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June 29, 2015

Daily News Brief

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TOP OF THE AGENDA

Greece Edges Closer to Default

The Greek government announced a week-long closure (FT) of its banks and stock market and capital controls on Sunday after weekend talks with international creditors broke down. Greek Prime Minister Alexis Tsipras said that Greece will hold a referendum (Guardian) on July 5 on whether to accept creditors' bailout terms. Global stock markets tumbled (BBC) on Monday following the developments. If a last minute aid-for-reform deal is not reached, Greece is expected to miss a $1.8 billion IMF payment deadline on Tuesday, which could lead to default and a possible exit from the eurozone.

ANALYSIS

"The government has rejected the terms on the table, so that trust that they would implement any agreement is low. Further, the financial package offered last week would have expired once the current program ends on June 30. Of course, creditors could offer those terms again, but that would require a new program and new parliamentary approvals, substantially raising the political impediments to a deal. In sum, time is short to avoid exit. The week after the referendum could be decisive," writes CFR's Robert Kahn in a recent blog post.

"For Greeks it will be a stark wake-up call of the cost of Mr Tsipras's referendum and this may concentrate minds when they vote on it next Sunday. Although the proposals that they are voting on have in any case been withdrawn the outcome still matters since it will send a clear message about whether the Greeks as opposed to the Greek government are prepared to do what it takes to stay in the euro," writes the Economist.

"What happens if the Greek electorate voted Yes but Greece is still forced out of the eurozone because the creditors and the ECB left them no other choice? This scenario would be the most toxic of all. It will imply that a monetary union without political union can only exist in violation of basic principles of democracy. It will come to be perceived as a totalitarian regime," writes Wolfgang Münchau in the Financial Times.

PACIFIC RIM

China-Led Bank Launches

Delegates from the fifty-seven nations joining the China-led Asian Infrastructure Investment Bank gathered in Beijing for a signing ceremony (VOA) to launch the new financial institution. The bank has been described as a possible rival to the World Bank and Asian Development Bank.

PHILIPPINES: Army special forces killed (AFP) top Philippine rebel commander Leonardo Pitao in the southern city of Davao on Sunday, according to the military. Pitao's New People's Army has led a rebellion for more than forty years, claiming tens of thousands of lives.

SOUTH AND CENTRAL ASIA

Taliban Ambushes Afghan Soldiers

Eleven Afghan soldiers were killed (RFE/RL) when a military convoy was ambushed by Taliban fighters in Afghanistan's western Herat province. Casualties in Afghanistan have increased since the Taliban opened its annual summer fighting season. Meanwhile, authorities arrested (TOLO) the Taliban's shadow governor in eastern Nangarhar province on Sunday.

This CFR InfoGuide explores the reemergence of the Taliban in Afghanistan.

PAKISTAN: Sartaj Aziz, an advisor on Foreign Affairs and National Security, said on Monday that incidents of terrorism have decreased (International News) in Pakistan. Separately, air campaigns (Daily Times) in North Waziristan and Khyber Agency killed thirty-four suspected militants, according to intelligence officials.

Sartaj Aziz discusses U.S.-Pakistani relations in this CFR Meeting.

MIDDLE EAST AND NORTH AFRICA

Iran Talks May Miss Deadline

Officials from all parties involved in the negotiations on Iran's nuclear program expect that talks will extend (WSJ) beyond the June 30 self-imposed deadline, according to a senior U.S. official. Iranian Foreign Minister Javad Zarif flew home to Tehran on Sunday for consultations. 

This CFR Issue Guide gathers background and analysis on what is at stake in the Iran nuclear talks.

LIBYA: Rival factions in Libya met in person for the first time in months during UN-brokered peace talks (AFP) over the weekend in Morocco. The parties did not reach an agreement on an initial proposal to form a unity government. Talks are set to resume on Thursday.

SUB-SAHARAN AFRICA

Burundi Votes Amid Tensions

Voting stations opened (Al Jazeera) in Burundi for controversial parliamentary elections on Monday. The African Union will not observe the election and the UN called for a delay following weeks of political unrest amid opposition to President Pierre Nkurunziza's bid to run for a third term. The head of parliament fled the country on Sunday.

CHAD: Chadian security forces killed (Reuters) six militants as they stormed an illegal arms depot east of the capital on Monday; five officers were killed in the operation. On Sunday, authorities arrested sixty suspected militants believed to be responsible for a June 15 suicide bomb attack in the capital, which killed thirty-four people.

EUROPE

French Police Probe Syrian Connection in Terror Attack

French authorities are investigating (France 24) a possible Syria link in Friday's terror attack on a chemical plant, a day after the lead suspect admitted to killing his manager. Authorities say the suspect sent an image of himself with the victim's body to the phone of a Canadian man whose last known location is the self-declared Islamic State stronghold of Raqqa, in Syria.

AMERICAS

Brazil's Rousseff in the United States

President Dilma Rousseff visits the United States (Bloomberg) in her first official visit following 2013 allegations that the United States had spied on her. She and U.S. President Barack Obama are expected to discuss mending ties, climate change, and bilateral trade, as Rousseff seeks investors for a $64 billion infrastructure package.

GUATEMALA: Protesters took to the streets of Guatemala City over the weekend to demand the resignation (LAHT) of President Otto Perez Molina amid corruption allegations. Several high-level officials in the Molina administration have been forced out office since April following a series of large demonstrations sparked by corruption scandals.