Europe/Americas update: January 29 2019

EUROPE

UKRAINE

Ukrainian President Petro Poroshenko announced Tuesday that he will run for reelection in March. The announcement was mostly a foregone conclusion, as is–probably–his eventual defeat. Former Prime Minister Yulia Tymoshenko is considered the favorite according to polling. Poroshenko has of course failed to bring the war in eastern Ukraine to an end and if anything has overseen a worsening of the country’s massive, endemic corruption problem.

DENMARK

The Danish government says it plans to boost its military spending to 1.5 percent of GDP by 2023, up from 1.35 percent currently. NATO members are trying to get up to the 2 percent GDP spending guideline set out for alliance members, whether because they want to appease Donald Trump or not.

FRANCE

With the US preparing to withdraw from Syria and the Syrian Democratic Forces wondering why they should continue to hold on to all of their foreign ISIS prisoners if no foreign government is going to help them, the French government has done an about face and will now take its nationals off of the SDF’s hands. Most European governments would prefer to leave their foreign fighters languishing in SDF prisons, but that may not be possible for very much longer. The returnees–thought to number around 150–will, obviously, be tried once they get back to France.

SPAIN

The Spanish government has revived its demand that Gibraltar not be subject to whatever Brexit arrangement the United Kingdom reaches (or doesn’t reach) with the European Union and instead be governed according to a bilateral arrangement between Madrid and London. Gibraltar’s residents voted overwhelmingly to remain in the EU, which Spain seems to think should override the fact that the enclave is, in fact, part of Britain. This could throw yet another monkey wrench into Brexit, though at the moment the British government is screwing things up plenty well all on its own (see below).

UNITED KINGDOM

Yes, so, about that. The British parliament voted on Tuesday to do two things: reject the possibility of a “no deal” Brexit, and authorize Theresa May to go back to Brussels and demand a change in the Irish backstop portion of her Brexit agreement. This is really pretty astonishing. For one thing, whether parliament rejects a no deal Brexit or not is irrelevant–the UK is out of the EU on March 29, period, unless the EU agrees to extend that deadline. For another, while Theresa May is free to demand that the EU reopen Brexit talks, there appears to be no willingness at all to do so on the EU side, and there’s nothing she can do to force the issue.

In other words, we’re almost two years into the Brexit process, and amazingly, somehow the British government still hasn’t figured out that 1) it’s not the only party involved in these talks and 2) it doesn’t have any leverage against the EU. These things should have become abundantly clear about a month into the process and yet the lessons apparently still haven’t been learned. At some point during these negotiations I figured this national self-delusion that Britain is still the center of the world would fall apart in the face of clear evidence that it just isn’t that important anymore, but I guess I was wrong.

IRELAND

The splinter group that calls itself the “New IRA” has claimed responsibility for the January 19 car bombing in Londonderry. Nobody was hurt in that explosion. The “New IRA” is one of many small groups that broke off from the Provisional IRA because it opposed the late-1990s Irish peace process.

AMERICAS

VENEZUELA

International estimates say that some 35 people have been killed and 850 or more arrested as Venezuelan President Nicolás Maduro’s government tries to suppress protests and the coup bid launched by National Assembly president Juan Guaidó. The crackdown seems to have stifled protesters, as demonstrations have been few and far between in recent days despite Guaidó’s repeated calls for protests. He’s called for protests on Wednesday and a major national demonstration over the weekend, so we’ll see if that pans out.

Venezuelan authorities froze Guaidó’s bank accounts on Tuesday and took steps to bar him from leaving the country as Maduro’s justice department investigates the events of the past week. This prompted the US government, which has repeatedly threatened Maduro’s life and/or called for the Venezuelan military to threaten his life, to warn of “serious consequences” should Guaidó be harmed in any way. Washington now recognizes Guaidó as Venezuela’s legitimate president, as though that were Washington’s decision to make, just one of the many surreal elements to this story.

The effects of the Trump administration’s decision to levy sanctions on Venezuela’s oil industry are still being worked out, but the penalties seem like they’re really going to hit state oil giant PDVSA hard:

The U.S. measures, while stopping short of a full embargo on Venezuelan exports, are still a potentially devastating double whammy.

They prohibit refiners in the United States, which imported about 580,000 barrels a day of Venezuelan oil over the last year, from buying any more crude from PDVSA. That’s especially important because the United States is one of the few destinations for Venezuelan crude that actually pays for it; countries such as Russia and China accept Venezuelan oil as partial payment for billions of dollars of debt.

Just as important, the U.S. measures also prohibit the export from America to Venezuela of ultralight oil that Venezuela needs to mix with its extremely heavy oil in order to get it out of the ground. Together, the measures threaten to both starve the regime of funds in the short term and make it harder to pump more oil to sell elsewhere.

“The sanctions are really well designed. They’ll have a financial impact on Maduro and impact PDVSA’s heavy crude output,” said Kevin Book, the head of ClearView Energy Partners.

US banks have reportedly stopped trading in PDVSA bonds in light of the sanctions, which is another major blow to its ability to conduct operations.

The goal, other than trying to funnel Venezuelan state resources toward Guaidó’s would-be government, is presumably to starve Maduro of the money he’s used to maintain support at home and maybe even abroad. PDVSA is, like most (all?) state-owned oil giants in countries that are heavily dependent on the oil industry, a den of corruption. This isn’t a new thing, it long predates Maduro and Hugo Chávez, but regardless it’s partly through PDVSA’s resources that Maduro is able to keep major players in his political party and possibly even at the top levels of the Venezuelan military happy and on his side. The lost revenue also makes it harder for Maduro to service Venezuela’s debt, for example to Russia, though at the moment at least Moscow is standing by Maduro and heavily criticizing the US for moving to oust him.

A Russian passenger plane that normally flies a Southeast Asia route mysteriously flew to Caracas on Tuesday for reasons that are at this point not clear. This sent a thrill up a few people’s legs, but so far at least it hasn’t amounted to anything.

MEXICO

The death toll from the January 18 pipeline explosion in Hidalgo state has risen to 122 according to AP, with almost 30 people still hospitalized. Authorities discovered a tunnel in Mexico City on Tuesday that’s been used by bootleggers to tap multiple pipelines to steal fuel.

UNITED STATES

Finally, Western Washington University’s Edward Alden argues that the lesson of Canada’s decision to arrest Huawei CFO Meng Wanzhou on behalf of the US is that the US won’t stand behind its allies:

The United States, in the midst of its escalating trade war with China, has launched a global campaign to persuade allies to bar Huawei, the Chinese telecommunications giant, from any contracts to build the next generation of 5G wireless systems. Those systems could control everything from self-driving cars to power plants, and Washington fears that the company’s close ties to the Beijing government pose major risks of espionage and even tampering.

With Canada, U.S. President Donald Trump’s government has gone a step further. At the request of the United States, Canada last month arrested Meng, the daughter of company founder Ren Zhengfei, on allegations that she lied about Huawei’s involvement in Iran in an effort to evade U.S. sanctions.

The Justice Department on Monday released an indictment charging Meng with repeatedly lying to U.S. banks about Huawei’s business dealings with Iran. The indictment also detailed a decadelong effort by the company to steal U.S. corporate trade secrets, an issue at the heart of the administration’s trade fight with China.

But the backlash Canada has faced from China since the arrest and the token support it has received from Washington will serve as a warning to other U.S. allies: If you stand with the United States, and for the values it has long embraced, it may not stand with you.

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.