Top of the Agenda: New Doubts Over Greek Bailout Deal
Luxembourg Prime Minister Jean-Claude Juncker, head of the Eurogroup of eurozone finance ministers, cancelled a critical meeting focused on releasing a $170 billion EU-IMF bailout package for Greece. Despite the Greek parliament's passage of an approximately $4.3 billion austerity package on Sunday, Juncker said Athens had not accounted for an additional $427 million in savings demanded by Brussels. At the same time, the leaders of Greece's political parties had failed to provide the necessary assurances to EU leaders (DerSpiegel) that they would follow through on implementing the agreed austerity measures, Juncker said.
However, Greek conservative leader Antonis Samaras, who has been highly critical of further budget reductions, responded that he would send a letter of commitment to Brussels (Reuters) by the end of today. The Greek government must also complete a bond swap deal with private bondholders by Friday as part of the bailout package.
"Greece has to repay around $19 billion in a March 20 bond redemption, and if it fails to secure further EU funding by then, it will undoubtedly face a disorderly default. Such a scenario would likely signal Greece's exit from the eurozone, with potentially significant knock-on effects for European banks," explains this CFR Analysis Brief.
"The country's unsustainable mountain of debt will of course become smaller, but that alone will hardly help. And while Athens makes even more cuts in wages, pensions and state expenditures, it isn't even remotely clear how this formula will return the Greek economy to growth. Fundamentally, Europe's strategy can be reduced to a single message: More of the same!" says this Der Spiegel analysis.
"If Italy and Spain are able to make decent progress in dealing with their own public finances, the rest of the eurozone will feel more confident about limiting the fallout from a decision to turn off the Greek tap. Greece has delayed a messy default, but it will happen eventually," notes the Economist.
Biden Criticizes China's Xi
U.S. Vice President Joseph R. Biden Jr. pressed Chinese Vice President Xi Jinping on Tuesday over China's alleged intellectual property theft, human rights abuses, its recent veto of a UN resolution against Syria, and its devalued currency on the first day of Xi's weeklong U.S. tour (NYT).
THAILAND: Officials arrested and charged two Iranians over an attempted bomb attack in Bangkok (al-Jazeera). Thai Foreign Minister Surapong Tovichakchaikul said the botched bombing could be linked to attacks on Israeli diplomats in India and Georgia earlier this week.
PAKISTAN: Afghan President Hamid Karzai and Iranian President Mahmoud Ahmadinejad are set to arrive in Islamabad Thursday for talks on combating terrorism (ExpressTribune). Iranian and Pakistani officials will also continue negotiations over a multi-billion-dollar oil pipeline between the two countries.
Pakistan's stability is of great consequence to regional and international security. Examine the roots of its challenges, what it means for the region and the world, and explore some plausible futures for the country with this CFR Crisis Guide.
Assad Sets Referendum Date Amid Continued Violence
IRAN: President Mahmoud Ahmadinejad is expected to announce advancements in the country's nuclear program today (AFP), including new uranium enrichment centrifuges and nuclear reactor fuel plates, state television reported. The United States and the EU contend Iran is trying to develop nuclear weapons.
As the United Nations faces increasing pressure to end violence in Syria and resolve tensions with Iran over its nuclear program, former senior U.S. official William H. Luers discusses challenges in UN diplomacy and prospects for intervention in this CFR Interview.
SOUTH SUDAN: Officials failed to reach an oil transit fee deal with Sudan (WSJ)--through which all of South Sudan's oil must be transported--and accused Khartoum of "stealing" 2.4 million barrels of oil shipments.
With oil supplies tight, regions most vulnerable to oil supply disruptions present a significant economic concern, explain this CFR Backgrounder.
Italy, Netherlands in Recession
The economies of Italy and the Netherlands fell into recession, both shrinking by 0.7 percent (BBC) in the fourth quarter of 2011. Overall eurozone economic activity dropped by 0.3 percent, though France registered unexpected growth of 0.2 percent.
Chávez Allies Attack Presidential Rival
Venezuelan President Hugo Chávez's campaign team criticized opposition candidate Henrique Capriles over an alleged homosexual act and his Jewish roots, calling him a "bourgeois" and a "fascist" (Guardian). Capriles, the leader of the Democratic Unity coalition, will face off against Chávez in the country's October presidential election.
HONDURAS: A prison fire (CNN) in central Honduras killed at least 272 people last night. Firefighters have contained the blaze, but the cause of the incident is still unknown.
Poll Finds Economy Still Dominant Campaign Issue
The economy continues to resonate on the campaign trail; a New York Times/CBS poll released Tuesday found that when asked to name one issue that presidential candidates should discuss, most voters in both parties mentioned an economic problem (NYTimes) such as unemployment or the budget deficit.
Republican presidential candidate Ron Paul issued a statement on the fiscal 2013 budget proposal Tuesday, criticizing it for spending too much.
Editor's Note: For more information on the presidential election and foreign policy check out CFR's campaign blog, The Candidates and the World.