US regulators seek to break up Google, forcing Chrome sale

U.S. regulators want a federal judge to break up Google to prevent the company from continuing to squash competition through its dominant search engine after a court found it had maintained an abusive monopoly over the past decade.

The proposed breakup floated in a 23-page document filed late Wednesday by the U.S. Department of Justice calls for sweeping punishments that would include a sale of Google’s industry-leading Chrome web browser and impose restrictions to prevent Android from favoring its own search engine.

A sale of Chrome “will permanently stop Google’s control of this critical search access point and allow rival search engines the ability to access the browser that for many users is a gateway to the internet,” Justice Department lawyers argued in their filing.

Although regulators stopped short of demanding Google sell Android too, they asserted the judge should make it clear the company could still be required to divest its smartphone operating system if its oversight committee continues to see evidence of misconduct.

The broad scope of the recommended penalties underscores how severely regulators operating under President Joe Biden’s administration believe Google should be punished following an August ruling by U.S. District Judge Amit Mehta that branded the company as a monopolist.

The Justice Department decision-makers who will inherit the case after President-elect Donald Trump takes office next year might not be as strident. The Washington, D.C., court hearings on Google’s punishment are scheduled to begin in April and Mehta is aiming to issue his final decision before Labor Day.

If Mehta embraces the government’s recommendations, Google would be forced to sell its 16-year-old Chrome browser within six months of the final ruling. But the company certainly would appeal any punishment, potentially prolonging a legal tussle that has dragged on for more than four years.

Besides seeking a Chrome spinoff and a corralling of the Android software, the Justice Department wants the judge to ban Google from forging multibillion-dollar deals to lock in its dominant search engine as the default option on Apple’s iPhone and other devices. It would also ban Google from favoring its own services, such as YouTube or its recently launched artificial intelligence platform, Gemini.

Regulators also want Google to license the search index data it collects from people’s queries to its rivals, giving them a better chance at competing with the tech giant. On the commercial side of its search engine, Google would be required to provide more transparency into how it sets the prices that advertisers pay to be listed near the top of some targeted search results.

Kent Walker, Google’s chief legal officer, lashed out at the Justice Department for pursuing “a radical interventionist agenda that would harm Americans and America’s global technology.” In a blog post, Walker warned the “overly broad proposal” would threaten personal privacy while undermining Google’s early leadership in artificial intelligence, “perhaps the most important innovation of our time.”

Wary of Google’s increasing use of artificial intelligence in its search results, regulators also advised Mehta to ensure websites will be able to shield their content from Google’s AI training techniques.

The measures, if they are ordered, threaten to upend a business expected to generate more than $300 billion in revenue this year.

“The playing field is not level because of Google’s conduct, and Google’s quality reflects the ill-gotten gains of an advantage illegally acquired,” the Justice Department asserted in its recommendations. “The remedy must close this gap and deprive Google of these advantages.”

It’s still possible that the Justice Department could ease off attempts to break up Google, especially if Trump takes the widely expected step of replacing Assistant Attorney General Jonathan Kanter, who was appointed by Biden to oversee the agency’s antitrust division.

Although the case targeting Google was originally filed during the final months of Trump’s first term in office, Kanter oversaw the high-profile trial that culminated in Mehta’s ruling against Google. Working in tandem with Federal Trade Commission Chair Lina Khan, Kanter took a get-tough stance against Big Tech that triggered other attempted crackdowns on industry powerhouses such as Apple and discouraged many business deals from getting done during the past four years.

Trump recently expressed concerns that a breakup might destroy Google but didn’t elaborate on alternative penalties he might have in mind. “What you can do without breaking it up is make sure it’s more fair,” Trump said last month. Matt Gaetz, the former Republican congressman that Trump nominated to be the next U.S. Attorney General, has previously called for the breakup of Big Tech companies.

Gaetz faces a tough confirmation hearing.

This latest filing gave Kanter and his team a final chance to spell out measures that they believe are needed to restore competition in search. It comes six weeks after Justice first floated the idea of a breakup in a preliminary outline of potential penalties.

But Kanter’s proposal is already raising questions about whether regulators seek to impose controls that extend beyond the issues covered in last year’s trial, and — by extension — Mehta’s ruling.

Banning the default search deals that Google now pays more than $26 billion annually to maintain was one of the main practices that troubled Mehta in his ruling.

It’s less clear whether the judge will embrace the Justice Department’s contention that Chrome needs to be spun out of Google and or Android should be completely walled off from its search engine.

“It is probably going a little beyond,” Syracuse University law professor Shubha Ghosh said of the Chrome breakup. “The remedies should match the harm, it should match the transgression. This does seem a little beyond that pale.”

Google rival DuckDuckGo, whose executives testified during last year’s trial, asserted the Justice Department is simply doing what needs to be done to rein in a brazen monopolist.

“Undoing Google’s overlapping and widespread illegal conduct over more than a decade requires more than contract restrictions: it requires a range of remedies to create enduring competition,” Kamyl Bazbaz, DuckDuckGo’s senior vice president of public affairs, said in a statement.

Trying to break up Google harks back to a similar punishment initially imposed on Microsoft a quarter century ago following another major antitrust trial that culminated in a federal judge deciding the software maker had illegally used his Windows operating system for PCs to stifle competition.

However, an appeals court overturned an order that would have broken up Microsoft, a precedent many experts believe will make Mehta reluctant to go down a similar road with the Google case. 

Lower turkey costs set table for cheaper US Thanksgiving feast this year

Inflation-weary consumers should see the cost of their classic Thanksgiving dinner gobble less of their paychecks this year, largely because Americans are buying less of the meal’s centerpiece dish, turkey. 

The price tag of the traditional holiday meal, which also includes cranberries, sweet potatoes and stuffing, has dropped for a second consecutive year, according to the American Farm Bureau Federation’s annual survey released on Wednesday. 

Cooks can thank the bird. Turkey prices dropped 6% on cooling demand as some consumers opted to add beef and pork to the menu, the Farm Bureau and market analysts said.  

Still, the meal’s price tag will cost families about 19% more than pre-pandemic times, the Farm Bureau said.  

Frustration over high prices was seen as a major factor in Donald Trump’s presidential election victory over Kamala Harris, but the Farm Bureau data suggests some of the worst inflation has abated. 

“We are seeing modest improvements in the cost of a Thanksgiving dinner for a second year, but America’s families, including farm families, are still being hurt by high inflation,” said Farm Bureau President Zippy Duvall. 

Cheaper meal 

The average cost for a 10-person meal came to $58.08, down from $61.17 last year and a record $64.05 in 2022, Farm Bureau data showed. 

The price of a turkey, which represents the bulk of the bill, fell even as supplies dropped 6% in 2024 partly because of a bird-flu outbreak. Turkey demand of 13.9 pounds per person in 2024 is down nearly a pound from 2023, according to the U.S. Agriculture Department. 

Like most grocery items, turkey prices rose alongside overall inflation in recent years, which may have spooked consumers in 2024, said Ashley Kohls, the Minnesota Turkey Growers Association’s executive director. 

“We’re working on bringing folks back to purchasing turkey after a number of years of having elevated prices at the grocery store,” Kohls said. 

Indiana turkey farmer Greg Gunthorp said his customers appear to have plenty of supply to meet consumer demand this year. There have been far fewer frantic calls from buyers scrambling to restock, he said. 

“We’ve had those outlier years when there just aren’t enough turkeys to go around and our phones are just ringing off the hook. This is definitely not one of those years,” Gunthorp said. 

“I think lots of people are adding items to the menu in addition to the turkey, things like brisket and ham.” 

The Farm Bureau survey found that the price of other ingredients in the Thanksgiving meal also fell, including the cost of fresh vegetables and whole milk, although the price of processed ingredients, such as dinner rolls and cubed stuffing, increased.

Islamic Council’s VPN decree raises concerns about privacy in Pakistan

WASHINGTON — Pakistan’s top cleric has declared that virtual private networks, or VPNs, are unlawful, igniting a debate on privacy rights and access to information amid a government crackdown on the internet.

Allama Raghib Naeemi, head of the Council of Islamic Ideology (CII), issued a decree saying it makes no difference whether a VPN is registered or unregistered.

“If attempts are made to access indecent or immoral sites, character assassination is done, statements are being made against national security, or if various incidents of religious blasphemy are being spread through it, then [using] it would completely be un-Islamic,” he said.

A VPN protects online privacy by creating a secure connection and is used to access blocked content, protect data from hackers and support remote work or secure transactions.

Several internet service providers in Pakistan expressed concerns Tuesday over the possible imposition of blanket restrictions on VPNs, warning that the move would anger users and impact online businesses.

Shahzad Arshad, chairman of the Wireless and Internet Service Providers Association of Pakistan, said in a statement, “It is essential to recognize that blanket restrictions or sweeping narratives around tools like VPNs risk alienating segments of society, particularly those who rely on these tools for entirely legitimate purposes, such as IT exports, financial transactions, and academic research.”

Arshad, in reference to CII’s declaration, said technology is neutral and that how it is used determines whether it is aligned with ethics.

Amnesty Tech, part of Amnesty International, said last week on X that imposing restrictions on VPNs would amount to “violating the right to privacy under international law, restricting people’s access to information, and suppressing free expression.”

Qibla Ayaz, former chairman of CII, told VOA Deewa it seems as if a government agency has reached out to the religious body seeking its stance on the VPN issue.

“Similar requests were sent by the government in 2023,” he said. 

The CII is a constitutional body in Pakistan that advises the legislature on whether a certain law is repugnant to Islam, namely to the Quran and Sunna.

According to activists and experts, CII’s declarations on technology use are unwarranted and will only strengthen the government’s digital suppression of social media users.

Haroon Baloch, a Pakistani digital rights activist, believes the proposed restrictions on VPNs are aimed at suppressing political dissent.

“First, the government had compliance challenges with X. And when the platform did not agree with the government’s requests, then it banned X. And when X was available with the help of VPN, the government is planning to ban the VPN now,” Haroon told VOA.

Pakistan banned X in February and installed firewalls to restrict access to certain online content. But consumers are using VPNs to access restricted networks and content and to hide their identities and locations. 

Pakistan Army Chief General Asim Munir told a gathering at the Islamabad Policy Research Institute on November 16 that technology has played a pivotal role in the dissemination of information, but “the spread of misleading and incorrect information has become a significant challenge.”

In a speech to religious leaders in Islamabad earlier in August, Munir said, “Anarchy is spread through social media.”

A directive in October from the Interior Ministry asked the Pakistan Telecommunication Authority to block “illegal” VPNs that had not registered by the end of November.

The Interior Ministry charged in a letter to the Pakistan Telecommunication Authority, which oversees the internet and mobile industry and has broad powers over online content and the licensing of service providers, that terrorists are increasingly using VPNs to facilitate violent activities and financial transactions in Pakistan.

“Of late, an alarming fact has been identified, wherein VPNs are used by terrorists to obscure and conceal their communications,” the letter said, adding that pornography sites are frequently accessed using VPNs.

“These trends … warrant the prohibition of unauthorized virtual private networks in order to address critical threats,” the letter said.

The 2024 “Freedom on the Net” report published by Freedom House says the Pakistan Telecommunication Authority has historically implemented policies that undermine internet freedom, removed content without a transparent process and instituted wholesale bans on platforms.

This story originated in VOA’s Deewa Service.

Pakistan’s Islamic Council calls for ban on use of VPNs

WASHINGTON — Pakistan’s top cleric has declared that virtual private networks, or VPNs, are unlawful, igniting a debate on privacy rights and access to information amid a government crackdown on the internet.

Allama Raghib Naeemi, head of the Council of Islamic Ideology (CII), issued a decree saying it makes no difference whether a VPN is registered or unregistered.

“If attempts are made to access indecent or immoral sites, character assassination is done, statements are being made against national security, or if various incidents of religious blasphemy are being spread through it, then [using] it would completely be un-Islamic,” he said.

A VPN protects online privacy by creating a secure connection and is used to access blocked content, protect data from hackers and support remote work or secure transactions.

Several internet service providers in Pakistan expressed concerns Tuesday over the possible imposition of blanket restrictions on VPNs, warning that the move would anger users and impact online businesses.

Shahzad Arshad, chairman of the Wireless and Internet Service Providers Association of Pakistan, said in a statement, “It is essential to recognize that blanket restrictions or sweeping narratives around tools like VPNs risk alienating segments of society, particularly those who rely on these tools for entirely legitimate purposes, such as IT exports, financial transactions, and academic research.”

Arshad, in reference to CII’s declaration, said technology is neutral and that how it is used determines whether it is aligned with ethics.

Amnesty Tech, part of Amnesty International, said last week on X that imposing restrictions on VPNs would amount to “violating the right to privacy under international law, restricting people’s access to information, and suppressing free expression.”

Qibla Ayaz, former chairman of CII, told VOA Deewa it seems as if a government agency has reached out to the religious body seeking its stance on the VPN issue.

“Similar requests were sent by the government in 2023,” he said. 

The CII is a constitutional body in Pakistan that advises the legislature on whether a certain law is repugnant to Islam, namely to the Quran and Sunna.

According to activists and experts, CII’s declarations on technology use are unwarranted and will only strengthen the government’s digital suppression of social media users.

Haroon Baloch, a Pakistani digital rights activist, believes the proposed restrictions on VPNs are aimed at suppressing political dissent.

“First, the government had compliance challenges with X. And when the platform did not agree with the government’s requests, then it banned X. And when X was available with the help of VPN, the government is planning to ban the VPN now,” Haroon told VOA.

Pakistan banned X in February and installed firewalls to restrict access to certain online content. But consumers are using VPNs to access restricted networks and content and to hide their identities and locations. 

Pakistan Army Chief General Asim Munir told a gathering at the Islamabad Policy Research Institute on November 16 that technology has played a pivotal role in the dissemination of information, but “the spread of misleading and incorrect information has become a significant challenge.”

In a speech to religious leaders in Islamabad earlier in August, Munir said, “Anarchy is spread through social media.”

A directive in October from the Interior Ministry asked the Pakistan Telecommunication Authority to block “illegal” VPNs that had not registered by the end of November.

The Interior Ministry charged in a letter to the Pakistan Telecommunication Authority, which oversees the internet and mobile industry and has broad powers over online content and the licensing of service providers, that terrorists are increasingly using VPNs to facilitate violent activities and financial transactions in Pakistan.

“Of late, an alarming fact has been identified, wherein VPNs are used by terrorists to obscure and conceal their communications,” the letter said, adding that pornography sites are frequently accessed using VPNs.

“These trends … warrant the prohibition of unauthorized virtual private networks in order to address critical threats,” the letter said.

The 2024 “Freedom on the Net” report published by Freedom House says the Pakistan Telecommunication Authority has historically implemented policies that undermine internet freedom, removed content without a transparent process and instituted wholesale bans on platforms.

This story originated in VOA’s Deewa Service.

Zambia, Zimbabwe seek move to wind, solar to avert power shortages

VICTORIA FALLS, ZIMBABWE — Zimbabwe and Zambia are holding a summit this week in Victoria Falls to identify ways to attract investors for energy projects and development.

The talks come as the neighbors experience their worst recorded drought, which is drying up the Kariba Dam reservoir and causing hourslong power cuts.

Speaking at the inaugural Zimbabwe-Zambia Energy Projects Summit, officials from both countries said depending so heavily on hydropower leaves them vulnerable to lengthy lapses in electricity. Recently, power outages reached 20 hours.

They say they want to increase investment in wind and solar energy generation.

Zimbabwean Vice President Constantino Chiwenga said Zimbabwe and Zambia are well-positioned to benefit from solar and wind power.

“In particular, the potential for solar energy is highly promising,” Chiwenga said. “Both Zimbabwe and Zambia enjoy abundant sunlight throughout the year. This is the only asset on this Earth we do not pay for. So, let’s use it.”

With investments, he said, building large-scale solar farms could generate power not only for local consumption but also to export to neighboring countries.

“These initiatives will not only enhance our national energy security but also position both nations as key players in the regional energy market,” he said.

Zimbabwe and Zambia have started exploring floating solar projects on Lake Kariba. The hydroelectric dam there was built during the colonial era, but an El Nino-induced drought has left the dam with about 2% of its water, resulting in hourslong power cuts in both countries.

Zambian Energy Minister Makozo Chikote said that Zambia hopes to buoy its push into renewable energy with money from increased copper production. He announced a target of 3 million metric tons of copper to be produced annually in Zambia by 2035.

“We are at a critical juncture in our countries: energy and mining sectors,” he said. “The demand for electricity and resources continues to grow, and it is imperative that we adopt strategies to meet the challenges head on.”

Chikote referenced the current drought, which has left the reservoir at a historic low, saying, “Overdependence on hydro has exposed the vulnerability of the energy in … Zambia.”

The countries are looking to the West for potential investors.

Jobst von Kirchmann, European Union ambassador to Zimbabwe, said that investors want predictability in legislation and the courts, but especially in monetary policy.

“Zimbabwe is now running a monetary policy which is a multicurrency policy, but then if someone goes out and says, ‘We should abandon the dollar; we should go back to mono-currency,’ that’s a killer for investment,” he said.

Some elements in Zimbabwe’s ruling ZANU-PF party have been calling for the abandonment of the dollar, which the country has been using since 2009, together with other currencies.

John Humphrey, British trade commissioner for Africa, echoed the call for stability.

“When we are in the renewable sector, it’s not just about five or 10 years,” he said. “Actually, you are looking at a much longer period. So, in order to be able to make those sorts of investments, you really have to feel like you are operating in a predictable and stable environment.

“Money is like water,” Humphrey said. “It goes where it is easy, and if you put something in its way, it just flows somewhere else.”

The meeting ends Wednesday.

AI in action at Africa Tech Festival

Artificial intelligence was much discussed and demonstrated at the Africa Tech Festival in Cape Town, South Africa earlier this month. The conference highlighted how technology is changing industries on the continent. Vicky Stark filed this report.

Greece to repay chunk of bailout debt early

Athens, Greece — Greece will make an early repayment of 5 billion euros ($5.3 billion) in bailout-era debt in 2025, Prime Minister Kyriakos Mitsotakis told a banking conference in Athens on Monday, describing the move as a signal of the country’s fiscal recovery.

“This … underscores our confidence in public finances and reflects our commitment to fiscal discipline,” Mitsotakis said.

Finance Ministry officials say they plan to reduce debt through primary surpluses, loan repayments and combating tax evasion.

Greece has rebounded from a 10-year financial crisis that forced it to borrow tens of billions of euros from its European Union partners and the International Monetary Fund.

But Mitsotakis’ center-right government, elected for a second term in 2023, is struggling to address a cost of living crisis that has sapped Greeks’ spending power. Despite the lack of any substantial challenge from opposition parties, the high cost of living has nibbled away at the government’s approval ratings and triggered union anger.

The country’s two main private and public sector unions have called a general strike for Wednesday that will keep island ferries in port and disrupt other forms of transport and public services. 

A protest march will be held in central Athens on Wednesday morning.

The GSEE main private sector union Monday accused the government of “refusing to take any meaningful measures that would secure workers dignified living conditions.”

“The cost of living is sky-high and our salaries rock-bottom, (while) high housing costs have left young people in a tragic position,” GSEE chairman Yiannis Panagopoulos said.

According to EU forecasts, Greece’s economy is expected to grow 2.1% in 2024 and maintain a broadly similar course over the following two years.

Unemployment, now below 10%, is expected to keep declining, while inflation is projected at 3% this year. 

South African universities embrace AI, seeing it as equalizing tool

The rise of AI tools like ChatGPT has sparked debate in higher education, raising questions about ethics and integrity in teaching, learning and knowledge creation. In South Africa, some academic institutions are taking a proactive approach, integrating AI into their curricula. Experts say this step is not only innovative but also helps level the playing field among students. Zaheer Cassim reports from Johannesburg.

‘Morphing’ wheel from South Korea may transform lives – and robots

DAEJEON, South Korea — Imagine a wheelchair equipped with wheels flexible enough to navigate all manner of obstacles from curbs to humps and even staircases.  

Or perhaps an unmanned delivery vehicle using the same wheels that takes the stairs to deliver food and groceries right to your door. 

This is what researchers from the Korea Institute of Machinery and Materials (KIMM) envision for their “morphing” wheel, which can roll over obstacles up to 1.3 times the height of its radius.  

Inspired by the surface tension of water droplets, it goes from solid to fluid when it encounters impediments. 

Other possible applications include robots that spy on the enemy in the battlefield. 

The KIMM team also hopes that morphing wheels will eventually be used with two- and four-legged robots – currently limited in movement efficiency and susceptible to vibration – that can carry payloads that need stable movement in industrial settings. 

“The goal is to make this viable for speed up to 100 kph, or the speed of an average car,” said Song Sung-hyuk, principal researcher at KIMM. 

Wheels developed for a similar purpose such as nonpneumatic or airless tires have flexibility but are limited in their ability to overcome obstacles, said Song, who is a member of KIMM’s AI robotics research team.  

The morphing wheel consists of an outer hoop of a chain and a series of spoke wires running through the hub. The stiffness of the spokes – and hence the wheel – is automatically regulated by a sensor as it reacts to the terrain. 

Song’s team demonstrated to Reuters a prototype wheelchair mounted on morphing wheels as it climbed stairs with 18-cm steps with a life-size dummy sitting in it. The team has also tested a device mounted with the wheel at speeds of up to 30 kph. 

The morphing wheel was featured on the cover of the journal Science Robotics in August.

Chinese social media reels over woman’s illegal surrogacy case

BEIJING/HONG KONG — A 22-year-old Chinese woman’s account of how she was lured into the country’s illegal surrogacy industry before suffering a miscarriage went viral on Chinese social media this week and raised heated debates over women’s rights and social inequality. 

Surrogacy is banned in China, and authorities have vowed to severely crack down on illegal practices, including the buying and selling of sperm, egg and surrogacy services. 

The incident comes as Chinese authorities grapple with how to increase the country’s birth rate as more young couples put off having children or opt to have none. 

China’s population fell for a second consecutive year in 2023 and Beijing in October rallied local governments to direct resources towards fixing China’s population crisis to create a “birth-friendly” society.  

Zhang Jing, 22, told state-backed Phoenix TV magazine that she donated her eggs out of financial desperation and then agreed to “rent out her uterus” to be impregnated for a total of 30,000 yuan ($4,152).  

If she “successfully” delivered the baby, she would be paid a total of 240,000 yuan. At five months pregnant, she experienced severe complications and had to have an abortion.  

Zhang’s story amassed more than 86 million views and 10,000 comments on Chinese social media platform Weibo, with the hashtag “#2000s-born Surrogate Miscarriage Girl Speaks Out#.” 

The majority of comments strongly opposed surrogacy. Some warned that legalizing surrogacy in China could lead to increased competition that would lower compensation and further devalue women. 

“No woman could escape this if surrogacy were legalized,” one user wrote, while another said, “Legalizing surrogacy would drive down prices and commodify women.” 

Zhang’s story ignited calls for a more thorough crackdown on illegal surrogacy by authorities, with some commenters warning that allowing the black market to continue to operate could even normalize human organ trafficking.  

“Life should not be traded as a commodity,” one user wrote. “If this extends to the sale of organs, it will only get darker and darker, and women will have no future.” 

The incident comes a few weeks after a 28-year-old pregnant woman who acted as a surrogate in China’s southwestern city of Chengdu was allegedly abandoned by her surrogacy agency. 

Debt-saddled Laos struggles to tame rampant inflation

Vientiane, Laos — Suffocating under a mountain of debt to China, communist Laos is struggling to tame rampant inflation, with food prices rising so sharply that a growing number of households are resorting to foraging.

At a market in Vientiane, traders told AFP they have never known business to be so slow, as families have seen the value of their money collapse since COVID-19.

While the pandemic and Russia’s invasion of Ukraine sent prices around the world spiraling, Laos has found itself incapable of putting the brakes on inflation.

Prices rocketed 23% in 2022 and 31% last year, while they are on course for 25% this year, according to the Asian Development Bank.

Families in particular have been hit hard as the cost of basic staples such as rice, sugar, oil and chicken doubled last year.

A growing number of households are so desperate for food that they are now having to forage to supplement their diets, according to a World Bank household survey earlier this year.

At Vientiane’s morning market, a gold trader said that where customers used to come to buy necklaces, rings and earrings for special occasions, now all anyone wants is to sell their valuables to raise cash.

“I sometimes sit all day and nobody buys my gold,” the 45-year-old told AFP last month, speaking on condition of anonymity because talking to foreign media in authoritarian, one-party Laos is risky.

“My shop used to be busy but now nobody buys gold — they all come to sell it to get money.”

After 15 years running his shop, the trader said he fears for the future of his business.

‘Unsustainable’ debt

Despite three decades of consistent economic growth, Laos remains one of the poorest countries in Asia, with limited transport infrastructure and a low-skilled workforce mostly employed in agriculture.

Life expectancy is just 69 years and the Asian Development Bank says that nearly 1 in 3 children under 5 is stunted because of malnutrition — one of the highest rates globally.

In recent years, the government has borrowed billions of dollars from neighbor China to fund a $6 billion high-speed railway and a series of major hydropower dams — aiming to become the “battery” of Southeast Asia.

The World Bank warned in a report last week that public debt — over $13 billion, or 108% of gross domestic product — was “unsustainable.”

Servicing the debt is fueling inflation by driving down the value of the kip, which lost half its value against the dollar in 2022, and nearly a fifth in the first nine months of 2024.

“Given Laos’ heavy reliance on imports, the kip’s depreciation has driven up domestic consumer prices and inflation, squeezing domestic demand and slowing economic recovery,” Poh Lynn Ng, an economist with the ASEAN+3 Macroeconomic Research Office, told AFP.

Interest payments totaling $1.7 billion are due in 2024 and an average of $1.3 billion for the next three years, further eroding Laos’ foreign exchange reserves.

AFP contacted the Laotian finance ministry for comment, but did not receive a response.

Response ‘too slow’

The Bank of Lao PDR has raised interest rates and in August, the government launched a plan aiming to bring inflation below 20% by December.

But Vivat Kittiphongkosol of the Joint Development Bank Laos said the government had been “too slow” to react as problems unfolded.

“To kill this economic problem, you cannot utilize a single transaction and expect it to solve everything. You need to do a lot of things,” he told AFP.

The World Bank says the government has brought some stability to its finances, but mainly through debt deferrals and limiting spending on health, education and welfare.

Alex Kremer, the World Bank Country Manager for Laos, warned these austerity measures would have damaging long-term consequences.

“Continued underinvestment in human capital will damage the country’s long-term productivity and its future ability to compete in regional markets,” he said.

Instead, the World Bank has urged the government to boost revenue by cutting tax breaks — and also to try to restructure its debt.

Though small, Laos is too important to Beijing to be allowed to fail, JDB’s Vivat said, both politically and as a key leg in the Belt and Road Initiative route that aims to connect southwest China ultimately to Singapore.

A Chinese foreign ministry spokesperson told AFP Beijing was doing “all it can to help Laos ease its debt burden.”

But Laotians can expect more pain in the short term, with the ADB predicting inflation will stay above 20% until the end of next year at least. 

Australia’s plan to ban children from social media proves popular, problematic

MELBOURNE, Australia — How do you remove children from the harms of social media? Politically the answer appears simple in Australia, but practically the solution could be far more difficult.

The Australian government’s plan to ban children from social media platforms including X, TikTok, Facebook and Instagram until their 16th birthdays is politically popular. The opposition party says it would have done the same after winning elections due within months if the government hadn’t moved first.

The leaders of all eight Australian states and mainland territories have unanimously backed the plan, although Tasmania, the smallest state, would have preferred the threshold was set at 14.

But a vocal assortment of experts in the fields of technology and child welfare have responded with alarm. More than 140 such experts signed an open letter to Prime Minister Anthony Albanese condemning the 16-year age limit as “too blunt an instrument to address risks effectively.”

Details of what is proposed and how it will be implemented are scant. More will be known when legislation is introduced into the Parliament next week.

The concerned teen

Leo Puglisi, a 17-year-old Melbourne student who founded online streaming service 6 News Australia at the age of 11, laments that lawmakers imposing the ban lack the perspective on social media that young people have gained by growing up in the digital age.

“With respect to the government and prime minister, they didn’t grow up in the social media age, they’re not growing up in the social media age, and what a lot of people are failing to understand here is that, like it or not, social media is a part of people’s daily lives,” Leo said.

“It’s part of their communities, it’s part of work, it’s part of entertainment, it’s where they watch content – young people aren’t listening to the radio or reading newspapers or watching free-to-air TV – and so it can’t be ignored. The reality is this ban, if implemented, is just kicking the can down the road for when a young person goes on social media,” Leo added.

Leo has been applauded for his work online. He was a finalist in his home state Victoria’s nomination for the Young Australian of the Year award, which will be announced in January. His nomination bid credits his platform with “fostering a new generation of informed, critical thinkers.”

The grieving mom-turned-activist

One of the proposal’s supporters, cyber safety campaigner Sonya Ryan, knows from personal tragedy how dangerous social media can be for children.

Her 15-year-old daughter Carly Ryan was murdered in 2007 in South Australia state by a 50-year-old pedophile who pretended to be a teenager online. In a grim milestone of the digital age, Carly was the first person in Australia to be killed by an online predator.

“Kids are being exposed to harmful pornography, they’re being fed misinformation, there are body image issues, there’s sextortion, online predators, bullying. There are so many different harms for them to try and manage and kids just don’t have the skills or the life experience to be able to manage those well,” Sonya Ryan said.

“The result of that is we’re losing our kids. Not only what happened to Carly, predatory behavior, but also we’re seeing an alarming rise in suicide of young people,” she added.

Sonya Ryan is part of a group advising the government on a national strategy to prevent and respond to child sexual abuse in Australia.

She wholeheartedly supports Australia setting the social media age limit at 16.

“We’re not going to get this perfect,” she said. “We have to make sure that there are mechanisms in place to deal with what we already have which is an anxious generation and an addicted generation of children to social media.”

A major concern for social media users of all ages is the legislation’s potential privacy implications.

Age estimation technology has proved inaccurate, so digital identification appears to be the most likely option for assuring a user is at least 16.

Australia’s eSafety Commissioner, an office that describes itself as the world’s first government agency dedicated to keeping people safer online, has suggested in planning documents adopting the role of authenticator. The government would hold the identity data and the platforms would discover through the commissioner whether a potential account holder was 16.

The skeptical internet expert

Tama Leaver, professor of internet studies at Curtin University, fears that the government will make the platforms hold the users’ identification data instead.

The government has already said the onus will be on the platforms, rather than on children or their parents, to ensure everyone meets the age limit.

“The worst possible outcome seems to be the one that the government may be inadvertently pushing towards, which would be that the social media platforms themselves would end up being the identity arbiter,” Leaver said.

“They would be the holder of identity documents which would be absolutely terrible because they have a fairly poor track record so far of holding on to personal data well,” he added.

The platforms will have a year once the legislation has become law to work out how the ban can be implemented.

Ryan, who divides her time between Adelaide in South Australia and Fort Worth, Texas, said privacy concerns should not stand in the way of removing children from social media.

“What is the cost if we don’t? If we don’t put the safety of our children ahead of profit and privacy?” she asked. 

EU fines Meta $840 million over abusive practices benefiting Facebook Marketplace

Brussels — The European Commission on Thursday fined Meta Platforms $840.24 million over abusive practices benefiting Facebook Marketplace, it said in a statement, confirming an earlier report by Reuters.

“The European Commission has fined Meta … for breaching EU antitrust rules by tying its online classified ads service Facebook Marketplace to its personal social network Facebook and by imposing unfair trading conditions on other online classified ads service providers,” the European Commission said.

Meta said it will appeal the decision, but in the meantime, it will comply and will work quickly and constructively to launch a solution which addresses the points raised.

The move by the European Commission comes two years after it accused the U.S. tech giant of giving its classified ads service Facebook Marketplace an unfair advantage by bundling the two services together.

The European Union opened formal proceedings into possible anticompetitive conduct of Facebook in June, 2021, and in December, 2022, raised concerns that Meta ties its dominant social network Facebook to its online classified ad services.

Facebook launched Marketplace in 2016 and expanded into several European countries a year later.

The EU decision argues that Meta imposes Facebook Marketplace on people who use Facebook in an illegal “tie” but Meta said that argument ignores the fact that Facebook users can choose whether to engage with Marketplace, and many do not.

Meta said the Commission claimed that Marketplace had the potential to hinder the growth of large incumbent online marketplaces in the EU but could not find any evidence of harm to competitors.

Companies risk fines of as much as 10% of their global turnover for EU antitrust violations.

Foreign acquisition of US Steel faces cooler temperatures after presidential election

Before the U.S. presidential election, President Joe Biden and former President Donald Trump opposed a Japanese company’s planned $14 billion purchase of U.S. Steel, a once-iconic pillar of America’s industrial age. With the election over, there are indications that the deal may go through. VOA Chief National Correspondent Steve Herman went to Braddock, Pennsylvania, to gauge local sentiment to the acquisition. Videographer: Adam Greenbaum

Analysts skeptical about African impact of China’s zero-tariff offer

NEW DELHI — Analysts interviewed by VOA expressed skepticism over China’s recent decision to eliminate tariffs for goods from least developed countries with diplomatic relations with Bejing, including 33 in Africa, next month.

The move was announced by Chinese President Xi Jinping at the 2024 Summit of the Forum on China-Africa Cooperation in Beijing in early September.

The analysts see it as an effort to expand China’s influence in Africa without bringing much benefit to the LDCs.

“This move has not generated the excitement it should, due to well-known structural difficulties in Africa,” Emmanuel Owusu-Sekyere, director of research, policy and programs at the African Center for Economic Transformation in Accra, Ghana, told VOA.

“Cooperation between China and Africa has benefitted China much more than it has Africa,” he said, adding, “Africa has given China unbridled access to its markets, which has crippled local production capacity in several aspects of the manufacturing sector e.g., textiles.”

Xi described the zero-tariffs plan as making China the first major economy to take such a step to offer Africa a substantial opportunity to do business in the large Chinese market.

Analysts see it as Beijing’s attempt to compete with the United States. The U.S. African Growth and Opportunity Act provides duty-free access to the U.S. market for more than 1,800 products from 32 sub-Saharan African countries. It will come up for renewal next year. They say China is also trying to take advantage of resentment of some African countries barred from AGOA on such grounds as human rights or lack of democracy and free markets.

“China’s move to allow African LDCs to export tariff-free is clearly a move to project its power in an alternative world order,” said Samir Bhattacharya, associate fellow at the New Delhi-based Observer Research Foundation.

“The rigid policies of the U.S. have made some African countries averse towards it. China sees this as an opportunity to undermine the U.S.-led world order and promote its own narrow interests,” Bhattacharya said.

“China has reworked its trade basket to lure African leaders,” he added.

“This scheme would offer additional support to dictators and military leaders in African countries who are not comfortable with the U.S.,” he said. “It would not improve the economy of these countries.”

China’s viewpoint

Chinese Commerce Ministry spokesperson He Yongqian has said that the initiative would boost LDC exports. It will also promote solidarity and cooperation among the countries of the Global South and advance the goal of “inclusive and equitable economic globalization,” she said.

She said China has signed framework agreements on economic partnership for common development with 22 African countries, including Ethiopia, Burundi, Gabon and Zimbabwe.

However, Owusu-Sekyere expressed a different view.

“African countries are not strategically located in Asian production value chains like Bangladesh and Vietnam. Lack of strategic positioning and planning as well as structural bottlenecks will make it difficult for African countries to take advantage of this plan,” Owusu-Sekyere said.

Every time China’s government enters into a trade or investment agreement with another country, Chinese entrepreneurs usually rush to grab the business opportunities created by the deal. This has been the experience of several countries in Africa and Asia that have received Chinese investments.

Owusu-Sekyere said several African countries have enacted laws reserving the retail sector exclusively for locals but it has been taken over in those countries by Chinese entrepreneurs using local partners as fronts.

The bigger challenge for African countries are nontariff barriers related to such things as quality, he said.

“African economies are not diversified enough to supply at the quality and scale required to meet the sophisticated and diverse demands of a huge market as China.” according to Owusu-Sekyere. 

Bain: Global luxury sales to fall 2% in 2024, among weakest years on record

Sales of personal luxury goods are set to fall 2% this year, making it one of the weakest on record, with price hikes and economic uncertainty shrinking the industry’s customer base, according to consultancy Bain & Company.

In its closely-watched report on the $386 billion global market, Bain estimated a 20-22% sales drop in China, which has turned into a drag after a years-long boom before the pandemic fueled by the wealthy and growing middle-class.

The forecasts include the effect of currency moves.

“This is the first time the personal luxury goods industry has declined since the 2008-09 crisis, with the exception of the pandemic,” Bain partner Federica Levato told Reuters.

The study released on Wednesday will likely heighten concerns among investors that the sector’s current downturn, which has knocked shares in the likes of LVMH and Kering, may be longer and deeper than anticipated.

Global sales of luxury personal goods – spanning clothing, accessories and beauty products – are expected to be flat at constant exchange rates during the holiday season, with China’s performance still negative, Levato said.

A shift by brands to position their products within a higher price band, coupled with weaker consumer confidence amid wars, China’s economic woes and elections across the globe, has led many customers, especially younger ones, to forgo purchases.

“The luxury consumer base has declined by 50 million over the last two years, from a total of approximately 400 million consumers,” Levato said.

Growth prospects for the market hinge partly on the strategies brands choose to pursue, including on pricing, she added.

In a further sign that higher prices are holding back consumers, Bain said the outlet channel was outperforming, driven by shoppers’ quest for value.  

The personal luxury goods sector is expected to grow by between 0% and 4% at constant exchange rates in 2025, supported by sales in Europe and the Americas, with China seen recovering only in the second part of 2025, Bain said.  

Levato said Donald Trump’s victory in the U.S. presidential election had removed one uncertainty, while possible interest rate and tax cuts could encourage Americans to spend more.  

In contrast to personal goods, luxury spending on experiences, such as hospitality and dining, is expected to increase this year, Bain said. 

China’s largest air show takes off with fighter jets, attack drones

Zhuhai, China — Stealth fighter jets and attack drones took center stage as China’s largest air show officially opened on Tuesday, an opportunity for Beijing to showcase its growing military might to potential customers and rivals alike.

China has poured resources into modernizing and expanding its aviation capabilities as it faces off against the United States and others around regional flashpoints like Taiwan.

Record numbers of Chinese warplanes have been sent around the self-ruled democratic island, which Beijing claims as its territory, over the past few years.

The star of Airshow China, which showcases Beijing’s civil and military aerospace sector every two years in the southern city of Zhuhai, is the new J-35A stealth fighter jet.

Its inclusion in the airshow suggests it is nearly ready to enter operation, which would make China the only country other than the United States to have two stealth fighters in action, experts said.

The J-35A is lighter than China’s existing model, the J20, and looks more similar in design to a US F-35.

A group of J20s performed a display flight on Tuesday morning, flying in a diamond formation across a grey sky.

State news agency Xinhua quoted military expert Wang Mingzhi as saying the combination of the two models greatly enhances the People’s Liberation Army Air Force (PLAAF)’s “ability to conduct offensive operations in high-threat and contested environments.”

Attack drones

The airshow will feature a dedicated drone zone for the first time, reflecting their increased prominence in warzones, including Ukraine.

The SS-UAV — a massive mothership that can rapidly release swarms of smaller drones for intelligence gathering, as well as strikes — will be on display in Zhuhai, according to the South China Morning Post.

In October the United States unveiled sanctions targeting China-based companies linked to the production of drones that Russia has deployed in Ukraine.

Moscow and Beijing have deepened military and defense ties since Russia’s invasion of its neighbor three years ago, and the secretary of its Security Council, Sergei Shoigu, is due to visit Zhuhai.

This year the show’s focus is squarely on the military sector, as it coincides with the 75th anniversary of the PLAAF, but China’s burgeoning space industry will also be showcasing developments.

A model of a homegrown reusable space cargo shuttle will debut at the show, Xinhua reported on Monday.

Named Haoloong, the shuttle is designed to be launched on a commercial rocket, and then dock with China’s space station Tiangong.

“It can re-enter the atmosphere, fly and land horizontally at a designated airport, allowing for recovery and reuse,” Xinhua said.

Beijing has poured huge resources into its space program over the past decade in an effort to catch up to traditional space powers the United States and Russia.

Web Summit kicks off in Lisbon as tech leaders weigh Trump’s return

LISBON, PORTUGAL — Lisbon will this week play host to Europe’s biggest annual tech conference, Web Summit, where industry leaders and lawmakers will weigh the pros and cons of Donald Trump’s return to the White House.

Senior executives from firms such as Apple, Microsoft, and Meta will join high-ranking officials from Europe for debates about the future of artificial intelligence, social media regulation, and the impact a second Trump presidency may have on the continent.

Trump has previously promised he could end the war between Ukraine and Russia within 24 hours of taking office. Days after Trump’s re-election, two senior Ukrainian government officials, Alex Bornyakov and Mykhailo Fedorov, will take to the stage to discuss how the country has continued innovating in the face of conflict.

John Adam, chief revenue officer at software development firm Aimsoftpro, is among those attending. About 70% of the company’s workforce is still based in Ukraine, with the rest having relocated around Europe after the war’s outbreak in 2022.

“There’s mixed feelings because the Trump approach looks like it’s more geared towards the present lines of conflict, which is not an ideal scenario for Ukraine, and there’s a reluctance to accept that. At the same time, we would like this to have an endpoint,” he said.

The X factor

While not expected to attend, tech billionaire and vocal Trump supporter Elon Musk will be a recurring theme, from his role in Ukraine via satellite service Starlink to his success with space exploration firm SpaceX and controversial stewardship of social media platform X, formerly Twitter.

One panel will debate how Europe might develop a homegrown rival to SpaceX; another whether Musk “destroyed Twitter.” Joe Benarroch, who quit his role as X’s de facto spokesperson and head of business operations in June, will join a panel titled “What to do about social media.”

While the EU has tried forcing online platforms to clamp down on harmful content, Trump’s election may lead to them reducing moderation efforts, according to Mark Weinstein, founder of privacy-focused social media platform MeWe, who will share the stage with Benarroch on Wednesday.

“Historically, Trump has been highly critical of online moderation,” he said. “To avoid political retribution, major social networks are likely to continue the trend of becoming significantly more permissive with content they allow on their platforms.”

As data center industry booms, English village becomes battleground

ABBOTS LANGLEY, England — Originally built to store crops from peasant farmers, the Tithe Barn on the edge of the English village of Abbots Langley was converted into homes that preserve its centuries of history. Now, its residents are fighting to stop a development next door that represents the future.

A proposal to build a data center on a field across the road was rejected by local authorities amid fierce opposition from villagers. But it’s getting a second chance from British Prime Minister Keir Starmer’s government, which is pursuing reforms to boost economic growth following his Labour party’s election victory in July.

Residents of Abbots Langley, 30 kilometers northwest of London, worry the facility will strain local resources and create noise and traffic that damages the character of the quiet village, which is home to more than 20,000 people. Off the main street there’s a church with a stone tower built in the 12th century and, further down the road, a picturesque circular courtyard of rustic thatched-roof cottages that used to be a farm modeled on one built for French Queen Marie Antoinette.

“It’s just hideously inappropriate,” said Stewart Lewis, 70, who lives in one of the converted houses in the 600-year-old Tithe Barn. “I think any reasonable person anywhere would say, ‘Hang on, they want a data center? This isn’t the place for it.'”

As the artificial intelligence boom fuels demand for cloud-based computing from server farms around the world, such projects are pitting business considerations, national priorities and local interests against each other.

Britain’s Deputy Prime Minister Angela Rayner has stepped in to review the appeals filed by developers of three data center projects after they were rejected by local authorities, taking the decision out of the hands of town planners. Those proposals include Abbots Langley and two projects in Buckinghamshire, which sits west of London. The first decision is expected by January.

The projects are controversial because the data centers would be built on “greenbelt” land, which has been set aside to prevent urbanization. Rayner wants to tap the greenbelt for development, saying much of it is low quality. One proposed Buckinghamshire project, for example, involves redeveloping an industrial park next to a busy highway.

“Whilst it’s officially greenbelt designated land, there isn’t anything ‘green’ about the site today,” said Stephen Beard, global head of data centers at Knight Frank, a property consultancy that’s working on the project.

“It’s actually an eyesore which is very prominent from the M25” highway, he said.

Greystoke, the company behind the Abbots Langley center and a second Buckinghamshire project to be built on a former landfill, didn’t respond to requests for comment. In an online video for Abbots Langley, a company representative says, “We have carried out a comprehensive search for sites, and this one is the very best.” It doesn’t specify which companies would possibly use the center.

The British government is making data centers a core element of its economic growth plans, deeming them “critical national infrastructure” to give businesses confidence to invest in them. Starmer has announced deals for new centers, including a 10 billion pound ($13 billion) investment from private equity firm Blackstone to build what will be Europe’s biggest AI data center in northeast England.

The land for the Abbots Langley data center is currently used to graze horses. It’s bordered on two other sides by a cluster of affordable housing and a highway.

Greystoke’s plans to construct two large buildings totaling 84,000 square meters and standing up to 20 meters tall have alarmed Lewis and other villagers, who worry that it will dwarf everything else nearby.

They also doubt Greystoke’s promise that it will create up to 260 jobs.

“Everything will be automated, so they wouldn’t need people,” said tech consultant Jennifer Stirrup, 51, who lives in the area.

Not everyone in the village is opposed.

Retiree Bryan Power says he would welcome the data center, believing it would benefit the area in a similar way as another big project on the other side of the village, the Warner Bros.’ Studio Tour featuring a Harry Potter exhibition.

“It’ll bring some jobs, whatever. It’ll be good. Yeah. No problem. Because if it doesn’t come, it’ll go somewhere else,” said Power, 56.

One of the biggest concerns about data centers is their environmental impact, especially the huge amounts of electricity they need. Greystoke says the facility will draw 96 megawatts of “IT load.” But James Felstead, director of a renewable energy company and Lewis’ neighbor, said the area’s power grid wouldn’t be able to handle so much extra demand.

It’s a problem reflected across Europe, where data center power demand is expected to triple by the end of the decade, according to consulting firm McKinsey. While the AI-fueled data boom has prompted Google, Amazon and Microsoft to look to nuclear power as a source of clean energy, worries about their ecological footprint have already sparked tensions over data centers elsewhere.

Google was forced to halt plans in September for a $200 million data center in Chile’s capital, Santiago, after community complaints about its potential water and energy usage.

In Ireland, where many Silicon Valley companies have European headquarters, the grid operator has temporarily halted new data centers around Dublin until 2028 over worries they’re guzzling too much electricity.

A massive data center project in northern Virginia narrowly won county approval last year, amid heavy opposition from residents concerned about its environmental impact. Other places like Frankfurt, Amsterdam and Singapore have imposed various restrictions on data centers.

Public knowledge about the industry is still low but “people are realizing more that these data centers are quite problematic,” said Sebastian Lehuede, a lecturer in ethics, AI and society at King’s College London who studied the Google case in Chile.

As awareness grows about their environmental impact, Lehuede said, “I’m sure we will have more opposition from different communities.”

EV industry watching Musk’s role in tariff fixing

New Delhi — The electric vehicle industry is closely watching to see how Tesla boss Elon Musk, who played a key role in the victory of Republican President-elect Donald Trump, will use his influence with the incoming president to steer the industry’s future.

At stake are several issues including the new administration’s approach to tariffs on Chinese EVs and tax credits. In anticipation of decisions favorable to Tesla, shares in the company rose 27% after the election result was announced, taking its market capitalization to $1 trillion.

During the campaign, Trump said he would increase tariffs on Chinese goods and roll back tax credits available to EV buyers in the U.S. He also vowed to reduce or eliminate many vehicle emissions standards under the Environmental Protection Agency, which support the EV industry.

Industry analysts are divided on whether high tariffs on Chinese EVs are advantageous or disadvantageous for Tesla’s business. Some analysts have suggested that Musk could persuade the Trump administration to reduce the tariffs on Chinese EVs and might even temper the overall tariff regime against Chinese goods.

However, Musk is likely to support the elimination of the $7,500 tax credit given to EV buyers in the United States. The absence of tax credits would make it difficult for legacy carmakers to introduce EV versions of their cars in competition with Tesla.

“As Elon Musk played a very important role in funding Trump’s campaign, he will no doubt have the ear of the U.S. president and play a role that will help shape policies that are advantageous to Tesla and his other businesses,” Bill Russo, founder and CEO of Automobility Limited, a Shanghai-based strategic consulting and investment platform, told VOA.

To be sure, Musk opposed U.S. tariffs on China-made EVs last May. “Neither Tesla nor I asked for these tariffs. In fact, I was surprised when they were announced. Things that inhibit freedom of exchange or distort the market are not good,” Musk said after the Biden administration enhanced tariffs on Chinese EVs.

The question is whether he will continue to oppose tariffs on Chinese EVs after Trump enters the White House. A section of analysts has predicted that Musk would continue this line of argument because China accounts for one-third of Tesla sales.

“Tesla is in China because Elon Musk needs the scale and efficient cost structure of the Chinese supply chain to make the company more competitive around the world,” Russo said.

China makes over 70% of the EV batteries in the world and almost two-thirds of all EVs and related components. “Tariffs make accessing this supply chain more costly, and that does not help Tesla,” he said.

Between January and May this year, Tesla sold almost as many cars in China as it did in the United States. Chinese consumers bought one-third of Tesla cars of all models totaling 513,644. In the same period, the company sold 522,444 vehicles in the U.S.

Wedbush Securities analyst Dan Ives argued that higher tariffs would help Tesla compete better with Chinese EVs in the U.S. market.

“Tesla has the scale and scope that is unmatched in the EV industry and this dynamic could give Musk and Tesla a clear competitive advantage in a non-EV subsidy environment, coupled by likely higher China tariffs that would continue to push away cheaper Chinese EV players (BYD, Nio etc.) from flooding the U.S. market over the coming years,” Ives said in a note to clients this week.

Taking a different view, Beatrix C. Keim, director of Germany-based Centre Automotive Research, said the next president is unlikely to listen to arguments for reducing tariffs on Chinese EVs.

“There is a 100% tariff for Chinese EVs in place. I don’t think that Trump will weaken this,” she said. The high tariff does not affect Tesla because it does not export cars from its Shanghai plant for the U.S. market, and builds them in the U.S.

Keim said Musk will do whatever serves Tesla’s business in China. “Chinese people are very likely to react emotionally if he is perceived as acting against China’s interest,” she said. “Chinese customers had once blocked the sales of Tesla cars, and this can happen again.”

Musk said last April that he loved the Chinese people.

“I’m a big fan of China. I also have a lot of fans in China. Well, the feelings are reciprocated,” Musk, who has often been described in Chinese social media as a “friend of China,” said in April.

Tesla is set to introduce a new fully self-driving (FSD – Supervised) car in the coming months, though the vehicle’s safety remains under review. Musk must have sufficient influence in both Washington and Beijing to obtain the regulatory approvals necessary to sell it.

“China is likely to approve FSD as it would like to show goodwill toward foreign technology,” Russo said. However, Tesla’s FSD may have a limited market in China where local manufacturers play a much bigger role.

Keim said Tesla’s FSD might not face regulatory challenges in Europe, but it may be difficult for it to find enough customers in the face of local competition.

One of the questions that is often asked is whether China would retaliate by imposing higher tariffs on American goods, including Tesla.

“This is very unlikely, as Tesla has invested in China and is used as an example of how foreign brands are still welcome in China, and Tesla is held up as a benchmark for Chinese companies to measure against,” Russo said.

“Killing competition is not viewed as healthy for the forward development of the Chinese automakers. This is in stark contrast to the way the U.S. has acted so far.”