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Showing posts from October 15, 2013

China's Coal Dependency

According to government authorities, Beijing will close its four remaining coal-fired power plants before the start of 2015, replacing them with four new natural gas-fired power plants at a total investment cost of $7.8 billion. When completed, these four power plants using natural gas from Shaanxi province will have a total generating capacity of 2.7 gigawatts. In the near term, efforts to reduce coal usage will probably be limited to Beijing and a few other top-tier cities, such as Shanghai, Tianjin and Guangzhou, where the Party is most keen to quell social discontent by improving the quality of life, in part by decreasing pollution.

The rest of China's economy will almost certainly continue to rely on coal for two-thirds or more of its energy and electricity needs throughout the next decade; national coal consumption is set to rise from 3.66 billion metric tons in 2012 to well over 4 billion metric tons in the next few years, despite the government's intent to cap consumpti…

In the Eurozone, 2014 Budget Debates Heat Up

Summary


Ireland and Portugal, two recipients of bailouts from the European Union and the International Monetary Fund, will present their 2014 budgets on Oct. 15. While the new budgets probably will include spending cuts and tax hikes, austerity measures are likely to be less harsh than in previous years. Dublin and Lisbon are attempting to balance social stability against fiscal consolidation efforts as they prepare to return to financial markets in early and late 2014, respectively.

Elsewhere in the European Union, debates over national budgets for 2014 have been particularly contentious in the Netherlands and Italy, two countries with fragile ruling coalitions. France, meanwhile, is looking for a balance between demands at home and abroad.

Analysis


On Oct. 8, the European Commission accepted Ireland's plan to implement tax and spending increases worth 2.5 billion euros ($3.39 billion), instead of the 3.1 billion euros originally agreed upon with the troika (the commission, the Eur…

In Turkey, an Inevitable Shift in Foreign Policy

Summary







Turkey's Middle East policy under the ruling Justice and Development Party has broadly focused on two ambitious objectives: deepening influence in the Arab world through the empowerment of moderate Sunni Islamist forces and a visibly antagonistic relationship with Israel, and using political and economic appeasement to contain Kurdish separatism. These policies, closely linked with the leadership of Turkish Prime Minister Recep Tayyip Erdogan and Foreign Minister Ahmet Davutoglu, may be expiring. Turkey simply lacks the internal political coherence and the regional influence to stick to foreign policy positions that collectively run against U.S. and Iranian interests.




Turkey will be driven toward a more moderate foreign policy by a number of factors, including a developing U.S.-Iranian dialogue, Washington's willingness -- at least temporarily -- to work with Russia in the Middle East, the proliferation of battle-hardened jihadists in Turkey's immediate region and a…