What Our Analysts Are Reading – July, 2021

Bulgaria

Bulgaria held a second round of snap elections in July after the first round in April failed to produce a majority. Parties that formed out of the summer 2020 anti-corruption protests fared slightly better than the long-standing GERB party of former Prime Minister Boyko Borrisov. The party that came out on top (There is Such a Nation) is led by media personality Slavi Trifonov who is sometimes compared to Ukrainian President Volodymyr Zelensky. However, once again no party secured enough of the vote to form a government, leaving parties forced to form a coalition which has proven a challenge.

Georgia

In the wake of the tragedy and violence that occurred at the Tbilisi Pride Parade, the Carnegie Endowment’s recent and final publication in the series For the Future of Georgia sheds valuable insight. The Article examines in particular the geopolitical context of the pride parade attack and the Georgian Orthodox Church’s (GOC) role within this context. The GOC states it is not opposed to the European integration ambitions which are, for the most part, vastly popular across Georgia. Simultaneously though, the GOC does serve as an effective means for Russia to maintain ties with Georgia on grounds of heritage and what is understood as traditional societal values. The presence of several GOC priests along with significant anti-EU displays at the Pride Parade attack seems to have created a more visible tension between the GOC and Western oriented policies.

Latvia

Increasing levels of illicit cigarette smuggling in Latvia and Ukraine continues to be a concern according to recent reports by the OCCRP and KPMG. According to the KPMG report, counterfeit and contraband cigarettes in Latvia reached nearly 20 percent of the tobacco market, despite an overall decrease in cigarette smoking. Meanwhile, a China-owned cigarette manufacturer in Romania has been linked to large-scale cigarette smuggling in Ukraine. The main reasons for smuggling illicit cigarettes is due to significant price differences based on excise duties. Countries throughout eastern Europe lose hundreds of millions of Euros a year in tax revenue due to illicit cigarette smuggling.

Lebanon

This year, the Muslim Eid Al-Adha holiday, typically celebrated with large meals and fancy new outfits, was little more than an afterthought to a growing number of impoverished Lebanese. Households were unable to buy holiday favorites such as sweets or drinks and settled for inexpensive dishes made from cheap foods like lentils and potatoes. Few could afford any meat.

The ongoing economic and financial crisis in Lebanon since 2019 has nearly erased the country’s historic middle class and further divided the poorest from the top ten percent who have access to foreign currency. Furthermore, recent resignation of the former Prime Minister-designate Saad Hariri devalued the Lebanese lira further to record-low levels with no sign of recovery anytime soon. Most salaries relying on the lira can no longer cover basic living costs, which continue to rise due to supply shortages.

According to the World Bank, 50 percent of the population is below the poverty line. NGOs have stepped in to deliver aid in the absence of state assistance. One NGO called Al Jannah Foundation (AJF) has been distributing clothing and food boxes to underprivileged families during Eid, through donations and fundraising campaigns. This year, AJF has doubled the size of food packs in order to feed a family of five for two weeks.

Meanwhile, many expats and Lebanese living abroad who are visiting for the holidays find it extremely affordable, and the Lebanese government is looking to tourism and the expat community to bring in fresh currency to boost the economy.

Senegal

The coastal West African country Senegal has largely been spared the levels of COVID-19 infections and deaths compared to other parts of the world, with around 50,000 cases and just over 1,000 deaths reported, and has even been internationally applauded for its efforts in curbing the spread of the virus. However, the spread of the highly contagious Delta variant has caused the third wave to hit African countries like Senegal with unprecedented infection rates. The World Health Organization has reported a surge in cases across Senegal, threatening to overwhelm health services just as families gather to celebrate the Eid Al-Adha holiday. Holiday travelers leaving the capital city, Dakar, on their way out of town to visit family in rural areas could be seen packed into crowded buses, many of them unmasked. With just over 600,000 vaccine doses administered to the population of around 16 million people, even higher infection rates following the holiday are likely. If the trend continues, the government has threatened to reimpose strict lockdown measures to curb the spread, even though such stringent measures in the past have incited riots and protests in urban areas. 

Ukraine

An article published in Euromaidan Press detailed the ways in which Ukrainian oligarchs wield influence in the West using various countries’ financial and political system. The analysis is in light of President Zelensky’s draft law dubbed “On the prevention of threats to national security associated with the excessive influence of persons of significant economic or political importance in public life (oligarchs)” that was presented in June 2021. The article emphasizes that Western countries should be concerned by the level of power and influence Ukrainian oligarchs continue to hold outside of their own nation.

Yemen

A typical Eid al-Adha holiday purchase in Yemen includes a sheep or goat to be shared in celebration. This year, many had to forego the purchase of these livestock for more affordable options such as chicken. In Ta’izz city, one of the areas worst affected by the ongoing conflict between Houthi rebels and the recognized government forces, the local currency has plummeted in value and food prices have skyrocketed. One Ta’izz resident noted sheep and goat prices between 150,000 and 200,000 riyals ($150 to $200) per head, while chickens were selling for about 20,000 riyals. High prices have stagnated livestock markets across the country due to prohibitive costs.

In government-controlled areas, the Yemeni riyal dropped to its lowest value in more than seven years of conflict this month, at 1000 YER/USD. Food prices across the country have simultaneously increased by 200 percent compared to pre-conflict levels. According to the World Food Program (WFP), around 80 percent of Yemenis rely on international food aid and some five million Yemeni are on the brink of famine.