TheChek News Flow

Atomic watchdog’s withdrawal comes despite no independent assessment of damage to Tehran’s nuclear facilities

Israel intends to maintain “aerial superiority” over Iran to protect itself from future threats from the Islamic republic, the country’s defence minister has said, as the UN confirmed it had pulled out the inspectors who have provided information on the progress of Tehran’s nuclear programme.

The comments by Israel Katz came ahead of the announcement by the International Atomic Energy Agency (IAEA), the UN’s nuclear watchdog, that a team of its inspectors had left Iran on Friday after staying in Tehran throughout last month’s 12-day war with Israel.

“The Israel Defense Forces’ mission now is to prepare a ‘blue and white’ enforcement plan to ensure Iran will not be able to threaten Israel again,” Katz told his country’s military on Thursday night, in an apparent reference to the colours of the Israeli flag.

His office did not share further details, but the outline echoed how Israel has interpreted a ceasefire with Hizbollah in Lebanon, where the air force has carried out near-daily air strikes even after the formal cessation of hostilities in November 2024.

Katz’s instructions came at a time when there is less information available about Iran’s nuclear activities than before the war.

There has been no independent assessment of the damage to Iran’s nuclear facilities since US President Donald Trump announced a ceasefire last week.

The location of the country’s enriched uranium stockpiles — including 400kg that had been enriched to about 60 per cent purity, or near weapons grade — remains unknown.

Friday’s announcement by the IAEA that it had withdrawn its remaining inspectors, the chief independent source of information about the nuclear programme for more than two decades, came after Iran’s parliament passed a law suspending co-operation with the agency.

In a post on X, Rafael Grossi, the UN agency’s director-general, said it was of “crucial importance” that the IAEA discuss with Tehran how it could resume “its indispensable monitoring and verification activities in Iran as soon as possible”.

Iran’s foreign minister Abbas Araghchi said the Islamic republic remained committed to its obligations under the nuclear non-proliferation treaty, and Steve Witkoff, US special envoy to the Middle East, may meet Iranian officials in Europe next week, according to a report by Axios.

The status of Iran’s nuclear programme — and how much the US and Israeli attacks have set back the country’s atomic ambitions — represents one of the most contentious issues about the recent war.

While Trump has said the programme has been “obliterated” by the US attacks on Iran’s nuclear facilities, the Pentagon said this week that it had been “degraded . . . by one to two years”.

Tehran insists its atomic programme is purely peaceful, but Israel has long regarded the possibility of a nuclear-armed Iran as an existential threat while refusing to declare its own secret arsenal.

Katz said in his comments on Thursday night that he had instructed the military to ensure that Israel’s air force, the most technically advanced in the region, maintains its “air superiority and the ability to enforce the restrictions on Iran”.

“The state of Israel is determined to lead an active defence policy against Iran,” he said.

During last month’s war, the Israeli air force quickly took control of Iran’s skies after destroying the country’s limited aerial defences.

That enabled Israeli warplanes to strike across Iran at will, and cleared the way for the US assault on fortified underground nuclear facilities.

The Iranian armed forces’ chief of staff, Major General Abdolrahim Mousavi, warned Israel of a forceful reaction to any further military aggression.

“We had designed a crippling plan [in response to Israel’s offensive], but we did not get an opportunity to implement it when the conflict was halted,” the top military commander said on Friday.

“If they attack Iran once again, they will see what we will do in response. In that case, even the US may not be able to save [Israeli President Benjamin] Netanyahu.”

Also speaking on Friday, Iran’s President Masoud Pezeshkian reiterated Tehran’s commitment to diplomacy, adding the Islamic republic was seeking to resolve issues through dialogue, before it was attacked by Israel.

“Iran still considers negotiation and diplomacy as an effective means of resolving differences,” he said during a visit to neighbouring Azerbaijan, adding, “The other side, however, will need to demonstrate through action that it remains committed to this approach.”  

Before Israel’s unexpected assault in June, Iran had fired missiles at Israel on two previous occasions in retaliation for Israeli assassinations in Tehran and of Iranian military staff in a diplomatic compound in Syria.

Josh Schulman is approaching the first anniversary of what has been an eventful period as chief executive of luxury fashion business Burberry.

The former head of US fashion businesses Coach and Michael Kors got to work straight away, setting out a new strategy aimed at returning the business to its roots as a specialist in British outerwear, following a costly and unprofitable incursion into the leather goods market — Burberry declared a £66mn loss in the year to March, as sales slid by 17 per cent.

End markets remain unhelpful. UBS analysts expect demand for luxury goods to remain weak until at least the second half of next year, with demand from both US and Chinese consumers remaining subdued.

Schulman’s turnaround plan involves substantial cost cuts — in May, he increased Burberry’s annual cost saving target to £100mn, from £40mn previously, putting 1,700 jobs at risk. RBC Capital Markets analyst Piral Dadhania has pinpointed its 422-strong store network, which is “outsized” relative to its revenue base, as an area that could be pared back.

Schulman clearly has confidence in his plan, and the Burberry board has confidence in him — it awarded him a bonus of £1.2mn (equivalent to his annual salary) for last year, with the requirement that he spends at least half of it on shares.

Perhaps too much shouldn’t be read into his recent £320,000 purchase, then. With the share price doubling over the past three months, Burberry’s shares trade at an 11 per cent premium to brokers’ consensus forecasts and at a forward price/earnings ratio of over 60. Although there’s an argument to be made for the potential for big earnings upgrades, this puts it well ahead of fellow posh coat makers Moncler and Canada Goose, whose shares trade at 21x and 15x, respectively.

Regulator flags policies to boost innovation in devices to help patients control devices and robotic limbs with their thoughts alone

China has unveiled policies to support the development of the medical use of brain-computer interfaces (BCI), technology that enables brain signals to control external devices.

The National Medical Products Administration said on Thursday that it would introduce supportive policies for medical devices based on the technology, which could allow people with missing or damaged body parts to control computers and robotic limbs using their thoughts.

The support for medical applications of brain-computer interfaces is among a range of innovation-boosting measures proposed by the agency, which regulates medications and medical devices.

“[We will] strengthen the standardisation research of new biomedical materials, including medical materials for additive manufacturing, flexible electrodes for brain-computer interfaces, and gene-engineered synthetic biomaterials,” it said.

The agency added that it would promote “research on safety and efficacy evaluation methods for medical devices based on brain-computer interface technology”.

Research is under way in healthcare and medical sciences on how the technology can be used to repair or reinstate functions for people with impairments caused by neuromuscular disorders such as stroke and spinal cord injuries.

There are also hopes that it could be an effective treatment for movement disorder cerebral palsy or the rare neurodegenerative disease amyotrophic lateral sclerosis (ALS). The technology might also help to restore damaged sight or hearing.

“Medical robots, advanced medical imaging equipment, artificial intelligence medical devices and new types of biomedical materials are key areas that shape the new quality productive forces of medical device manufacturing,” the agency said.

“[We should] promote the application of more new technologies … in the healthcare sector to better meet the health needs of our people and enhance the international competitiveness of China’s advanced medical devices.”

The agency also said that it would accelerate the development of general standards and establish standardisation technical organisations for medical robots and AI-powered devices. Approval procedures for equipment with high clinical application value will also be streamlined.

“[We will] continue to implement special innovative reviews for high-end medical devices that are the first of their kind in China, top in the world and have significant clinical application value,” the agency said.

“[We will also] strengthen communication between applicants and review experts, and enhance technical guidance for the research, development and registration of innovative medical devices.”

Research on BCI technology began in the 1970s when scientists showed that brain signals could be recorded and translated into commands, allowing users to control machines with their thoughts.

While early research focused on helping people with disabilities, today’s BCIs have expanded into a wide range of applications, from wearable devices for gaming to hands-free drone control.

In February, Tianjin and Tsinghua University researchers said they had developed the world’s first two-way adaptive brain-computer interface, allowing the brain and device to learn from each other.

The team said the system could eventually be integrated into portable and wearable BCI devices, making it suitable for consumer and medical applications.

Why 1 clause in the US-Vietnam trade deal is sparking concern across Asia

The inclusion of a 40 per cent tariff on transshipped goods could ‘open up a can of worms’ for the whole region, analysts said

The United States announced it had reached a trade deal with Vietnam on Wednesday, which will see Washington impose a 20 per cent tariff on Vietnamese goods.

Businesses in Vietnam’s vast export sector initially reacted with relief to the news, as the 20 per cent rate is substantially lower than the 46 per cent so-called “reciprocal” tariff that the US threatened to impose on Vietnam in April.

However, the agreement has a sting in the tail. US President Donald Trump also said in a social post announcing the deal that goods deemed to be transshipped via Vietnam would face a far higher levy of 40 per cent.

It remains unclear exactly how the transshipment clause will work in practice, but analysts said the provision could have far-reaching implications – not only for Vietnam, but also for the wider region.

What is transshipment, and why is the US so concerned about it?

In its purest form, transshipment refers to exporters evading tariffs by diverting goods via a third country.

The US has grown increasingly concerned about a rise in transshipment since it began targeting China with sky-high tariffs earlier this year.

Trump administration officials allege that large volumes of goods are being exported from China to third countries – often in Southeast Asia – where their certificate of origin is altered, allowing them to be exported to America at a lower tariff rate.

It is unclear how much transshipment is occurring in reality. Some analysts have pointed to a sharp rise in both Chinese exports to Southeast Asia and Southeast Asian exports to the US in recent months to suggest that transshipment is indeed a significant issue.

But others have claimed the issue is overblown. A report by MUFG Bank said the impact of the transshipment tariff may be limited if enforcement only targets the most blatant cases of trade diversion.

Why has the new transshipment tariff attracted so much attention?

The special 40 per cent levy in the US-Vietnam deal is sparking discussion partly because it sends a signal about how seriously Washington is taking the issue of transshipment, and partly due to the uncertainty surrounding the policy.

The key question for businesses and policymakers is how the agreement will define transshipment. Will the higher tariff only apply to goods that have simply been diverted via Vietnam, or will it apply more widely?

It is a crucial issue because the supply chains of Vietnam (and other Southeast Asian nations) are closely intertwined with China’s. It is common for a product’s raw materials and components to mostly come from China, but for part of the production and assembly process to take place in Southeast Asia.

If those kinds of goods are also deemed to be transshipped under the new deal, then the higher tariff will “open up a can of worms” for the whole region, analysts at the financial services firm Nomura said in a research note on Thursday.

Many firms would struggle to avoid the higher levy under that scenario, as Asia “is heavily dependent on imports of intermediate products from China, and does not have a local ecosystem in place yet”, the note added.

What are the wider implications of this deal for Asia?

On the most basic level, the tariffs imposed under the US-Vietnam deal will have a direct impact on economies across Asia, as many regional economies rely heavily on exporting goods to America.

According to Nomura, if current tariff levels remain constant, they will put 1.7 per cent of Vietnam’s gross domestic product (GDP) at risk, as well as 0.8 per cent of China’s, 0.7 per cent of Thailand’s and 0.6 per cent of South Korea’s and Malaysia’s.

But some analysts said the transshipment tariff carried even greater significance, as it signalled the US was determined to reduce China’s role in the region’s supply chain.

“While the exact criteria for defining transshipment remain unclear, it is evident that Vietnam’s role as a potential connector for Chinese exports to the US will diminish,” said Su Yue, principal economist for China at the Economist Intelligence Unit.

Some analysts said they also felt it was more likely that other Asian economies would face higher US tariffs after seeing the details of the US-Vietnam deal. Most nations currently face a 10 per cent “baseline” tariff rate.

Euben Paracuelles, a senior economist at Nomura, estimated that if the US’ goal was to clamp down on goods being diverted via Southeast Asian markets, then the average tariff rate for the region would need to be raised from 10 per cent to 15.5 per cent.

It is also possible that the US may try to impose higher transshipment tariffs on other Asian economies, though any measures will hinge on airtight origin certification, as “rules can be porous and firms are nimble”, Nomura noted.

Bloomberg has reported, per Nomura, that the US wants to impose a rule on India stating that a product must have at least 60 per cent local value added to be certified as “made in India”, while India is pushing for a lower 35 per cent threshold.

What are the other details of the US-Vietnam deal?

The US and Vietnamese sides have yet to release the full text of the agreement, but Politico reported that it had seen a draft joint statement indicating that the US may eventually lower its tariffs on some Vietnamese goods after further negotiations.

Technology products, footwear, agricultural goods and consumer items such as toys are among the goods that may be included, Politico said.

According to Bloomberg, the US may apply lower tariff rates to products from Vietnam with high local value added, with 100 per cent locally-made goods facing only a 10 per cent tariff.

Meanwhile, Vietnam has agreed to slash its tariffs on US goods to zero, as well as address non-tariff barriers including intellectual property violations. It will also provide preferential market access for US agricultural products – such as poultry, pork and beef – and unspecified industrial goods.

The draft statement also confirms that Vietnam will finalise a long-anticipated US$8 billion purchase of 50 Boeing aircraft and sign memorandums of understanding for US$2.9 billion of US agricultural imports, according to Politico.

ASNR has authorised EDF to enhance safety standards at its 1.3GW reactors, allowing them to function beyond their original 40-year design.

French electric utility EDF is reportedly planning to invest €6bn in extending the operational life of 20 nuclear reactors after receiving approval from France’s nuclear regulator.

The French Authority for Nuclear Safety and Radiation Protection (ASNR) has authorised EDF to enhance safety standards at its 1.3GW reactors, allowing them to function beyond their original 40-year design.

EDF stated that aligning safety measures with those of newer European Pressurised Reactor models will require significant investment, and initial preparatory work on the first reactor commenced last year.

Reuters reported that President Emmanuel Macron has prioritised boosting France’s nuclear energy capacity, aiming to extend the lifespan of existing facilities and construct at least six new reactors in the coming decades. This initiative presents challenges for EDF, which is dealing with financial strains, project delays, and reactor defects. The French government, facing budgetary constraints, recently nationalised EDF with a €10bn investment.

EDF’s CEO, Bernard Fontana, appointed earlier this year, is focused on revitalising the nuclear expansion strategy. He is exploring financing options for the upgrades and new reactor constructions, which may include asset sales.

ASNR will establish specific safety requirements for each reactor during its 40-year inspection, and EDF must submit annual progress reports to demonstrate compliance. This decision affects 20 reactors within EDF’s 56-reactor fleet, with their approved lifespan concluding between 2026 and 2040.

Previously, ASNR extended the operational life of EDF’s 32 smaller 900MW reactors, said the publication.

Transition away from fossil fuels will incorporate ‘some years’ using oil, Corrêa do Lago says

Brazil’s UN climate summit chief has defended oil and gas production as being compatible with international efforts to limit global warming, ahead of the South American country hosting the world’s most important climate talks.

President Luiz Inácio Lula da Silva’s government wants Brazil to become the world’s fourth-largest oil producer. The country last month hosted an auction of oil blocks, including some in the sea close to the mouth of the Amazon river.

Almost 200 countries agreed to transition away from fossil fuels by 2050 at the UN COP28 climate summit in Dubai in 2023. Progress on national climate goals will be assessed at the upcoming UN COP30 in November, as the world remains off track on the need to cut greenhouse gases by half by 2030 from 1990 levels to limit global warming to 1.5C since pre-industrial times.

André Corrêa do Lago, president-designate of the UN COP30 climate summit taking place in the Amazonian city of Belém, played down concerns that Brazil’s stance on oil expansion was in conflict with global efforts to reach net zero emissions. 

“We are thinking of a ‘net zero’ that incorporates some years continuing to use oil. The transitioning away [from fossil fuels] allows considerable flexibility,” the senior diplomat told the Financial Times. 

“I believe that all countries are analysing how they can reach net zero in a way that is economically viable, technologically viable, and that logically should go in the direction of the transition away [from fossil fuels].”

By 2030, Petrobras, Brazil’s state-backed fossil fuel company, will increase oil production by among the most of the world’s top producers in percentage terms, according to new analysis from campaign group Global Witness based on March data from independent consultancy Rystad Energy.

The oil and gas major, controlled by the Brazilian government, is on track to produce a billion barrels of oil in 2030, or a third more than it did in 2024, the research found.

Petrobras declined to comment. Its public data shows production of both oil and gas was the equivalent of 2.7mn barrels per day in 2024 and would rise to 3.2mn bpd by 2029, although this 19 per cent increase versus the 33 per cent in the study is not directly comparable as the figures cover both oil and gas.

Global Witness investigator Patrick Galey said its research had focused solely on oil because the resulting carbon dioxide emissions from its use were more polluting over a longer period, lasting for hundreds of years in the atmosphere.

Rystad analyst Flávio Menten said Petrobras was not taking a wildly different strategy to its multinational peers, and after 2031 the research group forecast a steady production decline for Brazil.

Just over half of Brazil’s oil is exported, while the country’s electricity network is largely fuelled by hydropower and wind.

Brazil’s government argues that some of the proceeds from hydrocarbon export revenues can go towards investing in greener energy sources. Its mines and energy ministry said its transition was compatible with its economic and social needs.

The transition process was not “something radical”, the ministry said, and it was important to balance the strengthening of renewable energy sources with oil and gas exploration and production “which will still be necessary for national matrices in the coming decades.”

Corrêa do Lago said many countries, including the US and Norway, were also expanding oil production. The COP28 agreement to transition away from fossil fuels “allows countries and companies to choose different paths”, he noted.

He argued that if Brazil increased its oil production but used the proceeds to protect the Amazon from deforestation, that was “completely different” from a scenario in which the country boosted fossil fuel production and reduced renewables. 

Some countries, he said, had little choice presently but to use their fossil fuel reserves to help pay for their economic development.

But there were already signs of the shift away from fossil fuels by major economies, such as the rise of electrification in China, he added.

This year’s summit would focus on efforts to implement the agreements already made at past UN climate summits, he noted, including phasing out fossil fuels.

Campaigners such as Galey accuse Brazil of a “conflict of interest”, however, in attempting to balance its role as host of the UN climate summit at the same time as expanding oil production. 

The oil industry had shown a “mastery over the entire COP process”, Galey said, in thwarting efforts to tackle climate change at the most recent UN summits held in the petrostates of United Arab Emirates and Azerbaijan.

At the Global Tipping Points Conference and Exeter Climate Forum in the UK this week, involving hundreds of delegates from leading European scientific organisations and academia, almost 200 participants endorsed a statement calling for action from policymakers “especially [the] leaders meeting at the COP30 climate summit in Brazil later this year”.