By Matt Hadro

A massive, well-funded push to increase access to abortion worldwide could be underway at the United Nations, and according to one congressman it could silence faith-based organizations which oppose abortions out of conscience.

At issue is proposed language in the United Nations’ Sustainable Development Goals that will eventually be voted on and adopted by the U.N. General Assembly in September, and will go into effect in 2016.

If the current proposed language is adopted, it could result in “unfettered access to abortion” around the globe, according to the office of Rep. Chris Smith (R-N.J.), who is co-chair of the Congressional Pro-Life Caucus.

The language establishes targets for global development, among them to “ensure universal access to sexual and reproductive health-care services” by 2030.

The other target in question tries to “ensure universal access to sexual and reproductive health and reproductive rights as agreed in accordance with the Programme of Action of the International Conference on Population and Development and the Beijing Platform for Action and the outcome documents of their review conferences.”

This language – “sexual and reproductive health and reproductive rights” – is interpreted to include abortion by most U.N. agencies and Western donor countries, said a former diplomat at the U.N. who participated in numerous negotiations involving sexual and reproductive health language. Such language is usually part of an agenda in which developed countries use financial incentives to pressure poor, pro-life countries to liberalize their abortion laws in accord with the U.N.’s definition of sexual and reproductive health and rights.

In this case, the language is but a tiny part of 17 development goals and 170 targets that together establish a broad and comprehensive global agenda for the next 15 years that includes fighting poverty, ending world hunger, and promoting sustainable energy and universal education.

Thus the language is alarming especially for developing countries, Smith noted, because the massive funding required for these Sustainable Development Goals – $5-7 trillion – can also be used as an incentive for developing countries to liberalize abortion laws.

The goals basically state to developing countries that access to abortion and contraception “is what you need if you want economic growth,” Smith added.

Without meeting the sexual and reproductive rights targets established in the development goals, poor countries could risk losing development funding. Most countries allow legal abortion in some circumstances, with only a handful either banning it outright or allowing it in all circumstances.

The result of the goals if the current language is adopted, Smith said, could be a massive expansion of abortion worldwide due to international pressure on countries and charities to offer abortion access.

State and local laws limiting access to abortion could be deemed to violate the “universal right” to abortion services and could be erased. These would include laws such as a minor having to obtain parental or spousal consent to get an abortion.

Faith-based organizations that oppose abortion out of conscience could see their funding wither as a result of these development goals, Smith explained.

For example, the U.S. bishops’ anti-human trafficking program lost a government grant in 2011 once the U.S. Department of Health and Human Services began prioritizing grants for organizations that provide abortions to trafficking victims. The bishops’ program could not provide abortions, out of conscience.

Such an example could happen on a mass scale at the global level, Smith warned, when faith-based organizations that do not offer contraceptives or abortions out of conscience will lose funding from countries and international donors.

The Post-2015 goals build upon the original eight “Millennium Development Goals” that the U.N. set in 2000 for the next 15 years, which included cutting world poverty and reducing the spread of HIV/AIDS.

As these goals were set to expire and in preparation for the Post-2015 agenda, the U.N. Conference on Sustainable Development met in Rio de Janeiro in 2012. It issued an outcome document, “The future we want,” which set the table for the sustainable development goals in time for the 2013 general assembly meeting.

That document did not include the “sexual and reproductive health and reproductive rights” language that the current proposed goals state, Smith noted.

However, the International Planned Parenthood Federation has been pushing hard for the inclusion of the language, noting that it would constitute a “sea change” from the original Millennial Development Goals.

According to the International Planned Parenthood Federation, abortion is indeed a part of these reproductive rights mentioned.

In its Vision 2020 manifesto, “Sexual and Reproductive Health and Rights – a Crucial Agenda for the post-2015 Framework,” the federation states that “some aspects of the sexual and reproductive health and rights agenda are inadequately resourced and sorely neglected, including access to safe and legal abortion, access by adolescents, and access for the poorest and most marginalized groups.”

Also, the World Health Organization, which is the leading international health agency of the United Nations, has already made specific abortion recommendations for countries’ health systems.

In the executive summary of its report “Safe Abortion: Technical and policy guidance for health systems,” the WHO states that “to the full extent of the law, safe abortion services should be readily available and affordable to all women.”

“This means services should be available at primary-care level, with referral systems in place for all required higher-level care,” the report added.

This is evidence that WHO wants to “harmonize the push” and “integrate” abortion into normal health care worldwide, resulting in an abortion surge for the next 15 years,” Smith said.

The post New UN Agenda Could Enable Global Expansion Of Abortion appeared first on Eurasia Review.

By Prof. Purnendra Jain and Tridivesh Singh Maini*

Over the past year, Prime Minister Narendra Modi has made it unequivocally clear that he favours states’ active participation and partnership in his development agenda through his stated policy of ‘cooperative federalism’. Not just in the domestic policy arena, he has now extended this partnership in the international arena through the involvement of states in promoting India’s broader interests abroad.

While the Modi government’s willingness to partner with states in the promotion of India’s interest overseas is a new toolkit in India’s foreign policy, Prime Minister Modi cannot be credited for inventing this wheel. It must be recognised that he certainly is the one who has acknowledged and promoted the importance of this actor and is trying to deploy this resource which other leaders before him failed to harness sufficiently, and carried out foreign policy in the conventional manner. As international relations today have become complex and multilayered, national governments alone do not possess adequate resources to effectively represent their countries’ interests and promote them overseas.

Promotion of ‘local interests’ overseas by sub-national units has today become a global phenomenon. Sub-national governments in the Western world and even in some Asian countries, including Japan and China, have vigorously pursued their economic and cultural interests through trade linkages, cultural exchanges and scientific cooperation through sister relationships and regular contacts at various levels. Some sub-national governments even pursue policies independently of their national governments such as Quebec in Canada. Some su-bnational units have represented their own local interest taking a different stance from their national governments. Okinawa Prefecture in Japan, for example, has represented its own local position in Washington independent of the policy stance held by the national government on the deployment of US troops in Japan.

Far from being courageous enough to represent their interest overseas in competition with the national government, Indian states have been largely inactive in their international engagement even in non-controversial areas such as trade and cultural exchanges. As the chief minister of Gujarat, Modi was among a handful of chief ministers who began to recognise the importance of connecting their states to foreign countries in the pursuit of trade and investment. Chandrababu Naidu in Andhra Pradesh has been another internationally active chief minister in India. Though states bordering Pakistan, like Jammu and Kashmir and Punjab and the northeastern states bordering Bangladesh and Myanmar have emerged as stakeholders in neighbourhood policy, and this was recognized even by the previous United Progressive Alliance (UPA) government, at times it was argued that states like West Bengal and Tamil Nadu in fact had a veto over India’s ties with Bangladesh and Sri Lanka respectively.

In the economic sphere, states apart from Gujarat – such as Tamil Nadu, Madhya Pradesh and West Bengal have been organizing Investor summits with the aim of seeking foreign investment.

Modi is rightly trying to strengthen the partnership between the centre and states. The prime minister’s vision to make states’ partnership in promoting India’s interest overseas can be seen clearly both before and during his China visit. Andhra Pradesh Chief Minister N. Chandrababu Naidu was chosen by the Ministry of External Affairs to lead an Indian delegation in April.

Modi himself was accompanied by two chief ministers – Anandiben Patel (Gujarat) and Devendra Fadnavis (Maharashtra).

Not only did the chief ministers meet Chinese provincial leaders and potential investors but they were also part of the India-China State and Provincial Leaders Forum which shall be a dialogue between governors of Chinese provinces and chief ministers of Indian states. This dialogue is along the lines of the US-China Governors Forum which was begun in July 2011, and a host of issues – economic, environmental and pertaining to research and education are discussed . The India-China Provincial Leaders Forum seeks to expand, not just to be a forum for enhancing economic ties, but also strengthen people-to-people contact and cultural and educational ties. Besides, it will give a chance to Indian states and provinces to explore ties according to their complementarities as well as needs.

During Modi’s visit agreements were also signed for twinning of one Indian state (Karnataka) and one Chinese province (Sichuan), and similarly between cities Chennai-Chongqing, Hyderabad (Telangana)-Qingdao (Shangdong) and Aurangabad (Maharashtra)–Dunhuang (Gansu). Twin city partnerships between US and China, such as the city of San Francisco and Shanghai, have been helpful not just for removing misunderstandings between citizens of both countries, but during the recession helped in drawing Chinese real estate and tech investments into the US.

It would also be important to point out, that it is not just Modi who understands the relevance of sub-national linkages. Chinese President Xi Jinping during his visit to India in September 2014 landed in Ahmedabad and an agreement for sister state-province partnership was signed between Gujarat and Guangdong, while an agreement for sister city partnership between Ahmedabad and Guangzhou was also signed. William Antholis in his book, Inside Out, India and China: Local Politics go Global (2014), states that one of the major similarities between President Xi and Prime Minister Modi is that they have been strong regional leaders. It was perhaps symbolic that while President Xi landed in Modi’s home state, the Indian prime minister landed in Xi’an (Shaanxi province) the hometown of the Chinese president.

Diplomacy today no longer starts and ends in national capital cities, nor is it the sole preserve of national leaders and national foreign affairs officials. Modi’s emphasis on sub-national relations during his China visit strongly gives this message. Hopefully, mechanisms such as the Provincial Leaders Forum will ensure that interactions between provinces help in creating strong linkages at the sub-national level which will contribute to a substantive bilateral relationship.

*Purnendra Jain is Professor in Asian Studies at the University of Adelaide. Tridivesh Singh Maini is a Senior Research Associate with The Jindal School of International Affairs, OP Jindal Global University, Sonepat. They can be reached at contributions@spsindia.in

The post States As Partners In Modi’s Global Engagement – Analysis appeared first on Eurasia Review.

Global experts in sporting event security gathered in Qatar to discuss and share best practices to address and mitigate potential threats facing major sporting events.

The two-day (9 and 10 June) meeting brought together 12 representatives from eight member countries with the aim of providing concrete recommendations on strengthening physical security capabilities and improving the formulation and implementation of security architecture for major sporting events.

The meeting was held under the auspices of INTERPOL’s Project Stadia, which is funded by Qatar and will culminate with the 2022 FIFA World Cup.

The project also entails the creation of a centre of excellence in physical, personnel and cyber security for major sporting events which will also provide INTERPOL member countries with a repository of consolidated best practices.

“Project Stadia’s first Sports Safety and Security Expert Group meeting sets a precedent by reviewing a selection of insightful success stories and case studies from major sporting events around the world,” said Michael O’Connell, INTERPOL’s Director of Operational Police Support and Head of Project Stadia.

“This group’s recommendations will ultimately provide a significant resource for member countries hosting such events in the future on crucial challenges and strategic countermeasures in the realm of physical security,” he added.

“The organization of this important event in cooperation with INTERPOL will draw on the experience of security experts from across the world, and assist Qatar’s continued preparations for a successful and safe tournament in 2022,” said Colonel Mohammad Al-Sulaiti, Executive Director of Security Department of the Supreme Committee for Delivery and Legacy.

“By looking into best practices from major sporting events across the world, it will provide a platform for global expertise exchange which is accessible to everyone around the world, thereby helping countries across the world host sporting events in a safe and secure environment.”

Countries represented at the meeting: Brazil, France, Germany, Gabon, Qatar, Spain, United Kingdom and United States of America. The expert group will meet on an annual basis until 2022.

The post INTERPOL Holds Meeting On Sports Safety And Security In Qatar appeared first on Eurasia Review.

Refugee and migrant arrivals to Europe across the Mediterranean so far in 2015 have moved above 100,000, with record numbers now arriving every day in the Greek islands.

Official figures show that as of 8 June a total of 103,000 refugees and migrants had arrived in Europe: 54,000 in Italy, 48,000 in Greece, 91 on Malta and 920 in Spain.

The latest tally includes around 6,000 migrants and refugees who were disembarked in southern Italy last weekend in a major rescue operation coordinated by the Italian Coast Guard and joined by navy ships deployed by Frontex and from Italy, Germany, Britain, Ireland, Spain and MOAS.

Record numbers of the refugees are arriving in flimsy rubber dinghies and wooden boats on the Greek island of Lesvos, putting an enormous strain on its capacity, services and resources.

Half of some 600 refugees, mainly from Syria, Afghanistan and Iraq, who arrive daily in Greece, now come ashore on this island. Arrivals on Lesvos have grown from 737 in January and 1,002 in February, to 3,348 in March. Almost 5,000 arrived in April and over 7,200 in May.

Hundreds of refugees leave the island for the Greek mainland every day after being identified, screened and registered. At present, however, there are around 2,200 to 2,500 waiting there for registration by the authorities.

A screening centre in the village of Moria, a former detention centre for migrants waiting to be deported, is currently housing over 1,000 refugees.

“This is more than twice its official capacity of 410 people. In addition, an education park in Kara Tepe is being used as temporary accommodation for around 1000 refugees,” UNHCR spokesperson Adrian Edwards told a press briefing in Geneva.

Two NGOs, Metaction and Medecins du Monde, are providing urgently needed services in Moria. Metaction is responsible for the identification, follow up and referral of unaccompanied children, while Medecins du Monde provides medical attention and psychosocial support. The Ministry of Interior’s First Reception Service is responsible for the registration of the new arrivals.

UNHCR has a permanent presence in the island’s main town, Mytilini, and is working with people at the Moria centre. UNHCR has been present on Lesvos and other Greek islands since 2011, supporting the authorities’ efforts to improve reception conditions and procedures, providing legal advice to newcomers about the asylum procedure in Greece, as well as their right and responsibilities, and identifying and referring people with specific needs such as unaccompanied children, people with disabilities, the elderly and victims of torture or trauma. In recent weeks, UNHCR has been distributing sleeping bags and hygiene kits to refugees in greatest need in Lesvos and other Greek islands.

To deal effectively with the challenges posed by the large number of arrivals in Lesvos and other Greek islands, UNHCR is calling for urgent reinforcement of personnel and resources of all the state services and civil society organisations dealing with the reception of refugees. We are also seeking increased support to the affected island communities.

The post Mediterranean Migrant Crossings In 2015 Already Top 100,000 appeared first on Eurasia Review.

By Dr. Odeen Ishmael*

Guyana witnessed a change in administration after the ruling People’s Progressive Party-Civic (PPP) lost by a mere one percent of the votes to an alliance of opposition parties comprising A Partnership for National Unity and the Alliance for Change (APNU+AFC) in the general elections held on May 11. The retired army Brigadier David Granger, leader of the alliance, was elected as the new president while the grouping, with 50.3 percent of the votes, acquired 33 seats in the 65-seat National Assembly. The PPP-C obtained 49.2 percent of the votes and was allocated the remaining 32 seats.

Background to the elections

Back in 2011, the PPP-C won the general elections with a plurality of nearly 48 percent of the votes. The opposition parties, APNU—a coalition of the People’s National Congress (PNC), the Working People’s Alliance (WPA) and four other mini parties—and the AFC, which had contested separately, together actually garnered a majority of 33 seats with 52 percent of the votes, but since Guyana’s constitution does not allow for post-election coalitions, the PPP-C formed a minority government under the presidency of Donald Ramotar.

However, the government faced continuous opposition from the APNU and the AFC which slashed the annual budgets and opposed funding for major development projects on the grounds that they were not viable and that contracts were awarded in a non-transparent manner. Also opposed was the anti-money-laundering measure, the passage of which was required by the international community to prevent financial sanctions from being leveled against Guyana. Then in late 2014, the opposition, using its majority in the assembly, signaled its intention to move a vote of no-confidence against the government which would have forced its resignation and the holding of new elections. To offset this, President Ramotar prorogued the National Assembly for a period of six months, but in January of this year he announced May 11 as the date for general elections.

As the parties prepared for the election campaign, APNU and AFC formed an alliance in February and named David Granger (of APNU) and Moses Nagamootoo (of AFC) as its presidential and prime ministerial candidates respectively. Before Nagamootoo joined the AFC back in 2011, he was a popular long-serving executive member of the PPP who left the leadership after accusing the government of encouraging corruption. He himself had vied in 2011 to be chosen as the PPP’s presidential candidate but lost out after the party’s central committee selected Donald Ramotar as its candidate.

The elections campaign

The 2015 elections campaign, as was the case in previous occasions, saw a revitalization of the support bases of the two main contesting parties and huge rallies were held in their respective strongholds. By and large, the citizens of Indian descent (comprising 43 percent of Guyanese) along with the indigenous Amerindians (9 percent) maintained their support for the PPP while those of African descent (34 percent) and mixed ethnicity remained solidly in support for the opposition alliance. However, the AFC insisted that it had garnered support from sections of the Indo-Guyanese population, thus eroding what the PPP believed would be an expected majority at the polls. This claim cannot be clearly verified, but what was evident was that in eastern Berbice, a region with a significant majority of Indo-Guyanese, the voter turn-out was relatively low. One reason postulated for this was that those who abstained did so because they were disillusioned with the PPP, while at the same time, they had no liking for the opposition alliance, particularly the APNU, which they saw as the old dictatorial PNC with a new name and noted for rigging elections from 1968 to 1985.

An interesting aspect of the campaign was the accusation leveled by the APNU+AFC on the PPP that the latter had moved away from the ideals of its founder, Cheddi Jagan. This claim, made by Nagamootoo after he departed from the PPP in 2011, was intensified as the campaign progressed and the alliance actually began promoting itself as the group promoting Jagan’s ideals of national unity and good governance.

Allegations of fraud

When the official results were finally announced on May 16, the PPP leadership accused the Guyana Elections Commission of rigging the ballot and made varying demands for a recount of the votes. It even claimed that the international observers—all of whom declared the elections free and fair—colluded with the commission to facilitate the rigging since they did not observe the actual counting, an essential part of the electoral process. The commission refused the PPP’s request for a total recount which could have settled the issue and eliminated all suspicions of irregularity. For the PPP a recount was deemed most necessary especially when the results showed that it lost in one administrative region by a single vote and nationally by less than 5,000 votes; and also since the chief elections officer admitted that many fake statements of polling results were submitted to the commission by some of its returning officers.

In light of these developments, Ramotar refused to concede and continued to insist that the PPP had won the elections even after Granger was declared as the new president. The PPP’s acrimony was vividly demonstrated when Ramotar, as the outgoing president, refused to attend Granger’s inauguration ceremony later that afternoon.

But the accusation of rigging, which is now echoed by many rank and file PPP supporters, should be examined for what it is worth. Protest demonstrations outside the elections commission’s central and regional offices have occurred and it is also expected that the party would move to the high court with an election petition that will call for a total recount of the ballot. Certainly, if it feels that it won a majority based on the numbers shown on its copies of the statements relating to the results at the polls. It should publish those to buttress its case with the Guyanese populace. So far, the elections commission itself has not officially published the elections results in the Official Gazette; this should have been done since May 26, as required by the national electoral laws.

The counter-argument to the allegation of fraud is why would any rigging allow the alliance to barely scrape a win by only one percent? And if there were some degree of rigging, how did the PPP manage to win seven of the ten administrative regions—one more than it did before—in the regional elections held simultaneously as the general elections?

But it was apparent that there was division in the PPP camp. At least one minister in the PPP administration stated his agreement with the official results and said that they indicated the need for a national unity government; while some others on May 15 relinquished their offices and issued farewell messages to their staff soon after the preliminary results indicated a PPP defeat. The day before, in a well-publicized message to the PPP leadership, this writer had urged it to issue a “concession” statement and urged Ramotar to demonstrate political leadership by meeting with Granger to express working cooperation with the incoming administration [inewsguyana.com, May 15, 2015].

What is to be done

Whatever the outcome of any election petition, the PPP must conduct a surgical analysis as to why it did not win the majority. While criticizing the conduct of the elections may seem to be a popular action to whip up political support, self-criticism must take center stage.

What must now be done? Clearly, there must be the injection of “new blood,” as former PM Sam Hinds recently stated, to become part of the party’s leadership [Guyana Times, May 19, 2015]. The PPP should take the example shown by the British Labor Party after its recent electoral trouncing when its leader decided to resign. The PPP leadership has persons who have been there since the last two decades of the twentieth century, and the time is now opportune for them to step back and allow the younger ranks, who no doubt have fresher ideas, to move to the fore. Most of the current leadership, from as far back as 1992, became government bureaucrats and this proved in the long run to be a detriment of the conduct of the political work of the party in the towns and villages since they came to see themselves more as state officials rather than party functionaries. Over a long period of time, such type of leadership bred arrogance which propagated a feeling of apathy and disillusionment among its traditional supporters and negated efforts to win political support from those regarded as the “cross-over” voters.

Such feeling existed during the 2011 elections. As can be recalled, when the party failed to win an overall majority in 2011, the leadership, in analyzing the root causes, pledged to consult with its members and supporters at the community level to obtain their views as to what went wrong. Apparently, this activity was not approached with firm seriousness, since much of the same reasons for the electoral failure repeated themselves on May 11.

As expected, it will be highly necessary to pay heed to its supporters at the grass-root level. Despite advances in economic and infrastructural development, there were constant complaints that the ruling party had failed to rein in the corruption which permeated through various sectors of the society. There were also accusations from various directions that some of its leaders were tainted by corruption, even though such accusations were generally based on “perception.” However, the perception of corruption leaves an indelible mark even if unproven and not dealing adequately with these charges, the PPP was not able to pull any significant political support from “cross-over” voters.

Ideological and organizational weaknesses

In addition, the PPP will have to re-examine the stance of its own ideology. Perhaps, one of the charges that held resonance was that the party over the past fifteen years gradually shifted away from the ideals of its founder, Cheddi Jagan, who had championed the socialist cause and close association with the rural and urban poor, the working class and the peasantry, as well as , clean and transparent governance. Actually, during an address to a May Day rally to trade union members closely associated with the party, Ramotar was loudly heckled by sections of the audience who felt that his government was not doing enough to improve the lot of the working people. And, significantly, over the past decade there were numerous strikes for better working conditions by sugar workers, traditional supporters of the PPP, in the state-owned sugar industry.

Added to this was the issue of security. While this remained as a serious bugbear during the PPP administration, the weakness in the party’s own security situation was evident on May 11 when it failed to effectively protect its own election “command center” in eastern Georgetown. Party officials also claimed that some of its election agents at polling stations were thoroughly intimidated and even physically assaulted by opposition supporters, forcing them to abandon their posts. This obviously exposed a glaring weakness in the party’s training and selection methodology, and clearly exposed that some persons it appointed to work at the polling stations in opposition strongholds were not prepared to properly carry out their duties.

The PPP, now must use its time as the opposition party to restructure, reorganize and rebuild itself. When it controlled the government, especially since 2001, it neglected the development of some of the party’s vital organs to reform. Its congress, due to be held every three years, was postponed or delayed at times, as were its regional and district conferences—all of which were much anticipated fixtures in the years the party was out of government. These had greatly placed the party in steady contact with its membership and grass-root supporters whose interests it represented with zeal and courage.

In the reorganization process, the leadership must realize that times have changed and that the party must adapt to new circumstances. It is no longer a “Marxist-Leninist” party, as it regarded itself in the pre-1992 period, since it has in the past two decades embraced capitalist development of the economy, even though it continued to emphasize social development. Therefore, it must move away from its archaic “Marxist-Leninist” superstructure by having its members elect a “leader,” and not a “general secretary” chosen by a closed group of central committee members. However, such changes can only be changed by the general membership, so it may be necessary for a special congress to be held for this purpose. Total democracy must be implemented if the party intends to remain as an attractive option to the electorate. Significantly, similar proposals were made before and the proponents were castigated by the power players in the party as proponents of “anti-party” activities.

The PPP must now move back closer to its power base—the rural and urban poor, the working class and small farmers. At the same time, it is essential to practice open democracy. Clearly, the concept of “democratic centralism” consisting of freedom of discussion with the expression of opposing opinions has not really been exercised within the PPP for a while. The views and dictat of a “supreme” leader or a particular group should not be allowed to hold sway over the membership of the entire party.

Political option

What is the political option open to the PPP now that it has lost executive power after twenty-three years in office? Obviously, it can function as a strong opposition, but it must be constructively critical in its approach. Clearly, it remains a formidable force with its support from half the population. In such a situation, it can approach the governing alliance with a proposal for a national government. Actually, President Granger at his swearing-in ceremony, stated that he would be a president for all Guyanese, saying: “I extend the arm of friendship to former President Donald Ramotar and the members of the PPP to join this great movement of national unity.”[Guyana Chronicle, May 17, 2015] Whatever this means in practical terms hopefully it will be spelled out by Granger; however the PPP on May 19 dismissed this call as “deceptive” and continued to insist that it won the elections. Up to June 10, the party had not named its thirty-two parliamentary representatives; and in the meantime, it announced that it would boycott the opening session of the new parliament. These actions may prove to be detrimental to the PPP since growing numbers of its own supporters have been expressing on social networks that they want the party leadership to display leadership and to support actively the drive for national unity. They, no doubt, join the growing majority of Guyanese who yearn for such an achievement, and the PPP is now presented with an opportune moment to demonstrate its willingness to work in this direction.

*Dr. Odeen Ishmael, Ambassador Emeritus (retired) of Guyana, historian and author, is a long-standing member of the PPP. He is currently a Senior Research Fellow at the Washington-based Council on Hemispheric Affairs.

The post PPP Suffers Setback In Guyana Elections – OpEd appeared first on Eurasia Review.

Washington has been rocked by the scandal of J. Dennis Hastert, the longest-serving Republican speaker in the history of the U.S. House, indicted on charges of violating banking laws by paying $1.7 million (as part of a $3.5 million agreement) to conceal prior misconduct, allegedly child molestation.

That scandal contains another one that’s received less attention: the fact that Hastert, who never made much money as a teacher or a congressman, could manage such payments because after retiring from Congress he became a high-paid lobbyist.

This second scandal is perfectly legal but it’s a growing menace.

In the 1970s, only 3 percent of retiring members of Congress went on to become Washington lobbyists. Now, half of all retiring senators and 42 percent of retiring representatives become lobbyists.

This isn’t because more recent retirees have had fewer qualms. It’s because the financial rewards from lobbying have mushroomed, as big corporations and giant Wall Street banks have sunk fortunes into rigging the game to their advantage.

In every election cycle since 2008, more money has gone into lobbying at the federal level than into political campaigns. And an increasing portion of that lobbying money has gone into the pockets of former members of Congress.

In viewing campaign contributions as the major source of corruption we overlook the more insidious flow of direct, personal payments – much of which might be called “anticipatory bribery” because they enable office holders to cash in big after they’ve left office.

For years, former Republican House majority leader Eric Cantor was one of Wall Street’s strongest advocates – fighting for the bailout of the Street, to retain the Street’s tax advantages and subsidies, and to water down the Dodd-Frank financial reform legislation.

Just two weeks after resigning from the House, Cantor joined the Wall Street investment bank of Moelis & Co., as vice chairman and managing director, starting with a $400,000 base salary, $400,000 initial cash bonus, and $1 million in stock.

As Cantor explained, “I have known Ken [the bank’s CEO] for some time and … followed the growth and success of his firm.”

Exactly. They had been doing business together so long that Cantor must have anticipated the bribe.

Anticipatory bribery undermines trust in government almost as much as direct bribery. At a minimum, it can create the appearance of corruption, and raise questions in the public’s mind about the motives of public officials.

Was the Obama White House so easy on big Wall Street banks – never putting tough conditions on them for getting bailout money or prosecuting a single top Wall Street executive – because Tim Geithner, Barack Obama’s treasury secretary, and Peter Orszag, his director of the Office of Management and Budget, anticipated lucrative jobs on the Street? (Geithner became president of the private-equity firm Warburg Pincus when he left the administration; Orszag became Citigroup’s vice chairman for global banking.)

Another form of anticipatory bribery occurs when the payment comes in anticipation of a person holding office, and then delivering the favors.

According to the New York Times, as Marco Rubio ascended the ranks of Republican politics, billionaire Norman Braman not only bankrolled his campaigns but subsidized Rubio’s personal finances.

A case of anticipatory bribery? Certainly looks like it. In the Florida legislature, Rubio steered taxpayer funds to Braman’s favored causes, including an $80 million state grant to finance a genomics center at a private university and $5 million for cancer research at a Miami institute. “When Norman Braman brings [a proposal] to you,” Rubio said, “you take it seriously.”

Hillary and Bill Clinton have made more than $25 million for 104 speeches since the start of last year, according to disclosure forms filed with the Federal Election Commission in mid May – of which she delivered 51, earning more than $11 million of the total.

Now that she’s running for president, she’s stopped giving paid speeches. But her husband says he intends to continue. “I gotta pay our bills,” he told NBC News.

Anticipatory bribery? Asked about his paid speeches, some of which pay $500,000 or more, Bill Clinton said, “People like to hear me speak.”

That may be the reason for the hefty fees, but is it possible that some portion comes in anticipation his having the intimate ear of the next president?

We need some rules here.

First, former government officials, including members of Congress, shouldn’t be able to lobby or take jobs in industries over which they had some oversight, for at least three years after leaving office.

Second, anyone who runs for office should bear the burden of showing that whatever personal payments they received up to three years before were based on their economic worth, not anticipated political clout.

Finally, once they declare, even their spouses should desist from collecting big bucks that could look like anticipatory bribes.

The post Anticipatory Bribery – OpEd appeared first on Eurasia Review.

Cyber warfare, with the changing international environment, ever growing technologies and capabilities, has emerged as a new threat on the globe. It is being used by states as a covert campaign against other states. The advancement in technology has brought revolution in military affairs that has drastically changed the nature of warfare. With the rapidly changing nature of warfare, states are pursuing for new and efficient strategies and employing innovative tactics. Cyber warfare is one such domain which enables a state to achieve its target of attacking the adversary without firing a single bullet. It has also opened a new door of competition among states. Along with states, non-state actors are equally active in the cyber warfare domain. Cyber warfare has challenged the traditional concept of warfare. Now in cyber domain computer technology and information flow is used as the warring media. The only thing required in this battle space is just to click a mouse to complete the attacking process. One of the cyber attacks that caused physical damage was the famous Stuxnet virus, created by America in collaboration with Israel to disrupt the Iranian nuclear program. One other such attack that resulted in huge damage was when some unknown attackers targeted the computers controlling a German steel mill and stopped a furnace from being shut down.

Cyber-defense is one of the key challenges that United States has been facing in contemporary times. Recently, in a huge cyber attack attempt against United States of America, the data of 4 million U.S government employees was hacked. It has been alleged that China was behind this, but there is no clear evidence and China has denied any such kind of involvement. In response to that, White house has called the congress to come out of dark ages in the wake of these recent attacks. They insisted on bringing new cyber reforms in order to meet the 21st century challenges in the cyber domain. In April, Pentagon announced a new strategy and laid down the conditions of possible use of cyber weapons against potential adversaries in case of any attack. It hopes to instill fear in cyber adversaries. Pentagon referred China, Russia, North Korea and Iran as potential adversaries and the greatest threat in this regard. The strategy outlines that “the United States will seek to exhaust all network defense and law enforcement options to mitigate any potential cyber risk to the U.S. homeland or U.S. interests before conducting a cyberspace operation”.

U.S officials claim that China has redirected as much as 20 to 30 percent more funding to cyber than they have in previous years. It is being done in an attempt, to level the playing field, to meet with superior U.S. military cyber capabilities. They also depicted that China and Russia, with large-scale investments in the cyber domain, are among the most capable cyber warfare nations. In the current age of information and technology, cyber domain is of significant importance enabling hackers to cause huge damage by targeting electric grid, financial services and other key networks, all from a comfort zone i.e.from their own computer. When it comes to cyber attacks it is difficult to identify the real perpetrator. This is because it is easy to hide such attacks, and there are many people who are involved in such attacks like criminal hacker gangs having different means and motives. Besides, such attacks can be carried out by hiring hackers or from foreign soil.

The recent attack shows that the United States is vulnerable in the defensive domain despite having the cyber command in hand, which monitors the cyber-attacks, and offensive teams to go after hackers and cyber spies. Whereas in the offensive domain U.S has the advantage. America and China indulging in cyber activities, both offensive and defensive, against each other is a major concern for the countries itself, and along with the region as a whole. Cyber attack can inflict heavy damage and with the systems, whether economic, military, financial or nuclear, becoming more and more computerized are vulnerable to such attacks. With the absence of any international law regarding cyber terrorism and lack of institutional arrangements or response from international organizations, along with attitude of great powers it seems that cyber warfare is here to stay.

*The writer is an M.Phil scholar at the School of Politics and International Relations, Quaid-e-Azam University, Islamabad.

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High population densities in the third world and the exponential rise in cross continental migration are symptoms of the biggest problem humanity has ever faced.

Due to rapid population growth over the last 50 years many parts of Central Africa, South Asia, and SE Asia are reaching unsustainable population densities. The wealth and affluence gap between North and South is a magnet attracting anybody who is able to travel outside their impoverished regions to seek better lives in any accessible developed country.

Without any local sustainable economy and economic opportunity, moving from these desolate overpopulated, and/or war-torn areas is the only hope and dream available to impoverished people. Survival is one of the highest forms of motivation within the human psych.

Hope for a better life is not a crime. Rather it’s a symptom of something wrong on a global scale.

Cross region migration is now growing to levels that may in the very near future become uncontrollable. This is the real danger for the procrastinating ‘developed world’ today.

Historically, cross region migration has traditionally been one of the factors that have built and developed “new countries” culturally, economically and socially. Australia was built on migration, just as the United States was. Many countries have been supplemented with groups of people with a strong sense and need to work and prosper, which has arguably been of great benefit to the host countries.

However with the strengthening of national sovereignty around the world, ‘free migration’ has been snuffed out throughout the ‘developed world’, and most of the developing world as well. In addition the incumbent populace of most countries have developed ‘anti-migration’ stances, where governments are able to act strongly against refugees because it is politically favourable to do so.

During the last decade, the Australian Government almost succeeded with domestic electorate support to label ‘hope for a better future’, as ‘economic migration’ and almost have it classed as a ‘crime’. Punishment for the ‘hope’ of the impoverished was to be imprisoned in some location within the Pacific, Indian Ocean, or SE Asia with very few rights or trial. Current Australian policy states that refugees who attempted to come to Australia by boat are imprisoned in harsh conditions in what the author termed as Australia’s Guantanamo, never to be settled in Australia.

Disquiet over predominantly Muslim refugees arriving in Germany has led to demonstrations earlier this year. Just very recently a Finnish reserve councillor in Helsinki caused a storm of protest when he suggested that African men in Finland be sterilised.

Earlier this month in Southern Thailand, mass graves of Rohingya Muslims and Bangladeshi refugees were found in abandoned detention camps run by human traffickers, with further camps and mass graves found on the Malaysian side of the border a week or so later.

The growth of cross continent migration is bringing out repression, hate, criminal opportunism, and impoverishment all over the world.

This potential epidemic so far has been only tackled from the national, and sometimes bilateral perspectives. These attempts like Australian-Indonesian cooperation have been aimed at preventing the arrival of refugees, rather than attempting to solve the actual source of the problem.

A realization by EU member governments that the refugee surge from Africa, and the Middle East is much larger than any one country can cope with, led to an emergency summit, which was held late last month. Last year more than 150,000 refugees made it to Italy by sea, with more than 36,000 reaching Italy, Malta, and Greece this year so far. However, the summit reached a consensus that the majority of refugees should be repatriated. The summit was restricted to looking at treating the symptoms, where the communiqué stated that “our immediate problem is to prevent more people dying at sea, to fight traffickers, to prevent illegal migration flows and to reinforce internal solidarity.”

So far all governmental responses appear to lack humanity. Responses also appear to avoid the causes of the problem. National sovereignty and lack of any international forum with the respect and ‘clout’ to deal with this issue is hindering any real attempt to solve the causes of cross continent migration.

The cross continental refugee crisis is a universal problem caused by uneven distribution of wealth and resources, rapidly growing populations in particular regions, which has made life for a percentage of the planet’s population totally unsustainable.

If, and there is no evidence to indicate that this is a temporary problem, massive refugee migration continues, then a number of potential consequences may surely arise.

First, conflicts are very likely to develop and erupt between neighbouring countries. There is a trend towards exclusion and repatriating problems back to the country of origin. Borders are likely to be closed in the future as the means to prevent migration. Some countries may go a step further and classify refugees as invaders. Tensions may grow along many select borders in the future.

Secondly, simply diplomatic ‘spats’ between neighbours could easily develop into much tenser situations. The recent tension over the Bali Nine executions was lucky not to escalate. This time a sense of maturity was maintained. What if out of anger the Indonesian authorities just started turning a blind eye to boats loaded with refugees departing for Australia? It would have been a disaster for Australian authorities.

Thirdly, this inept attitude by most world governments is allowing the creation of perhaps one of the largest illicit industries yet, potentially much larger than narcotics. We have seen people smugglers cruelty along the Malaysian-Thai border just in the last few days, and unfortunately there will be more to come. The people smuggling industry will grow almost unhindered while governments fail tackle the real issues in the countries of refugee origin.

Finally, as long as extreme inequality and poverty is not tackled in Africa, and South Asia, the developed world will remain open to invasion. Australia cannot afford to support hundreds of thousands of refugees in detention camps offshore. Nor can Europe, or the transit countries in SE Asia.

The current world demographics cannot be ignored, because inaction will create the biggest threat to national sovereignties that has ever occurred, much bigger than any war in the past.

The fact that the world has chosen urbanization of the prime means of habitation leaves many countries open to strangulation, if cross continental migration continues to grow exponentially. If extremely large numbers of refugees flock into already overlarge cities, many cities will not be able to take the strain. Infrastructure may just collapse, urban transport will be inadequate, unemployment dramatically increase, food and water shortages occur due to supply chain stress, making cities almost totally unmanageable. The sustainability of cities will come under threat.

Mass cross continental migration is indeed a universal problem that national governments cannot deal with individually. This is a matter that all governments need to deal with together. Humanity must learn to think as a planet and learn how to see above their respective territorial perspectives.

The decision making models that exist within the world today are self-destructive and may represent an even graver threat to humanity than the potential of nuclear war and climate change.

The post Humanity Beware! – OpEd appeared first on Eurasia Review.

By Phyllis Bennis*

Almost nine months after President Obama admitted that “we don’t have a strategy yet” to challenge the Islamic State — and just days after he said he still has “no complete Iraq strategy” — the non-strategy suddenly has a name: escalation.

According to reports in the New York Times and the Wall Street Journal, the Obama administration is poised to send 400 to 500 additional troops to Iraq immediately, and to build a new U.S. military base in restive Anbar province to house them — and potentially many more.

These troops would not be limited to the officially narrow training mission of the 3,100 U.S. troops already on the ground in Iraq. They would still be considered trainers and advisers, but their mission, according to the Times, would be “to help Iraqi forces retake the city of Ramadi and repel the Islamic State.”

The escalation isn’t exactly the massive deployment of ground troops called for by some hawks in Congress and by neo-conservative commentators, who continue to blame the rise of the Islamic State on Obama’s earlier withdrawal of U.S. troops from Iraq — rather than on George W. Bush’s initial invasion and occupation of the country, which actually led to the creation of the group in 2004.

But the Journal still recognized that “the new plan is a marked if modest expansion of the U.S. military role in Iraq. It would expose American forces to greater risk of being drawn into direct combat with Islamic State forces that already control territory around likely sites for a planned U.S. training base.”

A Series of Setbacks

The official reason is linked to the Islamic State’s recent seizure of Ramadi, the capital of Anbar province and a key city only 70 or so miles from Baghdad. (As Business Insider so nicely put it, Ramadi is closer to Baghdad than New York is to East Hampton.)

Obama and other top U.S. officials initially attempted to downplay the significance of Ramadi, describing the inability of the Iraqi military to defend it as simply a “tactical retreat.” But there’s no question that the loss of the city, followed quickly by the Islamic State’s seizure of the strategic Syrian city and ancient ruins of Palmyra, reflected a serious consolidation of the group’s military power.

Since then it’s been a rough few weeks for Obama’s war on ISIS.

On June 2, news broke that the Iraq military had managed to lose 2,300 armored Humvees, at least 40 M1A1 tanks, 74,000 machine guns, and 52 or more howitzers, mainly to the Islamic State. Weapons were abandoned by fleeing troops, captured on the battlefield, and in some cases likely sold to ISIS and other militias. In a Reuters article caustically titled “Dude, Where’s My Humvee?” Iraqi Prime Minister Haider al-Abadi admitted blithely, “we lost a lot of weapons.”

The Reuters writers were equally direct: “The United States is effectively supplying the Islamic State with tools of war the militant group cannot otherwise hope to acquire from its patrons.”

Despite the bluster of hawks who crave a deeper war in Iraq and Syria, it isn’t true that Obama has no strategy against the Islamic State. There is a strategy — but it’s wrong, and it’s losing.

The Obama administration has so far been unable or unwilling to act on its own oft-repeated understanding that “there is no military solution” to the so-called ISIS crisis. Instead, the U.S. strategy has relied almost solely on military action, with little or no investment in the funds, personnel, or political capital to wage the kind of powerful diplomacy that’s so desperately needed. If anything, the ongoing air war — and the flooding of the region with arms — is making a diplomatic resolution less likely.

Same Old Mistakes

As the war escalates, Congress is largely sitting on the sidelines.

A new measure sponsored by Connecticut Senator Chris Murphy calls for a prohibition on ground troops being sent to Iraq or Syria. But while symbolically important, it would have a very limited impact on the ground, particularly since — on paper at least — Obama has already staked out a similar position. Murphy has made clear that his real goal is to limit potential troop escalations by a post-2016 Republican president.

For now, the latest escalation — like those before it — is taking place without any congressional authorization, indeed without even any discussion or debate.

And it could get a lot worse before anything gets any better.

Martin Dempsey, the Pentagon’s top general, is retiring soon. He will be replaced by Marine General Joseph Dunford, who commanded U.S. troops in Afghanistan and is credited with persuading Obama to slow down the U.S. withdrawal from the country. His appointment as Chairman of the Joint Chiefs of Staff may signal a broader new commitment to escalating Obama’s global war on terror.

That would mean repeating many of the same mistakes we’ve already made.

In May, the Pentagon said it was sending 2,000 anti-tank rockets to the Iraqi military to use against ISIS car bombs. In response to Iraq’s recent loss of U.S. tanks and Humvees, the Pentagon announced its intention to send 1,000 more anti-tank weapons to the Iraqi military — to use against the same tanks it had sent previously, now in ISIS hands.

Bookmakers haven’t yet announced their predictions for how long it will be before those rockets end up in the Islamic State’s hands as well. But at the current rate of escalation, they won’t be the last things to blow up.

*Phyllis Bennis is a fellow at the Institute for Policy Studies and author of the forthcoming Understanding ISIS and the New Global War on Terror: A Primer.

The post Obama Does Have A Strategy In Iraq: It’s Called Escalation – OpEd appeared first on Eurasia Review.

The House Foreign Affairs Committee, in association with Congressional Caucus on India and Indian Americans organized a Congressional Reception to welcome Ambassador Arun K. Singh on his taking over as India’s Ambassador to the United States at the Capitol Hill on June 10.

The event was hosted by the Chairman of House Foreign Affairs Committee- Congressman Ed Royce (Republican-California) and Ranking Member Congressman Elliot Engel (Democrat-New York), together with co-chairs of the Caucus – Congressman George Holding (Republican- North Carolina) and Congressman Ami Bera (Democrat-California).

The event was attended by a number of Members of US House of Representatives, leaders of the Indian American community from across the United States, as well as by members of the media, the Think Tank community and academia.

In their welcome remarks, both Congressman Ed Royce and Congressman Eliot Engel spoke warmly of Ambassador Singh’s contribution in promoting India-U.S. relations.

During his remarks, Congressman Ed Royce welcomed Ambassador back to Washington D.C and reiterated his commitment to promoting India-US ties. Congressman Eliot Engel called India and US as ‘natural partners’ with common strategic and geo-political outlook. Congressman George Holding called the India-US relationship as the founding relationship of 21st century and advocated strengthening bilateral economic ties.

Congressman Ami Bera called the relationship ‘non partisan’ and recognized that the diaspora brings vibrancy to the bilateral ties.

Ambassador Arun K. Singh, in his remarks, thanked Congressman Ed Royce, Congressman Eliot Engel, Congressman George Holding and Congressman Ami Bera for their welcome and for their leadership at the House Foreign Affairs Committee and at the Congressional
Caucus on India and Indian Americans. He noted the important contributions made by the Caucus to bring the people and governments of the two countries closer, and described the bipartisan support for India-U.S. relations in the U.S. Congress as a source of strength for the India-U.S. strategic partnership that now spans almost all dimensions of human endeavor.

Congressional Caucus on India and Indian Americans is a bipartisan group of Members in the US House of Representatives. It was founded in 1993 by the Congressman Frank Pallone from New Jersey and Congressman Bill McCollum from Florida and is the largest single country Caucus in the House of Representatives.

The post US Congressional Reception Welcome India’s New Ambassador Singh appeared first on Eurasia Review.

By Stuart Larkin*

After some thirty years of double-digit economic growth, China has become dependent on the world economy with one of its two key drivers having been labour-intensive manufacturing exports. The other is domestic infrastructure and real estate development. Xi Jinping is regarded as China’s strongest president since Deng Xiaoping which is fortuitous because China now faces considerably changed circumstances both at home and abroad which require talented leadership and a much more pro-active approach. Thanks to an inappropriate response in western countries to the 2008 global financial crisis that continues to this day, weak consumer demand in developed country markets coexists with massively inflated values in asset markets and a glut of investment capital in a very low interest rate environment (with negative nominal interest rates in some countries). In short, China can no longer rely on the US to lead the world economy with consumption growth, and instead it must pro-actively foster new sources of growth by further promoting the rise of Asia. It can do this most effectively by spurring regional infrastructure development – because of the scale factor as well as the demand multiplier effect – which promotes future growth by complementing, and increasing the returns to, the further integration of trade and investment within the Asia Pacific region.

The Asian Infrastructure Investment Bank (AIIB), along with the creation of other institutions such as the New Development Bank, (NDB), the Contingency Reserve Fund and the Silk Road Fund, are major initiatives for China although they will play a complementary role with existing institutions that manage capital exports. There is a tendency to see the AIIB as having two key roles: as a leading agency for implementation of the “Belt and Road” vision expounded by Xi Jinping and as an instrument of “soft power” delivering “public goods” which address the region’s infrastructure financing requirement. However, AIIB can only really be understood when placed in the context of the economic circumstances that confront China at home and abroad. Partly out of necessity and partly out of opportunity, Beijing is now laying the foundations for the next stage of China’s rise. However, the logic of the “great leap outward”, along with the ability to execute, is undermined if the financial surpluses go into reverse due to deterioration in the domestic economy. Xi Jinping’s strategy is not without its risks.

THE WORLD ECONOMY AS THE DEFINING CONTEXT FOR CHINA

National Revival; “Belt and Road”

With China having the second largest economy in the world, and destined to become the largest1, it is understandable that it should aspire to eventually attain global superpower status to match the USA. Becoming a regional great power is a necessary intermediate step, and Beijing often couches its rapid rise in terms of “national revival”, restoring its status to that which it once enjoyed in the past.

The “Belt and Road” is a far-reaching economic development plan which focuses on improving trade, infrastructure and connectivity in the Asia Pacific region and beyond. The Silk Road Economic Belt is a programme to build land transportation corridors that connect China to Europe and all other major Eurasian sub-regions, including Indochina, South Asia and Southwest Asia. The 21st Century Maritime Silk Road is a port development initiative to broaden Chinese trade channels targeting the maritime regions of Southeast Asia, South Asia, the Middle East, East Africa and the Mediterranean2. China is planning to build highways, express railways, pipelines and ports and to use these new outlets to bind China with other countries in the region. Connectivity has a compelling economic and commercial logic to it – to gain access to global natural resources and overseas markets to sustain China’s economic expansion – but it also easily takes on geostrategic and security connotations. However, what is less well appreciated is the role domestic economic circumstances play in the motivation for China’s “Great Leap Outward”.

China’s Economy

Beijing’s top priority at the moment is to manage the slowdown of the Chinese economy, which has slowed to around 7 per cent GDP growth but has not yet troughed, and facilitate a structural transition. Dependence on exports to rich country markets for growth when these markets have stagnated must be reduced, along with reduced dependence on domestic infrastructure and real estate development for growth. There needs to be a re-orientation towards greater domestic consumption as a driver of growth. But this is easier said than done since many citizens still face economic insecurity and the savings rate remains stubbornly high at around 40 per cent.

Given strict capital controls, China’s high savings rate causes another problem – a domestic savings glut resulting in weak resource allocation. The marginal productivity of domestic investment has fallen so low that in the macro-economy it now takes RMB 5 of investment to produce RMB 1 of GDP growth3. The slowdown has revealed a glutted real estate market and overcapacity in many capital intensive sectors such as cement and iron and steel. China has to drain off surplus savings from its domestic economy to improve resource allocation and returns on investment. China’s export of capital in the modern era can be traced to the “Going Out” policy from 2002 but a quantum step-up is now in prospect; (see later section on China’s capital exporting institutions).

After years of trade surplus and net inward capital flows China has accumulated a high level of foreign exchange reserves, which stood at US$ 3.84 trillion in December 20144. Foreign exchange reserves need to be redeployed from low-yielding foreign government bonds, such as US Treasuries. After more than a decade of the “Going Out” policy to secure outside sources of energy and minerals, China has given careful consideration to what other asset classes have the potential scale to accommodate a significant proportion of reserve assets in the medium to long term. However, should the Chinese economy move into trade deficits that diminish foreign exchange reserves, and should its domestic savings surplus serious decline, then the very logic of “Belt and Road” will be undermined, along with the capability to execute it. Assuming this doesn’t happen, the search will continue for overseas financial assets that can be invested in that also deliver benefits to China’s real economy, (such as exports of construction services and building materials). With this in mind we shift our focus to the current circumstances in the world economy.

Global Economic Conditions and the Opportunity in Infrastructure Finance

China’s export growth has slowed as consumer markets in developed economies have remained weak since the 2008 Global Financial Crisis (GFC). Bank bailouts spurred national debt to high levels in many countries and the general response has been to cut public spending rather than raise taxes especially on the rich. The result has been continued weak demand, high unemployment and downward pressure on wages, particularly in middle-class occupations under continued pressure from technology and off-shoring. Rather than stimulate bank lending to real economy businesses, Quantitative Easing (QE) has just stoked asset prices, particularly in real estate and equities. This has further widened inequality which has suppressed economic recovery since the wealthy save proportionately more. Apart from the US economy which is boosted by lower energy costs through fracking, recovery in other developed economies is weak or non-existent (although they will benefit from lower oil prices).

In the continued absence of Keynesian demand stimulus policies, growth prospects in the developed world are poor. China’s economic slowdown, which prompted an end to the 15- year commodity super-cycle, is lowering growth rates of economies in the region who are also negatively impacted by the withdrawal of foreign capital resulting from the announcement of QE tapering. In short, growth prospects globally are “moderate”5 and interest rates are likely to remain low for some considerable time to come. Ordinarily, this should be good for financing infrastructure, were it not for the longstanding failure in the existing global financial architecture to intermediate savings into infrastructure investment.

Globally, and regionally, there is clearly a need for infrastructure investment. The global infrastructure financing requirement is estimated at US$ 1.0-1.4 trillion annually with current annual spending on infrastructure of US$ 0.8-0.9 trillion6. Government budgets provide around half the funding and national development banks US$ 570-650 billion annually. Private sources account for US$ 150-250 billion; Official Development Assistance, (ODA), and MDBs provide only an estimated US$ 40-60 billion annually, and South-South flows are estimated to finance US$ 20 billion or less annually7. On the regional level, the “funding gap” is just as bad. Asian nations need infrastructure investments of US$ 750 billion per year through 2020 (ADB) whereas ADB and World Bank combined are making infrastructure investments of just US$ 20 billion a year worldwide8.

Some specific causes of the funding gap can be identified. Financing from national budgets is subject to macroeconomic constraints and the debt levels and budget deficits of the developed countries limit their ability to contribute. Also, the availability of credit from the private sector is constrained by tough regulatory reforms like Basel III. However, a more fundamental systemic failure is occurring. Despite very low interest rates, huge gaps in infrastructure coexist with comparably massive accumulation of savings and underused global capacity. The world’s capital is concentrated in vast pools of value with US$ 80 trillion plus in global bond markets, US$ 60 trillion held in worldwide bank deposits, upward of US$ 50 trillion captured in equity markets and US$ 47 trillion plus controlled by 10 million high net worth individuals9. So it is not the case that there is inadequate savings to finance the world’s infrastructure requirement but rather that there is a massive failure in the intermediation of savings into investment.

Given the consumption weakness and investment surplus globally, developing necessary infrastructure is essential to realize global growth potential. Infrastructure projects produce an impressive demand stimulus during the construction phase, for labour, building materials etc. which is particularly marked in the developing world. The IMF found that the long term fiscal multiplier for government investment in infrastructure is around US$ 1.6 for every US$ 1 of investment in developing countries, much higher than in developed countries10. If ways can be found to intermediate savings into infrastructure investment, with momentum being generated to get a large number of projects underway, then infrastructure development will become a driver of regional and world growth. If AIIB and her sister institutions succeed, and play a key role in this, then the leadership of global finance will eventually pass to China.

AIIB AMONG CHINA’S CAPITAL EXPORTING INSTITUTIONS

Although there are many opportunities for China to successfully invest abroad, and it is not that hard to exceed the low rates of return at home, I have already mentioned the need to drain the domestic economy of excess savings. In the West, resources are allocated freely, domestically or internationally, through a “trillion” individual investment decisions. However, in China four particular factors give rise to strong state control over allocative decisions that permit a highly focused and strategic engagement with the world economy. There are strict capital controls; much of the economy still consists of state-owned enterprises, (SOEs); most domestic savings are deposited in a handful of huge commercial banks; and the policy banks play a big role in allocating resources.

China is now a net capital exporter. Chinese investors channelled capital into 6,128 overseas firms in 156 countries and regions in 2014 with outward direct investment (ODI) reaching US$ 102.89 billion, up 14.1 per cent according to PRC Ministry of Commerce, (FDI was US$ 119.6 billion, up only 1.7 per cent); if including Chinese firms’ investment through third parties, total ODI reached US$ 140 billion, making China a net outbound investor. It is estimated that in the next decade, outbound investment will total US$ 1,250 billion11. Chinese outbound mergers and acquisitions (M & A) investments and greenfield FDI in the first 5 months of 2014 were up 24 per cent on the same period in 2013 to US$ 54.2 billion12; and the sector mix of ODI was less resource driven and more diversified13. To encourage ODI as well as inward FDI is an important policy shift for Beijing who has also been working on plans for more outbound investment funds, e.g. one that targets Chinese-Arab cooperation with China Development Bank, (CDB) investing alongside the Abu Dhabi Investment Authority.

I have already mentioned that China’s enormous financial surpluses are made up of domestic savings and foreign exchange reserves. Renminbi savings are largely held as deposits in state- owned banks which lend to, among others, the policy banks such as CDB who finance the infrastructure projects which have powered China’s phenomenal growth rate alongside manufacturing exports. China now intends to draw on each of these two sources and lend very large amounts to finance infrastructure projects in the region. Because of this, China’s strategic move into regional infrastructure finance markets should be characterized as a “great financial expansion” rather than as a mercantilist-driven one as the “Belt and Road” vision suggests, (although there are intended benefits for China’s corporates as well). Should it be difficult to identify “bankable” projects in Southeast Asia, where returns will be greatest, “Belt and Road” provides a broad canvas for face-saving investments elsewhere in order to still make rapid headway in exporting capital.

Given the size of the challenge, AIIB is only one of an array of financial institutions being deployed for China’s capital exports. The largest of these is CDB, one of three policy banks established in 1994, along with the Export-Import Bank of China (Eximbank of China)14 and the Agricultural Development Bank of China. CDB’s outstanding foreign currency loans were US$ 97.4 billion in 2009, accounting for 17 per cent of its outstanding loans (China Development Bank Annual Report 2009); in 2010 CDB’s outstanding foreign exchange loans were US$ 141.3 billion (Peoples’ Daily Online, February 14, 2011). The Chinese Investment Corporation (CIC) is a sovereign wealth manager modelled along the lines of Singapore’s Temasek Holdings. China International and Trust Investment Corporation (CITIC), the state- owned investment company, has extensive international financial experience and will also play a leading role in redeploying China’s vast surplus capital abroad. These institutions are augmented by some major new ones.

The New Development Bank (NDB), is a new multilateral with Brazil, Russia, India, China and South Africa (the BRICS countries) as founder members. It will focus on infrastructure and lend to BRICS countries themselves but also to other developing countries. Assuming a capital endowment of US$ 100 billion of which 20 per cent is paid in, and if lending 50 per cent of project value, after 20 years there could be a total stock of loans of US$ 350 billion with annual lending of US$ 34 billion to investment projects totalling US$ 68 billion annually15. There are also Contingency Reserve Arrangements (CRA) of US$ 100 billion, of which China will contribute US$ 41 billion16. Another major initiative is the US$ 40 billion Silk Road Fund announced in November 2014 to provide investment and financing support to carry out infrastructure, resources, industrial cooperation, financial cooperation and other projects related to connectivity for countries along the “Belt and Road”17. Foreign exchange reserves will be tapped for 65 per cent of the fund, China Investment Corporation and the Export-Import Bank of China will chip in 15 per cent each, and CDB will invest 5 per cent18.

How important the AIIB will be among such an impressive array of outbound investment institutions cannot yet be determined. While the AIIB has not been capitalized yet, in the course of his five tours, Li Keqiang signed bilateral and multilateral cooperation agreements worth some US$ 140 billion19. It will take the AIIB some time to build up its capital base to support a massive lending portfolio so in the short term it may be eclipsed by institutions like CDB in terms of volume of lending. But the AIIB will have OECD countries as shareholders and this will be important in mobilizing capital from non-China sources. The AIIB’s multilateral character ensures that it will have a different style from the others (along with NDB). It seems likely that China’s top leadership will focus on overall strategy and, while avoiding micromanagement, will foster competition between the country’s various outbound investment players to improve overall performance.

The AIIB has a role to play in the development of China’s domestic finance sector and in its integration with the global finance sector. China favours gradually moving towards full convertibility for the yuan for at least three reasons: China’s growing status in the world economy; US debasement of the dollar by quantitative easing (monetary expansion); and US abuse of its global trading currency status by imposing sanctions on certain dollar payments for political purposes. Development of the offshore renminbi market is an important intermediate step towards convertibility and the AIIB can help in at least two important ways. First, it can sell its own renminbi bonds to finance its loan portfolio for infrastructure projects, so creating an important new internationally traded benchmark issue. Second, when construction is completed on individual projects those project loans can be securitized into yuan-denominated bonds. This will create an important new yuan-denominated asset class which when internationally traded adds depth to the offshore renminbi markets.

AIIB IN THE GLOBAL FINANCE SECTOR

China has been careful not to directly challenge the world’s hegemonic institutions but to create some new ones that can play a complementary role. AIIB will have substantial proprietary capital resources as well as easy access to China’s huge savings surplus while the World Bank and ADB are actually relatively cash-strapped20. But the latter have long experience of working multilaterally and also have extensive networks into the private sector. They also have tremendous institutional knowledge and expertise in infrastructure lending in the region. The AIIB can benefit greatly by drawing on that wealth of experience which translates into capacity for loan origination. The AIIB will certainly want access to the deal flow and the World Bank and ADB are always looking for co-investors as a means of leveraging their own limited capital. Some institutional rivalry is inevitable but most likely competition and cooperation will coexist as they do elsewhere in the finance sector where, for example, banks compete fiercely for advisory mandates and then sit on the same underwriting syndicates.

From its inception, the AIIB will want to maximize its impact on the infrastructure finance market. It will want to leverage its intermediation role by drawing in co-investors to help finance the projects it takes the lead on. It will obviously be well placed to draw on China’s other outbound investment institutions and its commercial banks but it would also be wise to engage the private investment institutions of the global financial system for two reasons. First, that public private partnership (PPP) is the key to plugging the “funding gap” is established orthodoxy in infrastructure finance circles these days. Second, political resistance to excessive Chinese influence through its project lending can be overcome if the project loans are syndicated to institutions from a range of countries. It will make sense for the AIIB and its array of sister institutions to each pursue multiple points of engagement with the global financial system – to mix up China’s money with everybody else’s – in order to downplay the sense of China’s rise. This may seem counterproductive when China is seeking enhanced political influence but too overt an assault on infrastructure markets will create nationalistic backlashes. AIIB can build its international private sector network by drawing on its OECD country memberships.

There are approximately 8,000 institutional investors worldwide but only about 300 that are dedicated to infrastructure. As at 4th November 2014, there are 148 private infrastructure funds currently in the market21. The demand for infrastructure assets with a dependable, existing income stream now exceeds supply. The asset class has such a brief investment history, just over 20 years. Last year saw record fund raising of US$ 50 billion but this is still a tiny fraction of global savings. World Bank Group data shows that private sector infrastructure investment in Emerging Markets and Developing Economies (EMDEs) declined from US$ 183 billion in 2012 to US$ 146 billion in 2013. And this is only around 15 per cent of total infrastructure investment22. Clearly there is much more that can be done to mobilize private sector investment in infrastructure.

But the key for the AIIB is to help host governments, i.e. clients, develop the project pipelines of “bankable” projects. Infrastructure finance can be seen as a tremendous market opportunity left open by the failure of the US-led global financial architecture to provide intermediation. China’s institutions can also hope to benefit from a more profound sense of western failure in finance. Massive bank bailouts in 2008 have left an enduring legacy of sovereign indebtedness, “austerity” policies and economic stagnation in many western countries while banking culture has been exposed time and again as rotten to the core. Money laundering, misrepresentation of risk on securities, manipulation of benchmark interest rates and currency markets, aiding and abetting tax evasion are just some of the criminal activities undertaken by officials of the world’s top banks without criminal prosecution. “Too big to fail” and “too complex to regulate”, the banks have achieved regulatory capture. In such a setting, AIIB’s entrée into global finance will be seen by many as a blessing.

CONCLUSION

The AIIB lies at the intersection of many different themes. It is seen as the leading agency for implementation of the “Belt and Road” vision expounded by Xi Jinping and as an instrument of “soft power” delivering “public goods” which addresses the region’s infrastructure financing requirement. It is cited by some as a prime example of China’s “new multilateralism” although the multilateral approach is not new to China. Along with NDB, the AIIB is seen as a rival to the World Bank and ADB, mounting a challenge to the post-war international order established by the Bretton Woods institutions. The AIIB is a prominent new international financial institution appearing on the world stage, not at a time when the World Bank and IMF have faced the most hostile criticism, but when the private global finance sector is not trusted and where bankers in many Western countries are despised.

The AIIB is coming into being at a time of considerable structural change in the world economy. The US can no longer power the world economy with consumption growth and while it has entered cyclical recovery, not least because of cheap energy, the other developed economies of the West and Japan remain moribund. As world demand slumped following the 2008 GFC, China didn’t depreciate its currency and provided stimulus that helped to maintain Asian growth. But now China is slowing considerably (and undergoing restructuring) and the 15-year commodity super-cycle has turned down; other Asian economies are adversely affected by that but also by the announcement of QE tapering that has caused the repatriation of capital to developed economies, fuelling their asset bubbles. Meanwhile, tapering of the QE taper adds another dimension to the distorted Western economies characterized by weak consumer demand coexisting with high asset prices and rising inequality. In the midst of this, China unveils its full array of financial institutions and corporates aligned to execute a tidal wave of capital exports destined for Asian economies, with AIIB destined to lead, or at least showcase, the charge.

If the AIIB and her compatriot institutions can successfully intermediate China’s – and global – savings into infrastructure finance then they will create a much needed new driver of world growth. While this may take some time to achieve it may ensure a prominent role for China in global finance while facilitating the country’s continued rise.

About the author:
*Stuart Larkin was Visiting Fellow at ISEAS from 26 May 2014 to 25 September 2014, and 20 October 2014 to 19 April 2015.

Source:
This article was published by ISEAS as ISEAS Perspectives Number 27, 2015 (PDF)

Notes:
1. China has already overtaken the USA as the world’s largest goods trader, with total imports and exports of over US$ 4 trillion in 2013. Jamil Anderlini and Lucy Hornby, China Overtakes US as World’s Largest Goods Trader, Financial Times, 10th January 2014, http://www.ft.com/intl/cms/s/0/7c2dbd70-79a6-11e3-b381-00144feabdc0.html#axzz3RVdkoAQF
2. David Arase, China’s Two Silk Roads Initiative: What It Means For Southeast Asia, unpublished draft, February 2015
3. David Arase, China’s Two Silk Roads: Implications for Southeast Asia, ISEAS Perspective, 22nd January 2015
4. Trading Economics, China’s Foreign Exchange Reserves, accessed 17th February 2015, http://www.tradingeconomics.com/china/foreign-exchange-reserves
5. Global growth to remain ‘moderate’ in 2015, says IMF, BBC News, 14th April 2015. http://www.bbc.com/news/business-32303683
6. Elek, Andrew, Boosting infrastructure investment can prove G20’s value to the world, The Conversation, 21st February 2014, http://theconversation.com/boosting-infrastructure-investment-can- prove-g20s-value-to-the-world-23472
7. Ibid.
8. Gallagher, Paul, U.S. Suicidal War on New Chinese Infrastructure Bank, Executive Intelligence Review, July 7th 2014; http://www.larouchepub.com/other/2014/4127us_v_china_bnk.html
9. Global Energy Basel, Infrastructure for a Changing World, 2012.
10. Miriam L. Campanella, AIIB to Help Fill Infrastructure Finance Gap, Asia Sentinel, 9th April 2015.
11. Xinhua, China’s ‘New Normal’ of Investment Brings New Win-Win Opportunity, 21st January 2015, http://news.xinhuanet.com/english/china/2015-01/21/c_133936220.htm
12. PwC, Greater China Outbound M & A Spotlight, 2014.
13. Tong, Sarah Y., China’s Outward Direct Investment: Recent Development and Government Policies, East Asia Institute Background Brief No 935
14. Although it shares CDB’s mandate to help ease China’s energy and natural resource bottlenecks and to help Chinese firms expand overseas, Eximbank is a much smaller institution with assets of RMB 792million in 2009 against CDB’s RMB 4.5 billion, (Downs, 2011).
15. Griffith-Jones, Stephany, A BRICS Development Bank: A Dream Coming True? United Nations Conference on Trade and Development, Discussion Paper No. 215, March 2014.
16. Wikipedia. http://en.wikipedia.org/wiki/New_Development_Bank
17. Xinhuanet, Chronology of China’s “Belt and Road” Initiatives, February 5th 2015. http://news.xinhuanet.com/english/china/2015-02/05/c_133972101.htm
18. Caixin Online, Government Said to Name Three to Silk Road Fund Management Team, 5th February 2015.
19. Guangzhou Daily, China’s Super-Salesman Closes Deals Worth US$ 140 billion, 29th December 2014.
20. For example, World Bank and ADB together only have capacity to funnel about US$ 20 billion into Asia each year.
21. GIB Summit Report 2014, Op Cit.
22. World Bank, Public Private Partnerships: Global Infrastructure Facility (GIF), 17th November 2014, http://www.worldbank.org/en/topic/publicprivatepartnerships/brief/global-infrastructure-facility-gif

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By Erica Penfold*

The focus for this year’s African Union (AU) Summit – being held on 14 and 15 June 2015 in Johannesburg, South Africa – is the ‘Year of Women Empowerment and Development towards Africa’s Agenda 2063′. The Summit follows on from the launch of the Tripartite Free Trade Area (TFTA), which encompasses 26 countries in Southern and Eastern Africa, including SADC, the EAC and COMESA.

Despite the focus on development and the empowerment of women, proceedings will more than likely be dominated by continued conflict, the presence of Boko Haram and Al-Shabab and instability in Burundi.

The AU, identified as a continental organisation with a mission to drive African integration and development together with member states, regional economic communities and African citizens, is evidently aware of the need for renewed energy for development but is plagued by peace and security dilemmas. The AU is often unable to focus on integration and development because of these challenges.

A pressing continental concern is the urgent need for renewed attention on regional health governance. The AU is often mistakenly referred to as a regional organisation. As a continental organisation, with influence and the ability to sway leaders in regional economic communities such as SADC, the AU should focus more on how regional health governance and increasing access to healthcare and medicines can be of ultimate benefit for women’s empowerment, development and increased economic integration.

Women are identifiably integral to communities as caregivers and providers of healthcare and should hold an elevated status at the Summit. Peace and security concerns will however outweigh development concerns, particularly the position of women as healthcare providers.

Leaders at the Summit will adopt a formal position on the Post-2015 development agenda (which will be agreed upon at the UN in September and the UN Climate Conference in Paris in December). This will undoubtedly include a focus on health, as an integral part of the Post-2015 agenda, but these decisions should also include a focus on renewed efforts to provide healthcare for regional economic communities and migrant labourers. This is even more important considering the devastation of the Ebola outbreak, its economic impact and the aftermath of the disease, requiring consistent intervention from donors and developed nations.

The AU Summit in Addis Ababa in January 2015 dealt with the threat of Ebola in West Africa. The AU Support to Ebola Outbreak in West Africa (ASEOWA) has mobilised over 800 health workers, an effort which was praised by the three most affected countries.

However, there is limited follow through on this activity. What these countries and the region need is a sustainable regional healthcare development plan, to provide support for the beleaguered health systems. This is also true for the other RECs on the continent. The AU decision to set up the African Centre for Disease Control and Prevention in 2015 was welcomed widely. It remains to be seen how effective this centre will be.

Considerable and sustainable support for healthcare systems is needed and the AU Summit is a powerful platform for these issues to be brought to light. African member states cannot be solely reliant on donor interventions with limited government support for healthcare initiatives. Despite national efforts to ensure adequate provision of healthcare, there is still limited AU presence, regional support and cross-regional planning for migrant workers, cross-border projects and regional pharmaceutical distribution on the continent. Support for regional organisations remains weak, judging by outputs for healthcare at a regional level. The SADC Secretariat is a specific example of this.

SADC has a limited regional co-ordination presence for regional healthcare. The intended pharmaceutical integration plan, the SADC Pharmaceutical Business Plan, expired in 2013. The plan has as yet has not been renewed or replaced by a more effective option. Additional projects, including the Cross-Border HIV/AIDS and Malaria Initiatives, are still largely run by donors, with outsourced agencies assisting in implementation and roll-out of these plans. National governments in Southern Africa support these endeavours and provide some funding but these are still mainly donor-driven interventions.

The AU and SADC Secretariat could present a powerful regional force in Southern Africa, to provide relevant technical expertise, financial support and monitoring and evaluation for regional health governance, healthcare and access to medicines. Specific regionally co-ordinated support for major health challenges, including HIV/AIDS, malaria, tuberculosis and non-communicable diseases would also benefit social development on many other levels. Disease prevention, vertical and horizontal healthcare would also ensure that there is more than sufficient redress for health inequality on the continent and its relevant RECs.

The outcomes of the AU Summit will provide further cause for debate on these issues. Developing states will remain hopeful for the outcomes of the high level meetings the Summit provides.

*Erica Penfold is the Researcher/Project coordinator at the Poverty Reduction and Regional ­Integration project at SAIIA.

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(EurActiv) — If only a deal to end the crisis could be sealed with a kiss. But, 24 hours after Prime Minister Alexis Tsipras got a Greek-style embrace as he arrived in Brussels on Wednesday (10 June), an agreement to save his country from bankruptcy seemed as elusive as ever.

In Greece, men often kiss when they meet or part as friends. But the man who planted the kiss on Tsipras on Wednesday was European Commission President Jean-Claude Juncker, who is from Luxembourg – a country generally less known for open displays of affection between heterosexual males.

The occasion was a meet-and-greet session before a summit of European Union leaders and their counterparts from Latin America and the Caribbean at the Commission headquarters.

For anyone worried about the fate of Greece and the wider eurozone, the question was whether Tsipras can persuade creditors from the European Union and International Monetary Fund to release funds or relax borrowing limits so that Athens can repay debts due by the end of this month and avoid default.

The mood between Tsipras, a former Communist youth leader, and top European politicians was under close scrutiny. Things got off to a slightly awkward start.

Brussels was abuzz that Juncker was upset with Tsipras’ tactics in negotiating a deal, under which Greece is supposed to accept yet more reform and austerity in return for cash.

But the Commission president seemed keen to convey through body language that normal friendships had been resumed. As Tsipras approached, the Greek leader’s right arm twitched, suggesting he wanted to greet his host with the usual handshake.

Juncker was having none of it, seizing his guest in an embrace and planting the kiss on his cheek. Tsipras remained for a moment before extricating himself as quickly as possible without causing offence.

After a brief pose beside Juncker and European Council President Donald Tusk for the photographers, Tsipras departed the podium and headed off for a long day. Eventually he secured a meeting with German Chancellor Angela Merkel and French President Francois Hollande, but no deal.

Juncker has a record of more demonstrative public behaviour than his European colleagues, as chronicled on websites such as one titled From Luxembourg with Love.

Why Tsipras, now a member of the radical left, appeared ill at ease is less clear. For the communist movement he once belonged to, past fraternal embraces have bode ill. A portrait of Soviet President Leonid Brezhnev kissing East German leader Erich Honecker full on the lips in 1979 now adorns what remains of the Berlin Wall, which fell a decade later.

Niceties and brinksmanship

Tsipras’s day began with an 8 AM flight from Athens to Brussels on the prime minister’s official jet. Often he takes scheduled flights, but perhaps this time Tsipras wanted to think over his negotiating tactics without interruption from Greek journalists, who also fly to major events in Brussels.

After the Juncker greeting, the young premier slotted in a brief discussion with the Commission president on the sidelines of the summit. The two men agreed to meet again on Thursday.

What remained uncertain was whether he would meet Merkel and Hollande, leaders of the eurozone’s two biggest nations, and without whose approval no deal can be struck.

Greek officials said privately they expected the talks to take place. Merkel said it was up to Tsipras to request a meeting with herself, and Hollande.

Only when the diplomatic niceties and brinkmanship had been dispensed with did the three leaders finally get together late in the evening, after dinner.

They met in a spartan conference room in the Commission headquarters on a floor far above where journalists are allowed to roam, so the only guide to the mood is a series off official photographs. They showed Tsipras, in his uniform of dark suit and no tie, smiling broadly as he sat next to Merkel.

Across the table sat Hollande. Both the French and German leaders also managed smiles, although Merkel’s seemed to involve more effort to achieve.

Afterwards, both sides said they had agreed that Athens should “intensify” negotiations with its creditors. But if there was any agreement on anything else, they didn’t mention it.

Otherwise, Tsipras spent part of his day mingling with leaders of countries perhaps more sympathetic to his cause, such as leftist presidents Evo Morales of Bolivia and Nicolas Maduro of Venezuela – both of whom have experience of taking on the Western establishment.

The post Tsipras Gets Greek Kiss, But No Deal Yet appeared first on Eurasia Review.

Australian Prime Minister Tony Abbott warned Thursday of the Islamic State group’s “global ambitions” and said more must be done to combat the organization’s extremist mass appeal.

Abbott was speaking in Sydney at the opening address of a regional conference that aims to help governments come up with a more unified plan to counter and prevent the distribution of terrorist propaganda.

“Daesh is coming, if it can, for every person and for every government with a simple message: ‘Submit or die,'” said Abbott, using an alternate name for the extremist group. “The declaration of a caliphate, preposterous though it seems, is a brazen claim to universal dominion. Now, you can’t negotiate with an entity like this; you can only fight it.”

The prime minister said Australia is looking for ways to get tougher with its citizens who go to fight with overseas terrorist groups, an action he referred to as a “modern form of treason.”

But the conservative leader conceded that the “only really effective defense against terrorism is persuading people that it’s pointless.”

“Above all, we need idealistic young people to appreciate that joining this death cult is an utterly misguided way to express their desire to sacrifice,” he said.

The two-day summit is being attended by officials from about 30 nations as well as delegates from major technology corporations, including Facebook, Twitter, and Google.

Social media has played a key role in helping the Islamic State group attract thousands of foreign fighters to join its so-called Islamic caliphate, which stretches across parts of Syria and Iraq.

Over 100 Australians are thought to have joined the Islamic State. This has prompted Australia to introduce tough laws that would strip dual nationals of their citizenship if they join a terrorist group.

Australian Foreign Minister Julie Bishop said Thursday the passports of 115 Australians have been canceled, nine others have been suspended, and 14 passport applications have been refused as part of the anti-terror efforts.

Bishop also said more attention should be paid to how women can help combat extremism, warning that females make up “around one-fifth of those flocking to join ISIS,” another name for the extremist group.

The post Australia: Abbott Warns Of Islamic State’s ‘Global Ambitions’ appeared first on Eurasia Review.

US President Obama is sending up to 450 additional military advisers and trainers to Iraq, in response to a call by Iraqi Prime Minister Haider al-Abadi.

“These new advisers will work to build capacity of Iraqi forces, including local tribal fighters, to improve their ability to plan, lead, and conduct operations against ISIL (Islamic State) in eastern Anbar under the command of the Prime Minister”, White House Press Secretary Josh Earnest said in a statement. The US official however excluded the engagement of the new troops, which bring the total on the ground in Iraq to 3,100.

The new base of al-Taqqadum will be used for the training, in addition to four others. According to the US, the training should help the Iraqi forces to regain control of the cities of Ramadi and Fallujah, though the Iraqi government has decided to deploy the majority in defence of the capital Baghdad.

The post Iraq: US Advisers To Coordinate Fight Against Islamic State appeared first on Eurasia Review.

By Gustavo Plåcido Dos Santos*

On May 28, 2015, Morocco’s King Mohamed VI landed in Guinea-Bissau for a two-day visit aimed at deepening bilateral ties.1 The official visit was part of a four-nation tour of sub-Saharan Africa, which included three of Morocco’s main regional partners: Senegal, Côte d’Ivoire and Gabon. At first glance, it is hard to understand the reason for Guinea-Bissau’s inclusion in such a high-profile trip. That, however, becomes clearer when considering the geopolitical context in which Morocco is inserted, as well as the foreign policy guidelines Rabat has been pursuing for more than a decade.

In general terms, the tour is representative of Morocco’s intention to avert its relative isolation in Africa — it is the only African country that is not a member of the African Union (AU) — focus on South-South cooperation and turn the African continent into a “strategic priority”.2 In fact, since 2000 the monarch has vis- ited several sub-Saharan countries, concluded bilateral agreements, and has been a staunch supporter of African causes and interests, either by actively contributing to peacekeeping operations or in supporting sub-Saharan countries in international fora.

One can rightly conclude that economic interests were a major driver in Morocco’s shift towards its southern neighbors. In a context of low European demand for Moroccan exports, Rabat recognizes the need to develop ties with the rapidly growing sub-Saharan countries, namely in West Africa, so as to boost the national economy. In 2014, West Africa was the second fastest growing sub-region in the continent (5.9%), with estimates pointing to 6.2% in 2015.3 Given the sub-region’s geographic proximity with Morocco and the potential associated with fantastic economic growth rates, it is not surprising that Rabat looks favorably at West African countries.

With respect to Guinea-Bissau, one can easily understand why Morocco views the tiny West African nation as attractive: the return to constitutional order and institutional stabilization will lead, at least in theory, to the revival of Guinea-Bissau’s economy, i.e. to the emergence of a consumer market and, more importantly, to opportunities in the construction sector — infrastructures are notably scarce in the country, a result of decades of political instability, as well as poor and weak governance.

In deepening its relationship with Guinea-Bissau, Rabat has greater scope to expand influence across a region where most countries have been cementing close ties with the Kingdom — namely Senegal, Guinea, Côte d’Ivoire, Mali and Mauritania — in this way forming a strategic bloc which will surely favor Moroccan political and security interests. That said, the motives for Morocco’s shift towards the south go clearly beyond economic interests.

More than economic gains

The rapprochement and strengthening of ties with sub-Saharan countries boosts Rabat’s politico-diplomatic position, thus guaranteeing broader support for sensitive diplomatic issues — such as the Western Sahara case — and also greater projection and influence in international fora. In fact, when making the joint declaration marking the end of Mohamed VI’s visit, Guinea-Bissau’s President, José Mário Vaz, reiterated his country’s support for Morocco’s sovereignty over the disputed territory. In addition, the Bissauan President declared his country’s support for Morocco’s bid to join the Community of Portuguese-Speaking Countries (CPLP) as an observer: if successful, Rabat will be present in another major diplomatic front.4

The Moroccan monarch has been making strategic use of its “religious diplomacy”,5 so as to strike a closer relationship with sub-Saharan countries. The King is viewed as a moderate with regards to Islam, which serves the purpose of fomenting ties and boosting Rabat’s influence. For this purpose, he takes advantage of the close links between Islam in sub-Saharan Africa and Morocco’s centennial Sufi traditions, as well as from the fact that, due to historic reasons, many Muslims in the sub-region recognize the legitimacy of the monarch’s religious leadership. It should be noted that West Africa is the only sub-region in sub-Saharan Africa with a Muslim majority (52.2% in 2010), with estimates pointing to a 60% increase in the next 20 years.6

This approach also aims at countering and limiting the propagation of the Wahhabi ideology, which has inspired the extremist groups behind instability in the region. This matter is also relevant in respect to Guinea-Bissau, a country where around 45% of the population is Muslim and is likely to comprise 48.8% in 2050.7 When applying the “religious diplomacy” in its relation with Guinea-Bissau, Rabat is advancing an efficient strategy not only to contain religious extremism in the tiny West Africa nation — which otherwise may spill-over across the region — but also to insert Bissau within its sphere of influence. It is therefore not surprising that Mohamed VI ended up leading prayers in the Attadamum Mosque, in Bissau, during his visit.8 Furthermore, also noteworthy is the link between drug-trafficking and the expansion of jihadi groups in the Sahel. Despite the decrease in drug-trafficking in Guinea-Bissau — largely due to the return to constitutional order and US operations in the region — the phenomenon is still very much present. This represents a threat to Rabat’s interests, since drugs finance and promote jihadi and criminal organizations in the Sahel — Morocco is one of the transit points between Africa and Europe for narcotics originating from Guinea-Bissau.9

One of the major issues approached by both sides during Mohamed VI’s visit to Bissau was precisely to strengthen security cooperation, in particular the fight against terrorism and organized crime. Morocco is one of the main regional counter-terrorism players in the Sahel and understands that the fight against religious extremism can only succeed through greater bilateral and regional cooperation. Having said this, deeper ties between both countries, namely in terms of the promotion of socioeconomic development and rule of law in Guinea-Bissau, is a necessary approach so as to contain potential areas of tension and instability, while fostering greater and more efficient cooperation.

Conclusion

Morocco has been diversifying its external relation, shifting its focus to South-South Cooperation, in particular with West Africa. Considering the region’s highly attractive economic and politico-diplomatic potential, this is a logic approach for any nation intending to increase its influence. Aware of the limitations associated with not being part of the AU, Rabat has taken advantage of traditional religious links with Muslim populations in the sub-Saharan region, especially with West Africa, and also from its increasingly important role in the fight against terrorism in the Sahel.

Rabat’s strategic handling of those religious links has promoted Morocco has a reliable and committed partner in the region’s security and stability context, while allowing it to project its influence. Guinea-Bissau fits well in that strategy, mirroring the importance with which Morocco regards the country within West Africa. In addition, the inclusive nature of Morocco’s foreign policy towards the sub-region creates a breeding ground for greater regional cooperation.

The Kingdom’s contribution to the fight against criminal activities, to the promotion of the rule of law, to the consolidation of the constitutional order, and to socioeconomic development in Guinea-Bissau is crucial to Morocco’s own stability. Not to opt for a multidimensional strategy of this kind represents a risk which Rabat, as a rising regional power, certainly does not want to take. Morocco’s internal stability, economic growth and international affirmation are deeply intertwined with the fortunes of the region comprising West Africa and the Sahel. That being said, even though Guinea-Bissau is relatively less important than other regional countries, it should nevertheless be regarded as an integral part of the complex setting in which Morocco is inserted.

About the author:
*Gustavo Plåcido Dos Santos, Portuguese Institute of International Relations and Security (IPRIS)

Source:
This article was published by IPRIS as IPRIS Viewpoints 176 (PDF)

Notes:
1. 16 bilateral agreements were signed in several areas. “África: Guiné-Bissau e Marrocos assinam 16 acordos de cooperação” (Agência Angola Press, 29 May 2015).
2. “Africa, Strategic Priority for Morocco’s Foreign Policy: Minister” (Morocco World News, 25 May 2015).
3. “World Economic Situation and Prospects: Mid-2015 Update” (ONU, 19 January 2015), p. 112.
4. “Joint Declaration issued at the end of Official Visit of Morocco King to Guinea Bissau” (Maghreb Daily News, 31 May 2015).
5. Ghita Tadlaoui, “Morocco’s Religious Diplomacy in Africa” (FRIDE, 27 February 2015).
6. “The Future of the Global Muslim Population: Sub-Saharan Africa” (Pew Research Center, 27 January 2011).
7 .In contrast, the Christian population is expected to decrease from 19.7% in 2010 to 16% in 2050. “Global Religious Futures” (Pew Research Center).
8. “Rei de Marrocos dirige oração na Mesquita de Attadamum em Bissau” (Portuguese News Network, 29 May 2015).
9. Guinea-Bissau has been dubbed as the first narco-state in Africa. “Africa’s Cocaine Hub: Guinea-Bissau a ‘Drug Trafficker’s Dream’” (Spiegel International, 8 March 2013).

The post Guinea-Bissau In Morocco’s Foreign Policy – Analysis appeared first on Eurasia Review.

By Dr. S.Chandrasekharan

On 8 June, the four major parties- the Nepali Congress, the UML, the UCPN (Maoist) of Dahal and Madhesi Janadhikar Forum ( dem) of Vijay Gacchadar concluded a sixteen-point agreement on the new constitution.

Though the media reports indicate as if the final draft has been made out, it looks that only an outline has been agreed upon and problems are still likely to arise when the details are to be filled up.

It is also being made out that this will be the final stage of the deliberations that have been going on since the formation of the second Interim Constituent Assembly and from now on it will go to the CPDCC headed by Baburam Bhattarai to prepare the draft after making “another effort” to get the approval of those parties left out. The Maoist Chief Dahal seems to have abandonedt his thirty parties alliance in the negotiations.

The four parties command in all a majority of 465 out of 601 and they hope that some from the minor parties may also join and support the draft. With this strength, the ruling parties expect to get the provisions of the constitution passsed in the Assembly not withstanding the opposition of many of the Madhesi and Janajathi groups.

A ‘spin’ is being made out that the devastating earthquake of April 25 acted as a “trigger” to get the parties to compromise on their earlier rigid stand and move forward for the new constitution. But nothing could be farther from the truth.

The political leaders were no where to be seen in the first few days of the earth quake and when they did surface later they were booed and hooted out! The government of Sushil Koirala did not fare well either when there was total confusion and lack of coordination in the first few days!

Now the highlights of the 16 point Pact of the four parties:

• The country is to be federated into eight federal provinces on the basis of five ‘facts’ namely- ethnicity/community, language, culture, regional continuity and history and finally on four factors of capability that would include economic capability, infra structural potential, availability of natural resources and administrative feasibility. ( A very complicated formulation which perhaps reads better in the original Nepali script. To me it appears to be an attempt not to include the industrial districts of Morang and Sunsari in one of the two Terain provinces!)
• A Federal Commission will be formed to finalise the demarcation of the federal states while naming them will be left to the federal assemblies that will approve only with a two third majority. The Commission will have a mandate of six months time to complete the demarcation. ( Judging by the innumerable problems involved, it is doubtful whether the Commission would be able to decide on this complicated issue in six months when the political parties in the last six years have not been able to come to an agreement. Much would depend on the composition of the Commission)
• The Constituent Assembly will be turned into a central Legislative Parliament after the promulgation of the new constitution. (It is not clear how the current strength of 600 and odd members will be reduced to less than half the strength)
• The Lower House will have a strength of 275 members of whom sixty percent will be directly elected in ‘first past the post system’ – which comes to 165 and the rest will be elected by proportional representation. The upper House will have 35 members, and all elected through proportional representation.
• A Constitutional Court will be established and will be in existence for ten years to resolve disputes in local, federal and central courts.
• All executive powers will be vested in the Prime Minister and there will be a ‘ceremonial’

President elected through the Parliament. (Probably the Maoists have given up on an “Executive Presidency” in return for agreeing on eight states federal structure)

• Elections to the posts of President, Vice President, Prime Minister, Speaker and Deputy Speaker will all be made after the declaration of the new constitution.

The most crucial point that should have been decided was on the configuration of the provinces. In fact, the finalisation of the new constitution was getting delayed only on account of differences among the political parties on the question of identity-based provinces. By skirting this issue and leaving it to a future Federal Commission, the leaders of the four political parties have not only abandoned their responsibility but have given sufficient space for future strife, discord and instability.

What a pity that the legislators after seven years of tortuous negotiations have produced a damp squib.

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By Sylvia Mishra*

There is an emerging trend, substantiated by opinion polls and surveys, that the 2016 presidential elections are going to be dominated by foreign policy issues. As the US economy is bouncing back improving job creations and with the unemployment rate down to 5.5 percent, economic concerns that dominated the 2008 and 2012 presidential races are seemingly less critical in 2016. As the US confronts complex global challenges such as countering Islamic state militants in Syria and Iraq, negotiating a deal with Iran, diffusing the crisis in Ukraine and the rise of China, presidential candidates would be thoroughly tested on their abilities to address foreign policy challenges. Several Republicans hopefuls have already announced their Presidential bid to candidacy like Scott Walker, Marco Rubio, Rick Perry, Rand Paul, Mike Huckabee, Ted Cruz, Carly Fiorina, Rand Paul, Rick Santorum, George Pataki, Lindsey Graham and Rick Perry. The former governor of Florida, Jeb Bush, has confirmed that he would announce his bid on June 15 in Miami.

During the presidential elections of 2016, Republican candidates are trying to uncover the Grand Old Party’s (GOP) long and distinguished foreign policy lineage that during the last decade had been scarred by the war in Iraq. Republican candidates are focused on developing better appreciation for a full spectrum of foreign policy tools and avenues of non-military aspects in foreign policy. Senator Rand Paul, one of the leading presidential contenders, has defended his libertarian-leaning philosophy on foreign policy and national security by invoking the foreign policy tradition of ‘peace through strength’ of former Republican President Ronald Reagan. Republican presidential nominees are also focused on developing a comprehensive foreign policy stand on pressing issues such as devising a comprehensive strategy against the Islamic state, WMD proliferation, mobilizing international coalition, assistance to nations on post-war transition and addressing the strategic uncertainties in Asia. Developing cogent strategies on these issues would provide Republican candidates a counter-weight to the experience of former Secretary of State Hillary Clinton who is expectedly the leading Democrat nomination.

GOP contenders, Rand Paul, Marco Rubio, and Lindsey Graham, have all been highly critical of the present Obama administration for not developing a comprehensive plan to prevent the ISIL from controlling large swathe of territories in Iraq and Syria. Scott Walker, the Wisconsin Governor, speaking during a South Carolina GOP Grassroots provided a sharp critique of President Obama’s foreign policy and stated that the US needed a President who would stand more firmly against the Islamic State and behind Israel. Walker rallied for a more aggressive strategy stating that the safety of Americans is directly proportional to America’s willingness to intervene militarily in the Middle Eastern countries. While there is a striking consensus among all the GOP primaries that the US needs to have a more proactive approach to foreign policy making.

At the frontline of Republican primaries is Jeb Bush, who has spent the last six months raising money and touring voting states and building a political organization to prepare for a campaign. At a townhall meeting in Dubuque, Jeb Bush managed answers to inevitable questions like whether he would have gone to war in Iraq and he did so with intelligence and patience. He opined, “Knowing what we now know, I would not have engaged…I would not have gone into Iraq.” As Jeb Bush began his 6 days trip to Europe, in his speech in Berlin, he was sharply critical of President Obama administration’s approach towards Russia for being unable to establish a harder line against Russian President Vladimir Putin’s annexation of Crimea. Calling for closer ties with Europe, Jeb Bush stated that solidarity with allies are essential to preserve the fundamental principles of international. So far, Jeb Bush has been able to tread the fine balance of distancing himself from the weight of his family name famously stating, “I am my own man, and my views are shaped by my own thinking and my own experiences” and yet also carve out his own vision of America’s role in the world.

Marco Rubio, Senator from Florida could prove to be Bush’s most formidable opponent as he and bush will jostle in Florida’s winner-take-all primary. At the Council on Foreign Relations in New York City, Marco Rubio presented a polished speech with his neoconservative position on the deterioration of America’s physical and ideological strength leading to a world that has become far more dangerous than when President Obama entered office. He stated three pillars of his doctrine: American strength, the protection of America’s global economy, and a proud advocacy for America’s core values. Senator Rubio also presented ideas on downsizing troops and increasing the number of cyber warriors and special operators in a world where set piece battles are increasingly obsolete.

As the Presidential elections unfold, Republican candidates would be thoroughly tested on their merit of thinking creatively on issue-based solutions to global challenges and exploring facets of diplomacy and non-military aspects of foreign policies in contrast to the focus on military interventionism and a hawkish vision of American policies abroad.

*The writer is a Junior Fellow at Observer Research Foundation, Delhi

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The resignation on Tuesday of McKinney, Texas policeman Eric Casebolt after the widespread viewing of a video showing Casebolt drawing his gun and brutalizing a teenager outside a pool party may not be enough to bring justice, suggests Judge Andrew Napolitano. Napolitano, in a Fox Business interview, argues that it would be proper to prosecute Casebolt.

Reviewing the video footage, Napolitano explains to host Stuart Varney that Casebolt, who Napolitano calls a “hothead,” appears to have committed an illegal assault:

Varney: The police officer could be guilty of a crime?

Napolitano: Oh sure, it’s an assault for him to pull the gun on someone when it’s contraindicated under police procedures. He can only pull his gun to resist deadly force. There is no deadly force being applied to him.

Napolitano, a Ron Paul Institute Advisory Board member, explains later in the interview that further action should be taken against Casebolt stating:

[T]he tape that we saw showed unlawful behavior on the part of that cop. His superiors were right to suspend him and investigate. The prosecutor would be right to prosecute.

Many people assume that police are above the law and can get away with murder. Indeed, that is often the case. But, where there is video documentation of police misconduct, there is a much greater likelihood that police will be held accountable. Video documentation can also help police misconduct victims overcome trumped-up charges and even obtain compensation. The power of video may also lead some police to behave better when they know or suspect they are being recorded.

For some tips regarding filming police, check out the “Film the Police” page on the Cop Block website.

This article was published by the RonPaul Institute.

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By Andrew Topf

The financial pages of Canadian newspapers have been full of headlines lately announcing the potential of two large shale oil fields in the Northwest Territories said to contain enough oil to rival the Bakken Formation of North Dakota and Montana.

The report by Canada’s National Energy Board (NEB) evaluated, for the first time, the volume of oil in place for the Canol and Bluefish shale formations, located in the territory’s Mackenzie Plain. It found the “thick and geographically extensive” Canol formation is expected to contain 145 billion barrels of oil, while the “much thinner” Bluefish shale contains 46 billion barrels.

The report did not estimate the amount of recoverable oil, but points out that even if one percent of the Canol resource could be recovered, that represents 1.45 billion barrels. The calculation immediately had reporters comparing Canol and Bluefish to the Bakken, where the latest USGS estimate shows 7.4 billion barrels of technically recoverable oil (this includes the Three Forks Formation underlying the Williston Basin straddling North Dakota, Montana, Saskatchewan and Manitoba).

“Northwest Territories sitting on massive shale oil reserves on par with booming Bakken field in U.S.,” enthused the Financial Post. “NEB and GNWT study finds 200 billion barrels of oil in the Sahtu,” gushed CBC News, referring to a region of the sprawling territory that cuts across three provinces and touches the Arctic Ocean.

In truth, energy industry followers would do better to read a more subdued story in Bloomberg News, titled “Drop in oil prices means no drilling in Canada’s biggest shale reserves.” Because while the report from the NEB does indeed point to a very large pool of potential shale oil, getting it out of the ground will be no small feat, especially at today’s prices.

Before getting into the explanations, a little history and context.

Petroleum geologists have known about the Canol (short for Canadian oil) shale play at least since 2010, when ConocoPhillips bid $66 million to secure the rights to explore an 87,000-hectare parcel known as EL470. Thought to be the source rock of the Normal Wells discovery, which has yielded over 226 million barrels of conventional, light sweet crude since it was found in the 1920s, the Canol formation sparked a flurry of exploration activity around 2012-14. The area has seen 14 exploration licenses granted and $628 million in work commitments over the last five years.

ConocoPhillips, Imperial Oil, Shell Canada and Husky Energy are the major leaseholders in the Canol, along with MGM Energy, an Alberta-based junior that originally hitched its wagon to the Mackenzie Gas project, a proposed natural gas pipeline that would run 1,200 kilometers along the Mackenzie Valley to connect northern onshore gas fields with North American markets. The project was approved by the NEB in 2010.

But with U.S. shale gas flooding the market, the proposed pipeline, led by Imperial Oil, no longer made sense, so MGM turned its attention to unlocking Arctic shale oil. The company gobbled up 189,000 net acres in the Canol, and in 2013 did some drilling at one of its four licenses in the play. Shell, Husky and ConocoPhilllips have also drilled wells, but in all, only about 20 have penetrated the formation, according to John Hogg, the former vice president of exploration and operations at MGM, who is now president of Skybattle Resources Ltd., a consulting company.

In 2014 MGM was taken over by Paramount Resources after failing to find a partner to help fund development of its shale oil prospects, including its main exploration license known as EL466. That license was estimated to have 625 million barrels of oil in place.

“We know there is a tremendous resource here,” Hogg told Alberta Oil in a feature report on the Canol in 2013. “What we don’t know is how much has the potential to be economically developed.”

Indeed that is the question on the minds of oil investors as they digest the latest numbers of potential barrels of oil under the Arctic tundra. The two formations have more oil in place than any other shale deposit assessed by the NEB, including the Montney region and Duvernay field. Globally, their significance is harder to assess. If all 191 billion barrels were technically recoverable, they would represent over half of the 345 billion barrels of global recoverable shale oil resources, more than the top four countries, Russia, the U.S., China, and Argentina, combined. But as was mentioned earlier, the NEB did not do that recoverable-oil calculation.

Knowledgeable oilmen like Hogg say that the Canol, while highly prospective, is a long-term game that will have to wait until oil prices rise. ConocoPhillips and Husky have both suspended exploration in the play, scared off by the oil price rout.

Hogg told Bloomberg that exploring the Canol costs three to four times more than in northeast British Columbia, where the Montney Basin has been a hot zone of oil and gas exploration recently. That’s because the region lacks key infrastructure. A winter road is the only means of trucking drilling equipment to the Mackenzie Valley, with no all-weather road linking the potential oilfields to southern Canada. According to Hogg, a 500 to 800-barrels-a-day per well operation would only be profitable with oil at $75 a barrel (the Bakken produces an average of 630 barrels a day per well currently). WTI crude closed at $59.13 on Friday, June 5th.

Even if oil prices climb higher, those hoping for a Canadian Bakken need to be aware of the byzantine regulatory environment the Northwest Territories operates under compared to business-friendly Alberta to the south. Companies must submit applications to multiple regulators, versus a single regulator in Alberta With environmental assessments typically taking over 18 months to complete.

The Canol and Bluefish are shale oil formations, so companies will have to drill horizontal wells and use hydraulic fracturing to extract the oil. Fracking is a controversial practice that has not gone over well in other parts of Canada. Quebec and Nova Scotia have banned it, along with the state of New York, in the United States. Considering that most of the communities in the Mackenzie Valley are small and aboriginal, where the people see themselves as stewards of the land, it is quite unlikely that a big expansion of oil and gas production in the area would be allowed to go forward unopposed.

Then there’s the historical enmity towards new pipelines in the Northwest Territories. Pulling the oil out of the ground at economical prices is one thing, but getting it to southern markets is quite another. The Mackenzie Valley Pipeline to move natural gas from the Beaufort Sea through the Mackenzie Valley into Alberta has been frequently delayed due mostly to opposition from aboriginal groups. The closest the pipeline ever came to fruition was to receive federal Cabinet approval in 2011. The project is now estimated to cost $20 billion and no-one knows if and when market conditions will be favorable.

In late 2014, there was another proposal to transport bitumen, the tarry substance from which oil sands crude is derived, to Tuktoyaktuk, a hamlet on the coast of the Arctic Ocean. But again, the participation of native tribes is deemed crucial to the project. The experience of Enbridge, which is trying unsuccessfully to gain public acceptance of a plan to move oil sands crude across northern Alberta to a port on the British Columbia coast, does not hold much hope for the Northwest Territories, as far as new pipelines go.

Put it all together, and the potential of Canadian Arctic shale turning into another Bakken appears rather remote. Lack of infrastructure, low oil prices, a difficult regulatory environment, and a population that has traditionally opposed the expansion of oil and gas pipelines, are all factors working against this monster resource from ever moving beyond “in place” to anything resembling a set of producing fields.

Source: http://oilprice.com/Energy/Crude-Oil/Busting-The-Canadian-Bakken-Myth.html

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