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Name: The Economist

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Islamic stateless?

THE self-proclaimed caliphate of Islamic State (IS) is weakening fast. In June the jihadists were kicked out of Fallujah by the Iraqi army, then pounded by air strikes as they fled. American-backed rebels in Syria have surrounded the group’s fighters in the northern city of Manbij and are eyeing Raqqa, its de facto capital. In total, IS is now thought to have lost half of the land it seized in Iraq and 20% of its territory in Syria. It is on the verge of losing its main stronghold in Libya, too. The biggest fights are still to come: for Raqqa and Mosul, in northern Iraq, the two biggest cities under IS control. IS fighters are expected to defend them ferociously. More than just land is at stake. Apart from its savagery, IS has distinguished itself from other jihadist groups—and indeed, surpassed the likes of al-Qaeda—by capturing territory and governing it. As it loses that land, and any chance of building an Islamic Utopia, its appeal to disaffected Muslims may dwindle. So the group is adapting. In many ways IS is becoming more like a conventional, stateless, terrorist organisation. In an abrupt and remarkable shift, Abu...

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Crisis and opportunity

THE shockwaves from Brexit have been almost as severe on the Tiber as on the Thames. Markets fear that Britons’ vote to leave the European Union on June 23rd presages weaker growth in Europe and still-lower interest rates. That is not good for banks—and Italy’s, labouring under the EU’s heaviest bad-debt burden and tied to a frail economy, have been walloped (see chart). Shares in UniCredit, the biggest, have slid by one-third. Those of second-ranked Intesa Sanpaolo, though it is in far better shape, have shed 30%. Most troubled is Italy’s third-biggest lender (and the world’s oldest): Monte dei Paschi di Siena, founded in 1472. Its shares tumbled on July 4th and 5th after the leak of a request from the European Central Bank for it to reduce its bad-loan pile from last year’s €46.9 billion ($52 billion), or 35% of all its lending, to €32.6 billion by 2018. (That was already the plan, said the bank, but the shares...

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Iraq’s grim lessons

“With you, whatever”: Blair’s promise THERE has been no shortage of reports and inquiries into the Iraq war, which broke out in 2003. But after nearly seven years of toil, Sir John Chilcot and his fellow commissioners have published what future historians will regard as the definitive account of what happened and why. The lessons the Iraq Inquiry draws from 2.6m words of painstakingly accumulated evidence have almost as much relevance to American policymakers as they do to their British counterparts. The picture it paints, for all the familiarity of its main elements, is a devastating one of individual and institutional failure. The verdict on Tony Blair, Britain’s prime minister at the time, is not that he is a liar and a war criminal (as many contend), but a man steered by a fatal combination of hubris, wishful thinking and moral fervour into an ultimately disastrous course of action. The most damning of the inquiry’s conclusions is the overarching one that, based on Britain’s professed goal of disarming Saddam Hussein (it was never explicitly regime change), military action in March 2003 was not, as Mr Blair...

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Help from above

Blood from the sky “LAND of a thousand hills” is an apt nickname for Rwanda. The tiny, landlocked country ripples with steep, terraced hillsides. Under its single-minded president, Paul Kagame, it is also determined to become a technology hub for Africa. It is not, therefore, surprising that Rwanda will soon be a laboratory for one of the most hyped technologies around. Zipline, a Silicon Valley startup, will start testing delivery drones (otherwise known as Unmanned Aerial Vehicles) at a site 40 minutes drive south-west of the capital, Kigali, in August. If deemed safe by the government, a month or two later the fixed-wing “Zips” will be dropping off blood for transfusions in small boxes with parachutes at 21 hospitals and health centres within a 75km (40 mile) radius. The aim is to open a second hub in the east to cover the rest of the country within a year, and to start delivering vaccines and other medicines as well as blood. If all goes well, drones could cut a 3.5-hour trip by car to and from one of the country’s five blood banks to less than 45 minutes, a potentially life-saving difference for a...

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Opportunities galore

IF ANYTHING explains the poverty in many parts of sub-Saharan Africa, it is not an unwillingness to work hard—most of the continent’s people still sweat to survive tilling fields with medieval tools. Nor is it because of a lack of enterprise and optimism: on the permanently traffic-jammed streets of Lagos, Nigeria’s main commercial city, hawkers gingerly ease their way between cars trying to sell almost anything from snacks to books, pirated DVDs and even toilet seats. Africans are far more likely to be self-employed than people in richer parts of the world, for the simple reason that without social safety nets, many of them must hustle or starve. Yet for all Africans’ energy and ingenuity, the region struggles to produce enough of the productive and profitable small businesses it needs to lift hundreds of millions of people out of poverty. The World Bank reckons that sub-Saharan Africa has only a quarter as many small businesses as Asia, relative to its population. Members of the OECD, a club of mostly rich countries, have about eight times as many formal small businesses per person. Part of this is explained by the poor climate for...

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The infrastructure of power

AIIB careful with Avicenna CHINA’s growing global clout can be unsettling for the incumbents who must make room for it. At the same time, China’s recent financial tumult has been unnerving for the investors exposed to it. This combination of vastness and vulnerability has left some people afraid of China and others afraid for it. Both groups have found reason to worry about the Asia Infrastructure Investment Bank (AIIB), which has just held its initial annual meeting in Beijing and approved its first $509m-worth of projects. The AIIB reflects China’s new eagerness to institutionalise its official lending abroad, which has been generous but contentious. Another example is the sprawling “one-belt, one-road” initiative, which aims to revivify trade routes across and around the Eurasian landmass (see article). Harking back nostalgically to the Silk Road, it envisages a web of bilateral agreements between China and the beneficiaries of its largesse. The AIIB is more...

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Sifting through the wreckage

ONE of the first results to be declared on referendum night was that of Sunderland, in north-eastern England. Remarkably, 61% voted to leave the EU, despite the fact that 7,000 local jobs depend on the city’s Nissan car plant, which exports just over half its cars to Europe. Nissan had warned about the risks to carmaking in Britain if the country were to leave the EU, but few listened. It summed up a disastrous night for business and the economy. Cars are not the only industry at risk. Banks are talking about moving jobs abroad (see article). Airlines are charting new courses: Ryanair will divert $1 billion of investment in new aeroplanes from Britain towards the rest of the EU, and Wizz, a Hungarian rival, says it will make no more investments in Britain after the winter. Pharmaceutical firms are nervous. Brexit would restrict access to European research funds worth $1 billion. Stéphane Boissel, the boss of TxCell, a French biotech company, says he will no longer team up with British researchers, for fear of losing EU funding. The drug industry will suffer from stricter immigration policies. In Cambridge, one-third of researchers are foreign nationals. Much regulatory work in pharma is undertaken...

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Put asunder

All along the watch-tower THE road-blocks and army watch-towers that once dotted the 499-kilometre (310-mile) border dividing Northern Ireland from the Irish Republic were among the most hated symbols of its long-running civil conflict. But since the Good Friday peace agreement of 1998, crossing that border has come to mean nothing more than changing currency and remembering that road signs switch between miles and kilometres. The two societies have intertwined, making the question of whether Ireland should eventually be reunited seem less important, and helping to forestall any return to violence. All that has been put at risk by Britain’s vote to leave the European Union, and Ireland is worried. The border may return, even more forbidding than before. Post-Brexit, it will be the only land crossing between the United Kingdom and the EU. If migration to Britain is to be controlled, as the Leave campaign promised, not just security and customs checkpoints will be needed, but passport and visa controls. The Leave vote, said Enda Kenny, Ireland’s taoiseach (prime minister), was a...

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Soft target

THE morning after the suicide attack at Istanbul’s Ataturk International Airport on June 28th, a grim silence hung over the terminal. Taxi drivers waved down the few shocked passengers trickling out of the bomb-scarred building. In contrast with the long closure that followed the attacks at Brussels’ airport in March, flights had already resumed. Turkey is doing its best to maintain an air of normalcy. But with the prime minister, Binali Yildirim, suggesting that Islamic State (IS) was behind the attack, Turkey may find itself drawn ever further into the war in Syria. The three suicide bombers who attacked the airport killed at least 42 people and left more than 200 wounded. One struck in front of the arrivals hall entrance on the ground floor. The two others forced their way into the departures hall upstairs, shooting travelers with machine guns. One of them headed back downstairs before detonating his suicide vest. Security-camera footage showed one of the bombers being shot by police, then blowing himself up. If IS was responsible, the attack is the latest in a wave of bombings by the terror group that has killed nearly 200 people...

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Revolution cancelled

THE idea of re-running a vote when the first result is unsatisfactory has been getting a bad press recently. But Spain’s second general election in six months, on June 26th, showed that if the goal is to break a political deadlock, do-overs can be useful. The big winners were Mariano Rajoy, the prime minister, and his centre-right People’s Party (PP). Though they failed to get an absolute majority, they took 33% of the vote, up from 29% in the December election, which was so splintered that no party could form a government. Now, with 137 seats in the 350-member Cortes (parliament), Mr Rajoy is set to remain prime minister, albeit at the head of a coalition or minority administration. The election’s big surprise was that Podemos, a new far-left party dedicated to reversing austerity and defenestrating the traditional political class, stalled. Contrary to all poll forecasts, it failed to overtake the more moderate Socialist Party to become the largest force on the left. Podemos had merged with the old Communists of the United Left party for this election, but the merged force won 1m fewer votes than its constituent parts did last time. The long faces of Podemos’s young leaders as the results came in were eloquent. The Socialists did poorly compared to the past, winning 22.7% of the vote and 85 seats (down five). But it felt like a victory for Pedro...

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