Welcome to Thursday, where Libya’s prime minister survives an assassination attempt, Belarus and Russia start joint military drills and a Republican congresswoman spills her gazpacho. Fasten your seatbelts, we’re also looking at the world of private jet travel, a means of transportation that soared during the pandemic.
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• Russia military drills with Belarus: Belarus and Russia started ten days of joint military drills on Thursday, as tensions remain high over the Kremlin’s buildup of forces along Ukraine’s borders. Moscow has said the aim of the exercises is to “practice suppressing and repelling external aggression.” Around 3,000 Russian troops are believed to be in Belarus, which according to NATO marks the biggest Russian deployment to the ex-Soviet territory since the Cold War. On a visit to NATO’s headquarters, UK Prime Minister Boris Johnson warned that the Ukraine crisis has entered its “most dangerous moment” as the threat of a war looms.
• COVID update: The U.S. plans to begin the distribution of COVID-19 shots for children under the age of 5, as early as Feb. 21, according to the U.S. Centers for DIsease Control and Prevention. Paris banned a French “Freedom Convoy” of hundreds of motorists protesting against COVID-19 restrictions from entering the capital city. Meanwhile, UK Prime Minister Jonhson outlined plans to lift all domestic COVID-19 restrictions in England within weeks, including the legal requirement to self-isolate.
• Libyan Prime Minister survives assassination attempt: Libyan Prime Minister Abdul Hamid Dbeibah survived an assassination attempt in Tripoli, after gunmen fired on his car as we was returning home early Thursday. The attack came amid intense rival factions over control of the government.
• Church sex abuse panel in Portugal reports first 200+ cases: A lay committee investigating historic child sex abuse in the Portuguese Catholic Church announced it had received allegations from 214 people throughout its first month of work.
• Olympics drug controversy: The 15-year-old Russian superstar figure skater Kamila Valieva has turned up for training as usual Thursday morning at the Winter Olympics, despite having tested positive for a banned substance. The International Olympic Committee had announced that the medal ceremony for the figure skating event had been suspended. Meanwhile, Austrian Johannes Strolz bounced back from being dropped from his team to winning the gold medal in the men's Alpine combined event on Thursday, following in his father’s footsteps.
• Space storm destroys 40 of Space X’s Starlink satellites: Elon Musk's company SpaceX confirmed that a solar storm had destroyed most of the Starlink satellites it launched last Friday, with 40 of its 49 satellites expected to fall back to earth.
• Pro Trump representative confuses the Gestapo with gazpacho soup: Controversial Republican U.S. congresswoman Marjorie Taylor Greene triggered a wave of viral jokes on Wednesday as she accused Democratic leaders of “gazpacho” tactics on Capitol Hill. She apparently confused Hitler’s secret police with the popular Spanish cold tomato soup …
Canadian daily Ottawa Citizen devotes its front page to the “Freedom Convoy” protests that have paralyzed Ottawa’s city center for more than a week. What started as demonstrations against mandatory vaccinations for truckers crossing the U.S.-Canada border has grown into broader dissent against the Liberal government of Prime Minister Justin Trudeau. The leader is demanding an end to the protests, which have forced some factories to shut down due to the blockade of Detroit’s Ambassador Bridge on the border.
The South Korean curling team known as the “Garlic Girls” (마늘 소녀들, maneul sonyeodeul), a nod to the iconic produce of their region, starts competing at the Beijing Winter Olympics today in a round-robin match against Canada. The team had gained fame with its first Olympic gold medal at the 2018 Pyeongchang Olympic Games, before prompting debates about the mistreatment of athletes in South Korea, when its members denounced their coaches’ harsh training and abuse nine months later.
How the pandemic spread private jet travel beyond the super-rich and powerful
Once the reserve of the super-rich and famous, private jet travel soared during the pandemic. Amid border closures and travel restrictions, private charter flights are sometimes the only option to get people — and their pets!? — home.
✈️ During the pandemic, a surprisingly wide demographic have turned to private jets not because it was a luxury they could afford, but out of desperation, trying to reach a destination in the face of border closures and widespread flight cancellations. Last year, private jet hours were close to 50% higher than in 2020, according to the Global Business Aviation Outlook. While some of the increase can be attributed to more travel in 2021 because of COVID-19 vaccination, it still amounts to 5% more hours than before the pandemic.
🐶 More than just saving time through skipping security lines and long waits at airports, flying private jets also lets the super wealthy, and those desperate enough to break the bank, sidestep other regulations. As part of its zero-COVID policy, Hong Kong has severely limited flights. High cargo rates for animals and flight cancellations are making it very hard for pet owners to leave the island taking their furry friends along. Those desperate enough are spending upwards of $25,665 to privately charter themselves and their pets. Many are pooling their resources to share in the cost.
🧳 In Morocco, private jets were the only way for many to enter the North African kingdom after it suspended all air travel from Nov. 29 until Feb. 7 due to the rapid spread of the Omicron variant. Close to 6,000 Moroccans were stuck abroad. In this case, many weren’t looking for a luxurious travel experience but were just desperate to return to their home country. Traveling in groups was one way to decrease the expense, to as low as $1,400 per passenger for a flight from Europe, but for some this still means relying on family support or finding other ways to raise money.
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“I didn't kill anyone, and I didn't hurt anyone. Not even a scratch.”
— Salah Abdeslam, the only surviving member of the ISIS cell that targeted Paris in the 2015 attacks, has denied killing or hurting anybody during the trial of the attacks that left 130 people dead. Adbeslam said he supported the Islamic State of Iraq but chose at the last minute not to detonate his explosives, though prosecutors believe his suicide belt malfunctioned. The French-Moroccan is the only defendant, among 20, to be directly accused of murder and hostage taking.
The Enigma, a 555.55 carat black gem believed to be the world's largest cut diamond, has sold for $4.3 million in an online auction. The gem, known as a “carbonado,” is an extremely rare billion-year-old black diamond which contain osbonite, a mineral found only in meteors — meaning it could originate from space.
✍️ Newsletter by Anne-Sophie Goninet and Jane Herbelin
Garlic curling and gazpacho on the menu? Let us know what’s happening in your corner of the world!
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A gigantic and multi-faceted new location near Shanghai epitomizes the American giant's ambition to quench China's growing but still-nascent thirst for coffee.
Updated Dec. 7, 2023 at 4:05 p.m.
SHANGHAI — The town of Kunshan, an hour's drive from Shanghai, is the launchpad of Starbucks's latest Chinese offensive. In mid-September, the American giant inaugurated an 80,000 square meter site that includes a roasting plant, an integrated distribution centre, and an immersive experience centre.
Grandly named as the "China Coffee Innovation Park", this $220 million project is the Seattle-headquartered company's biggest investment outside the United States. And the Kunshan model of vertical integration, from bean to cup, has no equivalent anywhere else in the world for the Starbucks group.
The site is a symbol of Starbucks’s hefty ambitions in China – it plans to open a location in the country every nine hours between now and 2025. The aim is to have more than 9,000 shops in 300 Chinese cities by then, compared with 6,500 today. "The 9,000 stores are just a milestone", said Laxman Narasimhan, the company's new boss, who rushed to China at the end of May in the wake of his appointment.
Is the competition getting tougher? Has the end of the China’s "Zero-COVID" policy failed to deliver on its promise of an economic rebound? Is Washington pushing its multinationals to reduce their dependence on China?
Starbucks doesn't care. In the land of tea-drinkers, coffee is enjoying a meteoric rise, becoming a trendy drink for a young, urban middle class sensitive to Western influences.
The China focus comes amid news this week that McDonalds is launching a new kind of cafe-restaurant: CosMc's, which could be a direct competitor worldwide to Starbucks, serving customizable drinks like "s'mores and cold brew", "churro frappes", and "tumeric latte."
Some 10,000 CosMc locations are planned for opening over the next four years, with Starbucks expanding to 55,000 stores worldwide by 2030.
All of this speaks to coffee fever globally, which really began in China just a decade ago, and now registering double-digit growth rates that have manufacturers salivating.
"We expect China to be one of the biggest, if not the biggest market we have in the world," Narasimhan predicts.
In a country with 1.4 billion potential drinkers, the market promises to be gigantic. With nine cups of coffee consumed per capita per year, China is still a long way off American (329), Japanese (280) or South Korean (367) standards, according to a study by Deloitte.
Inevitably, every major player is jockeying to take advantage of this still-nascent craze. McCafé, Costa Coffee, Tim Hortons... all the big international chains are there.
Shanghai has a caffeine buzz
Starbucks opened its first café in Beijing's financial district in January 1999, but the battle for coffee dominance is now being waged in Shanghai. The financial metropolis prides itself on being the coffee capital of the world, with more than 8,500 coffee shops, the highest number in the world.
By comparison, Tokyo and London have around 3,500 and New York fewer than 2,000. Two new cafés open every day in this megalopolis of 24 million inhabitants, according to Xu Jian, a researcher at Shanghai Jiao Tong University. On a per capita basis, Shanghai now rivals Tokyo. The long Huaihai Street alone, which runs through the former French Concession, boasts around 50 coffee establishments.
Shanghai prides itself on being the coffee capital of the world, with more than 8,500 coffee shops
Starbucks has more than 1,000 outlets in Shanghai – more than anywhere else – and inaugurated its largest flagship store there at the end of 2017, a coffee bar covering more than 2,700 square metres where coffee is treated like an attraction. "You have to book your visit on our mobile app", explains a sales assistant. A dozen young Shanghainese listen in as she goes on to explain how coffee is made. Here, the beans come from Ethiopia, Brazil, Costa Rica and the province of Yunnan in the far west of China. From the bulk bags of beans through the roasting and bagging stages, aficionados take in the fabled brand's production process, surrounded by the hum of glinting machines.
Shanghai is the city of choice for most newcomers to China. This is where another American chain, Peet's Coffee, chose to open its first Chinese establishment in 2017. Canada's Tim Hortons did the same in 2019, and Italy's Lavazza followed suit in 2020. Shanghai is also the birthplace of a number of local brands, such as Manner, Seesaw, and Mr Stand, which have since expanded to the rest of the country. As a sign of the growing coffee culture among young, moneyed city dwellers, small independent coffee shops are springing up like mushrooms, sometimes just a few metres apart. These now account for more than half of the city's cafés.
Starbucks' new China Coffee Innovation Park in Kunshan.
The history of coffee in Shanghai is intimately linked to the colonial history of what was once a small coastal town. It dates back to the port city's forced opening to foreign trade in 1843, following the first Opium War. Numerous cafés opened at the beginning of the 20th century, when the city's two foreign concessions were experiencing their Roaring Twenties. Russian emigrants fleeing the October Revolution gathered along the then Avenue Joffre, in new cafés such as the Tkachenko Brothers, Renaissance Café, Constantine, and The Balkan. From the 1930s onwards, the arrival of thousands of Jewish refugees from Germany and other occupied parts of Europe led to the emergence of still more establishments.
The number of cafés in China has quadrupled in the space of two years
In this "Paris of the Orient", the cup of coffee, a symbol of exoticism and modernity, began to make its mark at the end of meals in the homes of bourgeois Chinese families. The cafés were not only frequented by homesick foreigners, in a China governed by the Nationalists, they also became meeting places for local intellectuals and underground members of the Communist Party. “There was a major hiatus until the 1980s, when a few large hotels once again started serving coffee," says Chen Zuen, professor of history at the Shanghai Academy of Social Sciences. But it is really over the last decade - and really the last five years - that the craze for coffee has taken hold in the city, Chen adds.
The rapid development of the coffee industry is a reflection of the wider consumer boom in China. The number of cafés in the country has quadrupled in the space of two years, rising to over 100,000 by 2020 before reaching 130,000 today. Taken as a whole, China's coffee industry is worth 200 billion yuan (€25 billion), according to Xu Jian's estimates.
"In China for China!"
Starbucks thought it was opening up a boulevard when it arrived in China on the eve of the new millennium. But the beginnings were not auspicious. “For the first twelve years of its presence in China, Starbucks remained faithful to its American frame of reference, which meant it came up against the usual difficulties on the ground," write Sandrine Zerbib and Aldo Spaanjaars in their book Dragon Tactics (Dunod, 2022). “When the brand celebrated its tenth anniversary in China in 2009, it had just 300 outlets, including those run in partnership with the Taiwanese group Uni-President".
It was at this juncture that Starbucks founder Howard Schulz enforced a radical change of direction. His motto: "In China for China!”
Delegation of power to local management, autonomy in the design of establishments, creation of small sales outlets for the collection of online orders, hot food offering, new merchandising, rapid conversion to digital technology... Starbucks is adapting to the specific characteristics of the Chinese market and to local demand, explain the authors, who are experts on Chinese entrepreneurship. And so began a meteoric rise. "Drinking a Starbucks coffee has become a marker of the Chinese middle class", says Xu Jian.
China's intractable 'zero Covid' policy and the strict confinement of tens of millions of inhabitants were a blow to Starbucks (more than 1,800 cafés were closed at the peak of the pandemic), but that didn't put the brakes on its ambitions. However, competition is fierce and consumer habits are changing fast. Even as as other global heavyweights find their footing in the country, a spate of homegrown brands, heavily financed by investment funds, want their share of the cake. Bouncing back after an accounting fraud scandal in 2020, Chinese start-up Luckin Coffee has embarked on a frantic race to occupy space, even if it means losing a lot of money in the short term. In the second quarter alone, it opened 1,485 outlets, an average of 16.5 a day. Luckin Coffee now has over 10,000 outlets in China, outnumbering Starbucks.
A sign pointing to the world's largest Starbucks in Shanghai.
More the merrier
Smaller indie players are also riding the wave. Guo Lanqin, 31, has opened two cafés in two years in Shanghai, with interiors that betray his passion for bicycles and skateboards. "Opening a shop was my dream and I couldn't find a suitable job," says the young entrepreneur. "I didn't have much formal education, but I started working in the coffee industry at the age of 17 and I know all the ins and outs."
In his café, called Manual, espresso is rare. The idle, tattooed youth of Shanghai come here mainly to order iced Americano or café au lait. "Consumers come here for a relaxed atmosphere and to drink simple, inexpensive coffees", Guo says. No fewer than five cafés have opened in recent years in this little Yanqing street in the heart of the former French Concession. But it doesn't faze Guo. "The more cafés there are in the street, the more people come to drink coffee," he says. "Each establishment has its own style, and the size of Shanghai's population is immense."
What coffee-preneurs can't wish away, however, is the increasingly intense price war over a beverage that is still often expensive in China. Low-cost coffee is at the heart of Luckin Coffee's strategy, and the company is relying on promotional coupons to build customer loyalty. It sells a cup of coffee at anything between 10 and 20 yuan (€1.30 and €2.60), compared with at least 30 yuan (€3.90) at Starbucks. To maintain such low prices, Luckin Coffee mostly maintains small outlets with little or no seating. Orders can only be placed and paid for via app, and takeaway orders are encouraged.
In a part of the world that is far more digitalised than Europe or the United States, deliverymen on two wheels criss-cross the business districts of Beijing and Shanghai to deliver the coffees ordered by white-collar workers on their mobile phones. This boom in online orders has prompted Starbucks to react by forging a partnership with e-commerce giant Alibaba and opening more and more small, dedicated outlets near offices.
Crowded market, huge potential
What does the future hold for businesses making big bets on China's growing love of coffee? "The market is crowded, but it still has enormous growth potential", says Xu Jian. The potential consumer base will continue to grow with rising levels of education and disposable income, emphasises Deloitte in a study published in 2021.
At this stage, coffee is still mainly a beverage for elite dwellers of China's megacities, who are aged between 20 and 40, have degrees and high incomes, and are predominantly women. But the beverage is poised for an image makeover. "While developing the habit of drinking coffee, consumers are constantly increasing the frequency with which they consume it, so that coffee is gradually moving from being a 'trendy' drink to an everyday beverage", notes Deloitte. In Shanghai, Beijing, and Guangzhou, per capita consumption is already on a par with mature markets such as the United States and Europe.
Tastes are changing fast, with a growing attraction for local products.
The next big growth spurts has to come from markets beyond the megacities. "Small and medium-sized towns are increasingly infected by coffee fever," says Chen Zuen. "At first, people don't necessarily like the taste of coffee, but they want to follow the trend and get hooked."
Starbucks is a pioneer of China's coffee culture, but it must carefully monitor the rapid evolution of the market. Tastes are changing fast, with a growing attraction for local products. Exhibit A: Buddhist and Taoist temples, which have started to offer coffee on site to lubricate the vast numbers of Chinese turning to them seeking a dose of spirituality.
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