One afternoon in mid-June, I sat with Ethan*, a local islander, at Nauru’s boat harbour. He was speaking about how life had changed in the country since an asylum deal with Australia. Just a few years before my arrival in 2016, the small Pacific island had once again been financed to process the asylum claims of migrants attempting to reach Australia. If successful, refugees would be resettled locally around the island. Successive Australian governments had taken a tough zero-tolerance approach, making sure that anyone making their way by boat without documentation would “never settle in Australia”.
Not far from where we sat, placards covered the fence of a refugee resettlement compound, reading: “We’re refugees not criminals,” and “Freedom is a Right Not a Crime, We Want Justice.”
“The thing is none of them want to be here,” Ethan explained, “and we don’t know who these people are, they could be dangerous. Why else does Australia not want them?” These fears were echoed to me numerous times in Nauru. “I’m so worried about having the refugee children in our school,” Sandra, a teacher at Nauru’s only secondary school, said on another occasion. “We don’t want to touch or go too close in case they say we hit refugees. And natural things like kids pushing each other on the playground. The next day it’s in the Australian news”. This teacher’s fears were confirmed several months later, with headlines like: “Nauru Government Denies Refugee Children Are Abused in Schools.”
These sorts of representations have created a fractious context locally: one produced by sending asylum seekers, many with devastating pasts, to a vastly different region of the world from their intended destination.
The UK Rwanda policy
In January 2023, the UK’s High Court ruled on the lawfulness of the British government’s plan to deport asylum seekers to Rwanda. Under this £140 million agreement, undocumented migrants could find themselves sent to the East African country – 4,000 miles south-east of where they lodged their asylum applications. Once in Rwanda, they will have their asylum claims processed, and will be eligible for residency, not in the UK – their original destination – but in Rwanda.
The European Court of Human Rights (ECHR) in Strasbourg is expected to rule on the controversial policy by the end of the year. This proposed “outsourced” asylum policy directly mimics Australia’s so-called “Pacific Solution”, the impacts of which I have examined in my research. Since Australia’s Liberal prime minister, John Howard, at the turn of the century, boat arrivals have been the basis for copious media attention and resultant public anxiety in Australia. Controversial offshore policies in small Pacific islands like Nauru, combined with high-profile military and naval operations, are intended to reduce the number of people crossing the Indian Ocean.
This article is part of Conversation Insights The Insights team generates long-form journalism derived from interdisciplinary research. The team is working with academics from different backgrounds who have been engaged in projects aimed at tackling societal and scientific challenges.
Now, like successive Australian politicians, UK Prime Minister Rishi Sunak is promoting the UK-Rwanda policy as a means of “stopping the boats”, but this time those crossing the English Channel from northern France. Just as Australian politicians stoked public anxiety, pursuing media attention and electoral gains, Suella Braverman, the UK home secretary, has called migrant boats from Calais “an invasion on our southern coast”. She also said: “I would love to have a front page of the Telegraph with a plane taking off to Rwanda, that’s my dream, it’s my obsession.”
I conducted long-term fieldwork in Nauru into the effects of the Australian government’s near AU$10 billion (about £5 billion) arrangement. I have also led anthropological fieldwork projects into similar outsourced asylum measures in regions as diverse as Guatemala, Jordan and Lebanon. What falls outside the global media headlines, from all sides of the political spectrum, is how these policies are realised in practice and whether or not they actually work.
I have interviewed migrants claiming asylum, as well as local residents, private security contractors and government officials. I found that these outsourcing schemes create a refugee industry economy that local populations become dependant on. For the asylum seekers and refugees, most with devastating pasts and equally hazy futures, being castigated to far off places not of their choosing all too often led to tragic instances of self-harm and suicide. In Nauru, the friction between different populations were apparent on a daily basis.
Australia’s ‘Nauru experiment’
The boat harbour is a popular spot for Nauruans and refugees alike. It is one of the few places where you can swim safely without the threats of currents or the jagged limestone pinnacles that pierce through the island’s coastal waters. It is also a place where I have long conversations with asylum seekers down from the island’s Regional Processing Centres (RPCs). The RPCs are tucked deep in the heart of coral atoll’s jungle. Many asylum seekers take advantage of the afternoon open centre hours at the RPCs to catch a bus down to the boat harbour.
“No, I can’t swim, but I just like to come here because it’s cooler than at the centres. The heat sticks to you up there,” Khadija, an Iranian asylum seeker says to me. “In Iran, we never have this kind of heat.”
Like the majority of Nauru’s new refugee population, Khadija stands out. She’s 20 and most of her life has been spent in Tehran then Jakarta: cosmopolitan, urban hubs at odds with small Pacific island climes. She, as with so many other asylum seekers I speak with in Nauru, took a boat from Indonesia in the hopes of reaching Australia to claim asylum. The financial cost and possible dangers were enormous. It cost AU$10,000 (just over £5,000) for the boat alone, she tells me. But she and her sister were escaping extreme domestic abuse.
Not far from us, on the concrete walls of the boat harbour, sit a group of Nauruan Community Liaison Officers, also dressed in distinctive fluorescent vests. They are tasked with dealing with conflicts that arise between refugees and locals now that refugees are being resettled on Nauruan visas around the island. Our conversation moves to some of these conflicts. Khadija tells me:
I have Nauruan friends, but no, I don’t want to be here. I’d never heard of Nauru before I came here. I was scared, I didn’t know where they were taking me.
Abdul, a friend of hers, catches wind of our conversation as he dries himself off with a towel nearby. “I don’t think anyone had heard of this place! I mean, why would we want to come here? It’s a dump!”
“Well, a lot of Nauruans have been kind, but there are no jobs here for us here. How can we set up lives? No one wants to be here,” Khadija says, worry lines coursing her face.
We speak about the latest Guardian Australia media report of Nauruans beating up a refugee. Abdul has a lot to say on the matter: “You never know. Sometimes it’s true, there are fights that happen. Sometimes it’s desperation. Refugees trying to bring media attention to their situation. This is all expected. Send people to a very different part of the world where they don’t want to be and see what happens.”
Khadija interjects: “And refugees here will also do anything to get to Australia. You can’t send people somewhere so different and not expect them to protest. It’s not nice for the Nauruans, but a lot of refugees don’t care about that.”
I think of the placards covering the fence of a nearby refugee resettlement compound and the doors of the Australian-funded refugee businesses (largely beauty salons and takeaways) that are all firmly closed in protest. I had been in conversation earlier that week with a group of Nauruans working at the RPCs, who had told me of “shit smeared on the walls” and “taps left on” from asylum seekers in desperate protest. Only a few years before I arrived in Nauru, one of the RPC buildings had been burned to the ground.
“It’s not just between locals and refugees,” points out Khadija. “It’s also between refugees, of course. I’m Shia. My sister and I were put together with someone who’s Sunni. They made life difficult for us. They had to move us to a different section.” Abdul nods, adding: “There was one guy who had to be moved to separate hotel accommodation because it got so bad.”
Secrecy, violence and segregation
The kind of secrecy, violence and segregation that Khadija and Abdul speak of underpins daily life in Nauru. Around the island, the destructive realities of outsourcing asylum are palpable.
Aziz, an Iraqi refugee, living in resettlement accommodation, tells me of the cries when he goes to sleep at night:
I hear my neighbour through the walls, I don’t know what he saw before he came to Nauru.
Marie, an Australian torture and trauma counsellor, told me “you can’t begin to help people work through trauma when it’s exacerbated by being in Nauru”. She says Nauru has never had the capacity or the infrastructure to effectively support asylum seekers and refugees.
Marie’s latter point is one I’ve heard several times. Prior to the Australian arrangement, Nauru had no history of refugee processing or resettlement. To make this outsourced arrangement a reality, the Australian government funded fly-in-fly-out Australian counsellors in addition to asylum legal support, interpreters, refugee adjudication and appeals tribunals, education and medics. However, counsellors like Marie were largely ineffective – palliative at best. Asylum seekers I spoke with described experiencing overwhelming powerlessness, depression, and identity crises because of the offshore arrangement.
Industry contractors I spoke with recounted similar stories of human suffering. Sarah, a facility manager from the Australian corporate management firm, told me of her recurring nightmares, having witnessed asylum seekers sewing their lips together in her work at the RPCs.
Vivian, a mental health counsellor to the Australian Immigration Department, made the damaging toll of working in Nauru explicit in our interview. She said:
The compromises that people are in, and every day going to work to do bad things to others is making them feel ill. I had a client who had breast cancer who said to me, ‘I believe that I will be punished for what I’m doing by getting my breast cancer back.’ It’s a toxic environment and it sends people mad.
Trevor, a security guard at the RPCs, described the hunger strikes he tried to resolve: “But it’s not just hunger strikes,” he added, visibly upset.
Self-immolation, self-harm, riots, arson, suicide, jumps from roofs, sewing lips. Asylum seekers are desperate not to be here and so many of them have been through all kinds of traumatic experiences I can’t even imagine before being sent here.
Sarah and Trevor are just some of the many industry contractors I spoke with who bear the scars of witnessing these devastating situations. In fact, lawsuits from past contracted Australian workers to Nauru still plague the Australian government.
Many locals were initially sympathetic to the plight of refugees. However, over the years, this sympathy turned to anger as Nauruans contended being represented as savages and human rights abusers in parts of the media and by certain refugee solidarity activists. “Look at this stuff they write … They haven’t even been here,” says Oliana, a Nauruan government worker.
A growing trend
The kind of outsourcing arrangement between Australia and Nauru seems outlandish, but it is not unique. It is part of a model of wealthier western countries funding poorer countries to carry out border enforcement. Australia is often cited as a case study of outsourcing asylum, but this system has historical precedents.
Asylum as a formal international legal procedure was institutionalised across the early 20th century. European governments sought increased control over the demographic makeup and political structure of their nation states. Some feared disproportionate numbers of undocumented migrant arrivals. It was in this climate that the international refugee agency – a precursors to the United Nations High Commissioner for Refugees (UNHCR) – pioneered systems of so-called burden-sharing.
In the early 20th century, the Nansen Office and Intergovernmental Committee on Refugees spearheaded moving refugees (largely Russians, Armenians, and Greeks) between countries. Just a few decades later, huge numbers of Jewish refugees sought to escape the atrocities of the second world war. Many European countries refused to provide sanctuary to Jewish refugees, referring to the “Jewish problem”.
Instead, countries as far flung as the Dominican Republic and Ecuador promoted themselves as destinations for Jewish refugees to attract political and economic support. The International Refugee Organization - UNHCR’s precursor, active between 1946-1952 - took this system of burden-sharing to new heights, relocating more than a million refugees from Europe to the Americas, Israel, South Africa and Oceania between 1947 and 1951.
As asylum seekers changed from eastern Europeans to Africans and Asians from the 1970s, the term “asylum seeker” attracted negative connotations in western political and media discourse. It became shorthand for economic opportunism, mass movements and threats to security. Tough measures on asylum, including intercepting migrants before arrival, soon become a touchstone for left and right-leaning governments alike.
Outsourced asylum models have since been adopted across the EU. There are agreements with eastern Europe, Turkey, north and East Africa, and Central Asia. The US has experimented with several of what are termed extra-territorial asylum processing schemes, including processing Haitian asylum seekers in Guantanamo in the 1990s, establishing facilities to assess asylum claims across Central America, funding local advertisements to dissuade migrants, as well as financing border enforcement and national asylum systems across Mexico and Central America.
Many Asian countries, including China, Japan, South Korea and Taiwan have implemented restrictive detention and temporary visa practices for African migrants, in particular. So-called transit regions, such as South Asia, eastern Europe and North Africa have also seen significant levels of funding and resources going into policing, detention, and other forms of immigration control.
The UK has toyed with different externalised border enforcement measures over the years. The Rwanda deal is one such arrangement. Sunak has said that he will do “whatever it takes to make the Rwanda plan work”, describing “illegal migration” as an “emergency”. In June 2022, the first flight of four asylum seekers from the UK to Rwanda was blocked after an injunction from the ECHR alleged it was a violation of civil and political rights.
Others question the efficacy of the £140 million Illegal Migration Bill that is designed for only a small number of asylum seekers: the Rwandan government has agreed to receive 200 asylum seekers a year across a five-year trial period. Meanwhile, Braverman has declared that relocating people to Rwanda is a “ground-breaking migration and economic development partnership” and “an innovative way of addressing a major problem” of “billions of” people coming [to the UK].
Anti-migrant protests outside asylum seeker housing in Knowsley and Dover in the UK have also led to concerns that the Conservative government is capitalising on xenophobic sentiments. As legal debates continue around the legitimacy of the arrangement, Sunak has put together legislation that would disallow anyone reaching the UK to claim asylum without prior clearance.
The legislation would extend the government’s ability to detain them beyond the current permissible 28 days. It would also enable their deportation to a third country, such as Rwanda – the only country that has agreed to such a strategy. The former home secretary, Priti Patel, attempted deals with countries including Ghana and Kenya, which were rejected locally.
But Rwanda has yet to experience the implications of the deal. Rwanda does have a recent failed history of taking asylum seekers through a similar arrangement. In agreement with Israel’s Netanyahu government, Rwanda received some 4,000 Eritreans and Sudanese between 2014 and 2017. At the time, Netanyahu marshalled a similar narrative steeped in racial bias around the country’s mistanenim or “infiltrators”. Israel paid the Rwandan government US$5,000 for every asylum seeker, each of whom received US$3,500 and their airfare. Almost all are thought to have left the country immediately. Yet, unlike the proposed UK-Rwanda deal, this coerced voluntary deportation scheme did not involve a long-term asylum processing and resettlement arrangement. Such a proposition presents far greater concerns: ones raised not just in Nauru but also across my other fieldwork sites.
US and Guatemala: conflicting refugee histories
Flores is a picturesque island village in Guatemala’s northernmost Petén region. Located deep in the jungle in Lake Peten Itza, it is a place where the concept of claiming asylum to – not from – was little heard of prior to 2010. I am sitting in Flores’ main church square for World Refugee Day in June 2022. It is a new event for the island, put together by UNHCR’s new Petén field office, to socialise Guatemalan residents in refugee protection. Under the slogan “Reborn in Guate”, UNHCR has devised a day-long programme of art, folklore, dance, music and poetry.
“We have to be careful with using the word refugees,” whispers Alessandra, a UNHCR official, as a group of young Honduran rappers take the stage. “Many people, particularly Indigenous Maya, still have such vivid memories of when they were refugees. We don’t want it to seem like anyone’s getting preferential treatment or that they accuse our new refugee arrivals of gaming the system”.
This goes back to Guatemala’s four decade-long civil war. From the 1950s to the 1990s, genocidal policies claimed the lives of hundreds of thousands of Indigenous Maya, or Maya Q’eqchi’. During this period, the US provided counter-insurgency training and military supplies to Guatemalan military and police, which heightened the escalation of violence.
In Santa Elena, just across the causeway from Flores, I have a long conversation with a local fruit market vendor, Estella, about this time. She was a young girl when the civil war broke out. Caught in the gunfire between guerrilla forces, she and her family, like so many Maya Q’eqchi’, eventually crossed the border to Mexico in the 1980s in hopes of survival. After nearly a decade living in different refugee camps in southern Mexico, she eventually returned to the Petén as a middle-aged woman in 1995, not long after the peace process negotiations.
“Most of my life, I was in fear of the military finding my family,” she says. “We moved between refugee camps in Mexico, almost every year it felt like. Chiapas, Campeche, Quintana Roo,” she slowly counts the different states on her fingers, adding:
We never knew if the Mexican government was on our side or if we might be handed over to the Guatemalan army. The Guatemalan army was always coming into Mexico, looking for guerrilla soldiers in the camps. We knew that if they found us, we would be killed without any mercy, we’d seen this happen to others.
All those years spent living in exile in refugee camps before returning to the Petén, gives Estella pause when discussing the new refugee programmes. “It confuses me. These people aren’t refugees. They haven’t been through the kind of suffering we have,” she says. “Many Maya never got their land back and still live as refugees in Guatemala. They have all these programmes for the new refugees, and make such a big deal about them, they even get a month of accommodation, but we Maya experience so much inequality that has never been resolved.”
Guatemala still has one of the most unequal systems of land tenure in the world. The violence of the civil war resulted in the loss of livelihoods for many Maya, including huge unemployment that lingers to this day. Oil palm plantations, taking over great swaths of north-eastern Guatemala that are home to Q’eqchi’ communities, are continuing to fuel displacement. Substantial numbers of Guatemalans are also deported back from the US and Mexico each year (almost 100,000 migrants in 2022 alone), compounding these tensions.
It is for this reason that the Guatemalan government avoids calling resettled regional migrants refugees. Officials I speak with at Guatemala City’s Migration Institute emphasise avoiding the term. Not only does it evoke traumatic memories for many, but the government fears public perceptions of preferential treatment of US-funded, regional refugees.
Yet, Guatemala is visibly promoting itself as an asylum destination, as the World Refugee Day celebrations make clear. In our conversation, Estella references the posters that cover Santa Elena’s central bus station. At her recommendation, I go to look at the almost tourist-style advertisements that stretch dramatically across the façade of the arrivals hall. One is fringed with stick figures of people running for safety and the logos of UNHCR and El Refugio de la Niñez, Guatemala’s national refugee support agency. At its centre, it features a family holding hands as they clamber over train tracks. In large blue font, with the words “danger”, “protection”, and “refugee” highlighted, it reads:
“If your life is in danger, and you cannot return to your country, you can ask for protection as a refugee in Guatemala. We can help you!”
Around another corner in the terminal, signs point towards a small office, the Attention Centre for Migrants and Refugees. Inside, I see a small team of Guatemalan social workers with leaflets explaining the process of claiming asylum in Guatemala.
These efforts constitute the US’ latest outsourced asylum strategy. As part of a regional approach begun in 2017, known as the Regional Comprehensive Protection and Solutions Framework (or its Spanish acronym MIRPS). Guatemala, together with Mexico and other Central American countries (Belize, Costa Rica, El Salvador, Honduras and Panama) is steadily developing the capacity to receive and support asylum claims in the country. Santa Elena is a way station for Honduran migrants making the long journey up to the US. Heightened US-funded border enforcement further south along Guatemala’s main land borders has also pushed more people to pass through the northern Petén border, where I conducted my research.
Migrants are encouraged to claim asylum for Mexico or Central America, rather than making their claims to the US. Limitations at the US-Mexico border, combined with the exorbitant costs and danger of making the crossing undocumented, are pushing more migrants to applying for asylum regionally.
Claiming asylum in Guatemala or other third countries might soon be a legal requirement. In 2023, the US Supreme Court issued a hotly contested proposed rule known as the “transit ban” – asylum seekers who pass through a third country en route to the US-Mexico border must claim asylum there first.
But very few migrants are interested in claiming asylum locally. Like the UK-Rwanda deal, the US plan also functions largely as spectacle. Although the numbers of asylum claims filed to Guatemala’s new National Commission for Refugees is increasing, only 634 refugee visa holders and 1,410 asylum-seekers reside in Guatemala.
Memories of exile
Estella’s confusion at the visible effects of outsourcing asylum in Guatemala foreshadows additional dynamics that the UK-Rwanda deal might produce. Like Guatemala, Rwanda is also a country with a tragic history of producing refugees. The 1994 Rwandan genocide led to the massacre of next to a million people. Horrific numbers of women were sexually assaulted. Over two million Rwandans fled to neighbouring countries in Africa’s Great Lakes region including Tanzania, Uganda, Burundi, and the Democratic Republic of Congo (DRC). Following the end of the civil war, an estimated 1.3 million Rwandan refugees returned after over two years in exile. As with Guatemala, memories of exile and return are ever-present in Rwanda. Outsourcing asylum to regions with pre-existing local refugee populations can incite the tensions voiced by Estella and others I spoke with.
Unlike Guatemala, Rwanda does have a history of formal refugee protection outside of the return of its own citizens. Almost 164,000 refugees live in refugee camps or urban areas in Rwanda. However, these refugees are from surrounding East African regions, such as the DRC and Burundi. Those asylum seekers who have received notices of intent from the UK Home Office (making them at risk of being sent to Rwanda) are largely from the same countries as those I met in Nauru: Afghanistan, Iran and Syria. These are countries that are ethnically and linguistically distinct to Rwanda.
Even in the US asylum arrangement with Guatemala, most refugees given residency there are from surrounding Spanish-speaking countries. Here, the emphasis is on developing a viable regional resettlement framework. That the UK is considering sending asylum seekers from far different regions to a country still raw from its own refugee dynamics does not bode well. It was the cultivation of ethnic hierarchies between Tutsis and Hutus under Belgian colonial rule that resulted in the 1994 Rwandan genocide in the first place.
A toxic policy with little returns
My fieldwork findings from Nauru and Guatemala paint a bleak picture of the impacts of outsourcing asylum, relevant to the UK-Rwanda arrangement. The British government is setting up for similar entrapment in a costly operation, totals that in Australia financially spiralled to an estimated AU$9.65 billion (over £5 billion) since July 2013.
Rwanda is a country that, unlike the UK, does not have a substantial Middle Eastern diaspora. The Rwandan government will require enormous investment to support new populations from well outside the East African region. The British government – and ultimately taxpayer – will end up shouldering these costs. Sustaining the operations in the face of ongoing activism and High Court pushbacks will require evermore Rwandan investments to ensure its international legal compliance. Rwanda, like Nauru, will have major challenges to contend with too, including education, social integration, housing capacity, and mental health and trauma-related concerns.
As a migration governance strategy, the UK-Rwanda deal makes little sense. It will cost the British taxpayer far more than the economic and social benefits of integrating the small number of migrants into the British workforce.
Since the post-war era, international migration worldwide has remained stable, as a percentage of the global population it stands at 3.6%. This is a fraction of the world’s population, meaning that most people migrate within countries, rather than across borders. The majority of irregular migrants to the UK are visa over-stayers and not those who take a boat across the English Channel. Typically, it is also not the poorest people who migrate. Taking a boat is an expensive endeavour and migrants require considerable resources to migrate, particularly across international borders.
‘A laboratory experiment gone wrong’
A new deal was finally struck for Nauru after almost a decade of indecision as to how to end the arrangement. It came amid a backdrop of deepening civil unrest, a series of tragic self-immolations, and a Guardian Nauru Files campaign that made global headlines. The Australian government arranged with the Obama administration a deal in which 1,250 refugees from Nauru and Manus Island would be resettled in the US.
These resettlement places were still honoured when Donald Trump entered office in 2016, as part of what Trump notoriously described as the “dumb, dumb deal”. Hamid, an Afghani refugee acquaintance in Nauru, sent me an email at the time. He expressed his excitement about his upcoming move to the US, but also his fear at the racism he might encounter. Like Hamid, most refugees have since been resettled across the US, Canada, and eventually through the long-standing New Zealand offer. But 60 refugees remain in Nauru, with the country still marred in refugee protests locally.
Heated debates continue in Australia. In March, the Albanese Labor government, the Liberal Party and the One Nation Party voted against the Green Party’s Migration Amendment Evacuation to Safety Bill 2023. This bill called for those refugees held in Nauru to be moved to Australia, while the Australian government pursued further resettlement options.
Nauru remains funded by the Australian government with the possibility that these operations might be restarted in the future. In October 2022, the Australian government awarded an AU$422 million (roughly £230 million) contract with the US-based private prison contractor, Management and Training Corporation, until September 2025 to hold refugees in Nauru.
Instead of debating the legitimacy of asylum, countries could benefit from providing work rights to migrant populations. The UK is well prepared for meeting these integration needs. Because of centuries of migration (much wrought through colonialism) the UK has already invested significant resources into supporting newcomers keen to integrate into the labour market. The Oxford Migration Observatory recently found that higher net migration reduces pressure on government debt over time. Incoming migrants are generally younger and of working age than the wider population. This means that they are more likely to work and contribute to public finances.
Not only is this shown to support migrant livelihoods, but it can also benefit the economies of sending and receiving countries in the long-term. These kinds of boosts to the economy and the labour market are much-needed in the post-COVID-19 and post-Brexit labour environment.
Back to 2016 and I am sitting in a senior Australian bureaucrat’s office in Canberra, discussing the standstill underway with the Nauru arrangement. I ask what the future holds for the offshoring policy. “Most politicians want it to end, but they’re unsure how to do it without losing face,” he replies.
Protests, many refugees on suicide watch, hunger strike, people sewing their lips together, no one interested in integrating locally in Nauru, it frankly just isn’t sustainable. It was never meant to be.
He pauses, adding: “Not to mention, ethically. It’s a laboratory experiment gone wrong.”
All names have been changed to protect the identities of those involved.
To hear about new Insights articles, join the hundreds of thousands of people who value The Conversation’s evidence-based news. Subscribe to our newsletter.
Julia Morris does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.
China Auto Sales Jump 55% Year Over Year As Price Cuts Continue To Move NEV Metal
Retail sales of passenger vehicles scorched higher in May, with 1.76 million units sold, according to preliminary data from the China Passenger Car Association released this week.
The sales figure represents 8% growth from the month prior. As has been the case over the last several years, new energy vehicles continue to grow disproportionately to the rest of the sector, driving sales higher.
Last month 557,000 NEVs were sold, growth of 55% year over year and 6% sequentially, according to a Bloomberg wrap up of the data.
The sales boost comes as the country slashed prices to move metal throughout the first 5 months of the year. In late May we noted that China's auto industry association was urging automakers to "cool" the hype behind price cuts that were sweeping across the country.
The price cuts were getting so egregious that the China Association of Automobile Manufacturers went so far as to put out a message on its official WeChat account, stating that "a price war is not a long-term solution". Instead "automakers should work harder on technology and branding," it said at the time.
Recall we wrote in May that most major automakers were slashing prices in China. The move is coming after lifting pandemic controls failed to spur significant demand in China, the Wall Street Journal reported last month. Ford and GM will be joined by BMW and Volkswagen in offering the discounts and promotions on EVs, the report says.
At the time, Ford was offering $6,000 off its Mustang Mach-E, putting the standard version of its EV at just $31,000. In April, prior to the discounts, only 84 of the vehicles were sold, compared to 1,500 sales in December. There was some pulling forward of demand due to the phasing out of subsidies heading into the new year, and Ford had also cut prices by about 9% in December.
A spokesperson for Ford called it a "stock clearance" at the time.
Discounts at Volkswagen ranged from around $2,200 to $7,300 a car. Its electric ID series is seeing price cuts of almost $6,000. The company called the cuts "temporary promotions due to general reluctance among car buyers, the new emissions rule and discounts offered by competitors."
China followed suit, and thus, now we have the sales numbers to prove it...
Most people in the mainstream concede that the economy is heading for a recession, but the consensus seems to be that downturn will be short and shallow. Projections by the World Bank undercut that optimism.
According to the World Bank, global growth in 2023 will slow to the lowest level since the 2008 financial crisis.
In other words, the World Bank is predicting the beginning of Great Recession 2.0.
You might recall that the Great Recession was neither short nor shallow.
In fact, World Bank Group chief economist and senior vice president Indermit Gill said, “The world economy is in a precarious position.”
According to the World Bank’s new Global Economic Prospects report, global growth is projected to decelerate to 2.1% this year, falling from 3.1% in 2022. The bank forecasts a significant slowdown during the last half of this year.
That would match the global growth rate during the 2008 financial crisis.
According to the World Bank, higher interest rates, inflation, and more restrictive credit conditions will drive the economic downturn.
The report forecasts that growth in advanced economies will slow from 2.6% in 2022 to 0.7% this year and remain weak in 2024.
Emerging market economies will feel significant pain from the economic slowdown. Yahoo Finance reported, “Higher interest rates are a problem for emerging markets, which already were reeling from the overlapping shocks of the pandemic and the Russian invasion of Ukraine. They make it harder for those economies to service debt loans denominated in US dollars.”
The World Bank report paints a bleak picture.
The world economy remains hobbled. Besieged by high inflation, tight global financial markets, and record debt levels, many countries are simply growing poorer.”
Absent from the World Bank analysis is any mention of how more than a decade of artificially low interest rates and trillions of dollars in quantitative easing by central banks created the wave of inflation that continues to sweep the globe, along with massive levels of debt and all kinds of economic bubbles.
If you listen to the mainstream narrative, you would think inflation just came out of nowhere, and central banks are innocent victims nobly struggling to save the day by raising interest rates. Pundits fret about rising rates but never mention that rates were only so low for so long because of the actions of central banks. And they seem oblivious to the consequences of those policies.
But being oblivious doesn’t shield you from the impact of those consequences.
In reality, central banks and governments implemented policies intended to incentivize the accumulation of debt. They created trillions of dollars out of thin air and showered the world with stimulus, unleashing the inflation monster. And now they’re trying to battle the dragon they set loose by raising interest rates. This will inevitably pop the bubble they intentionally blew up. That’s why the World Bank is forecasting Great Recession-era growth. All of this was entirely predictable.
After all, artificially low interest rates are the mother’s milk of a global economy built on easy money and debt. When you take away the milk, the baby gets hungry. That’s what’s happening today. With interest rates rising, the bubbles are starting to pop.
And it’s probably going to be much worse than most people realize. There are more malinvestments, more debt, and more bubbles in the global economy today than there were in 2008. There is every reason to believe the bust will be much worse today than it was then.
In other words, you can strike “short” and “shallow” from your recession vocabulary.
“We expect DNAmFitAge will be a useful biomarker for quantifying fitness benefits at an epigenetic level and can be used to evaluate exercise-based interventions.”
Credit: 2023 McGreevy et al.
“We expect DNAmFitAge will be a useful biomarker for quantifying fitness benefits at an epigenetic level and can be used to evaluate exercise-based interventions.”
BUFFALO, NY- June 7, 2023 – A new research paper was published inAging (listed by MEDLINE/PubMed as “Aging (Albany NY)” and “Aging-US” by Web of Science) Volume 15, Issue 10, entitled, “DNAmFitAge: biological age indicator incorporating physical fitness.”
Physical fitness is a well-known correlate of health and the aging process and DNA methylation (DNAm) data can capture aging via epigenetic clocks. However, current epigenetic clocks did not yet use measures of mobility, strength, lung, or endurance fitness in their construction.
In this new study, researchers Kristen M. McGreevy, Zsolt Radak, Ferenc Torma, Matyas Jokai, Ake T. Lu, Daniel W. Belsky, Alexandra Binder, Riccardo E. Marioni, Luigi Ferrucci, Ewelina Pośpiech, Wojciech Branicki, Andrzej Ossowski, Aneta Sitek, Magdalena Spólnicka, Laura M. Raffield, Alex P. Reiner, Simon Cox, Michael Kobor, David L. Corcoran, and Steve Horvath from the University of California Los Angeles, University of Physical Education, Altos Labs, Columbia University Mailman School of Public Health, University of Hawaii, University of Edinburgh, National Institute on Aging, Jagiellonian University, Pomeranian Medical University in Szczecin, University of Łódź, Central Forensic Laboratory of the Police in Warsaw, Poland, University of North Carolina at Chapel Hill, University of Washington, and University of British Columbia develop blood-based DNAm biomarkers for fitness parameters including gait speed (walking speed), maximum handgrip strength, forced expiratory volume in one second (FEV1), and maximal oxygen uptake (VO2max) which have modest correlation with fitness parameters in five large-scale validation datasets (average r between 0.16–0.48).
“These parameters were chosen because handgrip strength and VO2max provide insight into the two main categories of fitness: strength and endurance , and gait speed and FEV1 provide insight into fitness-related organ function: mobility and lung function [8, 24].”
The researchers then used these DNAm fitness parameter biomarkers with DNAmGrimAge, a DNAm mortality risk estimate, to construct DNAmFitAge, a new biological age indicator that incorporates physical fitness. DNAmFitAge was associated with low-intermediate physical activity levels across validation datasets (p = 6.4E-13), and younger/fitter DNAmFitAge corresponds to stronger DNAm fitness parameters in both males and females.
DNAmFitAge was lower (p = 0.046) and DNAmVO2max is higher (p = 0.023) in male body builders compared to controls. Physically fit people had a younger DNAmFitAge and experienced better age-related outcomes: lower mortality risk (p = 7.2E-51), coronary heart disease risk (p = 2.6E-8), and increased disease-free status (p = 1.1E-7). These new DNAm biomarkers provide researchers a new method to incorporate physical fitness into epigenetic clocks.
“Our newly constructed DNAm biomarkers and DNAmFitAge provide researchers and physicians a new method to incorporate physical fitness into epigenetic clocks and emphasizes the effect lifestyle has on the aging methylome.”
Read the full study: DOI:https://doi.org/10.18632/aging.204538
Corresponding Authors: Kristen M. McGreevy, Zsolt Radak, Steve Horvath
Keywords: epigenetics, aging, physical fitness, biological age, DNA methylation
Sign up for free Altmetric alerts about this article: https://aging.altmetric.com/details/email_updates?id=10.18632%2Faging.204538
Launched in 2009, Aging publishes papers of general interest and biological significance in all fields of aging research and age-related diseases, including cancer—and now, with a special focus on COVID-19 vulnerability as an age-dependent syndrome. Topics in Aging go beyond traditional gerontology, including, but not limited to, cellular and molecular biology, human age-related diseases, pathology in model organisms, signal transduction pathways (e.g., p53, sirtuins, and PI-3K/AKT/mTOR, among others), and approaches to modulating these signaling pathways.
Please visit our website at www.Aging-US.com and connect with us: