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The de facto US intervention in Haiti is under way

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Haiti’s unelected prime minister, Ariel Henry, said on Monday he would step down following the appointment of a transitional council and interim prime minister after leading the Caribbean country since the assassination of its last president in 2021.

Under Henry’s rule, armed gangs have greatly increased their wealth, influence and territory, leading to the establishment of a United Nations-backed security mission led by Kenya.

Last week, Henry travelled to Kenya to seek support. But the conflict escalated dramatically in his absence, leaving the 74-year-old neurosurgeon prime minister stranded in the US territory of Puerto Rico.

“My government will resign as soon as a (transitional) council is formed. I want to thank the Haitian people for this opportunity,” Henry said in a late-night video address.

Haitians celebrated in the streets after Henry’s statement went viral on social media, urging all Haitians to remain calm and do everything in their power to restore peace and stability as quickly as possible.

Henry’s resignation agreed with the US in Puerto Rico

Reuters quoted a senior US official as saying that Henry was free to stay in Puerto Rico or travel elsewhere, but that security in Haiti needed to improve before he could return home. The official said the resignation was agreed on Friday, revealing US involvement in the process.

Henry will be replaced by a Presidential Council of seven voting members, including two observers and representatives of various political coalitions, business, civil society and a religious community.

The council has been tasked with quickly appointing an interim prime minister; no one who wants to run in Haiti’s next elections will be able to do so.

The country has been without elected representatives since early 2023, and the next elections will be the first since 2016. Henry, who is seen by many Haitians as corrupt, has repeatedly postponed the elections, saying that security must first be restored.

The US brings the countries of the region together

Regional leaders met in nearby Jamaica on Monday to discuss the framework for the political transition process, which the US last week called for to be ‘accelerated’ as armed gangs try to overthrow the government.

US Secretary of State Antony Blinken said on Monday that the council would be tasked with addressing the ‘immediate needs’ of Haitians, ensuring the deployment of the security mission and creating the security conditions necessary for free elections.

Henry’s resignation comes amid regional talks on his request to join an international force to help police fight gangs whose brutal turf wars have fuelled the humanitarian crisis, cut off food supplies and driven hundreds of thousands from their homes.

Uncertainty of transfer in financing of ‘aid’ to Haiti

US Secretary of State Antony Blinken said on Monday that the US would provide $100 million for the force and $33 million in humanitarian aid, bringing the total US commitment to the force to $300 million.

But it was unclear how long it would take for the funds to be approved by lawmakers and transferred. A UN spokesman said that as of Monday, less than $11 million had been paid into the UN’s special trust fund and that no new contributions had been made since Haiti declared a state of emergency on 3 March.

Mexico’s foreign minister added that the country had contributed an unspecified amount of funds and called for further action to stop arms trafficking to Haiti.

Many Haitians inside and outside Haiti are wary of international intervention after previous UN missions left behind a devastating cholera epidemic and sexual abuse scandals that have never been resolved.

Gangs’ weapons come from the US

The UN believes Haitian gangs have amassed large arsenals, much of it made up of weapons smuggled from the United States.

A state of emergency was declared in Haiti earlier this month after Jimmy ‘Barbecue’ Cherizier, the leader of an alliance of armed groups, said they would unite and overthrow Henry, as clashes damaged communications and led to two prison breaks.

The UN estimates that more than 362,000 people, half of them children, have been internally displaced and thousands have been killed in the conflict since 2021, with widespread rape, torture and kidnapping for ransom.

The Financial Times writes that many of the country’s gangs are believed to receive significant support from Haiti’s elite. According to InSight Crime, which investigates criminal networks in Latin America, G-9 received half of its income from the government of President Moïse before he was assassinated in 2021.

Gang leader’s ‘bloody revolution’ statement

Cherizier, the leader of the G-9 gang in Haiti and a former policeman, threatened to go after hotel owners who hid politicians or collaborated with Henry.

Barbecue’ also demanded that the country’s next leader be elected by the people and live in Haiti with his family. Many influential Haitian politicians live abroad.

“We are not in a peaceful revolution. We are in a bloody revolution in the country because this system is an apartheid system, a bad system,” he said.

According to the FT, in the vast slums under Cherizier’s control, where there are no state services such as sewers, electricity or running water, there are murals depicting him as the Argentine revolutionary Che Guevara.

Who is the leader of the ‘Barbecue’ Cherizier gang?

A Guardian correspondent makes a similar observation. The gang leader, who claims to present himself in interviews as a “God-fearing Caribbean Robin Hood”, has paid tribute to freedom fighters such as Fidel Castro, Thomas Sankara and Malcolm X. When they met last year, he told New Yorker reporter Jon Lee Anderson: “I like Martin Luther King too. But he didn’t like to fight with guns, and I fight with guns.

In an interview with Vice in 2022, Chérizier described his favela army as ‘a socio-political structure and a force that fights for the defenceless’.

For some time now, ‘Barbecue’ has frequently taken Western media organisations into the areas under his control and given interviews.

Cherizier, the youngest of eight children whose father died when he was five, has said he was inspired by François Duvalier, the brutal dictator who ruled Haiti from 1957 to 1971. But ‘Barbecue’ claims he would ‘never slaughter’ people of the same social class as himself.

According to the UN, gangs like the G-9 now control about 80 per cent of the capital, Port-au-Prince. They extort money from businesses and kidnap residents, rich and poor, for ransom, while fighting each other for territory. With only 9,000 members, the police force is understrength.

Despite his efforts to portray himself as a pro-people politician, Cherizier is accused by the UN of taking part in several massacres, some of which took place while he was still a police officer. In one of them, more than 71 people were killed, 400 houses set on fire and at least seven women raped by gangs in the Port-au-Prince slum of La Saline in 2018.

As well as Cherizier and the G-9 gang, Johnson Andrï, known as ‘Izo’, and the 5 Seconds gang have also made a name for themselves. There are an estimated 200 gangs in Haiti, 23 of which are believed to operate in the Port-au-Prince area.

AMERICA

Fed cuts interest rates, dollar surges to two-year high

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The U.S. Federal Reserve reduced interest rates by a quarter percentage point but signaled a slower pace of easing next year. This move drove the U.S. dollar to its highest level in two years and triggered a sell-off in both domestic and international stock markets.

The Federal Open Market Committee (FOMC) voted on Wednesday to lower the benchmark interest rate to 4.25–4.5%, marking the third consecutive cut. The lone dissenting vote came from Cleveland Fed President Beth Hammack, who favored maintaining the current rates.

Officials highlighted concerns about persistent inflation, projecting fewer rate cuts for 2025 than previously expected. Reflecting these worries, policymakers also raised their inflation forecasts for the coming year. Following the announcement, Fed Chair Jay Powell remarked that the current policy settings were “significantly less restrictive,” indicating the Fed’s inclination to adopt a more cautious approach to further easing.

“This decision was a ‘closer call’ than prior meetings,” Powell noted, emphasizing that inflation trends remain “sideways” while risks to the labor market are “diminishing.”

Aditya Bhave, senior U.S. economist at Bank of America, described the Fed’s message as “unabashedly hawkish.” He pointed to the shift in officials’ 2025 forecasts, which now anticipate just two quarter-point rate cuts instead of three, calling it a “wholesale shift.”

JPMorgan Chase, a key player in U.S. bond markets, noted that money markets are pricing in only a 0.31 percentage point rate cut in 2025. This outlook, significantly tighter than the bank’s earlier 0.75-point forecast, underscores the magnitude of the Fed’s policy shift.

The decision triggered a sharp sell-off on Wall Street, with the S&P 500 falling 3% and the tech-heavy Nasdaq Composite dropping 3.6%. High-profile winners of the 2024 rally were hit hard, including: Tesla, down 8.3%; Meta (Facebook’s parent company), down 3.6%; Amazon, down 4.6%.

Smaller companies, often seen as more sensitive to US economic fluctuations, also suffered. The Russell 2000 index declined 4.4%.

In Asia, stocks fell in early Thursday trading. Benchmarks in South Korea and Taiwan dropped 1.8% and 1.6%, respectively. Meanwhile, U.S. government bond prices fell, driving the yield on two-year Treasuries—sensitive to Fed policy—up by 0.11 percentage points to 4.35%.

The U.S. dollar surged 1.2% against a basket of six major currencies, reaching its strongest level since November 2022. According to Wells Fargo senior economist Mike Pugliese, the currency had already been rising on expectations of inflationary pressures following Donald Trump’s election victory last month. However, Wednesday’s Fed decision “poured more petrol on the fire.”

The South Korean won dropped to a 15-year low against the dollar, while the Japanese yen weakened 0.5%.

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AMERICA

Amazon pledges $1 billion to Trump inauguration fund

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Amazon confirmed on Thursday that it will contribute $1 million to Donald Trump’s inauguration fund, a move mirroring similar actions by other major tech companies, including Meta, the parent company of Facebook and Instagram. Amazon also plans to broadcast Trump’s inauguration via its Prime Video service.

This announcement comes as major tech executives seek to establish ties with the incoming U.S. president, despite Trump’s longstanding criticisms of Big Tech. Trump has frequently accused technology companies of censorship and bias against conservative media.

Jeff Bezos, Amazon’s founder and CEO, is reportedly planning to meet Trump at his Mar-a-Lago resort next week, according to The Wall Street Journal, which first reported Amazon’s donation. Similarly, Google CEO Sundar Pichai and Apple CEO Tim Cook have expressed their congratulations to Trump since his election victory in November.

Trump’s relationship with Amazon has been fraught with challenges. During his first term, he accused the company of undercutting competition and criticized its tax policies. In 2018, Trump ordered a review of U.S. Postal Service package pricing, claiming the agency acted as Amazon’s “courier.”

Apple, meanwhile, faces potential risks from Trump’s proposed tariff policies, which could disrupt critical supply chains in China. However, during Trump’s first term, Cook secured exemptions for certain Apple products.

Meta’s CEO, Mark Zuckerberg, and other tech leaders have also engaged with Trump. According to The Information, Zuckerberg dined with Trump after the election. Pichai is also expected to meet Trump this week.

While Trump scrutinized Big Tech during his presidency, Amazon now faces mounting regulatory pressure under President Joe Biden. The U.S. Federal Trade Commission (FTC), led by Lina Khan, has been investigating Amazon for alleged monopoly practices, with several states filing lawsuits last year. The FTC is also examining major cloud service providers, including Amazon, over partnerships in artificial intelligence.

Despite earlier conflicts, Bezos recently praised Trump for his “tremendous grace and courage under real fire” in a post on X (formerly Twitter) following an assassination attempt. Bezos, who also owns The Washington Post, reportedly prevented the newspaper from endorsing Trump’s Democratic opponent Kamala Harris in the 2024 election.

Speculation about a tacit agreement between Bezos and Trump has surfaced, allegedly tied to Blue Origin, Bezos’s rocket company competing with Elon Musk’s SpaceX.

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AMERICA

Investors poured $140 billion into U.S. equities following Trump’s victory

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Nearly $140 billion has flowed into U.S. equity funds since last month’s election, as investors anticipate Donald Trump’s administration will implement sweeping tax cuts and regulatory reforms.

According to the Financial Times (FT), which cites data from EPFR, U.S. equity funds have seen inflows totaling $139.5 billion since Trump’s victory on November 5. This surge in investment made November the busiest month for equity inflows since records began in 2000.

The massive influx of funds has driven major U.S. stock indexes to a series of record highs, as investors appeared to shrug off concerns about potential economic risks, including inflation and its implications for the Federal Reserve’s interest rate policy.

“The growth agenda that Trump has put on the table is being fully embraced,” said Dec Mullarkey, Chief Executive of SLC Management. He added that Trump’s picks for top administration posts have been seen as “very market friendly.”

Trump has promised to fill his administration with financial experts, including Scott Bessent as Treasury Secretary, and Paul Atkins, a cryptocurrency advocate, as Chairman of the Securities and Exchange Commission (SEC).

The president-elect has outlined a pro-growth agenda, emphasizing reduced taxes, deregulation, and economic expansion. These proposals have spurred optimism among investors, fueling a rally in the market.

The S&P 500, Wall Street’s primary stock market indicator, has risen 5.3% since Election Day, bringing its total gains for the year to 28%. Smaller companies, which are often seen as more responsive to changes in the U.S. economy, have outperformed larger firms during this period. The Russell 2000 index recently hit a record high for the first time in three years.

While U.S. equity funds have enjoyed record inflows, other global markets have experienced outflows emerging market funds have seen net withdrawals of $8 billion, with China-focused funds accounting for $4 billion; funds investing in Western Europe have lost $14 billion; and Japan-focused funds have seen outflows of approximately $6 billion.

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