Tag Archives: trade negotiations

Five Stories You Might Have Missed

It’s been a relatively quiet week in domestic U.S. politics. Congress continues to spar over the Pelosi-CIA briefing debate, and observers continue to speculate about who President Barack Obama might nominate to replace Justice David Souter in the U.S. Supreme Court. Congress also moved forward with passage of a cap-and-trade system to address greenhouse gas emissions (though the legislation still has a long way to go before it becomes law). The most interesting story of the week came on Wednesday, when former Vice President Dick Cheney and President Obama gave “dueling speeches” on the topic of torture and U.S. national security.

But while it was relatively quiet in the United States, it was a busy week globally. Here are five stories you might have missed:

1. The campaign for elections to the European Parliament, scheduled for June 4, are beginning to heat up. The European Parliament is selected on the basis of nation-wide proportional representation elections, which means that national politics often play out in interesting ways at the European-wide level. Thus, observers are looking to the results of the election in the U.K. as a forecast for Gordon Brown’s political future, which has been challenged in recent weeks by the ongoing corruption scandal. In Italy, the vote is being cast as a referendum on Silvio Berlusconi’s aggressive anti-immigration platform. And in France, the campaign is centering on the question of Turkish membership in the European Union.

2. The German presidential elections took place on Saturday, with incumbent president Horst Köhler narrowly winning re-election and handing Chancellor Angela Merkel a symbolic victory ahead of her own re-election campaign. The German presidency is elected by the upper house of the country’s parliament. The position has little real authority, with executive power being vested in the office of the chancellor. However, a challenge from Merkel’s coalition partners threatened to see Köhler defeated, creating a political challenge just four months from the country’s next general election.

3. A trade agreement currently being negotiated between China and Brazil aims to see the countries use their own currencies rather than U.S. dollars in transactions. The move, seen as part of China’s broader strategy of moving the U.S. dollar out of its status as the global reserve currency, expands on a previous currency swap agreement between the two countries. In separate negotiations, China agreed to expand imports of Brazilian chicken and beef and to provide up to U.S. $10 billion to Brazil’s government-controlled oil company in exchange for guaranteed oil supplies over the next decade. China overtook the United States as Brazil’s largest trading partner earlier this year. 

4. The government of Nigeria launched a new military offensive in the Niger River Delta last week, hoping to defeat armed opposition forces in the area. The move marks a decisive shift in the politics of the delta. The previous Nigerian administration had opted for a more diplomatic approach, emphasizing negotiations with the Movement for the Emancipation of the Niger Delta, an umbrella group emphasizing autonomy for the Warri region. According to observers, however, the new Nigerian government headed by Umaru Yar’Adua is opting for a military-based approach to the crisis. The oil-rich region houses operations by leading international oil companies, including Royal Dutch Shell, ExxonMobil, and Total. The conflict has led to a sharp decline in Nigerian oil exports, and observers fear that this may lead to a spike in global oil prices.

5. Former South Korean President Roh Moo-hyun committed suicide on Saturday. Roh rose to power as a human rights lawyer representing student and union activist in the struggle against the country’s military government in the 1980s. He was elected president in 2003 on a strong anti-corruption and political reform platform, earning him the nickname “Mr. Clean.” However, after his party suffered a series of electoral defeats, he resigned from office in 2008. Shortly after Roh’s resignation, accusations of corruption in his administration began to surface, including charges that a South Korean tycoon paid his wife $1 million while another family member received $5 million from the same tycoon. Roh killed himself after losing face as a result of the scandal. However, such accusations have not been uncommon in South Korean presidential politics, and two of the four presidents who preceded Roh have been jailed on similar charges. Nevertheless, observers fear that Roh’s suicide may increase political tensions in South Korea.

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Five Stories You Might Have Missed

This is the beginning of the regular feature “Five Stories You Might Have Missed.”  In it, I will briefly summarize five of the most important stories from the previous week.  Enjoy!

1.  On Sunday, President Bush agreed to begin discussions with the Iraqi government over the development of a timeline for the withdrawal of US forces from Iraq.  The concession by Bush to the al-Malaki government marks a dramatic reversal of the administration policy, which had previously asserted that the development of such a timeline would constitute a victory for the terrorists.  Stay tuned for a more detailed discussion of this story tomorrow.  In the meantime, read more about it on the Financial Times website. 

2. On Friday, opposition leaders in Bulgaria began debate over a bill that would impeach President Geogi Parvanov, who stands accused of having ties to organized crime.  As one of the newest member states in the European Union, Bulgaria is under pressure to reduce corruption and mismanagement in government, or face the prospect of losing more than €600 million (approximately $950 million) in transfers from the EU.

3. The government of Taiwan announced it had ended its effort to purchase 66 F-16 fighter jets from the United States.  The deal, which had been sharply opposed by the government of China, was part of a general trend in expanding military sales to Taiwan over the past seven years.

4. Farming and automotive interests in Europe, combined with the governments of some member states, pressured European Union negotiators not to offer any additional concessions at trade talks scheduled for next week in Geneva.  The talks, designed to rekindle the World Trade Organization’s Doha Round, target reductions in agricultural subsidies and liberalizing trade in industry and services.  The talks have been stalled for more than two years, and the Geneva negotiations are widely seen as the last chance to salvage the round.  

5. In testimony before Congress on Wednesday, Federal Reserve Chairman Ben Bernanke commented that inflation, estimated at an annual rate of 5% in June—the highest level in the United States since 1991—was “too high” and that fighting inflation was a “top priority” for the Fed.  The primary mechanism the Fed would use to cut inflation would be an increase in the funds rate, an action that would almost certainly slow the economy, already teetering on the brink of recession.