Monday, July 31
A DEAL ON PAPER
Talks continue for Indonesia-Australia trade pact
Negotiators will meet in Canberra today for the next round of talks on the Indonesia-Australia Comprehensive Economic Partnership Agreement, a free trade deal.
The relationship has untapped potential, with Indonesia only Australia’s 16th largest trading partner. To upgrade it, Jakarta wants tariffs cut on paper and palm oil exports in return for slashing duties on Australian sugar.
Canberra has talked up the agreement, with Trade Minister Steve Ciobo declaring it his “number one trade priority”. On July 7, Malcolm Turnbull posted a video with Indonesian President Joko Widodo, hoping to wrap up the deal by year’s end and praising ties between the two neighbours as “getting stronger all the time”.
Despite the optimism, the path ahead has roadblocks. One came in April when Australia slapped a tariff on Indonesian paper over concerns its cheap price hurt the domestic market. Though Mr Ciobo has stressed it was an independent commission’s decision and not the Turnbull government’s, Jakarta will undoubtedly want the duty eliminated.
With Australia also eyeing deals with the EU and a post-Brexit UK, Turnbull will hope today’s talks go well not only for their own sake, but to presage a free trade winning streak.
TACTICAL WITHDRAWAL
UN cuts peacekeeping mission in the Democratic Republic of Congo
Taken on March 31, the decision to significantly reduce the UN peacekeeping mission in the DRC will be felt on the ground today.
The mission was originally established in the aftermath of the Second Congo War in 1999 to stabilise the country.
The cuts to the mission, which include the closure of five bases in the country’s east and a troop reduction of 25%, were heavily pushed by the US with Ambassador Nikki Haley saying the “UN is aiding a government that is inflicting predatory behaviour against its own people.”
Indeed, the mission is often criticised for being ineffective and is riddled with accusations of human rights violations and fraternisation with various parties to the conflict.
But the cuts could hardly have come at a worse time, with President Joseph Kabila’s unwillingness to yield power likely to exacerbate violence in the country’s central Kasai region.
With the UN unable and unwilling to pressure the government it will be up to the Congolese opposition to make sure that Mr Kabila sticks to his pledge of holding presidential elections this year and yielding power to his successor.
Delve deeper: Kabila’s Congo: the end of an era
LOFVEN IN PARIS
Embattled Swedish prime minister meets with French leadership
Swedish Prime Minister Stefan Lofven heads to Paris today for talks with Emmanuel Macron and Prime Minister Eduoard Phillipe.
The embattled Lofven is struggling to survive political turmoil back home. A fresh scandal centres on his government’s outsourcing of driver’s license databases to IBM Sweden. A lack of safeguards exposed that data—potentially including the identities of undercover operatives.
Lofven has resisted calls to resign, instead reshuffling his cabinet and bracing for a confidence motion when parliament returns from a summer break in September. Rather than face that vote, the prime minister may call early elections.
If so, the Paris visit could provide a boost. A YouGov poll at the end of June found that Mr Macron has a favourable rating of +29% among Swedes. So, Lofven could be hoping that appearing side-by-side with the French president will bolster his image as a statesman as his fate is decided.
Yet, Lofven is unlikely to receive much alleviation from his domestic headaches. At the very least, the Paris visit could bring him a respite from his looming potential unemployment.
HAPPENING ELSEWHERE…
Three days after Pakistan’s Supreme Court ousted PM Nawaz Sharif it will resume a hearing into the country’s popular opposition leader—former cricketer Imran Khan. The case has been brought by the leader of the ruling Muslim League-Nawaz, who wants Khan disqualified from leading the opposition PTI over accusations he owns offshore companies and evaded tax authorities. The allegations are designed to damage the former cricketer’s squeaky-clean image. Indeed, with the departure of PM Sharif, Mr Khan has a golden opportunity to claim the premiership when elections are held next year. But Sharif has other plans—his brother, Shahbaz, is set to become prime minister within two months and, in all likelihood, will contest the next election against Imran Khan. The more damage the ruling party can do to the opposition leader now, the easier their road back to power.
The US is reportedly pushing for the UN Security Council to discuss North Korea’s ICBM launch on Friday, although Ambassador Nikki Haley denies a formal request has been made. Pyongyang and experts both claim the missile tested on Friday test puts much, if not all, of the mainland US within range. The US responded by flying B-1 bombers over South Korea and conducting a successful test of the THAAD missile defence system over Alaska. President Donald Trump lashed out at China for not reining in North Korea, setting the two powers on a potential collision course.
US Vice President Mike Pence will inspect NATO troops serving in the Enhanced Forward Presence program in Estonia. Later in the day, Mr Pence will depart for Georgia.
UK Treasury officials will meet behind closed doors to begin discussions on the November budget. The Sunday Times reports Finance Minister Phillip Hammond is considering tax hikes on fuel, homes, incomes and business.