UK Labour Party momentum builds

UK Labour Party scores a double special-election victory [View in browser]( [Bloomberg]( Welcome to Balance of Power, bringing you the latest in global politics. If you haven’t yet, sign up [here](. UK opposition leader Keir Starmer is celebrating [a double special-election victory]( that leaves little doubt his Labour Party is on course to oust Prime Minister Rishi Sunak’s ruling Conservatives after 14 years in power. Starmer still has work to do to ensure that disillusioned voters don’t stay home in the general election expected this year. The results were a major blow for Sunak, whose woes were compounded by data this week showing the UK [slipped into recession]( in the second half of 2023, undermining his pledge to expand the economy. Labour overturned big Tory majorities in Wellingborough, central England, and Kingswood in the southwest with vote swings well above what’s required for a governing majority in parliament if replicated across the country. Meanwhile, a strong performance by anti-immigration party Reform UK will worry Tory strategists that a split in the right-wing vote could make it even easier for Labour. Yet turnout was low in both districts, highlighting a lack of enthusiasm for what’s on offer. This is not like 1997, when Labour last turfed out the Tories to take power under Tony Blair. The UK is a more fragmented society now, with voters less tribal and increasingly selective in their policy preferences: many previously Labour-voting districts backed Tory-led Brexit, for example. That helps explain Starmer’s ultra-cautious approach. He’s walking a tightrope between retaining the core Labour electorate and winning over socially conservative voters wary of change. He’s also eager to dissociate himself with the radical policies of his predecessor, Jeremy Corbyn, who led Labour to a thumping defeat in 2019. Starmer promises fiscal responsibility and warns there are no quick fixes to the UK’s profound challenges. Once in power, he may turn out to be more reformist than expected. But first, he has to galvanize enough voters to show up. — [Emily Ashton]( WATCH: Lizzy Burden reports on the Labour Party’s victories. Source: Bloomberg Global Must Reads US President Joe Biden urged Israeli Prime Minister Benjamin Netanyahu in a call yesterday to hold off on an assault on the southern Gaza city of Rafah without a plan to protect civilians. It’s the latest US effort to [head off a humanitarian catastrophe]( as Israel prepares for an attack. Biden administration officials have grown increasingly frustrated with Netanyahu’s government and the way his forces have conducted their campaign against Hamas since the group carried out an assault on Israel on Oct. 7. Residents inspect their homes after Israeli airstrikes on Monday in Rafah. Photographer: Ahmad Hasaballah/Getty Images  Ukrainian President Volodymyr Zelenskiy travels to Germany and France today [for talks]( with Chancellor Olaf Scholz and President Emmanuel Macron as he seeks military support. He’s also due to address the Munich Security Conference tomorrow. The European Union would need [to double]( military aid to Ukraine to bridge the gap if US support remains stalled in Congress, according to a German research group. South Africa is leading a regional force deploying into eastern Democratic Republic of Congo and [risks being caught up]( in a conflict against the M23 rebel group allegedly backed by Rwanda. Troops will replace a United Nations force and a year-old East African Community deployment that haven’t been able to halt fighting that’s displaced 7 million people and stabilize a region that borders Rwanda. Jailed former premier Imran Khan’s party named a prime minister candidate as it seeks to form a coalition government after Pakistan’s inconclusive election. The former cricketer’s PTI chose Omar Ayub Khan, the grandson of the military dictator who was Pakistan’s second president, as its nominee to lead the country. [The favorite](, Shehbaz Sharif, was nominated by Pakistan Muslim League-Nawaz, the party that’s widely seen as backed by the powerful military. North Korean leader Kim Jong Un’s influential sister offered a rare opening for Japan, saying she saw a positive tone in comments from Prime Minister Fumio Kishida, who is seeking a summit. While Pyongyang appears to be [warming slightly to Tokyo](, it has widened a chasm between itself and Seoul, with Kim saying last week that he has the legal right to annihilate South Korea. Senegal’s top court rejected President Macky Sall’s bid to postpone elections, [raising uncertainty in the West African nation]( that’s traditionally been one of the continent’s most stable democracies. Greece’s parliament voted yesterday to extend equal marriage and automatic parental rights to all of the country’s 10.5 million citizens, and [to allow same-sex couples]( to adopt. The Philippines said it will respond to any “dangerous” maneuvers by China in a disputed South China Sea shoal, where Manila has started rotating vessels this month [amid heightened tensions]( with Beijing. Washington Dispatch Biden today will visit East Palestine, the Ohio village where a Norfolk Southern train carrying toxic chemicals derailed [a year ago](, sparking a fire and sending funnels of smoke high into the air. Authorities temporarily cordoned off an evacuation area and conducted a controlled release of hazardous fumes to prevent an even larger explosion of the train’s cargo, which included vinyl chloride, a carcinogen. With many residents feeling unsafe, Biden came under criticism for not traveling to East Palestine — including from Donald Trump, who toured the town less than three weeks after the accident and distributed fast food and water. The president defended his administration’s response, saying federal officials rushed to East Palestine after the derailment, among them Environmental Protection Agency Administrator Michael Regan and Transportation Secretary Pete Buttigieg. The government also administered door-to-door health surveys that extended into neighboring Beaver County, Pennsylvania. The White House said Biden “will deliver remarks on how the administration is holding Norfolk Southern accountable for the derailment and is working with state and local officials to support the community as it moves forward.” One thing to watch today: The annual Munich Security Conference opens. [Sign up for the Washington Edition newsletter]( for more from the US capital and watch Balance of Power at 5pm ET weekdays on Bloomberg Television. Chart of the Day The total area of the planet covered by coral reefs [is larger than previously thought](, according to the most comprehensive high-resolution assessment to date. Shallow coral reefs cover about 348,000 square kilometers (or about 134,000 square miles) of the globe’s surface — about the size of Germany. Coral reefs are home to about a quarter of all marine life and are essential to the livelihood of about a billion people. And Finally It’s nearly a decade since a massive oil discovery was made off the shores of Guyana, and in that time the South American nation has seen huge change. Its economy quadrupled in size over the last five years, becoming the fastest growing in the world for two years straight. Yet, as Patricia Laya reports, not everyone is seeing the benefits and the former British colony [risks falling under the resource curse]( that frequently plagues petrostates. WATCH: While natural resource windfalls can create phenomenal wealth, they can lead to hyperinflation, social and political upheaval and severe income inequality. Source: Bloomberg Pop quiz (no cheating!) Which country is discussing the possibility of basing a nuclear weapon in space, according to US intelligence? Send your answers to balancepower@bloomberg.net. 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