ESADEgeo Daily Digest, 15/03/2019

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BBC / North Korea may break off US talks and resume missile tests, official says

  • North Korean Vice Foreign Minister Choe Sun-hui told foreign diplomats the US threw away “a golden opportunity” at a recent summit between US President Donald Trump and North Korean leader Kim Jong-un.
  • “We have no intention to yield to the US demands in any form, nor are we willing to engage in negotiations of this kind,” Choe told reporters, accusing the US of taking a “gangster-like” stance.
  • Choe said that North Korea’s demand during the recent summit was for five key economic sanctions to be lifted, not all sanctions, as Trump said after talks broke down.
  • However, Choe still praised the personal relationship between Kim and Trump. Instead she blamed US Secretary of State Mike Pompeo and National Security Adviser John Bolton for hardening the US position.
  • Kim is set to make an official announcement on his position regarding future talks and the possible resumption of missile and nuclear testing soon, Choe said in Pyongyang.

Al-Monitor – Semih Idiz / Turkey, US head to new crisis over Ankara’s S-400 purchase

  • The standoff between Turkey and the US over Ankara’s decision to purchase Russian S-400 missile-defense systems is coming to head. Turkey will hold local elections in two weeks, and President Erdogan has been using the S-400 issue in this context.
  • Washington has started to underline that if Ankara goes ahead with the S-400 purchase, it will not get advanced F-35 fighter jets, and also lose its chance of purchasing Patriot anti-missile systems from the US.
  • Ankara says it was forced to turn to Russia for the S-400s because of foot-dragging by Washington regarding the supply of Patriot systems to Turkey.
  • Hakan Aksay, expert on Turkish-Russian ties: “Russia sees Turkey as a country that has to remain in the Western alliance in order to help it destroy that alliance.” According to Aksay, Putin could accept a decision by Turkey to cancel its S-400 order if the Kremlin can get something in return from Ankara, especially in Syria.

Financial Times – Michael Peel & Aime Williams / European Nato countries continue to trail on military spending

  • Six nations apart from the US — up from four in 2017 — reached the benchmark of a defense budget equivalent to 2 per cent of gross domestic product, according to Nato data published on Thursday.
  • Poland and Lithuania last year joined Greece, the UK, Estonia and Latvia in hitting the 2 per cent target, the Nato estimates said. But more than half the alliance’s overwhelmingly European membership lagged below 1.5 per cent.
  • Military spending for European countries in Nato and Canada rose 3.8 per cent last year, slower than the 6 per cent in 2017, but still a fourth successive annual increase.
  • Patrick Shanahan, acting US defence secretary, on Thursday played down media reports that Trump was demanding Nato allies pay the cost of hosting US forces, plus a 50 per cent premium.

The Economist / China may soon run its first annual current-account deficit in decades

  • Every year for a quarter of a century China has run a current-account surplus. Yet the surplus may soon disappear. In 2019 China could well run its first annual current-account deficit since 1993.
  • The shift from lender to borrower will create a knock-on effect, gradually forcing China to attract more foreign capital and liberalize its financial system. But, instead of urging China to free its financial system, US negotiators are more concerned that China keep the yuan from falling.
  • China’s decades of surpluses reflected the fact that for years it saved more than it invested. As the population grows older the national savings rate will fall further, because more people in retirement will draw down their savings.
  • Whether or not China actually slips into deficit this year will be determined mostly by commodities prices. But the trend in saving and investment is clear: the country will soon need to adjust to a new reality in which deficits are the norm.

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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