World is entering time of ‘great power politics’, warns German chancellor
The German chancellor has warned that the rise of “great powers” is shaking the foundations of the old world order, unravelling it at “breathtaking pace”.Addressing the World Economic Forum in Davos on Thursday, Friedrich Merz said a time of “great power politics” had begun, citing Russia’s war with Ukraine, China’s move into the “ranks of the great powers” and the radical reshaping of US foreign and security policy under Donald Trump.“This new world of great powers is being built on power, on strength and when it comes to it, on force.It is not a cosy place,” Merz said, urging leaders at Davos not to accept this new reality and to “shape the future” instead.Merz’s speech chimed with the views of Mark Carney, Canada’s prime minister, who told the forum on Tuesday that a system of intensifying rivalry between great powers was rupturing the world order.
“Two days ago, Mark Carney said in this hall: ‘We must no longer rely only on the power of our values.We must also recognise the value of our power,’” Merz said.“I share that view.And when I look into this hall, I want to say: we share it.That is a good starting point.
“Our greatest strength remains the ability to build partnerships and alliances among equals based on mutual trust and respect.”Merz said a world in which only power counted was a dangerous place – first for small states, then for the middle powers and ultimately for the great ones.“I do not say this lightly.In the 20th century, my country, Germany, went down this road to its bitter end.It pulled the world into a black abyss,” he said.
The reshaping of the world order has been a top issue at the forum’s annual meeting this week, as the Nato alliance has been tested by Trump’s determination to acquire Greenland.Merz said Europe must boost its unity and competitiveness to help it fight back against the new era of “great power politics”.That meant massive investment in defence, measures to improve economic competitiveness, and unity among Europeans and “like-minded partners”.Germany’s leader also welcomed Trump’s announcement on Wednesday night that he had agreed the “framework of a deal” with Nato over Greenland.He warned that any threat to acquire European territory by force would be “unacceptable”.
Referring to Trump’s now-abandoned threat of tariffs on Europe over the Greenland row, he said: “New tariffs would undermine the foundations of transatlantic relations,Europe’s answer would be united, calm, measured and firm,”Trump, who left Davos on Thursday afternoon, told Fox Business Network he would hit European countries with a “big retaliation” if they sold their holdings of US Treasury bonds,This week the Treasury secretary, Scott Bessent, insisted he was not worried that European countries would dump their US debt holdings, as one Deutsche Bank analyst suggested could happen,“Denmark’s investment in US Treasury bonds, like Denmark itself, is irrelevant,” Bessent declared.
‘At the table or on the menu’: a turbulent Davos week with Trump’s circus in town
“If we’re not at the table, we’re on the menu.” The Canadian prime minister, Mark Carney, was the darling of Davos this week as he rallied resistance to Donald Trump’s smash and grab politics and his voracious appetite for other countries’ wealth and land.“Call it what it is,” he told delegates. “A system of intensifying great power rivalry, where the most powerful pursue their interests using economic integration as coercion”. He urged “middle powers” to band together or be crushed, and was rewarded with a standing ovation
Strong UK pay growth could limit interest rate cuts, Bank policymaker warns
The Bank of England may not be able to lower interest rates as much as expected this year, due to strong UK pay growth and expected rate cuts in the US, one of its top policymakers has said.Megan Greene, a member of the Bank’s monetary policy committee (MPC), which sets interest rates in the UK, said she was concerned that wages appeared to be growing strongly again this year and this could stop inflation from easing.In a speech in London at the Resolution Foundation, a leading thinktank, Greene said a decline in wage growth “may have run its course”, pointing to recent Bank of England surveys that suggest employers are planning to hand out pay rises of 3.5% or more this year.The latest official figures showed wage growth, excluding bonuses, weakened slightly to 4
Young will suffer most when AI ‘tsunami’ hits jobs, says head of IMF
Artificial intelligence will be a “tsunami hitting the labour market”, with young people worst affected, the head of the International Monetary Fund warned the World Economic Forum on Friday.Kristalina Georgieva told delegates in Davos that the IMF’s own research suggested there would be a big transformation of demand for skills, as the technology becomes increasingly widespread.“We expect over the next years, in advanced economies, 60% of jobs to be affected by AI, either enhanced or eliminated or transformed – 40% globally,” she said. “This is like a tsunami hitting the labour market.”She suggested that in advanced economies, one in 10 jobs had already been “enhanced” by AI, tending to boost these workers’ pay, with knock-on benefits for the local economy
TikTok announces it has finalized deal to establish US entity, sidestepping ban
TikTok announced on Thursday it had closed a deal to establish a new US entity, allowing it to sidestep a ban and ending a long legal battle.The deal finalized by ByteDance, TikTok’s Chinese owner, sets up a majority American-owned venture, with investors including Larry Ellison’s Oracle, the private-equity group Silver Lake and Abu Dhabi’s MGX owning 80.1% of the new entity, while ByteDance will own 19.9%.The announcement comes five years after Donald Trump first threatened to ban the popular platform in the US during his first term
Australian Open 2026: Sinner levels with Spizzirri, Keys and Pegula ease through – live
Spizzirri 4-3 3-6 6-4 Sinner (2)* We’re now watching polar opposite strategies. Sinner is playing for short points, Spizzirri is doing his best to keep his opponent moving as much as possible. On this occasion Sinner’s sh*t or bust approach results in a quick hold for the American as a series of Hollywood shots fail to come off.I wonder if the two-time defending champion is still in this mentally, or whether he has given up the grind for one almighty Hail Mary?*Spizzirri 3-3 3-6 6-4 Sinner (2) A double fault at 15-15 shows Sinner is still not his usual self, then a poor forehand clips the net and bounces out to hand Spizzirri two break points. The American makes a meal of a short second serve, then he clubs a routine backhand into the net, to let Sinner off the hook
Australian Open faces disruption as players brace for extreme heat in Melbourne
Defending Australian Open champion Madison Keys avoided the worst of Melbourne’s heatwave on Saturday, which is predicted to push temperatures towards 40C, as officials prepare to close stadium roofs and suspend play on outdoor courts under the tournament’s heat protocols.The focus is now on her men’s counterpart Jannik Sinner, who will be in action as the Melbourne Park heat ramps up, 12 months after he suffered a medical episode under the Australian sun. Sinner lost the first set against American world No 85 Eliot Spizzirri, and was broken again in the second before levelling at a set apiece.Earlier, Keys brushed past Karolina Plíšková 6-3, 6-3 in just 75 minutes to book a round of 16 clash against Jessica Pegula. The American said although she was ready for the heat, she gave herself a “pat on the back” for navigating a match against the former world No 1 with the minimum of fuss
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