🌍 The shipping industry is in trouble

Hi there Intriguer. Crypto bros apparently wanted to buy the sovereign nation of Nauru, but there’s a long history of folks casually trading territories like Pokémon. Scotland bought the Isle of Man from Norway eight centuries ago, while the Saudis (with their unyielding firehose of cash) bought two islands off Egypt as recently as 2017.

Today’s briefing is a 4 min read:

• 🚢 The shipping industry enters choppy waters.

• 🇳🇪 West Africa threatens intervention in Niger. 

• ➕ Plus: The world’s first female president, how the papers are covering more drone attacks in Moscow overnight, and Elon Musk’s unmatched power in the stars.

⏱️ Around the world in sixty seconds

1. 🇵🇰 Pakistan: A blast at a political rally has killed at least 54 people and injured hundreds more. A local ISIS affiliate has claimed responsibility for the suicide bombing that targeted supporters of a pro-Taliban cleric.

2. 🇬🇧 UK: Prime Minister Rishi Sunak has announced his government will grant 100 new North Sea oil and gas exploration licences to boost the UK’s energy security. Critics have said the decision “flies in the face of climate science“.

3. 🇵🇭 Philippines: The EU says it’s ready to strengthen its maritime cooperation with the Philippines following a meeting between President Marcos and EU chief Ursula von der Leyen. The two also agreed to resume negotiations towards a free trade agreement.

4. 🇨🇴 Colombia: The son of President Gustavo Petro has been arrested in connection with allegations he accepted money from drug traffickers to fund his father’s election campaign. Petro has denied the allegations and pledged not to interfere with the investigations.

5. 🇪🇬 Egypt: The rival Palestinian factions of Hamas and Fatah met in Egypt for reconciliation talks on Sunday. Another group, the Palestinian Islamic Jihad, boycotted the meeting to protest the Palestinian Authority’s detention of its members.

🚢 Shipping | Supply chains

The shipping industry is entering choppy waters

After a couple of years of sky-high profits, the shipping industry is spending record amounts to expand its fleets. But global trade is now decelerating.

What’s happening? The shipping sector has a long boom-bust tradition:

• 📈 When shipowners are profiting, they plough cash into new ships

• 📉 But when those new ships are delivered, the spike in capacity can crash freight prices, putting pressure on the shipowners.

And that’s what’s happening now. COVID triggered the sector’s most profitable years ever, so the sector went on its biggest shopping spree ever:

• 🚢 new ships worth $90B are due for delivery in coming years

• 🛳️ adding 890 ships to current global shipping capacity.

The shipyards building the vessels (mostly in China and Korea) will do well, but the picture’s a little more mixed for the ship-buyers themselves, because:

• 🏭 Inventory levels are high as consumer demand cools

• 🏗️ More containers are entering than leaving major Chinese ports

• 📦 Shipping from China to the US costs 85% less than a year ago, and

• 🗃️ Container production has fallen by over 70%.

So as trade slows, the shipping industry is bracing for a slowdown too, just as hundreds of new ships are starting to enter service.

Intrigue’s take: The shipping industry and the global economy have a very co-dependent relationship, like Michael Bay and explosions.

But this time, the bigger players still have record piles of cash to weather the storm, so they may end up buying any smaller players that struggle. That’ll further concentrate an industry that’s already 85%-controlled by ten firms.

Silver lining? Older, dirtier ships will go more quickly into retirement. And that’ll leave us with a newer and greener fleet, sooner.

Also worth noting:

• Responding to the International Maritime Organization’s 2050 net zero targets, some firms are ordering methanol-powered vessels.

• There are around 6,500 container ships in service around the world.

📰 How newspapers covered…

Further drone attacks in Moscow overnight (Monday evening)

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🇳🇪 Niger | Geopolitics

Regional leaders threaten to intervene in Niger

The 15-member West African bloc ECOWAS (the Economic Community of West African States) has warned it could use force in Niger if ousted President Bazoum isn’t reinstated within a week.

But the coup-installed leaders of nearby Guinea, Mali and Burkina Faso (all ECOWAS members) have rejected the bloc’s demand, with the latter two equating any military intervention to a “declaration of war” against them.

Intrigue’s take: Regional responses have merit: ECOWAS has led them before, and it voted last year to form a peacekeeping force. But an intervention in Niger, opposed by Niger and three other ECOWAS members, seems a heavy lift.

So we may be looking at a lose-lose here: if ECOWAS intervenes, things could get messy. But if the bloc stays on the side-lines (again), its credibility will take another hit.

Also worth noting:

• The largest ECOWAS member, Nigeria, shares a restive 1,600km border region with Niger. Nigeria’s military chief has said his troops will respond immediately if ECOWAS gives the order to deploy.

• French President Macron has warned that France will respond “immediately” to any attack on French interests, after the French embassy was attacked on Sunday (30 July).

• Niger’s coup leaders have reportedly now suspended the export of uranium and gold to France.

🎧 Today on Intrigue Outloud

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➕ Extra Intrigue

We’re very online, so you don’t have to be.

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• Can the Tigris and Euphrates be saved?

• Elon Musk’s unmatched power in the stars

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🗳️ Poll time!

🧑 Profile of the day

Today in 1980 Vigdís Finnbogadóttir became the President of Iceland and the first democratically-elected female head of state in the world. She went on to become the world’s longest-serving female president after 16 years at the helm.

Yesterday’s poll: How long do you think Kim Jong Un will rule North Korea?

🟩🟩🟩🟩🟩🟩 ✊ Kim’s not going anywhere; he’s young (39) and his family’s been running the place since 1948 (88%)

⬜️⬜️⬜️⬜️⬜️⬜️ 😨 He’s walking a tightrope, and a fall feels inevitable (10%)

⬜️⬜️⬜️⬜️⬜️⬜️ ✍️ Other (write in!) (2%)

Your two cents:

• ✊ A.F: “He will likely stay in place as long as his health allows. Historical precedence indicates that, in North Korea, death is the only tangible threat to a turnover in leadership.”

• ✍️ J.R.C: “His sister is actually running the show from behind the throne. She needs the male figurehead so she just keeps propping him up.”