This is ‘Global Village Today’, which delivers major news from various countries around the world.
Moderator) What news do you have today?
Reporter) Yes. British Prime Minister Liz Truss announced on the 20th that he would resign. The ruling Conservative Party is due to elect a new leader next week to become prime minister. Ukraine has begun to limit its use of electricity after a series of Russian attacks severely damaged its infrastructure. We will continue to share with you the news that the Japanese yen has broken through the 150 yen/dollar level, which is considered a ‘psychological resistance level’.
Moderator) This is the first news of the global village today. British Prime Minister Liz Truss has announced that he is resigning.
Reporter) Yes. Prime Minister Truss announced on the 20th that he would resign as prime minister in front of the prime minister’s residence. He said he would remain prime minister until the new Conservative party leader, who will become prime minister, officially takes office and until King James III appoints the new leader as prime minister. If Prime Minister Truss, who has been in office for just six weeks, steps down as scheduled, he will become the shortest prime minister in British history. The previous record was set at 119 days after the death of then Prime Minister George Canning in August 1827.
Moderator) Prime Minister Truss gave a brief speech announcing his resignation, but what did he say?
“The Conservative Party elected me prime minister with the task of cutting taxes and promoting economic growth,” Truss said.
Moderator) Are you saying you’re resigning because you can’t carry out the mission assigned by the party?
Reporter) Yes. However, he said, “I became prime minister at a time of very economic and international instability, such as the war in Ukraine and the soaring cost of living. I was proud of myself.
Reporter) Prime Minister Truss mentioned a task assigned to him by the party in his resignation.
moderator) Yes. Prime Minister Truss has launched massive tax cuts to revive the UK economy, which is heading into recession. However, fears arose that inflation would rise and the national debt would surge if this measure was implemented, causing the British financial market to fall into chaos in an instant, with the value of the British pound falling to an all-time low and interest rates on government bonds soaring.
Moderator) Then, wasn’t there criticism that the tax cuts that would have a big impact on the economy were pushed forward without sufficient review?
Reporter) That’s right. Prime Minister Truss soon acknowledged it was his mistake and withdrew most of the controversial tax cuts after his criticism of the tax cuts, both internally and externally, grew stronger. He also took steps to rectify his political ally, including the dismissal of Treasury Secretary Quozi Kwateng and the appointment of a new Treasurer.
Moderator) Still, the public opinion surrounding Prime Minister Truss hasn’t improved, hasn’t it?
Reporter) Yes. Mr Truss’s leadership has been questioned in the early days of his inauguration as Prime Minister flounders over some important policies, including tax cuts. Eventually, he was further cornered when it was said that Truss had to be replaced, not only within the opposition Labor Party, but also within his party, the Conservative Party.
But, did Prime Minister Truss refuse to resign?
Reporter) Yes. Prime Minister Truss said in Parliament on the 19th that he was a fighter, not a backer, and that he would remain prime minister. However, on the same day (19th), the interior minister, Suela Braiberman, resigned abruptly and was again in a difficult situation.
In this situation, Prime Minister Truss eventually resigned. Who is being talked about as the new leader of the Conservative Party, who will become the next prime minister?
Reporter) Yes. Former Prime Minister Boris Johnson, former Treasury Secretary Rishi Sunak, former Defense Secretary Penny Modont, and current defense secretary Ben Wallace are mentioned. In a Conservative poll earlier this week, former Prime Minister Johnson, who stepped down in July, took the lead. However, according to Archyde.com, the odds of winning are that former Treasury Secretary Sunak is ahead of former Prime Minister Modont and former Prime Minister Johnson. The Conservative Party plans to elect a new leader by October 28. The Conservative Party said that a new leader could appear as early as the 24th.
Moderator) How did the US react to the announcement of the resignation of Prime Minister Truss?
Reporter) Yes. US President Joe Biden issued a statement. “The United States and Britain are strong allies and long-lasting friends,” he said in the statement.
Moderator) Shall we look at the reactions of other countries?
Reporter) Yes, French President Emmanuel Macron emphasized that “it is very important for Britain to quickly find political stability”. “It’s always sad to see a friend leave,” he said. Meanwhile, Russia’s foreign ministry welcomed Truss’s resignation, saying that Britain had never seen such a disgraceful prime minister and that he would be remembered as ‘terribly ignorant’.
Moderator) Global Village Today, the next news. It seems that Ukraine’s power situation is quite serious right now?
Reporter) Yes. The Ukrainian government has put in place restrictions on electricity use from 7 a.m. to 10 p.m. on the 20th. Ukrainian President Volodymyr Zelensky said in a video address the night before (19th), urging people to conserve electricity, saying that the government is now working to build a power supply chain for key infrastructure facilities.
Moderator) So, is the power cut off in all of Ukraine?
Reporter) Yes. However, it is not a nationwide power outage. It will run sequentially by region, and the duration will not exceed four hours, Ukrenergo, the Ukrainian state-owned power company, explained.
Moderator) How much damage is the current power generation facility in Ukraine?
Reporter) Oleksandr Harshchenko, adviser to Ukraine’s Energy Minister, appeared on Ukrainian state TV the day before (19th) and said that about 40% of Ukraine’s total power generation facilities and capacity were severely damaged.
Moderator) Then, wouldn’t it be easy to recover within a short period of time?
Reporter) Yes. “Right now, restoration and repair work is underway, but miracles are only possible to a certain extent,” said Harshchenko, so power use must be limited so that the current grid is not overloaded. Ukraine’s state-owned utility Ukrenergo also said it may limit electricity use again in the future as winter approaches.
Moderator) The Russian army is now intensively attacking Ukraine’s infrastructure, right?
Reporter) Yes. Earlier this month, Russia launched a massive retaliatory attack after the explosion of the Krem Bridge, which was considered the pride of Russian President Vladimir Putin. In particular, recently, cruise missiles and self-destruct drones have been used to intensively attack Ukraine’s major infrastructure such as electricity, water and energy.
However, there are continuing claims that the ‘self-destruct drone’ used by the Russian military is made in Iran. This issue was also discussed at the UN Security Council meeting, right?
Reporter) Yes. The UN Security Council meeting was held on the 19th. At the request of three countries, the United States, the United Kingdom, and France, the situation of Iran’s arms support to Russia was dealt with on the agenda. Permanent members of the Security Council say Iran’s arms supply to Russia violates UN Security Council Resolution 2231.
Moderator) What specifically does Security Council Resolution 2231 contain?
Reporter) Yes. Security Council Resolution 2231 relates to the so-called ‘Iran nuclear agreement’ of the ‘Comprehensive Joint Plan of Action (JCPOA)’ signed between Iran and six major countries in 2015. The main goal is to restrict Iran’s uranium enrichment activities, but it also bans Iran’s missile-related technology trade and development of delivery means. The United States, Britain and France say Iranian drones used by Russia are also included in the weapons category restricted by Security Council Resolution 2231.
Moderator) Did you know what was going on in the meeting room?
Reporter) Since the meeting was held privately, we cannot know the details of the remarks. But prior to the meeting, Nate Evans, spokesman for the US mission to the United Nations, said the meeting would be a place for much dialogue, holding Iran and Russia accountable for failing to meet the obligations imposed by the UN Security Council. “There is sufficient evidence that Russia is using Iranian drones in brutal and deliberate attacks on the Ukrainian people,” Nate said.
Moderator) Shall we listen to the stories of other participating countries?
Reporter) Yes. France’s ambassador to the United Nations, Nicolas de Rivière, also reiterated to reporters shortly after the meeting that Iran’s arms trade violated Security Council Resolution 2231. Ambassador Rivier stressed that Security Council Resolution 2231 requires that Iranian arms transfers be approved on a case-by-case basis, and that Iranian drones have never received such approval.
Moderator) Have there been any remarks from the Russian side?
Reporter) Yes. Russia’s deputy ambassador to the United Nations, Dmitry Polyansky, also announced his country’s position to reporters immediately after the meeting. The West stressed that the meeting did not provide any evidence that Iran had sold drones to Russia. He said it was an unfounded accusation from the West to put pressure on Russia and Iran.
In the midst of this, Russia has declared martial law in the occupied territory of Ukraine?
Reporter) Yes. On the 19th, Russian President Vladimir Putin declared martial law in four areas occupied by Ukraine: Kherson, Zaporiza, Donetsk and Luhansk. Martial law came into effect on the 20th.
Moderator) What did you say about the reason for invoking martial law?
President Putin blamed the Ukrainian government. He explained that the Ukrainian government has repeatedly attacked without acknowledging the will of the people and refusing to negotiate. The ‘people’s will’ that Putin referred to refers to the referendum in favor of annexation of Russia held in the region at the end of last month. Russia annexed these territories with an overwhelming yes vote. However, the international community does not recognize this.
Moderator) But is Russia restricting the movement of its citizens?
Reporter) Yes. On this day (19th), the Russian government imposed restrictions on the movement of residents in eight regions, including the Krm Peninsula and the states bordering Ukraine, such as Belgorod, Krasnodar, and Bryansk. The Krum Peninsula was forcibly annexed by Russia in 2014, but other areas are Russian territory. According to the independent Russian media, with this measure, entry and exit control, such as crossing the border using vehicles, will be strengthened. In the event of an emergency, it is known that authorities can force residents to move.
Host) Global Village Today, I will go to Japan one last time. Is the Japanese Yen still depreciating?
Reporter) Yes. On the 20th, in the Tokyo foreign exchange market, the value of the yen hit the 150 yen level at one point during the day. The yen closed trading at 149 yen on the day, but the yen’s weakness continues.
Moderator) So you’re saying that 1 US dollar is equivalent to 150 Japanese yen?
Reporter) Yes. That’s why the yen is not worth it. The Japanese business community has regarded 150 yen per dollar as a psychological margin. However, as it crossed the 150 yen mark on the same day, attention is focused on whether the Japanese government will intervene.
Moderator) But why is the yen so weak?
Reporter) Economists cite the difference in interest rates between the US and Japan as the biggest reason. The U.S. is currently in the midst of a series of massive rate hikes to keep pace with record inflation. On the other hand, Japan maintains an ultra-low interest rate policy. As a result, the movement to sell low-interested yen and buy high-interested dollars continues. This is an analysis that leads to a weakening of the yen.
Moderator) So, what is the way to stop the weak yen?
There is also a way for the government to buy yen. Last month, when the yen-dollar exchange rate reached the high 145 range, the Japanese government tried to prevent further declines in the value of the yen by selling dollars to buy yen. However, the value of the yen is still falling without being able to hold out for a while. Some experts have warned that if this trend continues, there may be chaos comparable to the 1997-98 Asian foreign exchange period.
Moderator) If the situation does not improve even if the government intervenes directly, wouldn’t there be a way to raise interest rates?
However, this is not a situation that can be resolved simply by raising interest rates. Japan’s low interest rate policy is the core of former Prime Minister Shinzo Abe’s economic policy, so-called ‘Abenomics’. His successor, Prime Minister Fumio Kishida, also maintains this stance.
Moderator) Why is the Japanese government maintaining a low interest rate policy?
Reporter) This is to stimulate consumption and stimulate the economy by inducing a weakening of the yen. On the other hand, there is also an intention to reduce the burden of government bonds. Currently, Japan has huge debt. This is because even a small rate hike could snowball the interest burden. Meanwhile, Haruhiko Kuroda, the governor of the Bank of Japan (BOJ), the central bank of Japan, suggested on the 19th that if there is a stabilization and a weak yen, it will be positive for the economy as a whole, and that it will maintain a low interest rate stance.
Moderator) Global Village Today, I will listen up to this point.