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Hindustan Times
11-08-2025
- Politics
- Hindustan Times
Donald Trump brokers a peace plan in the Caucasus
THE SOUTH CAUCASUS is a mosaic of warring rivals and closed borders. Lookout posts and bunkers dot its frontiers. On August 8th Donald Trump met Armenia's prime minister, Nikol Pashinyan, and Azerbaijan's president, Ilham Aliyev, in an effort to end the conflict between their two countries. At the White House the trio signed a peace declaration and agreements on trade and security. Crucially, Armenia agreed to open an American-operated transport route across its territory, linking Azerbaijan to its exclave, Nakhchivan (see map). The corridor will be called the Trump Route for International Peace and Prosperity (TRIPP). 'A great honour for me,' said America's president. Mr Aliyev and Mr Pashinyan vowed to nominate him for a Nobel peace prize. The deal will diminish Russia, which has long meddled in the conflict, as well as Iran. It is not a formal peace treaty. But it paves the way to a bigger prize: an end to one of the world's most intractable conflicts and a regional detente, including the normalisation of Armenia's relations with Turkey, Azerbaijan's ally. Whether that happens will be a test of American diplomacy and of Armenia and Azerbaijan themselves. Russia could still sow trouble. Map Armenia and Azerbaijan have been fighting for more than 35 years. In the late 1980s, as the Soviet Union disintegrated, Armenian-backed separatists seized Nagorno-Karabakh, a region within Azerbaijan, and later built a buffer zone. For years the conflict was frozen. Azerbaijan, whose oil-and-gas industry boomed, built a formidable army equipped with Turkish and Israeli drones and missiles. In 2020 it recaptured the area around Nagorno-Karabakh. In 2023 it took back the territory itself; some 100,000 Armenians fled. Russia, which had supported Armenia during the 1990s, stood back. It did so partly to punish Mr Pashinyan, a democrat, who rose to power in 2018 in a peaceful revolution that swept Armenia's Kremlin-backed rulers from office. Since early 2024 the two sides have been inching towards a peace treaty. In previous negotiations they have relied on intermediaries such as Russia, Turkey or the Minsk Group, a multilateral forum set up in the 1990s to deal with the conflict. But recently they have been speaking directly. In March they agreed on a draft treaty. Two obstacles remained. The first was Azerbaijan's insistence that Armenia remove references to Nagorno-Karabakh from its constitution, which will require a referendum. The second was Azerbaijan's demand for a transport corridor to Nakhchivan. In 2020, as part of a ceasefire deal, Mr Aliyev and Mr Pashinyan agreed to open a route supervised by Russian officials. Both men later resiled from the idea that Russia should be involved, but could not agree on an alternative. Mr Trump provided a partial solution. For months, American negotiators have been shuttling back and forth to the region to thrash it out. Armenia will lease the land for 99 years to America, which will hire contractors to run the route. The TRIPP gives America a long-term stake in the region's security. Russia is furious. America has offered Armenia and Azerbaijan sweeteners, too. The boss of SOCAR, Azerbaijan's state energy firm, visited Washington with Mr Aliyev to sign a deal with ExxonMobil, an American oil giant. Armenia, which lacks Azerbaijan's natural resources, has less to offer America's mercantile president, but will get some support on artificial intelligence and semiconductors. Mr Trump also waived sanctions, introduced in 1992, that have prohibited military co-operation with Azerbaijan. He announced a 'strategic partnership' with Azerbaijan, which is a staunch ally of Israel. The peace deal could also pave the way for Turkey and Armenia to bury the hatchet. The standoff with Armenia has been 'Turkey's Achilles heel, in terms of its regional influence', says Nigar Goksel of the International Crisis Group, a global think-tank. Rapprochement between the two began in 2008, but stalled. To accommodate Mr Aliyev, Turkey had made normalisation with Armenia conditional on a peace deal between Azerbaijan and Armenia. That obstacle now appears to be gone. Turkey may decide to open its border with Armenia, which it shut in solidarity with Azerbaijan during the Nagorno-Karabakh conflict in 1993. 'Things will start moving fast,' Ms Goksel predicts. Yet amid the Trumpian pomp, the deal leaves much to be done. In Washington Messrs Aliyev and Pashinyan put their initials on a formal peace treaty, but did not sign it. Azerbaijan's demand for Armenia to change its constitution is unmet. The TRIPP's benefits will be concentrated in Nakhchivan and Syunik, the sparsely populated Armenian region it will cross. But the hope is that it could unlock more dealmaking. Azerbaijan and Armenia could start talking about opening other parts of their fortified border. There are reasons to be cautious. Mr Pashinyan is unpopular: just 13% of Armenians say they trust him. Nationalist hardliners, including Robert Kocharyan, a former president, accuse him of compromising Armenian sovereignty. (Mr Kocharyan, for his part, sold Armenian assets to Russia in exchange for debt relief during the 2000s.) Holding the referendum that Azerbaijan demands will be divisive, and an election next year will give Russia a chance to interfere. In June Armenia's government said it had foiled a coup planned for September. Azerbaijan could also disrupt the peace process. Mr Aliyev, an autocrat who succeeded his father in 2003, had previously threatened to seize a transport corridor by force. He has indulged in irredentist fantasies such as calling Armenia 'West Azerbaijan'. Laurence Broers of Chatham House, a British think-tank, says such talk will be 'kryptonite' for peace if it continues. Azerbaijan's military dominance only makes it harder for Armenia to trust it. Another risk is that America loses interest. Historically, peace in the south Caucasus has often been brought by outside powers. 'It was Russia and Turkey in 2020, it was the Minsk Group in the 1990s, it was the Bolsheviks in the 1920s,' says Mr Broers. Mr Trump has positioned America as the latest peace broker in a tough neighbourhood. Whether it lasts will not be in his control.
Economist
09-08-2025
- Politics
- Economist
Donald Trump brokers a peace plan in the Caucasus
THE SOUTH CAUCASUS is a mosaic of warring rivals and closed borders. Lookout posts and bunkers dot its frontiers. On August 8th Donald Trump met Armenia's prime minister, Nikol Pashinyan, and Azerbaijan's president, Ilham Aliyev, in an effort to end the conflict between their two countries. At the White House the trio signed a peace declaration and agreements on trade and security. Crucially, Armenia agreed to open an American-operated transport route across its territory, linking Azerbaijan to its exclave, Nakhchivan (see map). The corridor will be called the Trump Route for International Peace and Prosperity (TRIPP). 'A great honour for me,' said America's president.
Kyodo News
20-06-2025
- Business
- Kyodo News
FOCUS: Nippon Steel buyout spat hints at business fragility in U.S.
By Junko Horiuchi, KYODO NEWS - 7 hours ago - 13:07 | Japan, All U.S. President Donald Trump's bid to attract investment threatens to undermine the appetite for corporate spending in an ironic twist, with the 18-month saga over Nippon Steel Corp.'s buyout of United States Steel Corp. showing the growing vulnerability of businesses in the U.S. market, according to analysts. The U.S. administration's earlier blocking of the $14.1 billion takeover deal was clearly driven by political motives and corporate executives will no longer be able to make decisions regarding their U.S. operations based only business criteria, they said. The wrangling in the high-profile case could lead global companies to think twice about making sizeable investments and acquisitions in the world's largest economy, with many moving to reduce their exposure to the U.S. market. "I do think many companies are pausing investments and major capital expenditures, not only because of the Nippon-U.S. Steel deal but due to general uncertainty surrounding political and economic dynamics in Washington," said Zack Cooper, senior fellow at the American Enterprise Institute. Trump had repeatedly rejected Nippon Steel's plan to take full control of U.S. Steel. But Nippon Steel, the world's fourth-largest steel producer, and U.S. Steel, the 29th largest, said Wednesday following Trump's approval of the buyout plan that they had signed a national security agreement with the U.S. government and finalized the acquisition transaction. Under the deal, the Japanese steelmaker is obliged to invest $11 billion by 2028 on bolstering the U.S. steelmaker's operations, far more than the previously planned $2.7 billion. The U.S. government also obtained a golden share allowing it to veto key management decisions, such as when reducing investment, shedding production capacity in the United States or closing plants. Nippon Steel CEO Eiji Hashimoto told a press conference on Thursday that his company had learned from a year and a half of negotiations with the U.S. government that a flexible management strategy is required. The top executive said it had been believed that governments should not get involved in business deals. "But are strengthening their involvement in economic and business matters through industrial policy," he said. Trump's predecessor, Joe Biden, initially blocked the purchase of U.S. Steel on national security grounds, saying the manufacturing icon, based in Pittsburgh, Pennsylvania -- a key battleground state in the 2024 presidential election -- should be "American-owned and American-operated." Trump also opposed the deal during the presidential race, saying the acquisition of a minority stake in U.S. Steel would not cause any issues, but foreign ownership of the company would not be good psychologically. He ordered a new review of the deal by the Committee on Foreign Investment in the United States in April with a deadline for Trump to make a final decision initially set for June 5. "Because predictability is insanely low right now in the United States, Japanese companies are going to cut back the percentage of their business in the country," said Keisuke Hanyuda, the chief executive of Owls Consulting Group. While rising costs must be dealt with, "The last thing a business wants is to lose predictability," said Hanyuda, a former Japanese trade ministry official in charge of trade talks. Nippon Steel is betting on firm demand for high-tensile strength steel in the U.S. market, capitalizing on its advanced production technology for high-end steel plates used in products such as electric vehicles. The United States is one of three growth markets for the Japanese steelmaker, compensating for shrinking domestic demand. Under Trump, the steel, aluminum, auto and semiconductor sectors have been targeted by specific tariffs driven by political pressures and companies in these industries should consider other markets for growth to hedge their risks, analysts say. Earlier this month, Trump signed an order doubling the tariffs on steel and aluminum imports to 50 percent. "I think Japanese companies will have a difficult time purchasing famous American companies in sectors that President Trump prioritizes, such as autos, steel, aluminum, and chipmaking," Cooper at the American Enterprise Institute said, though investment in other sectors may still be viable. "But any Japanese company that is considering a major deal in the United States should develop a detailed political strategy before announcing a deal, lest they suffer similar roadblocks as Nippon Steel," he said. The United States remains a lucrative market with high growth potential but some global companies are beginning to reduce their reliance on it after the tariffs imposed by Trump, Hanyuda said. The European Union and the Association of Southeast Asian Nations, for example, have resumed economic partnership negotiations, while the EU is also looking at Japan, which is part of a trans-Pacific free trade pact that took effect in 2018 without the United States. Related coverage: U.S. Steel's strategic importance growing: Nippon Steel CEO Nippon Steel finalizes deal to make U.S. Steel wholly owned Trump effectively approves Nippon Steel's takeover of U.S. Steel
Kyodo News
20-06-2025
- Business
- Kyodo News
FOCUS: Nippon Steel buyout spat hints at business fragility in U.S.
By Junko Horiuchi, KYODO NEWS - 7 minutes ago - 13:07 | Japan, All U.S. President Donald Trump's bid to attract investment threatens to undermine the appetite for corporate spending in an ironic twist, with the 18-month saga over Nippon Steel Corp.'s buyout of United States Steel Corp. showing the growing vulnerability of businesses in the U.S. market, according to analysts. The U.S. administration's earlier blocking of the $14.1 billion takeover deal was clearly driven by political motives and corporate executives will no longer be able to make decisions regarding their U.S. operations based only business criteria, they said. The wrangling in the high-profile case could lead global companies to think twice about making sizeable investments and acquisitions in the world's largest economy, with many moving to reduce their exposure to the U.S. market. "I do think many companies are pausing investments and major capital expenditures, not only because of the Nippon-U.S. Steel deal but due to general uncertainty surrounding political and economic dynamics in Washington," said Zack Cooper, senior fellow at the American Enterprise Institute. Trump had repeatedly rejected Nippon Steel's plan to take full control of U.S. Steel. But Nippon Steel, the world's fourth-largest steel producer, and U.S. Steel, the 29th largest, said Wednesday following Trump's approval of the buyout plan that they had signed a national security agreement with the U.S. government and finalized the acquisition transaction. Under the deal, the Japanese steelmaker is obliged to invest $11 billion by 2028 on bolstering the U.S. steelmaker's operations, far more than the previously planned $2.7 billion. The U.S. government also obtained a golden share allowing it to veto key management decisions, such as when reducing investment, shedding production capacity in the United States or closing plants. Nippon Steel CEO Eiji Hashimoto told a press conference on Thursday that his company had learned from a year and a half of negotiations with the U.S. government that a flexible management strategy is required. The top executive said it had been believed that governments should not get involved in business deals. "But are strengthening their involvement in economic and business matters through industrial policy," he said. Trump's predecessor, Joe Biden, initially blocked the purchase of U.S. Steel on national security grounds, saying the manufacturing icon, based in Pittsburgh, Pennsylvania -- a key battleground state in the 2024 presidential election -- should be "American-owned and American-operated." Trump also opposed the deal during the presidential race, saying the acquisition of a minority stake in U.S. Steel would not cause any issues, but foreign ownership of the company would not be good psychologically. He ordered a new review of the deal by the Committee on Foreign Investment in the United States in April with a deadline for Trump to make a final decision initially set for June 5. "Because predictability is insanely low right now in the United States, Japanese companies are going to cut back the percentage of their business in the country," said Keisuke Hanyuda, the chief executive of Owls Consulting Group. While rising costs must be dealt with, "The last thing a business wants is to lose predictability," said Hanyuda, a former Japanese trade ministry official in charge of trade talks. Nippon Steel is betting on firm demand for high-tensile strength steel in the U.S. market, capitalizing on its advanced production technology for high-end steel plates used in products such as electric vehicles. The United States is one of three growth markets for the Japanese steelmaker, compensating for shrinking domestic demand. Under Trump, the steel, aluminum, auto and semiconductor sectors have been targeted by specific tariffs driven by political pressures and companies in these industries should consider other markets for growth to hedge their risks, analysts say. Earlier this month, Trump signed an order doubling the tariffs on steel and aluminum imports to 50 percent. "I think Japanese companies will have a difficult time purchasing famous American companies in sectors that President Trump prioritizes, such as autos, steel, aluminum, and chipmaking," Cooper at the American Enterprise Institute said, though investment in other sectors may still be viable. "But any Japanese company that is considering a major deal in the United States should develop a detailed political strategy before announcing a deal, lest they suffer similar roadblocks as Nippon Steel," he said. The United States remains a lucrative market with high growth potential but some global companies are beginning to reduce their reliance on it after the tariffs imposed by Trump, Hanyuda said. The European Union and the Association of Southeast Asian Nations, for example, have resumed economic partnership negotiations, while the EU is also looking at Japan, which is part of a trans-Pacific free trade pact that took effect in 2018 without the United States. Related coverage: U.S. Steel's strategic importance growing: Nippon Steel CEO Nippon Steel finalizes deal to make U.S. Steel wholly owned Trump effectively approves Nippon Steel's takeover of U.S. Steel
Time of India
19-06-2025
- Business
- Time of India
Is the Nippon Steel and US Steel merger a threat to American workers?
Nippon Steel 's 2023 announcement that it would buy US Steel , the linchpin of American steelmaking, sparked political and union opposition in the United States before being finally sealed Wednesday under strict conditions. This is how the saga developed: August 2023 The struggling US Steel launches a strategic review after receiving several unsolicited partial or total buyout offers. It rejects an offer from its American competitor, Cleveland-Cliffs (CLF), despite potential support from the steelworkers' union USW. December 2023 Nippon Steel announces an agreement to buy US Steel for $14.1 billion, plus $800,000 in debt -- unanimously approved by both boards of directors -- with finalisation expected by the third quarter of 2024. But the USW fiercely opposes the deal, saying it will not support anyone other than CLF. Days later, US President Joe Biden calls for "serious scrutiny" in terms of supply chain reliability. The United States is the world's leading steel-importing country. The US government agency responsible for assessing foreign investment risks, CFIUS, scrutinises the project. March 2024 Biden, campaigning for a second term, opposes the buyout in defence of American "workers", saying it is vital for US Steel "to remain an American steel company that is domestically owned and operated". US Steel, however, asserts that the deal can "combat the competitive threat from China", the sector's global leader. April 2024 US Steel shareholders overwhelmingly approve the buyout at an extraordinary general meeting. July 2024 Japanese media outlets reveal that Nippon Steel has hired Mike Pompeo, former US Secretary of State under Donald Trump, to advocate for its cause. September 2024 Kamala Harris, now the Democratic presidential candidate, states that US Steel should "remain American-owned and American-operated". Nippon Steel asserts that it will remain "a US company" with a majority of the board being American citizens. Trump, the Republican candidate, pledges to oppose the buyout proposal. US Steel threatens to shutter facilities in Pennsylvania -- perhaps the most critical swing state in the election between Harris and Trump -- if the sale is blocked. December 2024 Trump, now President-elect, confirms he will "block this deal from happening". He vows on social media to "make U.S. Steel Strong and Great Again" through tax incentives and tariff hikes. Nippon Steel condemns the opposition as "inappropriate" influence of politics. In mid-December, CFIUS fails to reach a decision owing to a lack of consensus within its ranks. January 2025 Biden blocks the acquisition on national security grounds. The issue escalates into a diplomatic dispute: Japanese Economy Minister Yoji Muto deems the decision "incomprehensible and regrettable". US Steel and Nippon Steel threaten legal action over "illegal interference" before eventually obtaining a Washington-granted extension until June to formally abandon their project. They express continued commitment to seeing it through. February 2025 Trump suggests an alternative to a merger: an investment from Nippon Steel. April 2025 Trump orders a new review of the project by CFIUS to determine whether "further action in this matter may be appropriate", reopening the door to the buyout. The review will involve "identifying potential national security risks associated with the proposed transaction and providing adequate opportunity to the parties to respond to such concerns". May 2025 Following the release of a new CFIUS advisory, Trump approves a partnership between the steelmakers through an unspecified agreement allowing US Steel to "REMAIN in America". Nippon Steel says it "applauds" the bold action taken by Trump but USW warns of a "disaster for American steelworkers". June 15, 2025 Trump removes the final regulatory hurdle by signing an executive order designed to eliminate all national security risks following the buyout. The US government will hold a perpetual non-economic "golden share" allowing it veto power over significant decisions affecting American jobs. Beyond the previously agreed acquisition price of $14.1 billion excluding debt, an additional $14 billion in investments by Nippon Steel will be required, $11 billion of which must be completed by 2028. June 18, 2025 Nippon Steel and US Steel announce their merger agreement, with the American group subsequently requesting the New York Stock Exchange to delist its stock.
