ESADEgeo Daily Digest, 03/07/2018

File:Angela Merkel mit Horst Seehofer 1738.jpg

Financial Times – Guy Chazan & Tobias Buck / Merkel and Seehofer reach deal and avert collapse of German coalition

  • Chancellor Angela Merkel and Horst Seehofer, German interior minister, have reached an agreement that should end a dispute that threatened to destroy the near 70-year-old alliance between the CDU and its Bavarian sister party, the CSU, and potentially blow up the coalition government.
  • The agreement calls for the creation of transit centres on the German-Austrian border for asylum seekers who have already been registered in other EU countries. They could then be sent directly from there to the countries that are responsible for them.
  • That represents a compromise: Seehofer had previously insisted that such refugees should immediately be turned away from the German border, a demand Merkel rejected. She said that such unilateral moves would harm the Schengen passport-free travel zone and endanger European unity.
  • But Seehofer and conservative members of Merkel’s party had long campaigned for the creation of transit centres on the border to handle refugees before they actually enter German territory. Therefore, the deal also represents something of a victory for Seehofer.

Foreign Policy – Stephen M. Walt / The EU and NATO and Trump — Oh My!

  • Although a good case can be made for gradually reducing the US role in Europe and letting Europeans handle their own defense, moving in that direction actually makes the EU more rather than less important, because it plays an important role in keeping Europe peaceful and prosperous.
  • There is no potential hegemon in Europe today. Thus, the United States could (and should) reduce its military role and gradually turn European security back to the Europeans. But if Trump wants to do less for NATO, he should be embracing the EU instead of denigrating it.
  • Moreover, from a US perspective, the present level of integration in the EU is close to ideal. If the EU were a true “United States of Europe”, then it would in fact be a third pole in world politics and a potential peer competitor.
  • If Trump showed up to his Helsinki meeting with Vladimir Putin after having driven NATO further into disarray, the Russian President would have already achieved a core strategic goal and would have little reason to do Trump any favors.

Brookings – Samantha Gross / What higher oil prices mean for OPEC and the U.S.

  • The US is signaling that it expects its allies to eliminate oil imports from Iran by November 4. The Trump administration is taking a harsher line than the Obama administration did in the lead up to the Iran nuclear deal (JCPOA), stating that it does not intend to issue waivers on secondary sanctions to those who import Iranian oil.
  • Why is the US looking to OPEC to increase supply? In the US, where private companies undertake oil and gas development, companies do not hold spare capacity in reserve because it does not make economic sense to do so. Saudi Arabia, on the other hand, is generally the world’s main holder of spare capacity, and today the United Arab Emirates, Kuwait, and Russia also have spare capacity owing to the current production cuts.
  • But the growing importance of US oil production is likely changing how OPEC producers think about responding to rising prices. Today, US oil production can respond more quickly to market conditions, meaning that periods of tight supply are likely to be shorter in duration.
  • Ahead of US midterm elections in November, the Trump administration wants low gasoline prices, but also wants to maximize the effect on Iran of the re-imposition of sanctions. The administration will find that actions that pull crude oil away from a tight market have ramifications at home, despite the US emergence as a powerhouse of crude oil production.
  • Al-Monitor – Laura Rozen / Trump administration denies pursuing regime change in Iran

Al-Monitor – Ben Caspit / For Israel, Syrian battles hit too close to home

  • The Israel Defense Forces (IDF) have significantly beefed up their presence in the Golan Heights, and conducted a secret night operation to transfer large quantities of humanitarian assistance to Syrian internally displaced people. Israel is determined not to allow these Syrians to enter its territory and is going out of its way to help them where they are.
  • Israel finds itself torn between helping the rebels, with whom Israel has developed a relationship of sorts, and reluctantly reconciling itself to Assad’s return to the border.
  • The IDF made the decision to accept the return of Assad to the south with two stipulations: that the Syrian army not enter the demilitarized zone in the Golan, and that southern Syria remain free of Shiite militias, Iranians and Hezbollah’s people, in any kind of uniform.
  • In spite of a very long series of painful blows inflicted by Israel, Iran continues its efforts to establish a foothold in Syrian territory. Israel, however, has no intention of letting up its pressure. In addition, together with the American administration, Israel is trying to deepen the gap between the moderate and conservative sectors in Iran that is already quickly widening.
  • Israel wants Trump to be as informed as possible for his summit with Putin, in order to fully present Israel’s interests to the Russian president. In late June, IDF Chief of Staff Lt. Gen. Gadi Eizenkot and the head of the Israeli-Iranian portfolio, Gen. Nitzan Alon, landed in Washington for a series of urgent meetings.

The selected pieces do not necessarily reflect the views of Javier Solana and ESADEgeo. The summaries above may include word-for-word excerpts from their respective pieces. 

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