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Oysters from Prince Edward Island are displayed in a Toronto market.
HARD NUMBERS: Killer oyster parasite spreads, Canada offers tariff relief, Small batch opioid precursors pose big problem, Moscow says “no” to new US-Russia nuclear treaty
95: An oyster parasite with a kill rate of up to 95% is spreading fast on Prince Edward Island, putting the lucrative industry at risk. Canadian food inspectors say the culprit – called “multinucleate sphere X” or “MSX” – has no effect on humans who eat contaminated oysters, but it shortens the mollusks’ lifespan. Oyster exports are PEI’s third most lucrative industry, bringing in about $24 million annually. Lobsters are in first, at nearly $300 million.
25: Canada is prepared to offer firms relief from a new 25% tariff on Chinese steel and aluminum coming into effect later this month. Ottawa imposed the measure to fight what it says is “dumping” in which China, suffering low domestic demand, exports unsold commodities at ultra-low prices. After Canadian firms warned they won’t be able to adjust their supply chains quickly enough, Finance Minister Chrystia Freeland said the government will develop a “framework” in which companies can request relief.
$800: How does so much fentanyl get into the United States? In small packages, according to a Reuters report, which finds that traffickers of the chemicals used to make the drug exploit a US trade loophole that permits packages with a value below $800 to enter the US with minimal inspections. Over a two-year period, a single trafficker profiled in the report ferried small packages arriving from China with enough precursors to make 5 billion fentanyl pills.
2: With just two years until the expiration of the last major nuclear arms limitation treaty between Russia and the US, Moscow may not seek to sign a new treaty at all. Russia last year suspended participation in the 2010 pact, known as the New START treaty, because of frictions with Washington over the Ukraine war. To sign a new agreement under these circumstances, said an unnamed Russian official, “will only entertain the pride of the United States.”Canada's Minister of Immigration, Refugees and Citizenship Marc Miller.
Hard numbers: Ottawa pledges fresh immigration crackdown, Gold and ‘Black Gold’ deliver a surplus, US makes big power grid pledge, China cracks down on opioid precursors
5: Canada says it will clamp down further on temporary immigrants, part of its strategy to reduce their share of the population to 5% over the next three years, as frustrations grow about the pace of immigration. Last year, temporary workers made up 6.2% of the population. So far this year, the level has climbed to 6.8%. In recent years, the Liberal government of Justin Trudeau encouraged the arrival of more temporary workers to help employers fill pandemic-related vacancies. But the country’s broader housing affordability crisis has fueled concern about the pace of immigration. A recent Leger poll showed 60% of Canadians said there were “too many immigrants.”
461 million: Gold and “black gold” helped deliver some sparkling economic news for Canada this week. Defying analyst predictions, the country registered a trade surplus in June, exporting $461 million more worth of goods than it imported. It was the first time that had happened in four months. Analysts pointed in part to surging exports of gold as well as oil, which finally began flowing from the Trans-Mountain Pipeline after years of delays.
2.2 billion: The White House has earmarked 2.2 billion to strengthen the US power grid and speed up the green transition. The money, to be matched by nearly $10 billion in private financing, will flow to eight projects across 18 US states. A major focus is to create additional transmission capacity and regional connections so wind farms and other alternative energy sources can make a bigger contribution to power generation.
3: China has committed to tightening regulatory controls on three chemicals used to make fentanyl, the White House said earlier this week. This is the third such move that Beijing has made since the two countries resumed counter-narcotics cooperation last fall. Illicit fentanyl overdoses — known more broadly as “the opioid crisis” — have become a leading cause of death for American adults under the age of 45 in recent years. China is known to have subsidized the production and marketing of fentanyl precursors.A bottle of fentanyl is displayed in Anyang city, central China's Henan province, 12 November 2018.
China agrees to restrict fentanyl production
China produces large quantities offentanyl, an opioid drug, much of which is then sold to drug cartels in Mexico that traffic narcotics into the United States. Fentanyl and other synthetic opioids were blamed for the overdose deaths of nearly 75,000 Americans in 2023.
For more than two years, the Biden administration has pressed China to stop the flow of chemicals used to make fentanyl. On Tuesday, China agreed to impose tougher restrictions and stricter oversight of the sale of three chemicals used to make fentanyl.
This tells us less about the future flow of opioids – they will probably continue to find their way across US borders – than about Beijing’s desire to protect stable and pragmatic relations with Washington. That is, at least until it becomes clear who will be inaugurated the next US president in January.
CBP agents stand by a plane that's believed to have carried Mexican drug lord Ismael "El Mayo" Zambada and Joaquin Guzman Lopez, who were arrested in El Paso, Texas.
Sinaloa cartel leaders arrested
Ismael “El Mayo” Zambada, the leader and co-founder of the notorious Sinaloa cartel was arrested on Thursday in El Paso, Texas, along with Joaquin Guzmán Lopez, the son of imprisoned cartel boss Joaquín “El Chapo” Guzmán.
The two men are considered to be among the most powerful drug traffickers in Mexico, and this is a major victory for US law enforcement agencies that have hunted figures like Zambada for years.
Attorney General Merrick Garlandsaid the men face “multiple charges” for leading the cartel’s criminal operations, which include “its deadly fentanyl manufacturing and trafficking networks.”
The DEA has directly attributed the deadly synthetic drug crisis in the US, involving substances like fentanyl and methamphetamine, to the Sinaloa and Jalisco cartels and their associates.
“Fentanyl is the deadliest drug threat our country has ever faced, and the Justice Department will not rest until every single cartel leader, member, and associate responsible for poisoning our communities is held accountable,” Garland said.
A congressional report earlier this year pointed to fentanyl as the leading cause of death for Americans aged 18-45. The opioid crisis is a major political issue in the US and has emerged as a key topic in the 2024 presidential election.
Though these arrests are a win for the Justice Department, experts doubt they will put a major dent in the drug trade — and suggest the arrests could lead to a spike in violence due to infighting that was already prevalent.A bottle of Fentanyl pharmaceuticals is displayed in Anyang city, central China's Henan province, 12 November 2018.
Friends that fight fentanyl together, stay together
After a four-year hiatus, the US and China have restarted joint talks to fight fentanyl. Chemicals for making the synthetic opioid flow from Chinese companies to drug cartels in Mexico and then to the US – where they are fueling the deadliest drug crisis the country has ever seen.
The talks aim to curb these precursor chemicals through better tracking and labeling, and if the US gets its way, by Beijing cracking down on the chemical manufacturers.
Why it matters: The talks are a sign that US-China relations are continuing to stabilize after years of tensions over COVID-19, trade, cross-strait posturing, and human rights violations. They are also a win for President Joe Biden: The fentanyl epidemic is sure to be a major 2024 campaign issue.
Will it work? Critics argue that the only way to stop the more than 100,000 Americans dying from fentanyl each year is through addiction-mitigating social policies.
A deadly side-effect: Curbing precursor chemical exports may inadvertently increase violence in Mexico as cartels fight to control the limited supply.
A bottle of Fentanyl pharmaceuticals is displayed in Anyang city
US cracks down on China’s role in fentanyl crisis
The US Justice Department filed criminal charges against four Chinese chemical companies and eight Chinese nationals on Friday, accusing them of trafficking fentanyl precursor chemicals to the Sinaloa cartel. Two high-ranking employees at the Chinese company, Amarvel Biotech, were arrested in Hawaii. The indictments mark the first time that Chinese producers, rather than cartel members, are being prosecuted for their alleged role in the US fentanyl epidemic.
Fentanyl is the leading cause of death for Americans under 50, responsible for 110,000 overdoses in 2022. The escalating death toll is pushing Washington to crack down on the foreign and domestic forces responsible for the drug crisis.
Fentanyl has been coming to the US from China since 2013. After the US pressured China to regulate the drug in 2019, manufacturers shifted to producing its raw materials, chemically camouflaging them for shipment, and giving cartels the scientific know-how to manufacture it in their own laboratories.
The crackdown on China’s fentanyl traffickers comes amid increasingly strained tensions between the two countries. China stopped cooperating with US counter-narcotic efforts after Nancy Pelosi visited Taiwan last year, but it agreed to participate in a joint effort to clamp down on precursor chemicals during Secretary of State Anthony Blinken’s visit to Beijing last week– one of the few areas of progress to come from the visit.
But any joint efforts appear unlikely in the wake of the indictments. Beijing has “strongly condemned” the charges, accusing the US of unlawfully arresting Chinese nationals and using China as a scapegoat for its drug crisis.
Blinken meets Xi in Beijing
Ian Bremmer's Quick Take: Hi, everybody. Ian Bremmer here, and Tony Blinken is not. No, he's coming back from Beijing, the US Secretary of State, the once-postponed and now-on-again weekend trip to Beijing. It's the first time he, as Secretary of State, has been there. Also, this was a last-moment meeting that included President Xi Jinping, and that's very important because on the ground in China, no attention being given publicly to the trip until Xi meets with Blinken, 35 minutes long, and then suddenly it is everywhere, and it's over 1 billion views, and it's all over state media, and it's all over social media. In a sense, the Chinese blessing the visit to their public and showing that they want to have a more constructive or at least stable relationship.
The other takeaway, marginal but still not unimportant, is the willingness to create a fentanyl working group. That's something the Americans have been pressing on for a while, which provides a little bit of cover for Biden that he's actually getting something done with the Chinese. Of course, the proof of the pudding is in the eating, and execution on that is something that everyone is going to be skeptical about and watching.
Okay, that's the good news. What's the bad news? There is no trust within this relationship. The US-China relationship continues to be very contentious, very conflictual. It's true that the Chinese gave their standard speaking points on Taiwan, and we can go to war, and we maintain the status quo. The Americans said, "We're not changing the status quo, and we don't want war." And everything will be fine. But the status quo is changing. The status quo is changing in a couple of ways. First of all, the Americans are doing whatever they can to make Taiwan less important. The export controls on Taiwan's semiconductors. Let's keep in mind that until very recently, until about a year ago, TSMC was producing 92% of the most important semiconductors in the world. The highest speed, smallest, fast. This is critical. Suddenly, that's down to 80%. Why? Because the Americans want to get away from vulnerability to Taiwan.
That's going to be down to 50% probably within five years. And as that happens, you've got Foxconn now moving all of their supply chain away from mainland China and towards India and Vietnam and Canada and other countries. Why are they doing that? And the answer is because the Americans see the status quo as risky, and they're trying to de-risk the status quo, which means less exposure to Taiwan, which makes a lot of sense for the Americans. But if you're the Chinese, you see that as actually leading to confrontation. You're saying, "Wait a second, we no longer have the ability to get access to this high-level technology. We have to build it ourselves." So when they do that and Taiwan becomes less important, it of course, becomes an area that's easier to have direct conflict.
Part of the reason the Americans were able to put unprecedented levels of sanctions against the Russians is because the Americans do almost no business with the Russians, Taiwan becomes less important, and the Americans de-risk the broader US-China relationship. It becomes easier to have confrontation with the Chinese, and as the Chinese take similar steps, they do the same thing. The one thing that didn't happen in this meeting was a willingness to re-engage on the military-to-military front. The Americans have been asking for it. Chinese have said no. They continue to say no this weekend. At the same time that the Chinese have taken really aggressive measures in the Taiwan Straits, in the South China Sea that potentially could risk direct accident/conflict with American military warships, jet fighters operating in the area. The fact that the Chinese are willing to tolerate that level of risk is they would argue analogous to the Americans being willing to tolerate greater levels of risk around the broader US-China relationship and around Taiwan.
That's not going to change. It's not going to change because Biden thinks he's got the right policies right now for China, because the politics of the relationship are heavily constrained by hawkish Democrats and Republicans, and because we're heading into the 2024 election. Now, the one thing that's useful is that in this relationship, Biden and Xi know each other well, they've known each other for a long time. Biden actually speaks with a lot of pride about that when you talk to him personally about how much time he spent with Xi. Not that he necessarily likes everything about him or trusts everything he says, but he respects him as a leader as opposed to Biden's view of Putin, which is exactly the opposite. That means that when they meet face-to-face, maybe there'll be a video call soon, but certainly looks likely on the sidelines of the APEX Summit in San Francisco this fall. Biden's going to go for a couple of days. That has the potential to strengthen the stabilization of the relationship, even as the structural forces are heading more towards conflict. I wish I had better news, but I'm glad the meeting happened. I'm glad it went as well as it actually did.
The Graphic Truth: The opioid death toll in US vs. Canada
The US and Canada are the world’s first and second-largest consumers of opioids per capita. And while both would love to relinquish their titles, it gets worse: Thanks to the explosion in fentanyl use in recent years, overdose deaths – as little as 2mg can be fatal – have skyrocketed.
The epidemic stems from big pharma’s false claims that opioid pain relievers were not addictive, which led to their widespread distribution. It’s also led to plenty of legal wrangling. Just this week, the Sackler family, whose pharmaceutical company, Purdue Pharma, has been at the heart of the crisis, was granted immunity from civil legal claims in the US in exchange for $6 billion to be paid to help combat the opioid epidemic.
We take a look at the toll opioids have taken in the US and Canada over the past six years (Note: 2022 Canadian figures are incomplete).