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Council on Foreign Relations Daily News Brief
July 30, 2014

Top of the Agenda

Russia Reacts to New U.S., EU Sanctions

Russia's central bank on Wednesday (WaPo) promised to help financial institutions targeted by the West, a day after the European Union and United States ratcheted sanctions on Russia's defense, finance, and energy industries. The coordinated measures exacerbate tensions that Russian president Vladimir Putin is balancing between business tycoons and nationalists (FT). Meanwhile, Belarus said it will host talks (Reuters) between Ukraine and Russia, while Dutch-led investigators once again failed to reach the Malaysia Airlines crash site (Bloomberg) even as the Ukrainian army continued to make advances against rebels in the country's east.

Analysis

"There would appear to be inexorable momentum for further sanctions: (1) Europe now is less of a constraint on further U.S. action; (2) Ukraine is achieving success on the battlefield, and without intensified Russian involvement would likely see further gains. If recent evidence of Russian shelling across the border is any indication, Russia has intensified its support in response to developments on the ground, which is justification for further sanctions; and (3) sanctions are likely to be extended over time in response to evasion," writes CFR's Robert Kahn.

"This change of view makes all the more troubling France's continued determination to deliver at least one of the two Mistral-class warships it is building for Russia for 1.2 billion euros, or about $1.6 billion. The Mistral is not heavily armed, but it is a serious military asset," writes the New York Times' board in an editorial.

"An improvement in the international climate is nevertheless unlikely without political change in Russia. For what makes Mr Putin so confrontational on the world stage is, at bottom, an awareness that Russia's post-communist attempt at building a modern state and society is running into the sands," writes the Financial Times in an editorial.

 

Explore CFR’s Interactive on the Sunni-Shia Divide

Sectarian conflict is becoming entrenched in a growing number of Muslim countries. Tensions between Sunnis and Shias could reshape the future Middle East. Click on the Sunni-Shia Divide to learn more.

PACIFIC RIM

China Corruption Inquiry Breaks With Past Practice

The graft investigation of former security chief Zhou Yongkang appears to violate a long-standing taboo (SCMP) against prosecuting the Chinese Communist Party's highest-ranking members, but President Xi Jinping's two most recent predecessors approved the deal, sources told Reuters.

This Backgrounder explains the threat China's Communist Party perceives from endemic corruption.

CHINA: Uighur exile groups disputed Chinese state media's accounts of clashes in the western province of Xinjiang (NYT).

 

SOUTH AND CENTRAL ASIA

Kerry Set to Arrive in India for Strategic Dialogue

U.S. secretary of state John Kerry is expected in New Delhi on Wednesday in the first high-level meeting since Narendra Modi, whom Washington once kept at arm's length, assumed the premiership (WSJ). Trade will top the strategic dialogue's official agenda (Hindu).

CFR's Alyssa Ayres discusses India's role in global trade negotiations.

PAKISTAN: Pakistan on Wednesday summoned a senior Afghan diplomat to lodge a complaint over a militant attack launched from Afghan soil, saying Afghan sanctuaries have undermined an ongoing offensive against the Pakistani Taliban (Dawn).

 

MIDDLE EAST

UN School in Gaza Struck

Israeli shells struck a UN school sheltering displaced Gazans on Wednesday, killing at least twenty (NYT), according to Palestinian health officials. Israel said UN facilities had not been targeted. Meanwhile, Israel's Foreign Ministry pushed for a UN Security Council resolution to set terms for ending the war (Haaretz), while Hamas' military chief said there would be no cease-fire without Israel lifting its blockade of Gaza.

Palestinian leader Mahmoud Abbas has been marginalized in the current crisis, writes CFR's Steven Cook.

LIBYA: Militants on Tuesday overran a special-forces base in Benghazi after a battle left at lease thirty people dead (Reuters).

 

AFRICA

European Ransom Payments Bankroll al-Qaeda

Payments made by European governments to free citizens taken hostage has netted $165 million for al-Qaeda and its affiliates since 2008, according to the U.S. Treasury (NYT).

SIERRA LEONE: The Pan-African airline ASKY has suspended flights to and from the capitals of Liberia and Sierra Leone amid increasing concerns of ebola spreading across borders (Guardian). Sierra Leone's leading ebola specialist died of the virus, officials said Tuesday (Daily Nation).

 

EUROPE

Spain in Talks to Defuse Catalan Referendum

Prime Minister Mariano Rajoy is expected to make a bid to avert a Catalan secession referendum in talks with regional president Artur Mas on Wednesday (AP).

 

AMERICAS

Argentina Nears Default

Members of Argentina's banking association flew to New York on Tuesday (Buenos Aires Herald), while the country's economy minister Axel Kicillof joined negotiations led by a court-appointed mediator (WSJ) in a last-minute bid to help avoid a technical default.

COLOMBIA: President Juan Manuel Santos condemned alleged attacks by the rebel group FARC on the country's infrastructure, saying they could jeopardize ongoing peace talks (Colombia Reports). An electricity tower in the Pacific coast city of Buenaventura was blown up Monday (BBC).

 

 

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