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Council on Foreign Relations Daily News Brief
April 4, 2013

Top of the Agenda

Top of the Agenda: U.S. Sends Defense Missiles to Guam After North Korea Threats

North Korea has shifted a missile with "considerable range" to its east coast (BBC) after renewing threats of a nuclear strike against the United States. Washington responded in tow by moving missile defense shields to Guam, although analysts are doubtful the North's missiles are capable of carrying nuclear warheads and have the range to reach the United States. The escalating events on the Korean peninsula have begun to affect markets (Reuters), as South Korean shares saw a 2 percent slump and the won slid 0.7 percent against the dollar. U.S. stocks also dipped on Wednesday after U.S. Defense Secretary Chuck Hagel's comments (Salon) that North Korea presented a "real, clear danger."

Analysis

"The first option should be deterrence of further aggression through diplomacy. But achieving diplomatic deterrence will depend on China's cooperation, and this requires that China's vital national-security interests be recognized," writes Yoon Young-kwan for Project Syndicate.

"Beijing sees the recent U.S. moves to strengthen its missile-defense system and fly advanced bombers and fighter jets to South Korea as direct threats to its security interests. But it sees a greater threat in the prospect of North Korea either collapsing or reunifying with the South, both of which it believes would help the U.S. to 'contain" China,'" writes Jeremy Page for The Wall Street Journal.

"Other anti-missile defences in the region are also being bolstered, a step that carries an additional message to Beijing - that if Pyongyang remains on this course anti-missile systems will only proliferate, something that may eventually compromise the effectiveness of China's own nuclear deterrent," writes Jonathan Marcus for the BBC.

 

PACIFIC RIM

Japan's Central Bank Pushes Hard on Abenomics

Bank of Japan Governor Haruhiko Kuroda chaired his first policy meeting by announcing increased quantitative easing measures (Bloomberg), doubling the bank's monthly bond purchases to 7.5 trillion yen, or $78.6 billion, in a bid to reach 2 percent inflation in two years.

 

SOUTH AND CENTRAL ASIA

Karzai to Step Down

Afghan President Hamid Karzai, who has ruled since 2001 after the United States launched an offensive deposing the Taliban of power, will not seek a third term (al-Jazeera) in next year's elections. Karzai said history will judge his track record in office.

CFR's president emeritus Leslie Gelb discusses how the United States should respond to Karzai in this article.

PAKISTAN: A group of British MPs said that the UK government should withhold extra aid to Pakistan unless the country does a better job of collecting taxes from its own elite (Channel4).

 

MIDDLE EAST

Kerry to Make Third Trip to Mideast

Secretary of State John Kerry is making his third trip to the Middle East in a span of two weeks in a fresh bid to relaunch stalled peace talks between Israel and the Palestinians (AP). Analysts say expectations remain low, though the trip would mark the administration's most sustained effort.

LEBANON: A Syrian jet fired a missile into Lebanon (Reuters) on Wednesday, raising concerns that Beirut may be dragged into the civil war despite its policy of dissociation from the two-year conflict.

 

AFRICA

South Africa Withdraws Troops From CAR

South Africa says it will pull out its troops from the Central African Republic (BBC) after Seleka rebels there seized power more than a week ago. South African President Jacob Zuma faced outrage over the death of thirteen South African soldiers in the rebellion.

CFR's John Campbell questions the presence of South African troops in the Central African Republic in this blog post.

NIGERIA: Nigerian President Goodluck Jonathan is likely to grant amnesty (Leadership) for the militant Boko Haram sect, and is expected to set up an amnesty commission to finalize details of clemency.

 

EUROPE

Portugal Faces Market Jitters

Portugal's stock market fell sharply (FT) on Wednesday as the center-right government faced a confidence vote in parliament and prepared for a constitutional court ruling that could eliminate its 2013 budget, raising fears the instability could derail the country's 78 billion euro bailout.

CFR's Robert Kahn talks about ECB policy for a fragmented financial market in this new blog post.

ITALY: Florence mayor Matteo Renzi launched a challenge (Reuters) to Italian center-left leader Pier Luigi Bersani on Thursday, calling for a government coalition with former premier Silvio Berlusconi.

 

AMERICAS

Argentina to Use Reserves to Pay Debt

Argentina will use $2.3 billion of central bank reserves (MercoPress) this year to meet payments to international financing organizations and on its official bilateral debt. The government has been unable to borrow from international markets since the country's 2001 debt default.

UNITED STATES: President Barack Obama urged Congress to pass gun control measures, including a Senate bill that would expand background checks to cover nearly all gun sales (HuffPost).

 

 

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