East Timor’s Shift in Strategy on the Greater Sunrise Gas Project

Economic

Summary:

After previously considering partnerships with Chinese and Kuwaiti investors, East Timor’s President Jose Ramos-Horta has reaffirmed his preference for working with Australia’s Woodside Energy and Japan’s Osaka Gas on the stalled Greater Sunrise gas project...

A Billion-Dollar Project Stuck in Limbo

The Greater Sunrise gas field holds an estimated 144.4 billion cubic meters of natural gas, making it a crucial economic asset for East Timor, Southeast Asia’s youngest and poorest nation. Originally valued at $65 billion in 2018, the project has yet to move forward due to prolonged negotiations between East Timor, Australia, and the project’s stakeholders.

Currently, the project is controlled by:

Timor Gap (East Timor’s state-owned company): 56.6%

Woodside Energy (Australia): 33.4%

Osaka Gas (Japan): 10%

Despite the long-standing disputes over where to process the extracted gas, the Timorese government remains committed to ensuring that a share of the economic benefits stays within its borders.

A Shift Away from China, Back to Traditional Partners

In 2023, East Timor had considered Chinese and Kuwaiti investors as potential partners for developing Greater Sunrise. However, in a recent interview with Reuters, President Ramos-Horta reversed course, stating that East Timor ultimately prefers to continue negotiations with Woodside and Osaka Gas for the sake of transparency.

The shift away from China-backed investments aligns with East Timor’s historical ties to Australia and Japan but also reflects growing concerns over China’s increasing influence in the region. The decision to prioritize Western partnerships underscores the strategic balancing act that East Timor must navigate in its foreign relations.

The Core Dispute: Pipeline to Darwin vs. LNG in East Timor

One of the most contentious issues remains the gas transportation and processing plan. The Australian and Japanese stakeholders propose transporting the gas via pipeline to an LNG facility in Darwin, Australia, arguing that this is the most cost-effective solution.

However, East Timor insists that building an LNG facility within its own territory would be economically viable and essential for national development. Citing a feasibility study by UK-based consultancy Wood, President Ramos-Horta stated that routing the gas to East Timor is no more expensive than the Darwin option, contradicting Woodside and Osaka Gas’s assessment.

This fundamental disagreement has stalled progress, with neither side willing to back down. The decision on the pipeline route is not merely an economic one—it is a matter of national sovereignty and long-term economic independence for East Timor.

Kuwait’s Investment Proposal and Political Time Pressure

Adding further complexity, a private Kuwaiti investment fund has offered to finance the entire cost of a gas pipeline to East Timor, contingent on an LNG facility being built locally. This external financing could tip the balance in favor of East Timor’s proposal, but it depends on whether Australia and Woodside are willing to alter their stance.

With Australia’s federal elections approaching in the first half of this year, Ramos-Horta emphasized the urgency of finalizing an agreement. He warned that continued delays risk derailing the project indefinitely, questioning whether Australia is genuinely committed to its economic partnership with East Timor.

Outlook: Can a Deal Be Reached?

While discussions are ongoing, no official meetings have been scheduled between East Timor and Australia to resolve the dispute. If no agreement is reached before the elections, the project may face further political and economic uncertainties.

Ultimately, East Timor’s insistence on domestic LNG processing is driven by economic necessity and national interests, while Australia’s preference for offshore processing in Darwin reflects its own economic and strategic priorities. Whether a compromise can be found will determine whether Greater Sunrise remains stalled or finally moves forward.

Source: Reuters

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Warren Takunda

Cryptocurrency

The International Monetary Fund wants to keep you down. Just look toward El Salvador for proof, where President Nayib Bukele abandoned his Bitcoin legal tender revolution in favor of international development loans. The new status quo has been made clear: while nation-states can stack and hold Bitcoin, the people cannot use it as legal tender. Instead, they must remain chained to fiat currency.

The International Monetary Fund (IMF), a financial arm of the United Nations, has long played a significant role in the economic colonization of emerging countries on behalf of a cabal of corporations, banks and the US government.

The IMF’s modus operandi has been to give developing countries development loans for construction and engineering projects. To receive these loans, countries often agree to balance their deficits, squeeze public spending, open their markets and privatize sectors of the economy. And, in the case of El Salvador, kill the Bitcoin Revolution and squash the opposition — Bitcoiners. This is known as “conditionality.”

The IMF says no Bitcoin for you

El Salvador became the world’s first country to make Bitcoin legal tender in 2021. President Bukele gave lip service to the idea that he introduced Bitcoin as a legal tender to free the Salvadoran people from the chains of central banking.

He has said, however, that the adoption of Bitcoin as tender by El Salvador’s Main Street has been slow. Bukele noted that it was the most unpopular measure his government had undertaken. According to a survey conducted by San Salvador University Francisco Gavidia, approximately 92% of Salvadorans did not use Bitcoin in 2023.

It appears the revolution is dead. El Salvador has been forced to scale back its Bitcoin agenda to attract development funds from the IMF, and take a quick step back on its pro-Bitcoin legal framework. To receive a $1.4 billion credit line, Bukele chose to do what the IMF required: revoke his plan for Bitcoin as a national currency. The IMF called it mitigating Bitcoin-related risks.

The development agency forced El Salvador’s government to reduce its Bitcoin purchases and no longer accept tax payments in Bitcoin. Bukele dropped the law requiring businesses to accept Bitcoin. Meanwhile, the IMF said the public sector’s Bitcoin-related activities will be restricted.

Central American countries will also gradually scale back their partnership with Chivo, the Bitcoin e-wallet El Salvador launched in 2021. The plan is to either privatize or shutter Chivo. How many people use the digital wallet is not public.

In 2021, the El Salvador government forked out $200 million to build out Bitcoin infrastructure, including Chivo and Bitcoin ATMs. It also offered $30 of free Bitcoin for those who signed up for the wallet. Most people used the Bitcoin to buy goods or exchanged it for dollars.

Despite the changes to its Bitcoin strategy, El Salvador’s government says it remains dedicated to Bitcoin. It can still stack Bitcoin — look no further than its recent 12 Bitcoin purchase. Stacy Herbert, director of El Salvador’s National Bitcoin Office, said the country would still buy Bitcoin to continue building its strategy Bitcoin reserve. El Salvador will no longer make putting Bitcoin into the hands of the people a priority. El Salvador continues to build a Bitcoin Reserve, but as legal tender, it appears that experiment has had to be exterminated.

The IMF vs. Bitcoin

The Salvadoran government made Bitcoin legal tender so that everyday citizens could enjoy the cryptocurrency’s benefits. They could experience holding a sound asset in their hands. They could start to understand the ills that central banks cast upon society.

The IMF disagrees. It has intended to diminish the chances that people discover how sound assets can change the lives of people with low incomes and the disenfranchised.

“For the public sector, engagement in bitcoin-related economic activities and transactions in and purchases of Bitcoin will be confined,” the IMF stated. “Transparency, regulation, and supervision of digital assets will be enhanced to safeguard financial stability, consumer and investor protection, and financial integrity.”

When El Salvador made Bitcoin a legal tender in September 2021, the IMF warned of financial and legal risks, which it recently said never materialized.

Bukele’s deal with the devil

It’s nothing new for the IMF to keep the tools of financial liberation out of the hands of the people. Its dominion over under-resourced countries is a through-line of the post-World War II world.

In 2024, the IMF’s colonial practices were met with mass protests in Kenya, which shed light on the predatory nature of the IMF.

The protest called on President William Ruto to strike down an IMF-led bill for austerity and regressive taxes in the nations.

It’s merely another case of the long arm of US colonial power prioritized at the expense of people experiencing poverty in underdeveloped countries. In Kenya and many other nations, the IMF continues pushing austerity measures, often freezing public sector bills.

“This global financial architecture was not established by us, it was not established for us, so it cannot be the financial architecture that will help us today. [...] That is neo-colonial wealth extraction,” Tunisian-American economist Fadhel Kaboub said in an interview outside the IMF counter-summit in Marrakech.

While people in Africa this year stood up to IMF colonization and power over debt, Bukele submitted.

The IMF, functioning as an arm of the UN to homogenize economic policies worldwide, intends to maintain fiat currency dominance. Nation-states can stack, but the IMF’s development help must be contingent on nation-states abandoning any notions of Bitcoin as legal tender. That is the lesson of El Salvador.

Source: Cointelegraph

Risk Warnings and Disclaimers

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Adam

Economic

The U.S.-EU Trade Deficit: A Matter of Perspective

On February 4, Politico reported that President Donald Trump reaffirmed his stance on imposing tariffs on the EU, citing the U.S. trade deficit as justification. While this is not the first time Trump has threatened such measures, analysts believe this time it warrants greater attention, particularly in light of the tariffs already imposed on China.

However, the trade imbalance Trump frequently references is considerably smaller than his claims suggest. According to data from the European Commission, the U.S. trade deficit in goods with the EU was approximately €150 billion in 2023. Importantly, this figure does not account for the services sector, where the U.S. maintains a surplus of over €100 billion, bringing the actual total trade deficit to around €50 billion ($52 billion)—a stark contrast to the $300-350 billion deficit Trump often cites.

When compared to other major trading partners, the EU’s trade surplus with the U.S. is relatively modest. The U.S. trade deficit with China is nearly seven times larger, while the deficit with Mexico is roughly twice as large. Even when expressed as a percentage of GDP, the EU’s surplus with the U.S. represents only 0.3% of its GDP, far below Canada’s 2.5%.

The Likelihood of Tariffs and Economic Consequences

Despite the relatively small trade deficit, experts widely believe that the risk of tariffs remains high. Agathe Demarais, a senior analyst at the European Council on Foreign Relations, predicts that the EU will likely be the next target after China, Canada, and Mexico.

One of the proposed solutions—increasing EU imports of liquefied natural gas (LNG) from the U.S.—has been deemed unrealistic due to the EU’s continued reliance on Russian gas.

From an economic standpoint, Deutsche Bank estimates that a 10% tariff on EU exports could result in a 0.5-0.9% contraction in the EU’s GDP. Given that the EU’s economy is projected to grow by only 1% in 2024, this policy could push the bloc dangerously close to recession. However, the EU is in a better position than Canada and Mexico, where similar tariffs could lead to GDP contractions of up to 3%.

Two key factors mitigate the EU’s vulnerability

Lower dependency on U.S. trade – Less than one-fifth of the EU’s total exports go to the U.S., whereas Canada and Mexico rely on the U.S. for three-quarters and four-fifths of their exports, respectively.Resilient export industries – Many of the EU’s key exports to the U.S., such as luxury automobiles and high-end pharmaceuticals, cater to wealthy consumers who are less sensitive to price fluctuations.

Another significant factor is the strength of the U.S. dollar. Varg Folkman, an analyst at the European Policy Center, suggests that a stronger dollar could reduce the competitiveness of American exports, indirectly benefiting the EU.

Nonetheless, Bloomberg Intelligence warns that uncertainties remain high. The actual impact of the tariffs, as well as whether they would be increased, maintained, or lifted during negotiations, remains unclear. What is certain, however, is that if implemented, these tariffs would have significant and largely negative consequences for the European economy.

EU’s Response: Negotiation and Strategic Positioning

In response to the looming threat, European Commission President Ursula von der Leyen announced on February 4 that the EU is prepared to engage in trade negotiations with the U.S. to safeguard its economic interests. While emphasizing the importance of transatlantic economic relations, she asserted that the EU will remain open yet firm in pursuing its economic objectives while protecting its strategic interests.

As the situation unfolds, the EU’s ability to navigate these negotiations will determine the extent to which it can mitigate the potential economic downturn. If talks fail and tariffs are enforced, the European economy may face a prolonged period of uncertainty, risking slower growth and possible recession.

Source: Political

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Adam

Economic

Impact of Trump’s Tariff Policy on Interest Rates

The latest round of U.S. trade tariffs could significantly impact monetary policy, with economists warning that Federal Reserve rate cuts in 2025 may now be off the table. Last week, President Donald Trump signed executive orders imposing additional tariffs on the country’s three largest trading partners—25% on imports from Canada and Mexico, and 10% on goods from China.

If these tariffs are implemented and maintained, consumer prices in the U.S. will rise, adding inflationary pressure at a time when inflation is still above the Fed’s 2% target. This could force the Fed to keep interest rates higher for longer, dashing hopes of lower borrowing costs for consumers and businesses in the near future.

Economists: "Rate Cuts May Be Off the Table"

According to Paul Ashworth, chief North America economist at Capital Economics, the likelihood of the Fed cutting rates in the next 12-18 months has now been "shut down." However, he also acknowledges that uncertainty remains high, especially after President Trump unexpectedly announced a one-month delay in implementing the 25% tariffs on Mexico and Canada.

Meanwhile, Joe Seydl, senior market economist at J.P. Morgan Private Bank, estimates that these tariffs, if applied long-term, could raise U.S. core inflation (excluding food and energy) by 0.5-1 percentage points through the end of 2026.

Since the Fed uses interest rate policy to control inflation, a sudden increase in import costs and consumer prices could force the central bank to maintain higher rates for an extended period.

Evercore ISI Forecast: Inflation to Hit 2.8% by Late 2025

Investment banking advisory firm Evercore ISI projects that the tariffs on Canada, China, and Mexico will push the Personal Consumption Expenditures (PCE) inflation index up by 0.7 percentage points, reaching approximately 2.8% in Q4 2025.

As a result, Evercore analysts predict that the Fed may completely abandon its planned rate cuts for 2025. In December 2024, Fed officials had projected two rate cuts for 2025, but those expectations may no longer be realistic given the new inflation pressures.

Will the Fed Raise Interest Rates Again?

While some have speculated that tariffs could force the Fed to hike rates instead of just pausing cuts, Stephen Brown, senior North America economist at Capital Economics, believes that is unlikely. Instead, he argues that tariffs will have a more significant economic drag on the U.S. than their inflationary effects, potentially pushing the Fed toward a rate cut.

Similarly, J.P. Morgan predicts that the new tariffs will shave 0.5-1 percentage points off U.S. GDP growth through 2026. If tariffs slow economic activity more than they push up inflation, the Fed might still have to cut rates—but for different reasons.

Market Outlook: A Delicate Balance for the Fed

The Federal Reserve now faces a challenging economic landscape. On one hand, higher import costs and inflation concerns argue against rate cuts. On the other hand, slower GDP growth due to reduced trade and investment could eventually force the Fed to intervene with lower rates.

With Trump's unpredictable trade policies and global economic uncertainty, the Fed may take a “wait-and-see” approach, keeping rates steady for longer than initially expected—and possibly delaying rate cuts until 2026 or beyond.

Source: Yahoo Finance

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Risk Warnings and Disclaimers

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Adam

Stocks

Market Volatility as New Tariffs Trigger Concerns

Asian stock markets experienced mixed trading patterns on February 5, as investors reacted to the latest round of tariff escalations between the United States and China. The renewed trade tensions have sparked fears of a prolonged economic conflict, with analysts closely monitoring Beijing’s response to Washington’s new 10% tariffs on Chinese goods.

In Japan, the Nikkei 225 index in Tokyo managed a modest gain of 0.1%, closing at 38,831.48 points. However, the Shanghai Composite Index in China fell 0.7% to 3,229.49 points, while the Hang Seng Index in Hong Kong dropped 1.1% to 20,570.56 points.

The market movements reflect a divergence in investor sentiment, with some traders seeing opportunities amid the chaos, while others remain wary of a potential full-scale trade war.

China’s Cautious Approach Keeps Markets Hopeful

According to Kai Wang, a market strategist at Morningstar, China’s retaliatory tariffs were less severe than expected, offering a glimmer of hope that Beijing and Washington might avoid a full-blown economic standoff. While China did impose 10-15% tariffs on select U.S. goods, only about 12% of total U.S. imports into China are affected.

“The Chinese response appears symbolic rather than aggressively punitive,” Wang noted. However, he also warned that Trump’s unpredictable trade policy could keep market volatility high for the next four years, creating a challenging investment landscape.

Similarly, HSBC’s global research division pointed out that Beijing’s response contrasts with the "tit-for-tat" approach seen in previous trade conflicts. While China’s measures were strategically measured, analysts acknowledge that risks of escalation remain high.

Tech Sector Hit by DeepSeek’s AI Breakthrough

Apart from trade tensions, technology stocks also faced additional pressures. Alphabet (Google’s parent company) and Advanced Micro Devices (AMD) both reported disappointing earnings results, adding to market jitters.

A major factor behind the weak tech sentiment is the emergence of DeepSeek, a Chinese AI startup that has developed an advanced chatbot at significantly lower costs than similar AI models from U.S. firms. This has raised concerns that China’s AI sector may challenge the dominance of U.S. tech giants, potentially reshaping the global AI industry.

Vietnamese Markets Stay Resilient

In Vietnam, stock markets remained positive, with the VN-Index gaining 4.93 points (0.39%) to reach 1,269.61, while the HNX-Index climbed 1.37 points (0.61%) to 227.98. The resilience of Vietnamese equities suggests that local investors remain optimistic despite regional economic uncertainties.

While markets are currently navigating through uncertainties, the risk of further tariff escalations and geopolitical tensions remains a key concern. Investors will closely watch for any new developments in U.S.-China trade negotiations, as well as the performance of the tech sector, which is undergoing significant shifts due to China’s growing AI capabilities.

With volatility likely to persist, market participants must prepare for continued fluctuations, balancing short-term risks with long-term investment strategies.

Source: WOWK

Risk Warnings and Disclaimers

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ING

Economic

USD: Rethinking FX reaction functions after the trade drama

To sum up yesterday’s events, the US struck a deal with Mexico first and Canada and all parties agreed to delay tariffs by at least a month. Trump managed to obtain greater commitment to border security from both countries, although there seemed to be limited discussion on trade.

In a matter of hours, markets shifted from scrambling to assess the consequences of Trump’s huge protectionist move to aggressively buying the dips in previously affected currencies. USD/CAD and USD/MXN are both trading below their Friday’s close. Last week, as the US ramped up its tariff threat, we argued that Trump’s handling of this tranche of protectionism would set a precedent that markets will use as a benchmark moving forward. If markets were reluctant to fully price in the impact of tariffs until the very last minute, yesterday’s turnaround by Trump may well warrant even greater caution when it comes to future protectionism threats.

One of the basic assumptions behind the reluctance to fully price in tariffs was that there would need to be a clear economic advantage to ultimately justify such measures. In the case of Canada and Mexico, where mostly border security was mentioned as a motive for protectionism, that motive seemed to be lacking – hence the surprise at Trump’s tariff announcement over the weekend. The question of whether Trump had planned an eleventh-hour deal with the two countries or was perhaps encouraged by some domestic backlash remains an open question. Either way, markets need to follow a rationale, and we think the conclusion is that Trump is ready to bluff his way into transactional victories, whether on border security or trade.

For FX, this means the dollar may not experience big rallies against directly and indirectly impacted currencies simply on the back of a tariff announcement, but only after duties effectively come to place and there are indications that they will stay. Let’s look at AUD, NZD and the China tariffs for instance. US tariffs on China are due to come into effect today, and Beijing has already announced a retaliatory 10-15% duties on US energy exports and farm equipment, coming into effect on 10 February. A cross like AUD/CAD should trade sharply lower in this situation given Canada has dodged tariffs and China has not, but it is only 0.5% lower on the day. That signals markets are pricing in a good chance that the US and China will also strike a deal and delay tariffs.

The final point to make is that markets are not fully pricing out the tariff threat just yet. That’s because tariffs have been only delayed by a month, and secondly because the rollercoaster of trade news in the past few days does leave markets with a higher degree of uncertainty and unpredictability that harms high-beta currencies both due to direct protectionism exposures and due to risk sentiment implications.

We can reasonably expect another correction in the dollar across the board if the US and China move towards a de-escalation in the coming days. But now that Trump has more concretely introduced the tariff threat into daily market news, the case for a structural flow against the dollar appears weak, and we would still expect support to DXY around 108.0. Today, the highlight in the US calendar will be December JOLTS jobs figures, although readjustments after the tariff scare should still dominate.

EUR: Don't get too excited

Amid the US-Canada-Mexico tariff saga – which was the main driver of EUR/USD yesterday – eurozone flash CPI estimates for January came in slightly hotter than expected. The core measure was unchanged at 2.7% (expected 2.6%) for a fifth consecutive month and the headline inched higher for the fourth month in a row, again challenging the ECB’s rather optimistic stance on disinflation.

As our economics team discusses here, this means that upside risks remain significant to inflation, but we are still confident that the trajectory remains deflationary for the remainder of the year. We still expect rates to be cut at least to 2.0% in the eurozone.

Looking at the implications of Trump’s handling of the Mexico and Canada tariff threat, sentiment in the eurozone has improved on the back of expectations that a deal can be struck and protectionism averted. Still, extra caution is warranted in this sense. If part of Trump’s motive to delay tariffs on US neighbours was domestic backlash for potential immediate economic pain for US consumers, that is not necessarily true for EU tariffs. On those, Trump can afford to play the longer game, and perhaps keep them in place for a prolonged period, making the EU feel some “pain” before striking a deal. Crucially, the motives for tariffs on the EU would not be border-related, where a deal is arguably quicker to achieve as we saw yesterday, but on trade imbalances, which often require longer negotiations.

With all this in mind, we are somewhat sceptical that the euro is bound for a major rally. Trump has already hinted the EU is next on the tariff list, and markets may probably find better value in buying the dips in currencies that have passed the protectionism peak against the euro, which is still to face the worst of it. We would expect a US-China trade deal to take EUR/USD close to 1.040, but the rally may lose steam around those levels.

GBP: The big winner in the tariff saga

The pound emerged as a safe haven among pro-cyclical currencies yesterday, and seems to be retaining some solid footing after an American trade war was averted. The reason is simple: the UK does not have much to lose from US tariffs. UK exports to the US are less than 2% of GDP and those to China less than 1%. Incidentally, Trump seems in no rush to hit the UK with tariffs, also considering its goods trade balance with the US is arguably negligible. Trump also seemed to be on rather amicable terms with UK Prime Minister Keir Starmer after a recent call.

Another factor contributing to sterling strength was Starmer’s trip to Brussels. That was officially aimed at strengthening an EU-UK defence path, but on which markets may be double reading an intent by Starmer to gradually reconnect with the EU politically. That is inarguably positive for sterling, which remains highly sensitive to any development that can improve a worsening growth outlook.

There are however some downside risks for the pound this week, as we expect headlines today confirming the fiscal headroom for the UK Chancellor has evaporated due to higher borrowing costs, and on Thursday the Bank of England may deliver a dovish rate cut. Still, EUR/GBP may not return to the 0.8450 January peak soon.

CEE: Safe haven within the EM market

Today's calendar is empty in the region however the global story provides plenty of impetus. After yesterday's inflation in Turkey, which surprised to the upside, and mixed PMI numbers the next events are the NBP and CNB meetings on Wednesday and Thursday. In the markets, yesterday's US tariffs triggered a sell-off in CEE currencies as in the rest of the EM space but CEE is showing some resilience to this type of headlines. At the same time, we saw a big pullback after the headlines from Mexico and especially the rates erased all losses and were actually stronger at the end of the day.

However, we see the CZK and HUF being exposed to this environment and a stronger US dollar will keep this part of the region under pressure. The CNB rate cut on Thursday and higher inflation in Hungary next week are FX negative on the local side in our view, which will make these currencies vulnerable. On the other hand, a hawkish NBP should keep PLN supported. The rate differential saw the biggest spike yesterday in Poland among CEE peers and Thursday's press conference is just another reason why the fade of yesterday's PLN weakness makes sense for us despite the current strong PLN levels.

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Cohen

Economic

The UK is racing to build a greener future and take the lead in driving sustainable finance. Bold policies like the Labour Party’s Green Prosperity Plan and the National Wealth Fund have been launched with the aim to drive investment in sustainable infrastructure. But turning ambition into action isn’t easy. The real challenge lies in unlocking capital at scale, creating a stable investment climate and bridging the gap between government policy and private sector needs.

An OMFIF roundtable in January brought together experts from the Department for Environment, Food and Rural Affairs, the City of London and the National Wealth Fund to examine how best to scale capital for green infrastructure. The discussion underscored the critical role of public-private collaboration, innovative financing mechanisms and targeted policy interventions in achieving the UK’s climate and economic objectives.

Achieving net-zero targets will require substantial investment in clean energy, green infrastructure and nature-based solutions. Conclusive government policies that align with private sector investment needs are essential to attract the necessary capital and overcome existing barriers.

Fuelling green growth and policy alignment

The National Wealth Fund has been designed to catalyse green investment, improve private sector participation and de-risk projects, while balancing financial sustainability with environmental and societal benefits. However, regulatory uncertainty, lengthy approval processes and a shortage of skilled workers continue to create hurdles by delaying projects and increasing costs for investors.

At the same time, fragmentation across sectors is slowing progress. Disjointed energy, manufacturing and resource management policies make it harder for investors to navigate the green finance landscape effectively. Without better coordination across government departments, capital deployment will remain inefficient. Speakers at the discussion emphasised the need for centralised frameworks that bring together policies, financing strategies and infrastructure development plans to remove barriers to investment.

The UK remains a global leader in sustainable finance, with established strengths in carbon markets, insurance and regulatory frameworks. However, transition finance, which supports industries in decarbonising, remains underdeveloped. Regulatory fragmentation, market hesitancy and a lack of clear, principles-based guidelines have slowed progress. Greater trust and transparency will be needed to unlock further investment opportunities.

Breaking barriers to transition finance and adaptation

Complex regulatory frameworks and slow project approvals continue to restrict the flow of private capital into green projects. Investors frequently cite uncertain policy landscapes and inconsistent regulations as major barriers to increasing their exposure to sustainable investments. A more agile regulatory environment – one that reduces administrative hurdles while maintaining accountability – will be crucial.

To combat this, public-private partnerships could help de-risk large-scale green investments, particularly in early-stage projects where private capital is often reluctant to engage. Adopting principles-based regulation would also create greater flexibility, allowing investors to respond to emerging technologies and sustainability opportunities without being constrained by outdated frameworks.

Beyond decarbonisation, investment in climate adaptation and nature-based solutions remains underdeveloped. Adaptation projects, such as sustainable agriculture, flood prevention and biodiversity restoration, offer long-term resilience benefits but often struggle to attract private capital due to unclear return profiles and data limitations. The roundtable discussion highlighted the need for government-backed financial mechanisms to reduce investor risk in these projects. Aligning public incentives with private sector expectations could create new pathways for capital to flow into adaptation finance.

Building a workforce for the green economy

The UK is facing critical shortages in engineering, clean energy and resource management. Yet, effectively delivering the energy transition requires a skilled workforce. Without targeted investment in workforce development, green infrastructure projects could face delays and rising costs.

Collaboration between industry, academia and government must serve to ensure that educational initiatives align with market needs. Expanding apprenticeship programmes, vocational training and research partnerships will be essential in developing a workforce capable of supporting a low-carbon economy.

The path forward

Attracting long-term green investment in the UK requires a critical three-pronged approach of regulatory reform, public-private collaboration and better workforce development. Simplifying regulatory frameworks will remove barriers, while stronger coordination across government can tackle systemic challenges. Institutional capital, including pension funds, must also be mobilised to finance sustainable projects at scale.

At the same time, innovation in clean energy and resource efficiency must be supported to help startups and emerging technologies scale effectively. Strengthening investment in climate adaptation and nature-based solutions will also be key to building resilience in the face of climate change.

By addressing these challenges head-on and aligning policy with investment needs, the UK can reinforce its position as a global leader in sustainable finance. The transition to net zero is not just an environmental necessity, it is an economic imperative.

Source：omfif

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Data

East Timor’s Shift in Strategy on the Greater Sunrise Gas Project

Timor Gap (East Timor’s state-owned company): 56.6%

Woodside Energy (Australia): 33.4%

Osaka Gas (Japan): 10%

A Shift Away from China, Back to Traditional Partners

The Core Dispute: Pipeline to Darwin vs. LNG in East Timor

Kuwait’s Investment Proposal and Political Time Pressure

Outlook: Can a Deal Be Reached?

Source: Reuters

The Lesson of El Salvador’s Failed Bitcoin Experiment

The IMF says no Bitcoin for you

The IMF vs. Bitcoin

Bukele’s deal with the devil

Source: Cointelegraph

Trump’s New Trade Policy and Its Potential Impact on the European Union

The U.S.-EU Trade Deficit: A Matter of Perspective

The Likelihood of Tariffs and Economic Consequences

Two key factors mitigate the EU’s vulnerability

EU’s Response: Negotiation and Strategic Positioning

Source: Political

New Tariffs Could "Shut the Door" on Fed Rate Cuts in 2025

Impact of Trump’s Tariff Policy on Interest Rates

Economists: "Rate Cuts May Be Off the Table"

Evercore ISI Forecast: Inflation to Hit 2.8% by Late 2025

Will the Fed Raise Interest Rates Again?

Market Outlook: A Delicate Balance for the Fed

Source: Yahoo Finance

Asian Stock Markets Show Mixed Reactions Amid Escalating U.S.-China Trade Tensions

Market Volatility as New Tariffs Trigger Concerns

China’s Cautious Approach Keeps Markets Hopeful

Tech Sector Hit by DeepSeek’s AI Breakthrough

Vietnamese Markets Stay Resilient

Source: WOWK

Lessons from a Very Short Trade War

USD: Rethinking FX reaction functions after the trade drama

EUR: Don't get too excited

GBP: The big winner in the tariff saga

CEE: Safe haven within the EM market

Labour’S Plans for a Net-Zero UK Must Eliminate Barriers to Green Investment

Fuelling green growth and policy alignment

Breaking barriers to transition finance and adaptation

Building a workforce for the green economy

The path forward

Source：omfif

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