The Politics of UN Security Council Reform

President Barack Obama chairs a meeting of the UN Security Council, September 24, 2009.

Blogging at Foreign Policy, David Bosco yesterday posted an interesting proposal for reform of the United Nations Security Council. As most readers probably already know, the UN Security Council is comprised of 15 members. The five permanent members (China, France, Russia, the United Kingdom, and the United States) each possess a veto over Security Council action. In addition, ten non-permanent members are elected by a two-thirds majority vote of the General Assembly to two year terms on a regional basis.

The structure of the Security Council was set in the immediate aftermath of World War II, when the five permanent members made more sense. The structure makes little sense today, though. Several important countries (such as Brazil, Germany, India, and Japan) lack a permanent seat but want one. Meanwhile, the current permanent members of the Security Council are hesitant to embrace expansion, as any expansion would dilute their position.

And therein lies the challenge. Given the competing positions, there has been little agreement on how to move forward.  And any changes would require the approval of 2/3 of the Member States in the General Assembly and agreement by the five permanent members of the Security Council. Thus while a general consensus that the Security Council’s structure needs reforming is widely shared, the specifics of any individual country’s membership on the Council draws opposition. Italy and Spain oppose Germany’s claim, Mexico, Columbia, and Argentina oppose Brazil, Pakistan opposes India, South Korea opposes Japan. The African bloc also demands membership, though precisely which countries would represent Africa on the Council is not entirely clear. Given this level of disagreement, it has been relatively easy for the permanent members of the Council to avoid the difficult decisions associated with reform.

And this is what makes Bosco’s proposal so intriguing. He suggests that the General Assembly engage in a policy of collective disobedience, refusing to approve any new rotating members for the Security Council until the permanent members of the Security Council move forward with a real reform of the Council. It would also force the various camps in the General Assembly to set aside their competing positions and develop a coherent reform proposal. Bosco notes the collective action problem that would have to be overcome for this proposal to work. Nevertheless, it represents in interesting possibility in moving a twenty-year old debate forward.

What do you think? Should Brazil, Germany, India, and Japan be granted permanent membership on the United Nations Security Council? Can the United Nations overcome the structural challenges it faces and reform its structure to become more relevant in the 21^st century? Or will competing positions and the structural power of the permanent members undermine proposals for reform? Take the poll or leave a comment below and let us know what you think.

The G7 and Japanese Currency Markets

The G7, a loose association of the world’s seven wealthiest countries, took the unusual step yesterday of backing intervention in Japanese currency markets. In the aftermath of the devastating earthquake and tsunami, the value of the Japanese yen had been pushed to record highs by markets (and currency speculators) anticipating Japanese companies repatriating funds to help rebuild lost production capacity. In hopes of keeping its currency value stable, the Japanese government injected 60 trillion yen (more than $740 billion) into the economy over a four day period following the crisis. But despite these efforts the yen climbed to its highest levels since World War II last week, peaking at 77 yen per dollar last week.

So what’s the worry? Currency values are important in determining exports, imports, and balance of trade. In general, a weaker currency means more competitive exports. This is why countries sometimes risk the specter of competitive devaluation, as the United States has accused China in recent years. But in the case of the Japanese yen, the challenge is much greater. An increase in the value of the yen could weaken the Japanese economic recovery. But more importantly, there was concern that it could also hamper the rebuilding effort by sapping much needed wealth from the market.

Historically, the G7 (as well as its individual member states) have been hesitant to intervene in foreign exchange markets, guided by the perception that it simply doesn’t work, or that the dangers outweigh the possible benefits. This is why the G7 maneuver is so unusual.

Globalization and the Japanese Crisis

Japanese disaster workers search for survivors.

The devastation wrought on Japan by the recent earthquake and tsunami is now being compounded by the threat of a meltdown at the Fukushima nuclear reactors. The humanitarian impact is overwhelming—by some estimates, as many as 10,000 people have likely already perished, and some half a million have been rendered homeless. The Japanese government is struggling to get the situation under control, and international humanitarian assistance is being mobilized in support.

The crisis in Japan also serves to illustrate the extent to which the world is increasingly globalized. According to a post at the Financial Times’ Brussels Blog, the European Union is screening Japanese food imports for radiation. While Japanese food exports to Europe are not particularly large—amounting to an estimated 64.8 million euros in 2010—European regulators assert they are acting out of precaution to prevent food contaminated by radioactivity from entering European markets.

Then there’s this post by Amy Lee at the Huffington Post. According to Lee, we should expect severe disruptions in global supply chains, particularly for consumer electronics, as a result of the Japanese crisis. Lee notes that Japan is responsible for 14 percent of global production in computers and other consumer electronics. Further, Japan is responsible for the production of approximately 60 percent of the silicon wafers used in the production of the semiconductor chips in nearly every electronic device. Widespread damage to production facilities have already forced many leading producers, including Sony, Toshiba, Panasonic, and Texas Instruments. Damage to Japanese infrastructure may affect exports even after the plants are brought back online.

The use of global commodity chains, in which complex products like automobiles or computers are assembled from components produced around the world, has created a system of global production that may be more efficient, but is also more susceptible to disruption. Compounding this, Japan’s perfection of the just-in-time manufacturing method, which reduces costs by keeping inventories low, means that there is little slack in the system. According to Lee, the global consumer electronics supply chain has about two week’s worth of excess stock that will offset disruptions caused by the Japanese crisis. After that, it could take six months for the supply chain to reintegrate. Until then, we can expect to see price increases and shortages for many consumer electronics.

Fairness, International Law, and Crimes Against Humanity

Ali Hassan al-Majid, better known as “Chemical Ali” was sentenced to death by an Iraqi court last week. The sentence—death by hanging—was carried out on Monday.

Checmical Ali playing card issued by U.S. military forces in 2003

Ali was convicted of crimes against humanity for his role in a series of chemical weapons attacks against Kurds in northern Iraq under regime of Saddam Hussein in the 198s. The campaign resulted in the destruction of an estimated 4,000 Kurdish villages, the death of more than 180,000 and deportation of an estimated 1.5 million Kurds. His willingness to use a number of chemical weapons, including mustard gas, sarin and VX nerve agents, earned him the nickname “Chemical Ali,” though Kurds often referred to him as the “Butcher of Kurdistan.” Ali’s sentence and execution marked the highest level execution of a former Hussein-regime official since the execution of Saddam Hussein in 2006.

Crimes against humanity were defined during the Nuremburg Trials at the end of World War II as “Murder, extermination, enslavement, deportation, and other inhumane acts committed against any civilian population, before or during the war, or persecutions on political, racial or religious grounds in execution of or in connection with any crime within the jurisdiction of the Tribunal, whether or not in violation of the domestic law of the country where perpetrated.” The definition was later clarified by an Explanatory Memorandum to the Rome Statute of the International Criminal Court (ICC), which explained that crimes against humanity are

particularly odious offences in that they constitute a serious attack on human dignity or grave humiliation or a degradation of one or more human beings. They are not isolated or sporadic events, but are part either of a government policy (although the perpetrators need not identify themselves with this policy) or of a wide practice of atrocities tolerated or condoned by a government or a de facto authority. Murder; extermination; torture; rape and political, racial, or religious persecution and other inhumane acts reach the threshold of crimes against humanity only if they are part of a widespread or systematic practice. Isolated inhumane acts of this nature may constitute grave infringements of human rights, or depending on the circumstances, war crimes, but may fall short of falling into the category of crimes under discussion.

The trial of perpetrators for crimes against humanity has often been difficult and controversial. Accusations that the Sudanese government has engaged in crimes against humanity in operations in Darfur, for example, have generated tension between the ICC and the African Union. Similarly, the trials of individuals involved in the Rwandan genocide has led to diplomatic standoffs between the post-genocide Rwandan government, the United Nations, and the government of France.

The challenge often centers on accusations of politically-motivated trials and the dangers of “victor’s justice,” where the rules of war (and more generally of right and wrong) depend on the nationality of the winner. Critics of the U.S. anti-terrorism policy often claim that the United States is engaged in victor’s justice in its decision to use water boarding against individuals with suspected links to terrorism. This claim is based on the decision of the U.S. government to try (and ultimately execute) Japanese soldiers after World War II on charges of war crimes for water boarding American soldiers.

Clearly, the situation in Iraq is different. But the case does beg the question of fairness in international law. We all know that “to the victor goes the spoils” and that “history is written by the victor.” But does international law allow for equity and fairness that are the foundation for contemporary legal systems?

Five Stories You Might Have Missed

Japanese elections took place on Sunday, marking a dramatic shift in political power in the country. The Liberal Democratic Party, which has ruled Japan for nearly all of its post-World War II history, looks set to lose handily to its main rival, the Democratic Party of Japan. Some analysists are projecting the DPJ may win as many as 320 seats in the lower house, giving it a two-thirds majority and eliminating any need to form coalition partners. Prime Minister nad LDP leader Taro Aso has already conceded defeat and announced his intention to resign as party leader. With the DPJ’s victory, Yukio Hatoyama looks poised to become the country’s next prime minister.

In other news from the previous week:

1. The dispute over the status of last week’s Afghan election continues. Although incumbent President Hamid Karzai has extended his lead in the most recent results, the current tally (in which Karzai leads his main challenger, Abdullah Abdullah 46% to 31%) would still force a runoff election in October. Although final results are not expected until the end of September, Abdullah has accused the government of engaging in a “massive state-engineer[ing]” of the election results, alleging voter intimidation, ballot-box stuffing, and other election irregularities. The United States has also expressed concerns over the accusations, with U.S. Special Envoy to Afghanistan and Pakistan “mak[ing] it very clear” in a meeting with Karzai last week that the election should be free and fair.

2.  Fighting between the government of Burma and a rebel militia known as the Myanmar National Democratic Alliance Army broke out last week, ending a ceasefire signed between the two more than twenty years ago. The fighting, which has led to a massive exodus of refugees into China, drew criticism from the Chinese government over the weekend. China has been one of the few countries to maintain close ties to the Burmese government, but those ties have been challenged after a reported 10,000-30,000 people crossed into China to flee fighting. The Burmese government is attempting to reassert control ahead of next year’s elections over a region which has large ethnic minorities who reject the central government’s authority.

3. The United Arab Emirates announced it had seized a ship carrying North Korean arms to Iran. According to a report issued by the government of the UAE to the United Nations, the ship, which was seized several weeks ago, was carrying ammunition and small arms, including rocket-propelled grenades, in contravention of a UN embargo established under UN Security Council Resolution 1874 (2009). That resolution was passed after North Korea’s second nuclear test in May. The United Arab Emirates is a close U.S. ally in the region, and has been under pressure to step-up its screening of  shipments bound for Iran.

4. The longstanding trade dispute between Brazil and the United States will take a new turn on Monday, when the World Trade Organization is expected to rule that Brazil may infringe patents on U.S. pharmaceuticals in retaliation for U.S. subsidies on cotton. Brazil successfully challenged U.S. cotton subsides in 2002, when the WTO ruled that the $3 billion annual cotton subsidies paid by the U.S. government unfairly distorted global cotton prices. Despite the victory, the United States has continued to pay the subsidies, and the Brazilian government has struggled to find a way to enforce the ruling. If the WTO does indeed rule that Brazil may bypass U.S. intellectual property protection in the case, it may represent a new avenue for developing countries to enforce WTO rulings. More on this in a future blog entry.

5. South African President Jacob Zuma stated last week that he will be quick to condemn any “deviant” behavior during his upcoming visit to Zimbabwe. The South African government has historically been very slow to criticize the Zimbabwean government or to bring pressure on the country, which has been in the throes of an economic and political crisis for the more than five years. Meanwhile, a United Nations report last week contended that international humanitarian assistance for Zimbabwe has fallen well short of the amount needed to address the food shortages and disease outbreaks facing the country. The UN estimates Zimbabwe will require $718 million in humanitarian aid this year. So far, only $316 million has been pledged.

Five Stories You Might Have Missed

The death of Michael Jackson dominated news coverage this week, pushing other major developments aside. Indeed, with so much popular interest generated that popular sites like Twitter and Facebook were overwhelmed with traffic and unable to keep up with bandwidth demands. By Sunday morning, networks were slowly returning to other coverage.

In other news from the previous week:

1. British Foreign Secretary David Miliband issued a statement expressing “deep concern” over the decision of the Iranian government to arrest eight local employees working in Tehran. The eight Iranian employees at the British embassy were charged with involvement in the ongoing protest over the outcome of Iran’s presidential elections. The arrests follow developments last week in which Britain and Iran each expelled two of the other’s diplomats. The arrests (and the continuing deteriorating relationship more generally) will likely be a topic for informal discussions at the G8 meeting this weekend.

2. Meetings between NATO and Russian foreign ministers over the weekend set the stage for greater cooperation in Afghanistan, counter-terrorism, and nuclear proliferation. Relations between Russia and the west had deteriorated after the Georgian war last year. The Russian government also announced plans to restructure the country’s military.

3. Taro Aso, Japan’s prime minister, is facing increasing pressure to resign from his post ahead of general elections which must be held by October. Aso’s ruling Liberal Democratic Party of Japan has dominated post-war Japanese politics, ruling the country for all but 11 months of the last 53 years. But Japan’s ongoing economic crisis, combined with allegations of corruption and political infighting within the LDP, has led to a sharp decline in popular support for the party—and a potential radical shift in Japanese politics, with the opposition Democratic Party of Japan poised to seize the opportunity.

4. Lebanon’s new prime minister, Saad al-Hariri, has begun the task of forming a new parliament for the country. Hariri won a surprising victory over rival Hizbollah last month, but now faces the daunting task of uniting Lebanon’s three rival factions, the Sunnis, Shi’as, and Christians. In order to maintain good relations between Lebanon’s three factions, Hariri has proposed to establish a government of national unity. (glossary) But Hizbollah has so far refused to accept the possibility of a unity government unless it is granted veto power, a development which Hariri opposes. Hariri was the favored candidate of the United States and Saudi Arabia, but was sharply opposed by Syria. Stable relations between the three countries are seen as vital to the maintenance of peace and stability in Lebanon.

5. Human Rights Watch accused the government of Zimbabwe of engaging in murder, forced labor, and torture in its diamond mining operations in the Marange district in the eastern part of the country. The accusations come shortly after a campaign by the country’s prime minister, Morgan Tsvangirai, failed to secure the western economic aid it had hoped for. Zimbabwe faces considerable challengesin its attempt to address the ongoing economic and political crisis which has plagued the country for more than a year. While inflation has come down from its record 231 million percent last year, the political standoff between President Robert Mugabe, who has ruled Zimbabwe since its independence in 1980, and his political rival, Prime Minister Tsvangirai, remains unresolved.

Five Stories You Might Have Missed

The big story of the week has been the swine flu outbreak, which now appears to be in decline. The Mexican government has announced that the outbreak that originated there appears to be easing. While governments around the world are responding with caution, the award for the biggest overreaction goes to the government of Egypt, which announced it would cull all 300,000 pigs in the country, despite the fact that there is no evidence that of the flu in the country. Pig farmers responded angrily to the proposal, sparking confrontations with police in the capital, Cairo. The World Health Organization, meanwhile, is defending its reaction, which many have criticized as an overreaction, saying that a second wave of outbreaks could appear in the future.

In news from outside the area of H1N1 (swine) flu:

1. The conflict between the Pakistani military and Taliban militants continues. The government of Pakistan stepped up its offensive against Taliban forces in regions along the Afghan border last week. The intensification of actions against the Taliban by the Pakistani government follow criticisms raised by U.S. Secretary of State Hillary Clinton that the Pakistani government was “abdicating” power to militant groups inside the country.

2. Regional governments in Southern Africa, led by South Africa and Botswana, are attempting to raise funds to finance trade credits and business loans to support the new coalition government in Zimbabwe. Zimbabwe’s economy continues to struggle, despite the government finally reigning in inflation last month. The power-sharing government has taken radical steps to bring the economy under control, including slashing government spending and permitting the use of foreign currencies for domestic transactions. As a result, the country had been struggling with an estimated 231 million percent inflation  over the past year. But so far Western donors, including the International Monetary Fund, have been hesitant to remove sanctions or increase aid to the impoverished country.

3. The European Union’s application for observer status on the Arctic Council was blocked by Canada last week. Canada is upset about proposed EU legislation intended to ban all imported seal products. Tensions over the status of the Arctic have intensified in recent years, as retreating sea ice resulting from climate change opens new shipping lanes and the possibility of extracting the Arctic’s vast stores of oil and gas. 

4. Despite experiencing a severe recession of its own, the government of Japan announced plans to expand financial assistance to other Asian countries. In a move intended to expand Japan’s influence in the region, the country will offer up to $100 billion in financial aid to Asian countries impacted by the global economic crisis. This announcement comes after other announcements that Japan would offer $100 billion in extra capital to the International Monetary Fund, $61.5 billion bilateral currency swap between Japan and Indonesia, and $38.4 billion in the multilateral Chiang Mai currency swap initiative. According to some observers, Japan is anxious to expand its influence in the region to counter the increasing influence of China.

5. May Day protests took place across Europe on Friday. Confrontations between police and protestors turned violent in Turkey, Greece, and Germany. The first of May is observed as International Workers Day (Labor Day) outside the United States. Increased unemployment resulting from the international financial crisis combined with growing social inequality raised concerns that protests may turn violent in countries like France and Spain as well, but no such outbreaks occurred.

Five Stories You Might Have Missed

It was a busy week for the U.S. Federal Reserve. Addressing a meeting of bankers on Friday, the Chair of the U.S. Federal Reserve, Ben Bernanke, called on legislators to address the need for regulatory reform of global financial markets. On Wednesday, the Federal Reserve undertook announced new plans intended to improve the position of the U.S. credit markets. With the federal funds rate remaining near zero percent, the Federal Reserve has been forced to turn to a program of qualitative easing, under which it purchases mortgage-related securities, removing them from the market and expanding the amount of cash in circulation. It is coordinating policy with the central banks of England, Japan, and Switzerland. But the dramatic move carries a number of risks, including the introduction of high rates of inflation and a decline in the value of the dollar. 

In news from outside the United States last week:

1.  A two-day meeting of the European Union last week produced a number of important outcomes, including a commitment to increase the E.U.’s contribution to the International Monetary Fund by €75bn. The European Union also staked out its position on reforming global financial market regulation, the focus of an upcoming G20 meeting in April. Current speculation is that the meeting of the G20 will likely pit Germany and France, which favor stricter regulation, against the United States and China, with the United Kingdom falling somewhere in the middle. However, all sides are currently playing up the likelihood of compromise.

2. On Saturday, the Abhisit Vejjajiva’s government in Thailand survived a no confidence motion in the national legislature. Vejjajiva has been in office for only three months, but has been under fire nearly the entire time, as Thailand has been plagued by political and economic instability compounded by declining exports, part of the impact of the global economic crisis. 

3. On Thursday, the government of China announced it would step up naval operations in the South China Sea, specifically targeting the disputed Spratly Islands. The Spratly Islands are claimed (in whole or in part) by at least six countries, including Brunei, China, Malaysia, the Philippines, Taiwan, and Vietnam. The announcement comes after a standoff between U.S. and Chinese naval vessels earlier this month, when the U.S. accused China of harassing a U.S. naval vessel operating in the South China Sea. China maintains the vessel was operating illegally in Chinese waters.

4. Israeli President Shimon Peres last week granted Likud party leader Benjamin Netanyahu two more weeks to form a coalition government. Netanyahu’s right-wing Likud party was named by Peres as formateur party after extremely close restuls in national elections earlier this month.  Netanyahu has the option of forming a coalition with a group of far-right and religious parties, but has been seeking to form a more centrist coalition with either Ehud Barak’s Labour party or Tzipi Livni’s Kadima party. A more centrist coalition, Netanyahu believes, would be better positioned to avoid potential clashes with the United States. But both Labour and Kadima remain hesitant to join a coalition government with Likud.

5. Andry Rajoelina was sworn in as the new president of Madagascar on Saturday. Brought to power under the auspices of a military rebellion, Rajoelina committed the new government to routing out the corruption of the previous regime and to re-establishing democracy within two years. But may observers remain skeptical. On Friday, the African Union suspended Madagascar from the organization, many donors have announced they will freeze aid, and the United States

And a bonus story this week:

6. A standoff between farmers and the government in Argentina last week threatens global food markets. Farmers are angry about the imposition of a 35 percent duty on soya exports and bans on export of some other food commodities. A similar standoff last year resulted in nationwide strikes and export bans. The standoff in Argentina has the potential to influence global food prices, as Argentina is one of the word’s largest food exporters—second only to the United States. China is the largest consumer of Argentinean soya exports.

Five Stories You Might Have Missed

The major news networks yesterday were giving virtually non-stop coverage to the upcoming inauguration of President-elect Barack Obama.  Obama is already on his journey to Washington DC for Tuesday’s inauguration.  In his weekly radio address, President-elect Obama warned of the challenges facing the nation, the most critical of which include unpopular wars in Iraq and Afghanistan and a global economic crisis.  Despite the challenges, however, the television news networks focused extensively on the pomp and circumstance of the ceremonial inauguration itself. 

Here’s five important stories you might have missed among all the ceremony:

1.  Hamas and Israel reached a one-week ceasefire on Sunday, temporarily halting the three-week old conflict which has already resulted in more than 1,100 Palestinian and 13 Israeli deaths.  The political fallout of the conflict also looks to be severe, with Qatar and Mauritania announcing they would terminate political and economic ties with Israel over the conflict. With the largest Muslim and Jewish comminutes in Europe, France is also bracing for an increase in sectarian violence between Jewish and Muslim communities.

2. After signaling that a deal had been reached last week and then seeing that deal collapse, Russia and Ukraine announced on Saturday that they had again reached an agreement which would permit Russia to resume natural gas shipments to the European Union.  Russian natural gas supplies are normally shipped through pipelines in Ukraine, and these shipments account for approximately twenty percent of the E.U.’s total natural gas consumption.  In the new one-year agreement, Russia offers Ukraine a 20 percent discount on natural gas prices in exchange for a promise not to increase transit fees for using the pipeline.  Some countries in Eastern Europe have been without heat for twelve days as Russia and Ukraine struggled to come to a solution to the standoff.  But political wrangling in Ukraine could still derail the deal.

3.  Ethiopian troops completed their planned withdrawal from Somalia’s capital, Mogadishu, on Thursday.  The withdrawal raises concerns about the viability of Somalia’s pro-Western government and the increasing influence of Islamic extremists in the country.  Ethiopia threatened to withdraw its forces several months ago, complaining that the international community had not provided sufficient resources to support its mission and the government of Somalia.  In the absence of Ethiopian or other military forces, it is feared that Somalia may expand its reputation as a home to Islamic terrorists.

4.  There is growing speculation that Fidel Castro, former president of Cuba, may be in grave health.  Castro has not appeared in public since July 2006, and has recently cancelled a number of meetings with foreign dignitaries.  In a public speech on Sunday, Venezuelan President Hugo Chávez, one of Castro’s closest allies, appeared to offer his eulogy, noting “That Fidel is his uniform, who walked the streets and town late at night, hugging the people, won’t return.  That will remain in memories.”  Fidel’s brother, Raúl Castro, has served as president of Cuba since July 2006, when his brother was forced to resign for health reasons.  Since then, the economy of Cuba has struggled, the extensive welfare protections afforded workers have begun to decline, and the government has begun to promise greater openness and transparency.

5.  A closely fought by-election in Malaysia has been won by the Pan-Malaysian Islamic Party, part of the country’s Islamic opposition.  While the results will not alter the balance of power in the national parliament, they do raise concerns about the ability of the incoming National Front government to effectively govern.  

And for two bonus stories this week:

6.  In Japan, sharp divisions are appearing in the Liberal Democratic Party, the party which has ruled Japan for all but 11 months in the past 53 years.  Yoshimi Watanabe, who served as state minister for administrative reform from 2007 to 2008, tendered his resignation from the party last week amid the declining popularity of the party with the electorate.  The opposition Democratic Party of Japan appears well-positioned to win the next national election, which must take place by September. 

7.  Iran’s ex-Prime Minister, Mir-Hossein Mousavi, may run as a candidate in the presidential elections scheduled for June.  Mousavi is widely seen as a reformist candidate possessing the popularity to potentially defeat incumbent president Mahmoud Ahmadi-Nejad.

Five Stories You Might Have Missed

Most of the headlines this week has centered on the auto rescue package.  The most recent news is that the Treasury Department is working to put together a rescue package for Detroit automakers after Senate Republicans blocked the Congressional effort last week.  The Canadian government is offering $3.4 billion in aid to struggling car makers on the condition that the U.S. government extend assistance as well.  Foreign car manufacturers are that the U.S. government should extend aid to American manufacturers in order to prevent knock-on effects on their own businesses.

Here’s five other important stories you might have missed this week:

1.  The government of Ecuador announced it would not meet the $30.6 million payment on the country’s foreign debt, despite holding $5.65 billion in cash reserves.  Rafael Correa, Ecuador’s leftist president, said, “I gave the order not to pay the interest and to go into default.  We know very well who we are up against—real monsters.”    The international debt-forgiveness campaign Jubilee celebrated the decision, arguing that requiring countries to repay illegitimate debt forces them to cut social spending.  As a result of the default, the cost of barrowing money by the Ecuadorian government and businesses will likely increase.

2.  The situation in Zimbabwe continues to deteriorate.  Once celebrated as a potential model for the rest of Africa to emulate, Zimbabwe’s social, political, and economic collapse continues.  The country currently faces an annual inflation rate of 231 million percent, and a cholera outbreak which has resulted in the deaths of more than 800 people this month now threatens to spread into other states in the region, forcing South Africa to declare a state of emergency and close the border.

3.  European leaders committed themselves to a 20 percent reduction in greenhouse gas emission by 2020.  The announcement, intended to reduce the danger of global climate change, falls short of the 25-40 percent reductions required of developed countries according to scientific assessments.  However, the EU has already announced its intention to pursue bigger reductions if the United States and other developed countries come on board.

4.  Ireland confirmed it would move forward with a second referendum on the Lisbon Treaty after securing concessions from the European Union.  The Lisbon Treaty, which was defeated by Irish voters in June, moves European integration forward.  Ireland is the only country which required a popular referendum on the Treaty.  The text of the Treaty has been amended to assure that Ireland’s military neutrality would be guaranteed, and its abortion laws and national tax system would not be affected.

5.  The South Korean government announced its intention to expand cooperation with China and Japan in coordinating economic policy to address the spreading global financial crisis.   The three countries account for 75 percent of the region’s economy and two-thirds of its trade.  The deal would expand a currency swap agreement intended to stabilize the three countries’ currencies, and could lead to further coordination of economic policy.