Global News Roundup for 11 December 2025

NATO Warning, China’s Fiscal Push, and Bulgaria’s Government Collapse Signal a “World Economy of Division and Defense”

Today’s Highlights (Quick Summary)

• In a speech in Berlin, NATO Secretary-General Mark Rutte warned that “Russia regards NATO countries as its next target,” calling on member states to step up defense spending and accelerate arms production.
• The Bulgarian government resigned en masse following large-scale protest demonstrations. Despite this, the country remains on track to adopt the euro on 1 January 2026, meaning political instability and currency union will proceed in parallel.
• China released the outcomes of its Central Economic Work Conference for 2026, announcing that it will maintain an “active fiscal policy” while aiming to keep growth around 5%. The World Bank also projects China’s growth at 4.9% in 2025.
• The U.S. Federal Reserve’s rate cut and a “slightly dovish” outlook triggered a weaker dollar. The Dow and S&P 500 hit record highs, while the Nasdaq fell further on declines in AI-related stocks.
• Tensions surrounding Venezuela escalated as the U.S. seized a large tanker off its coast, Russia reaffirmed support for the Maduro government, and developments continued after opposition leader María Corina Machado received the Nobel Peace Prize.
• The World Bank and ISO released the “World Development Report 2025.” For the first time, “international standards” took center stage as a driver of development, and the report stressed how important it is for developing countries to participate in standard-setting.

This article is organized especially with the following readers in mind:

• Individual investors and asset managers who invest in overseas equities, FX, and commodities
• Practitioners working in manufacturing, IT, or trading companies, handling business with Europe, China, and Latin America
• University students, graduate students, and think-tank researchers studying international relations, security, or public policy
• Businesspeople in their 20s–40s aiming for international careers through overseas postings, study abroad, or remote work

Let’s walk through the key topics one by one, looking at their economic and social implications as we go.

1. NATO Secretary-General Rutte Warns “Russia’s Next Target Is Us”

Implications for European Defense and Public Finances

Visiting Berlin, NATO Secretary-General Mark Rutte sounded the alarm in a speech, warning that “we are Russia’s next target” and that “a war on the scale our grandparents’ generation experienced could become a reality.” He urged member states to rapidly ramp up defense spending and arms production.

In the background is growing anxiety across Europe, as Russia’s invasion of Ukraine drags on and fears mount that “the next targets could be the Baltic states or Poland.” Rutte also stated that “many countries still do not share a sufficient sense of crisis,” stressing that time is of the essence.

On the U.S. side, reports suggest President Trump is growing weary of meetings over a Ukraine peace process. The White House Press Secretary said the President is “tired of repeated meetings that do not bring us closer to an agreement,” while adding that the administration will send representatives to talks in Europe over the weekend “if there is a prospect of results.”

Economic Impact: Defense Spending and Fiscal Deficits

Across Europe, many countries have already announced plans to raise defense spending above 2% of GDP. The Eurogroup, which gathers eurozone finance ministers, published its fiscal outlook for 2025–2026 and projects that rising defense expenditures will be a main driver of increases in fiscal deficits and government debt.

Potential economic impacts include:

• Rising demand for defense, cyber, and space industries
  Investment in weapons, ammunition, radar, satellite communications, and related fields is likely to increase within Europe, which tends to be a tailwind for the share prices of related companies.
• A “defense shift” in public spending and pressure on social security
  If defense spending grows within a limited fiscal envelope, budget allocation for education, healthcare, and pensions will become a more contentious political issue.
• Impact on long-term interest rates and government bond markets
  As concerns about deficits grow, long-term interest rates may creep up, raising the cost of mortgages and corporate borrowing.

For Japanese investors, this is arguably a phase where both “defense-related stocks as an opportunity” and “European fiscal risk” need to be watched in parallel. For example, shares in European defense companies supplying equipment to NATO may remain underpinned by expectations of more orders over the medium to long term, but if fiscal worries intensify, volatility across European equities could increase.

Social Impact: The Shadow of War Reaching Everyday Life

On the social front, debates may intensify around conscription systems and mobilization of reservists — in other words, how far “citizen participation in war” should go. In countries that share borders with Russia, such as the Baltic states and Poland, survival training and disaster preparedness are already being strengthened as part of school curricula.

From Japan, it may feel like a distant issue, but remember that a large-scale war in Europe would hit energy prices, financial markets, and ultimately Japan’s economy as well. This is not something we can simply ignore.

2. Bulgaria’s Government Collapse and Euro Adoption

Protests Reflect Rage over Prices and Tax Burdens

In Bulgaria, a coalition government that had been in power for less than a year resigned after weeks of protests. Prime Minister Rosen Zhelyazkov announced his resignation in a televised address just ahead of a no-confidence vote in parliament. The final straw was a 2026 budget that included hikes to social security contributions and dividend taxes.

The government subsequently withdrew the 2026 budget, its first to be drafted in euros, but large demonstrations in the capital Sofia and beyond, led mainly by younger urban residents, did not die down. Protesters expressed anger at “corruption and arrogance” in politics.

Even so, Bulgaria is still currently set to adopt the euro on 1 January 2026. The country, the poorest in the EU, has been pushing ahead with both Schengen and eurozone accession, leaving it simultaneously grappling with political instability and currency integration.

Economic Significance: Coexistence of Euro Adoption and Political Instability

Bulgaria’s case is notable for several reasons:

1. Lower currency risk and improved creditworthiness
   With the adoption of the euro, exchange rate risk is reduced and external creditworthiness tends to improve. For Japanese companies exporting to Bulgaria, a practical benefit is that they can shift from lev-denominated transactions to euro-denominated ones.

2. But investors also care about political stability
   Bulgaria has held seven general elections in the last four years, raising doubts about policy continuity. If political risk is perceived as high, investors may remain cautious despite the positive signal of euro adoption.

3. The tug-of-war between tax hikes and social security is a theme shared with Japan
   Backlash against higher social insurance contributions is an issue Japanese readers can easily relate to. Balancing “defense spending, social security, and fiscal discipline” is not only Bulgaria’s problem — it’s a challenge facing many advanced economies.

Social Aspect: Young Generations Who “Want to Be Like the Rest of Europe”

Among protesters, young professionals such as IT engineers and freelancers — people with global job opportunities — are particularly visible. Many are calling for “an end to entrenched corruption and a political system as transparent as in Northern and Western Europe.”

From Japan, this may look like a small-country government crisis, but how the “quality gap in democracy between Western and Eastern Europe” is addressed within the EU will shape the long-term stability of European integration. That, in turn, affects overall European growth prospects and confidence in the euro, with knock-on effects on FX and bond markets — and ultimately on Japan’s economy as well.

3. China’s “Active Fiscal Policy” and the Contradictions of Its Growth Model

Central Economic Work Conference Sets Direction for 2026

China held the Central Economic Work Conference (CEWC) on 10–11 December to chart its macroeconomic course for the coming year, releasing the results on the 11th. Key points include:

• In 2026, China will continue an “active fiscal policy” and a “moderately accommodative monetary policy.”
• The government will seek to boost domestic demand, especially private consumption, through higher incomes for urban and rural residents and expansion of service consumption.
• At the same time, it will maintain support for investment, particularly in manufacturing and infrastructure, even as it acknowledges a structural mismatch of “strong supply capacity but weak demand,” and it signaled its determination to keep growth around 5%.
• Fiscal deficits will remain around 4% of GDP, similar to this year, and the growth target is expected to stay near 5%.

The World Bank released its latest China economic update on the same day, projecting real GDP growth of 4.9% for China in 2025 and 4.4% in 2026. It assessed that growth in the first three quarters of this year was 5.2%, broadly in line with the official target.

Contradiction in the Growth Model: Excess Supply and Weak Domestic Demand

The Chinese government itself has acknowledged a “prominent imbalance” in which domestic production capacity is extremely strong, but demand — especially private consumption — is relatively weak.

Yet the latest policy direction still calls for “consumption expansion” and “investment expansion” in parallel, leaving some contradictions:

• Increasing investment makes it easier to sustain growth in the short term, but it exacerbates debt accumulation and overcapacity.
• Resources are more likely to be channeled into export-oriented manufacturing and infrastructure investment than into strengthening household income distribution and social security.
• As U.S. and European tariffs and sanctions tighten, China’s model as the “world’s factory” itself faces growing risks.

Even so, given global supply chains, whether China can maintain growth near 5% will significantly affect overall demand in Asia, commodity prices, and the earnings of Japanese companies.

Implications for Japanese Companies and Investors

Consider a few scenarios:

• Companies targeting China’s domestic demand
  If efforts to raise household incomes and expand service consumption succeed, demand in areas such as dining, travel, healthcare, education, and entertainment could remain resilient.
• Firms dependent on infrastructure and capital expenditure
  As long as government-driven investment continues, order books will be supported, but medium- to long-term risks of “capacity without demand” must be factored in.
• FX and interest rates: moderately loose monetary policy will put downward pressure on the yuan, affecting export margins for Japanese firms selling to China and the cost comparison with local production.

For investors, it will be important to calibrate exposure to China-related assets with both short-term stimulus and medium- to long-term structural risks in mind.

4. The Fed, SNB, and Global Markets: A Day of Weak Dollar, Strong Stocks, and Cheaper Oil

After the Fed’s Rate Cut, the Dollar Falls and Stocks Rise

On the 10th, the Federal Reserve cut its policy rate by 0.25 percentage points to a range of 3.5–3.75%. Markets began to price in the possibility of “up to two more cuts in 2026.”

On the 11th, in the FX market:

• The euro rose into the upper $1.17 range, its highest level in about two months.
• The pound climbed into the $1.33 range.
• The dollar index fell to its lowest levels since October, making the weak-dollar trend more pronounced.

The Fed also announced that it will start purchasing short-term U.S. Treasury bills (T-bills) on 12 December, with an initial injection of around $40 billion. It will also reinvest around $15 billion in maturing mortgage-backed securities (MBS) into T-bills, bringing total liquidity provision to about $55 billion.

On the back of this “slightly dovish” stance, U.S. equities on the 11th saw:

• The Dow Jones Industrial Average rise about 1.3% from the previous day, hitting a record high.
• The S&P 500 gain about 0.2%, also closing at a record high.
• The Nasdaq Composite slip 0.3%, weighed down by disappointment over cloud giant Oracle’s earnings.

In other words, “cyclical and value stocks rose, while AI-related tech names saw profit-taking.”

Bitcoin fell into the low $90,000 range, with Ethereum down more than 4%. Gold, seen as a safe-haven asset, rose about 2%, while crude oil prices fell more than 1%.

Swiss National Bank (SNB) Holds Rates, Franc Remains Strong

The Swiss National Bank (SNB) left its policy rate unchanged at 0% at its monetary policy meeting on the 11th. Although inflation is currently at 0% and within its target range, the SNB noted that the global economy is more resilient than expected, while U.S. tariffs and trade uncertainty pose risks.

The Swiss franc is trading near its year-to-date highs against the dollar. The SNB reiterated that it “stands ready to intervene in FX markets if necessary,” while also suggesting that the bar for returning to negative rates is high.

A strong franc undercuts the export competitiveness of Swiss firms — including watchmakers and medical device manufacturers — but from a Japanese perspective, the franc’s appeal as a “safe-haven currency” could renew interest in franc-denominated assets.

Why Oil Is Cheaper: Peace Hopes and High U.S. Fuel Inventories

In the oil market, prices had been rising following the U.S. seizure of a tanker off Venezuela, but they fell about 1.5% per barrel amid expectations for Ukraine peace talks and data showing build-ups in gasoline and diesel inventories. Brent crude ended at $61.28 and WTI at $57.60.

For Japanese households, lower oil prices tend to reduce costs for gasoline, electricity, and air travel. On the other hand, they are a headwind for investments in oil-producing countries and energy-related stocks. While stabilizing energy prices help ease inflationary pressures, we also need to keep in mind the “sluggish global demand” that often lies behind such price moves.

5. Pressure and Hope Around Venezuela: Tanker Seizure, Russian Support, and the Nobel Peace Prize

U.S. Seizure of a Large Tanker and International Law

The United States seized a large tanker, the Skipper, carrying roughly 1.1 million barrels of crude oil off the coast of Venezuela. U.S. authorities claim the vessel was involved in an “illegal oil shipping network” between Iran and Venezuela, describing the move as an effort to cut off funding for terrorist organizations.

However, several international law experts argue the seizure may well be a violation of international law. It has also been reported that, under the banner of “war on narco-terrorism,” the U.S. military has carried out repeated airstrikes on small vessels around Venezuela, reportedly killing more than 80 people.

These developments have sparked concerns that they may mark a step toward a de facto “naval blockade”, increasing the risk that Venezuela will face both military escalation and a worsening humanitarian crisis.

Russia’s Full-Throated Support and Geopolitical Risks

In this context, Russian President Vladimir Putin spoke by phone with President Nicolás Maduro and pledged continued support for the Venezuelan government under mounting U.S. pressure.

Russia is already supporting Venezuela through arms supplies and energy cooperation. This latest statement makes it clear that the “U.S. vs. Russia” confrontation is spreading more visibly into Latin America as well.

If the U.S. moves toward a full-scale naval blockade or further sanctions, the direct impact on global oil supply may remain limited, but market sentiment could add a “political risk premium” back onto crude oil prices.

Nobel Peace Prize Laureate Machado and Her “Invisible Return Plan”

There is also a glimmer of hope. María Corina Machado, the Venezuelan opposition leader who won the 2025 Nobel Peace Prize, secretly left the country — defying a long-standing travel ban — and arrived in Oslo the morning after the award ceremony.

Machado has described Venezuela as a “hub of international crime” and called on the international community to cut off funding to the Maduro regime. At the same time, she stated that “this prize belongs to all Venezuelans” and that she would “definitely bring it home at the right time,” although she did not reveal when she plans to return.

She is believed to be working closely with hawkish circles close to the Trump administration in the U.S., and depending on her next moves, the international community may swing between tougher sanctions and a greater emphasis on dialogue.

Possible Economic and Social Impacts

• Oil markets
  Although Venezuelan exports have already dropped sharply under sanctions, further deterioration could fuel expectations that “similar sanctions or conflicts might occur in other oil-producing countries,” adding to price volatility.
• Migration and refugee issues
  Economic collapse has already driven millions of Venezuelan refugees into neighboring countries. Additional sanctions or military tensions would place even greater strain on social infrastructure and public security in Latin America.
• Implications for Japanese companies
  Even if Japanese firms are not directly active in Venezuela, a higher political risk premium across Latin America as a whole could influence investment decisions in other regional markets such as Brazil and Colombia.

6. World Development Report 2025: Development Through Standards

For the First Time, “International Standards” Take Center Stage

On the 11th, the World Bank formally released its flagship annual report, the World Development Report 2025, with “international standards” as its theme for the first time. The launch event was held jointly with ISO (the International Organization for Standardization).

The report emphasizes the following points:

• Though often invisible, international standards — such as safety rules, quality norms, and data formats — are the very “infrastructure” of trade, innovation, and safety.
• When standards are developed and properly implemented across countries, ships can smoothly transit canals, buildings can withstand earthquakes, and measures of weight and voltage carry the same meaning around the world.
• For developing countries, it is crucial not only to “import” standards but also to “author” them by participating directly in standard-setting, which is key to growth and poverty reduction.

ISO and the World Bank plan to roll out capacity-building for standardization bodies in developing countries and launch programs in 2026 to encourage their participation in international standard-setting.

Economic and Social Spillovers: Why This Matters for Japanese Companies

Japan has long been an active participant in standard-setting bodies such as ISO and IEC. This report carries several important implications for Japanese firms:

1. Standards themselves are becoming a source of competitiveness
   When a company’s proprietary technology becomes a standard, it tends to be more widely adopted in global markets, generating network effects. In sectors such as semiconductors, batteries, hydrogen infrastructure, and renewable energy, the “standards race” will only intensify.

2. Business in developing markets may become easier
   Where previously “a patchwork of national standards” created barriers, greater alignment with international norms will make it easier for Japanese firms to roll out products across multiple markets simultaneously.

3. Alignment with social impact investing
   The spread of standards on safety, the environment, and accessibility reduces accident and disaster risks and promotes designs that are easier to use for everyone — including people with disabilities and the elderly.

“Standards” may sound a bit dry, but how we design the “rules that quietly support the world” will be deeply intertwined with growth and inequality reduction over the next decade.

7. Three Big Trends in the World Economy Highlighted by Today’s News

(1) The Re-Prioritization of Security and Public Finances

The NATO warning, Bulgaria’s government collapse, and rising defense outlays in the eurozone all show that security has returned to the center of economic policymaking.

• Expanding defense budgets boost investment in defense industries and related technologies in the short term.
• At the same time, they create trade-offs with spending on education, healthcare, and decarbonization, which could cast a shadow over future growth and social stability.

In Japan too, the debate over raising defense spending is in full swing. The question is how to set our own priorities amid a global trend of “full-throttle defense spending.”

(2) A Three-Way Macro Tug-of-War Between China, the U.S., and Europe

• China is trying to cling to 5% growth through fiscal stimulus, while wrestling with structural problems of excess supply and weak domestic demand.
• The United States, through Fed rate cuts and a weaker dollar, is again loosening global financial conditions.
• Europe is torn between rising defense costs and fiscal discipline, with both eurozone cohesion and political fatigue progressing at the same time.

From an investor’s perspective, the focus is shifting from “which region will grow the fastest?” to “which region is least likely to suffer a macro-policy mishap?” in relative terms.

(3) The Global South and Competition Over “Invisible Infrastructure”

Events in Venezuela and debates over international standards reflect the broader question of how the Global South (developing and emerging economies) will be positioned in the world order.

• Tools of “hard power” such as sanctions, military intervention, and naval blockades
• Tools of “soft, invisible infrastructure” such as international standards, technical rules, and the financial system

In both domains, whether developing countries can participate in rule-making will shape their growth paths and the future of democracy over the coming decades.

Closing Thoughts: Turning Today’s News into Tomorrow’s Actions

Looking across the global news of 11 December 2025, we see three threads running through it: security, macroeconomics, and international rule-making.

When you follow daily news, it can help to keep a few questions in mind:

1. “Who in which country gains or loses from this news?”
   For example, higher defense spending may benefit defense contractors but increase the tax burden on younger generations.

2. “Which parts of my work or life does this connect to?”
   For instance, a Fed rate cut affects exchange rates, which in turn influence import prices, travel costs, and what you pay on overseas e-commerce.

3. “How do short-term impacts differ from 10-year structural changes?”
   China’s fiscal stimulus may support Asian demand next year, but the burden of debt and overinvestment will show up over a decade-long horizon.

In this article, I’ve tried to organize the topics with everyday examples so that even readers not used to international affairs or economic news can see them as “their own business,” not someone else’s.

I’ll keep tracking global developments in a way that is gentle yet deep. If there are topics you’d like to know more about — “I want more detail here” or “I’m curious about follow-ups to this story” — feel free to say so anytime.

Further Reading (Mostly Official English Sources)

• NATO’s Rutte warns allies they are Russia’s next target – Reuters
• Bulgarian government resigns after weeks of street protests – Reuters
• China promises fiscal boost next year, recognises ‘prominent’ imbalance – Reuters
• World Bank: China Economic Update – Emirates News Agency
• US dollar sags as Fed outlook undermines; Swiss franc gets SNB lift – Reuters
• Monetary policy assessment of 11 December 2025 – Swiss National Bank
• Markets News, Dec. 11, 2025 – Investopedia
• Trump’s oil tanker seizure raises questions about potential Venezuela blockade – ABC News
• Russia’s Putin reassures Venezuela’s Maduro of Moscow’s support in call – Reuters
• Nobel Peace Prize winner Machado vows to bring award back to Venezuela – Reuters
• Eurogroup statement on the draft budgetary plans for 2026 – Council of the EU
• International Standards at the heart of development – ISO & World Bank