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China targets US defense contractors, Tesla’s annual sales drop, and container ships are getting sma͏‌  ͏‌  ͏‌  ͏‌  ͏‌  ͏‌ 
 
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January 3, 2025
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The World Today

  1. US attack marks IS revival
  2. China-US tensions deepen
  3. Tesla sales decline
  4. Mexico tariffs hit US cars
  5. Ships are shrinking
  6. Jeju Air probe deepens
  7. China’s thorium reactor
  8. Yellowstone eruption unlikely
  9. Iran’s brain drain
  10. Chinese calligraphy persists

Some of the most iconic photographs taken in space are up for auction.

1

New Year’s attack reflects IS resurgence

Police standing guard in New Orleans.
Octavio Jones/Reuters

The New Year’s Day attack in New Orleans that killed at least 14 people reflects a resurgent Islamic State group, experts said. The US Army veteran who drove a pickup truck into a crowd before opening fire appeared to have acted alone and had ties to IS, authorities said. IS attacks have plummeted since 2015, but 2024 marked the group’s “year of resurrection,” a counterterrorism scholar said. Extremist groups like IS organize “in chaotic places and this year has provided a bevy of them,” The Economist wrote. In Syria, for example, Western officials are concerned IS could use the ouster of Bashar al-Assad to rebuild its influence there.

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2

China expands curbs on US firms

Lockheed Martin.
Benoit Tessier/Reuters

Beijing added 28 US defense firms to a list that restricts what Chinese companies can sell to them, the latest escalation in a trade war that is set to deepen in 2025. Many of the targeted firms, including Raytheon and Lockheed Martin, were already subject to Chinese sanctions, but the latest move signals Beijing’s increased willingness to hit back at Washington. “The drumbeat of these things is going to be more frequent,” one China expert said. With US President-elect Donald Trump expected to take a more aggressive stance toward Beijing, US-China ties are firmly top of mind for multinational corporations, The Wall Street Journal reported. “The old playbook... has been upended. Now, geopolitics is the driving force,” an Asia analyst said.

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3

Tesla sales drop amid EV headwinds

Year-on-year change in Tesla vehicle sales.

Tesla’s annual sales declined last year for the first time in a decade. The electric carmaker sold just under 1.8 million vehicles in 2024, about 19,000 fewer than in 2023. Tesla’s growth had accelerated over the four previous years, and the slowdown is the latest sign of the challenges US EV makers face: Domestic demand is lukewarm, and in overseas markets, competition from Chinese rivals is fierce. Tesla plans to debut a cheaper model this year, but analysts question whether sales will fully rebound, especially if Donald Trump eliminates EV incentives. Tesla’s CEO Elon Musk, meanwhile, is politically ascendant: A fixture of Trump’s inner circle, Musk has suggested eliminating EV tax credits would only hurt Tesla’s rivals.

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4

Mexico tariffs could hit US car prices

Value of monthly US trade with Mexico.

US President-elect Donald Trump’s proposed tariffs on Mexican imports could make it harder to find an affordable car in the US. Trump has threatened 25% duties on all Mexican imports should the country fail to stem the flow of migrants, drugs, and Chinese goods across the border. If imposed, the tax could cause car prices in the US to skyrocket as most cars made for export in Mexico are destined for the US. Mexico’s economy minister — who referred to the threats as a self-inflicted wound — has vowed retaliatory measures. “Everyone’s got a pretty big case of anxiety here,” the head of US operations for Kia told The Wall Street Journal.

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5

Global turmoil leads to smaller ships

 A cargo ship at the main Port of Honduras.
Wikimedia Commons

Container ships are getting smaller. Just six vessels that can carry more than 17,000 20-foot containers are set to be built this year, down from 17 in 2024. Instead, production of mid-sized ships is ramping up, as conflict and geopolitical shifts reverberate through the industry: Attacks on large ships in the Red Sea, as well as an escalating shakeup in US-China trade, are causing supply chains to reroute through smaller ports or passageways, the Financial Times reported, necessitating more compact ships. “Smaller ships can respond to macroeconomic events more readily,” a shipbuilding adviser said.

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6

SKorea deepens crash probe

Wreckage of the Jeju Air plane that crashed.
Kim Hong-Ji/Reuters

South Korean authorities raided the offices of the airline and airport operator involved in the Dec. 29 plane crash that killed 179 people. The search warrant was issued on suspicions of professional negligence, and Jeju Air’s CEO was banned from leaving the country. Investigators are looking into communications in the flight’s final moments, jet maintenance, and the design of the airport. The crash put a spotlight on South Korea’s low-cost carriers, like Jeju, which have limited in-house maintenance capabilities and heavily rely on overseas contractors, The Korea Times wrote. The anguish over the crash comes at a time of broader turmoil: Police clashed with supporters of impeached President Yoon Suk Yeol who gathered outside his home in an apparent bid to prevent his arrest.

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7

China to build thorium nuclear reactor

China is planning to build the world’s largest thorium-based nuclear reactor in the Gobi Desert. Thorium is a weakly radioactive metal that can be converted into an isotope of uranium, making it usable for nuclear fuel. In China, thorium is a waste product of its rare earth mining industry, and “harnessing it would provide a practically inexhaustible supply of fuel,” IEEE Spectrum reported. But few details of the reactor — slated to begin operations in 2030 — are available, and it’s not clear whether converting thorium to uranium can be done at this scale, or safely: Thorium produces uranium-233, which is usable in nuclear weapons, and scientists are worried it could be at risk of theft and improper use.

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Live Journalism

Join us for a world-class lineup of live journalism at the World Economic Forum 2025, where Semafor editors will engage with industry leaders to discuss key themes, including global finance, regulatory challenges, Africa’s growth, and the state of media.

Explore the schedule and request invitations to attend these sessions.

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8

Yellowstone magma mystery solved

Yellowstone National Park.
Wikimedia Commons

The magma under Yellowstone National Park is unlikely to erupt anytime soon, a new study suggests. Researchers used advanced imaging techniques to map where and how the molten rock is stored under the US park, which had been a mystery. “It has a lot of magma, but the magma is not connected enough” to be capable of a full-scale eruption, one scientist told The Washington Post, although the region remains volcanically active because of how much magma is stored there. Over 2.1 million years, Yellowstone has seen three major eruptions — the last was nearly 70,000 years ago.

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9

Iran’s ‘human capital’ is dwindling

Iranians in black.
Majid Asgaripour/WANA via Reuters

Iran is suffering from acute brain drain. A quarter of the country’s university professors have emigrated in recent years, according to one government minister. Further down the academic ladder, a record number of students left last year; Iran’s president said 80% of students were considering emigration. Economic hardship, authoritarian rule, and political instability are driving the exodus, Iran-watcher Bahram Salavati wrote in the Financial Times, “steadily depleting the country’s human capital.” The loss is making it harder for Iran to develop. Tehran must address the root causes, Salavati argued, by pursuing “economic reforms, coupled with political stability and social freedoms,” but the drain shows no sign of slowing anytime soon.

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10

Chinese calligraphy endures

Person writing Chinese calligraphy.
Flickr

Calligraphy has endured as a symbol of Chinese culture even as that culture has changed. Since the fourth century, China has taken pride in skill with a brush. Many imperial practices were abandoned after the revolution, but not calligraphy, and even “Mao Zedong was proud of his own hand,” The Economist noted. Children study the art form until age 15 and gain credit for it on the gaokao, China’s university entrance exam. Beijing positions calligraphy as denoting continuity with ancient China, when the written language was used as an elite lingua franca in the absence of a shared spoken one, like Latin in medieval Europe. And the state has ploughed money into finding ancient examples, hoping to prove that Chinese writing is the oldest in the world.

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Flagging

Jan. 3:

  • France’s new government holds its first cabinet meeting led by Prime Minister François Bayrou.
  • The PDC World Darts Championship final takes place in London.
  • Swedish activist Greta Thunberg celebrates her 22nd birthday.
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Substack Rojak

Rojak is a colloquial Malay word for “eclectic mix,” and is the name for a Javanese dish that typically combines sliced fruit and vegetables with a spicy dressing.

Do you hear the people sing

The success of Filipino Sofronio Vasquez — the first Asian contestant to win the US version of singing contest The Voice — has reinforced the popular notion that people from the Philippines are above-average, if not stellar, vocalists. Countless viral videos show Filipino singers effortlessly nailing karaoke songs — a trend that owes to several facets of the country’s culture, The Rebel Yellow newsletter wrote.

The Philippines has a rich musical heritage that many Filipinos are exposed to at an early age, including traditional folk music, salinawit (popular English songs translated into Filipino), and kundiman, a traditional genre “characterized by melodramatic themes and mournful laments.” Many singers also credit karaoke for their vocal prowess: A Filipino entrepreneur patented the first karaoke system in 1975, and it’s been a popular family activity for decades. “It nurtures a love for performing… encourages everyone to participate and provides an opportunity to experiment and discover their singing/vocal abilities,” a Filipino singer told The Rebel Yellow.

Rice, rice, baby

Across Asian cultures, rice has long been linked to health and happiness. In Thailand, a common greeting literally translates to “Have you eaten rice yet?,” Asia-focused outlet Kontinentalist wrote in its newsletter. “To ask if someone has eaten rice is thus more than asking if one has filled his or her belly; it’s asking after someone’s well-being.” Areas that cultivate rice tend to exhibit stronger social bonds, as rice farmers have to work together and manage complex irrigation networks.

Perhaps it’s no coincidence, then, that many popular rice-based meals are meant to be shared: A dish from Indonesia’s Nusantara region, nasi ambeng, takes its name from the Javanese word ambengan, which means to sit together or gather in defense of a cause. Kontinentalist also noted a Chinese proverb that feels especially apt as 2025 begins: “If you are planning for a year, sow rice.”

The new empire

Hollywood blockbusters flopped in China in 2024, continuing a yearslong trend that has seen the US film industry, once popular in the country, lose ground to Chinese movies. Of the top 10 highest-grossing films in China this year, only one was US-made: Godzilla x Kong: The New Empire. Last year, no Hollywood movies cracked the top 10 in the Chinese market, which limits the number of foreign films and pre-screens them for approval.

The Beijing Scroll newsletter pinpointed several drivers behind the shift: China has built up its domestic movie industry, with more films “ranging from sci-fi blockbusters to narrative-driven stories… that cater to local tastes and are produced to high standards.” Chinese moviegoers, particularly Gen-Z audiences, are also tired of repetitive Western IP, especially superhero movies, and are streaming more releases at home. Some US films still generate buzz: Horror film Alien: Romulus, released uncut in China, generated controversy after some parents said the intense scenes had terrified their children. That only made more people flock to theaters “to see what the fuss was about.”

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Curio
Earthrise, captured as the crew of Apollo 8 orbited the Moon.
Earthrise, captured as the crew of Apollo 8 orbited the Moon. NASA

A series of images from the golden age of space travel are up for auction. The vintage NASA photos include Earthrise, which was captured by the crew of Apollo 8 as they orbited the Moon and has become one of the most iconic environmental images ever taken. Also featured in the auction is Buzz Aldrin on the Moon with the American Flag, taken by Neil Armstrong, and the first ever photo of a human in space — a 1965 print showing an astronaut floating in infinity, tethered by just a single lifeline to the spacecraft. “The image thus becomes a universal metaphor: humanity, exploring the limits of the known, remains inextricably linked to its origins,” Artnet wrote.

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Semafor Spotlight
Donald Trump.
Brian Snyder/Reuters

Electricity demand will become the biggest challenge for the global energy transition in 2025 as political support for clean energy wavers, Semafor’s Tim McDonnell reported. “The Trump administration is not going to present tailwinds for us. But I’m of the view that the headwinds might be less significant than some folks bluster about,” a renewables investment firm director told McDonnell.

For more on how Trump will shape the green transition, subscribe to Semafor’s Net Zero newsletter. →

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