Banananomics: Iran, Russia, and China Quickly Uniting Against The G7

Zimbabwe, which is under sanctions from the G7, is going to purchase Iranian weaponry.

Inputs that matter: Zimbabwean President Emmerson Mnangagwa met with Iranian President Ebrahim Raisi at the Iran-Africa International Economic Conference held in April.

• The 2nd annual conference had more than 40 African countries in attendance.

• Raisi stressed the importance of acquainting both parties with their shared capacities, particularly Iran's advancements in emerging technologies despite facing threats and sanctions.

• He highlighted Africa's potential in various fields, including emerging technologies, and called for developing cooperation roadmaps with defined timelines.

The opportunity: Zimbabwe introduced a new currency (ZiG) backed by gold on April 5, 2024.

• Zimbabwe has Africa's largest lithium reserves and is the world's sixth-largest producer and supplier.

• Chinese-owned companies have acquired Zimbabwe's most extensive lithium mining projects.

• China purchases more than 90% of Iran's annual oil production.

Zoom in: Responsible Statecraft reports that the European Parliament gave "A largely symbolic vote to reimpose nuclear sanctions after Tehran attacked Israel."

• The legislation refers to Iran's drone and missile attacks on Israel but not to the equally unprecedented Israeli attack on the Iranian consulate in Damascus, Syria, which was the direct trigger of the Iranian strike in the first place.

• While the E3 is concerned with Iran's nuclear progress, and French President Emmanuel Macron hinted in the wake of the Iranian strike on Israel that pressure has to be increased on Tehran also on the nuclear file, to trigger a snapback of the U.N. sanctions would require a political agreement with Washington. 

Between the lines: The social media account of the supreme leader, Ayatollah Ali Khamenei, said: "See what is happening in the world. In Western countries, in England and France, and in states across the U.S. itself, people are coming out in huge numbers to chant slogans against Israel and America. U.S. & Israel's reputation has been ruined. They truly have no solution."

• Benjamin Netanyahu, the Israeli prime minister, called for a crackdown on pro-Palestinian protesters in the U.S. as law enforcement intervened on many college campuses nationwide.

• Toomaj Salehi, an Iranian rapper who recently received a death sentence for song lyrics, has previously said that Iranians "are living somewhere horrific. You are dealing with a mafia that is prepared to kill an entire nation to keep its power, money, and weapons."

Follow the money: To move away from the G7's use of the U.S. Dollar (USD), competing BRICS members China and Russia signed a trade agreement allowing them to use local currencies to settle commodities trades.

• Today, more than 90% of the nation's bilateral trade dealings are settled in the yuan or ruble.

• Meanwhile, in Venezuela, Tether, a cryptocurrency pegged to the USD, is used for oil export transactions to avoid having revenues frozen in foreign bank accounts.

Robert Kiyosaki, author of Rich Dad Poor Dad, states the U.S. dollar is in depression due to global de-dollarization.

Inputs that matter: Throughout the last year, the BRICS alliance has sought to increase its relevance on a global scale.

• Meanwhile, the U.S. has struggled with its increasing debt crisis and skyrocketing inflation.

• Kiyosaki notes that in the Q4 of 2023, the economy grew by 3.4%.

• However, in Q1 of 2024, the economy grew by 1.6%.

• BRICS nations like Russia and China have become almost entirely dollarless. 

The opportunity: Chinese President Xi Jinping told U.S. Secretary of State Antony Blinken during his visit that Washington needs to see China's development as more favorable for bilateral relations to improve.

• Xi's comments come as the U.S. has imposed restrictions on Beijing's ability to access high-end tech and is moving close to banning the TikTok social media app unless its Chinese parent, ByteDance, sells it.

Zoom in: The U.S. recently purchased 81 obsolete Soviet-era combat aircraft from Kazakhstan, a former Soviet republic, with intentions to supply them to Ukraine.

• The aircraft of the 1970s and 1980s were deemed unusable, economically impractical for modernization, and limitedly useful as a source of spare parts.

• This development occurs amid Kazakhstan's increasing alignment with the West in Central Asia, which could strain its historical ties with Russia.

• During his visit to Kazakhstan in March 2023, U.S. Secretary of State Antony Blinken strongly supported the country's "independence, sovereignty, and territorial integrity."

Between the lines: This week, the U.K. Foreign Minister, David Cameron, visited Kazakhstan, a country bordered by Russia, China, Afghanistan, and Iran, to offer London's support with issues that arise in this region.

• Senate Minority Leader Mitch McConnell explains, "We need to get serious about what we're up against: China, Russia, Iran, and terrorism, a more formidable combination of problems than we had even going into World War II."

• French Foreign Minister Stéphane Séjourné will arrive in Lebanon to discuss proposals to prevent further escalation between Hezbollah and Israel.

• A State Department official said that in Saudi Arabia, Blinken is expected to hold new talks with the Saudi leadership on a potential normalization of relations with Israel.

Follow the money: Tesla's share price spiked more than 12% as investors reacted to news surrounding CEO Elon Musk's visit to China.

• The move raised expectations that Tesla's driver-assistance software Full Self-Driving, or FSD, would soon be available in the country, which is the largest market for electric vehicles.

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