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19 May 2023, Friday | NIAS Europe Daily Brief #519
IN BRIEF
By Nithyashree RB, Sreeja JS, and Melvin George
ITALY
Central Bank criticizes the new tax bill
On 18 May, Italy’s central bank said that reducing the tax bands and reducing the tax burden while providing an extensive welfare system is unrealistic. In March 2023, Italian Prime Minister Giorgia Meloni approved a bill which will reduce the income tax bands from four to three and eventually launch a flat tax model. The bill will supposedly increase investment and hiring rates and avoid tax evasion. While trade unions and opposition parties criticized the bill as advantageous to the rich, the government assured that the budget deficit will be lower. (Giuseppe Fonte, “Italian government’s flat tax plan may be unrealistic, central bank says,” Reuters, 18 May 2023)
TURKEY
Kemal Kilicdaroglu vows to send back refugees
On 18 May, Turkish opposition leader Kemal Kilicdaroglu said that he will send back all the refugees in Turkey if he becomes the president in an interview. He said ten million refugees are to come and they will indulge in criminal activities such as looting. Earlier Kilicdaroglu’s election campaigning focused on political reforms, Turkey’s EU membership bid, and closer ties with the West. Ahead of the second round of the election on 21 May, he criticized Turkish President Recep Tayyip Erdogan for allowing ten million refugees into Turkey and for jeopardising Turkish citizenship. (“Erdogan’s rival pledges to expel ‘all refugees’ from Türkiye,” RT, 18 May 2023)
THE UK
UK to invest in semiconductor design and research
On 19 May, Britain announced a strategic investment in the semiconductor sector in order to strengthen the domestic industry and supply chains. The newly formed Department of Science, Innovation and Technology will be focusing on semiconductor design and research. One billion pounds were announced, out of which 200 million will be invested in 2023 to 2025, the rest during the next decade. During the G7 meeting, a “semiconductor partnership” was agreed to be launched between Japan and Britain similar to the one Britain has with South Korea. The investment for chip manufacturing will be announced by autumn. Similar to US chip subsidies and European Union investments in the sector, these measures were taken in order to protect the manufacturing sector from supply chain disruptions in case of a Chinese invasion of Taiwan. (Alistair Smout and Sachin Ravikumar, “UK plans 1 bln pounds of semiconductor investment in new strategy”, Reuters, 18 May 2023)
REGIONAL
UK and Norway to cooperate against threats to undersea infrastructure
On 18 May, the UK government said that along with Norway, it would increase their collaboration to protect the undersea infrastructure from threats. UK's Defence Minister Ben Wallace said: "The attack on the Nord Stream pipeline has determined even closer collaboration across our collective assets to detect and defend against subsea threats and ensure continued North Atlantic security." (Alistair Smout and Kylie Maclellan “UK and Norway agree cooperation to counter undersea threats”, Reuters, 18 May 2023)
INTERNATIONAL
US and UK to tighten sanctions on Russia as G7 Summit commences
On 19 May, the G7 leaders are gathering at Hiroshima for the G7 summit, where they will unveil new sanctions and export controls against Russia. The renewed US sanctions package will include severe restrictions on goods key to the battlefield and add 70 Russian entities to the US commerce department’s blacklist. It will also announce 300 new sanctions against Russia’s “financial facilitators,” helping the war. The sanctions are likely to be extended to more sectors of the Russian economy. UK Prime Minister Rishi Sunak said he wants to ensure “Russia pays a price” for the war atrocities in Ukraine. He also expects others to follow suit. Import bans on Russian gold, diamond, copper, aluminium and nickel are likely to be implemented by the UK. The government is also planning to target 86 more people and companies connected to Putin “actively undermining the impact of existing sanctions.” (Jeff Mason, Trevor Hunnicutt, Daphne Psaledakis and Susan Heavey, “U.S., G7 to unveil new sanctions targeting Russia over Ukraine,” Reuters, 19 May 2023; “G7: New sanctions will make sure Russia pays a price, Sunak says,” BBC News, 19 May 2023)
Free trade between India and UK doubtful
On 18 May, Reuters reported that the free trade deal between UK and India is doubtful due to mutual differences in some key tariff lines and investment protection rules. India wants to levy import duties on car and liquor imports that the UK denies. India is against Britain’s insistence that its companies be allowed to seek international arbitration without going to Indian courts first should a dispute arise. (Shivangi Acharya, Aditi Shah and Aftab Ahmed, “Exclusive: India, UK still far apart on free trade deal - sources,” Reuters, 18 May 2023)
GENDER
Slovakia to bar transgender people from changing their gender
On 18 May, Reuters reported that Slovakia’s parliament will vote on legal recognition of transgender people. If the bill is passed, transgender people will not be able to change their gender in official documents. Gender will be assigned according to the number of chromosomes present through a genetic test. According to the Slovak psychiatric society, genetic tests do not always indicate gender correctly. At present, transgender people in Slovakia can change their names, surnames, gender and birth number. The bill will allow transgender people to change their names only. (Jan Lopatka, “Slovaks near vote on banning legal recognition for transgender people,” Reuters, 18 May 2023)