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Council on Foreign Relations Daily News Brief
October 31, 2014

Top of the Agenda

Ukraine and Russia Reach Gas Deal

Ukrainian and Russian officials signed a natural gas deal (NYT) on Thursday that provides Russian gas deliveries to Ukraine through March 2015. The deal had been delayed for months due to Ukraine's unpaid bills and Russia's annexation of Crimea. The European Union, which led negotiations, is also a signatory of the agreement, making this the first trilateral energy agreement (EU Observer) of its kind. Funds from the EU and the International Monetary Fund will help Ukraine repay its debts.

Analysis

"Russia's supply lines run through Ukraine to several EU countries, and as much as 70% of its gas to the EU is carried through those pipes. So while Russia has in recent years tried to bypass Ukraine, in particular with the Nord Stream and South Stream projects, the two countries are, for now, inextricably linked," writes Paul Kirby for the BBC.

"Many analysts believe Ukraine cannot get through the coming winter without cutting some kind of gas purchase deal with Russia. That question would not have arisen if Ukraine's leaders had made better decisions years ago and the country were now producing 30 BCM of gas," writes Steven Pifer in the American Interest.

"[Ukraine]'s economy is heavily dependent on Russia, not only for gas but also as its largest export client. Cutting off Russia—as joining the E.U. might entail—would be a risky move. As for the infusion of Western money, it could disappear into a hole of corruption. Ukraine's admission into the E.U. seems unlikely, despite the trade deal, Poroshenko's optimism, and all the flags," writes Nicolas Niarchos in the New Yorker.

 

PACIFIC RIM

North Korea Invites EU Rights Official

A North Korean diplomat said that the government has invited the European Union's top human rights official (AP) to visit in March 2015. North Korea also threatened to rescind its offers of other visits if a UN resolution on the country's human rights abuses does not strike references to the International Criminal Court by Saturday.

Ambassador Jang Il Hun discussed human rights in North Korea in this CFR Meeting.

JAPAN: The Bank of Japan announced new stimulus measures (WSJ) on Friday, increasing its asset purchases for the first time in a year and a half. The move comes after an April increase in the national sales tax reduced consumer spending.

This CFR Backgrounder looks at Japanese Prime Minister Shinzo Abe's economic plans.

 

SOUTH AND CENTRAL ASIA

Indian Government Bans Luxury Travel for Officials

Prime Minister Narendra Modi's government banned bureaucrats (Press Trust of India) from travelling first class and holding meetings in five-star hotels in a move intended to cut the fiscal deficit.

AFGHANISTAN: President Ashraf Ghani called on the Taliban to join inter-Afghan peace talks (Radio Free Europe) at a conference on Afghan reconstruction in Beijing on Friday.

This CFR Backgrounder discusses the reemergence of the Taliban in Afghanistan.

 

MIDDLE EAST AND NORTH AFRICA

Israel to Reopen Holy Site

Faced with harsh criticism, Israeli authorities announced it would reopen a holy site in Jerusalem (Guardian) on Friday. The site, known to Jews as Temple Mount and to Muslims as Haram al-Sharif, was closed following the shooting of a far-right Israeli activist on Wednesday night.

SYRIA: U.S. Secretary of Defense Chuck Hagel said on Thursday that Assad has "derived some benefit" (Al Arabiya) from the U.S.-led air strikes in Syria against ISIS. On Friday, U.S. officials also warned that more than one thousand foreign jihadis (WaPo) are entering Syria and Iraq each month to join ISIS.

This CFR Backgrounder chronicles the rise of ISIS.

 

SUB-SAHARAN AFRICA

Burkina Faso Leader Offers Talks

Following violent protests in which demonstrators set fire to Parliament, President Blaise Compaore reportedly offered to talk with opposition leaders and rescinded his plans to stay in office (NYT) beyond 2015. Compaore, who came to office in a 1987 military coup, agreed to negotiate on a transition period after which he would allow democratic elections.

LIBERIA: China will send an elite unit (Reuters) from the People's Liberation Army (PLA) to Liberia to help combat Ebola. The PLA unit has experience with epidemics following the 2002 SARS outbreak and will build and run a treatment center.

 

EUROPE

Hungary Drops Internet Tax

After mass antigovernment protests, Prime Minister Viktor Orban scrapped plans (FT) for the first tax on internet usage.

 

AMERICAS

Argentina and China Launch Currency Swap

The central banks of Argentina and China activated a currency-swap agreement (Bloomberg) on Thursday, as the South American country received its first installment of yuan totaling $814 million. The three-year agreement will help bolster Argentina's waning foreign currency reserves.

COLOMBIA: The FARC rebel organization, in peace talks with the Colombian government, acknowledged that its activities have harmed civilians (LAHT) on Thursday; this is the group's first admission of its kind.

 

 

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