Editor's note: Global Morning Briefing is a roundup of international news compiled by The Seoul Economic Daily.
Starbucks in Dandong, Within Sight of Sinuiju; Dozens of Trucks Parked Under the Bridge
Anticipation was palpable on the 6th in the Xinqu district of Dandong, in China's Liaoning province, ahead of the opening of the New Yalu River Bridge. China footed the bill for the bridge and completed it in 2014, but construction of connecting roads and customs facilities on the North Korean side stalled as ties between Pyongyang and Beijing soured, leaving the bridge unopened for 12 years. Vehicles have been spotted crossing it several times since the middle of last month, however, and night lighting has been switched on at the main towers and piers over the past few days.
Cafes and about a dozen food trucks have sprung up on what was once empty land around the bridge, and a large shopping mall has opened the area's first Starbucks and McDonald's outlets. Expectations of an opening have stirred property prices and prompted more trading companies to relocate to the area. Dozens of cargo trucks without license plates are parked on vacant ground beneath the bridge; sources said they are believed to be vehicles destined for sale in North Korea, and that while such goods fall under United Nations sanctions, China appears to be turning a blind eye.
The Dandong-Sinuiju corridor is the overland hub that handles roughly 70% of trade between China and North Korea, and once open, the new bridge is expected to replace the existing Sino-Korean Friendship Bridge as the main route. Some experts say freight volumes could as much as double. With the possibility of a U.S.-North Korea summit next month under discussion, analysts say North Korea could strengthen its leverage in talks with Washington while China gains a means of countering U.S. influence on the Korean Peninsula.
Even on the 6th, the 77th anniversary of diplomatic relations between China and North Korea, however, there were no visible signs of preparations for an opening ceremony. Merchants and customs guards gave differing dates for the opening, citing the 6th and the 16th, and some merchants said they were skeptical, noting that word of an opening had come every year without ever materializing.
France's Central Bank Warns of "Suffocation" From High Rates as Candidates Rally Behind Austerity
With French government bond yields surging to their highest in 24 years and the euro falling to a 17-month low, presidential candidates and political parties are putting forward successive proposals for sweeping austerity budgets. Marine Le Pen, who leads in polls, has pledged net savings of 140 billion euros by 2032 through more efficient government operations, while the governing centrist coalition has submitted to parliament its own deficit-reduction plan, including a freeze on civil servant pay and the scrapping of increases in pension benefits.
French politicians have entered this unprecedented competition over austerity to keep the country from becoming the epicenter of a eurozone fiscal crisis driven by national debt and deteriorating public finances. Ahead of the presidential election next May, however, they face fierce public resistance, with hundreds of thousands of teachers, civil servants and others staging large-scale protests against the austerity plans. Mindful of public sentiment, parties are also campaigning on costly pledges such as opposing an extension of pension contribution periods, raising questions about how effective the austerity drive will be.
Analysts say France is caught between pressure from the bond market and the barricades of protesters. Voices are also growing louder that the European Central Bank may have to step in as firefighter, activating its Transmission Protection Instrument (TPI) bond-buying program, should the French government's belt-tightening fail.
Gulf States Turn to "Shuttle" Oil Exports as Hormuz Volumes Partly Recover
Despite military threats from Iran and the escalation of all-out conflict in the Red Sea region, Gulf oil producers have kept crude exports flowing by using shuttle voyages and ship-to-ship (STS) transfers, lifting shipment volumes through the Strait of Hormuz back to prewar levels.
According to vessel data provider Kpler, crude exports through the Strait of Hormuz averaged 18.3 million barrels a day on a seven-day basis last month, above the prewar average of 18 million barrels. The recovery reflects aggressive use of detour routes such as offshore transfers, even at the cost of hazard pay and enormous expenses, and it has pushed international oil prices lower.
Still, voyage costs running from $30 million to $40 million and the risk of vessels being struck remain ever-present. With bombing between the Saudi Arabia-led coalition and Houthi rebels widening across the Red Sea and allied troop deployments extending the front, the global oil market, cut off from alternative shipping routes, is expected to deepen its reliance on the Strait of Hormuz despite the risks for the time being.
U.S. Vice President Vance Says Details of Alaska LNG Still Being Worked Out With Korea
U.S. Vice President JD Vance said on the 5th, despite the announcement that South Korean investment in the Alaska liquefied natural gas project had been confirmed, that "a few details still need to be worked out." That marks something of a shift in tone from President Donald Trump, who has pressed for more than $50 billion in investment even as South Korea denied that its participation had been finalized. Vance pointed to strong demand from Asian countries, however, signaling optimism that the project will come together.
Trump, meanwhile, traveled to Nebraska, a traditional Republican stronghold where the party has struggled in recent Senate races, and signed an executive order lifting restrictions on the use of dyed diesel, a tax-exempt fuel, through the end of the year, in a bid to shore up support. The measure extends the federal excise tax exemption to pickup trucks and other vehicles in addition to farm and construction equipment, though critics note that few service stations sell the fuel and that rising demand could end up pushing up fuel costs for farmers.
