiple emissions targets across their markets, some slowing their transition plans in response. Yet Rio Tinto predicts over 10% compound annual growth in lithium demand through to 2040, leading to a supply deficit.

?At $5.85 a share, Rio?Tinto is paying a 90% premium on Arcadium Lithium’s closing share price of $3.08 the day before a potential deal was mooted. Both companies’ boards have since unanimously approved the deal. The acquisition will give Rio Tinto access to lithium mines, processing facilities and deposits in Argentina, Australia, Canada and the US that are all expected to play a key role in manufacturing batteries for electric vehicles (EVs) and other energy storage. It also gives the world’s second largest miner a customer base that includes the carmakers Tesla, BMW and General Motors.

?Jakob Stausholm, chief executive of Rio Tinto, called the deal a “countercyclical expansion…increasing our exposure to a high-growth, attractive market at the right point in the cycle”, while Peter Coleman, chair of Arcadium, said the cash offer would give shareholders “certainty and liquidity” and avoid the risks associated with lithium market fluctuations. Arcadium shares had fallen more than 37% since the start of the year, as the lithium market dipped.

Image Credit: Reinhard Jahn. License.

The Clock's Ticking on TikTok

Another week, another platform being taken to court. This time, the court case revolves around TikTok and the thirteen U.S. states, along with Washington, D.C., who are suing them, alleging that the platform harms children’s mental health and does not adequately protect young users. The lawsuits argue that the app is intentionally addictive, keeping teenagers excessively engaged.

?New York Attorney General?Letitia James stated, "Young people are struggling with their mental health because of addictive social media platforms like TikTok," noting that some young individuals have reportedly been injured or killed while imitating stunts seen on the app. Washington D.C. Attorney General Brian Schwalb described TikTok as "an intentionally addictive product," accusing it of causing significant psychological issues, including depression and anxiety.

?In response,?TikTok has labelled these claims as "inaccurate and misleading," highlighting features designed to promote safety, such as default screen time limits and privacy settings for users under 16. TikTok spokesperson Alex Haurek expressed disappointment that the states chose litigation over collaboration, asserting the company's commitment to teen safety and ongoing improvements to its platform. The lawsuits arise from a bipartisan investigation initiated in March 2022, involving states such as California, New Jersey, and Massachusetts, among others.

?Of course, this is not the first time?Tik Tok has faced criticism and legal action in the United States. Other states and the U.S. Justice Department have taken similar legal actions in the past regarding child protection on the platform. All the while, a potential ban on TikTok looms, over fears it could give data to the Chinese government. Ultimately, TikTok could be banned in the new year unless Bytedance sells it. As of this week, the company has appealed against the ruling with judges expected to issue a decision imminently.

Image Credit: Plann. License.?

China's Udder Pressure?

In 2018, officials launched a campaign to supercharge China’s dairy industry, aiming to boost food security by cutting reliance on imports, while simultaneously improving public health. Farmers received subsidies to increase their herds and state propaganda encouraged dairy consumption. Subsequently, milk production rose by a third, surpassing government targets two years early.

?However, public consumption has not increased accordingly. The average Chinese person still only consumes 40kg of dairy products per year; a third of the global average and less than 40% of what China’s health authorities recommend. As a result, prices have fallen by 28% since August 2021, to the point where most farms have been losing money since the second half of last year.

?Explanations for this limited consumption are multifaceted. Some point to wider issues; China’s sluggish economy has led cost-conscious consumers to avoid ‘exotic’ produce, while a baby bust has reduced demand for infant formula. However, other constraints on dairy demand are more deep-rooted. Many Chinese people are genetically predisposed to be intolerant of lactose, which has contributed to a continued cultural apprehension towards dairy products.

?Additionally, there are significant obstacles to exporting excess produce. Chinese dairy production is high by international standards, due to being forced to import much of its cattle feed. Then, its market value is damaged by the poor reputation of Chinese dairy products, following a 2008 scandal whereby six babies died and hundreds of thousands fell ill following the discovery of dangerous chemicals in Chinese milk powder.

?Therefore, dairy farmers are struggling. Many are dumping milk, with banks being encouraged to extend loans to farmers and accept cattle as collateral. More drastically, the China Dairy Association has proposed the culling of 300,000 cows. Beset by an ailing economy and aging population, China’s dairy problem is further evidence of serious economic?challenges ahead.?

Image Credit: Qilai Shen. License.?

And that's it for this week. I hope you found something of interest that you might want to delve into further. If so, please get in touch at [email protected]

?For now, that’s The Weekend Box officially closed.?

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