Skip to main content

Posts

Showing posts from June 17, 2014

Sunni Militants' Resurgence in Iraq

Click to Enlarge


The Shiite-dominated Iraqi state has weakened to the point where Tehran will have to depend on Shiite militias to protect its interests across the Iraqi border. When Iran's Shiite proxies consolidated control over Iraq after the U.S. invasion, Tehran took comfort in the weakening of the Sunnis, the minority community that had dominated Iraq since 1920. However, Tehran has been concerned about a potential Sunni revival, especially since the Arab Spring in Syria metastasized into a full-scale civil war and regional sectarian conflict. If Syria fell to the Sunnis, Tehran's allied regime in Baghdad would be threatened and Iran could again face a major threat on its western border.

Iran's sense of relief about preventing the collapse of the Alawite regime in Damascus shattered earlier this month when Islamic State in Iraq and the Levant militants surged in Iraq. The offensive likely came as a surprise, since the Sunnis in Syria had been contained and the Islami…

Russia: Natural Gas Cutoff Puts Pressure on Ukraine

An employee at Uzhgorod natural gas metering station near Chaslivci, Ukraine on May 21.(ALEXANDER ZOBIN/AFP/Getty Images)

Analysis


Following weeks of EU-arbitrated negotiations between Russia and Ukraine, Russian energy company Gazprom cut off natural gas supplies to Ukraine on June 16. Five days earlier, Russian Energy Minister Alexander Novak threatened that Moscow would do so if Kiev did not make a $1.95 billion payment on its natural gas debt. On the same day, both Gazprom and Ukraine's Naftogaz filed lawsuits in an arbitration court in Stockholm; Gazprom is trying to collect $4.5 billion in back payments, though Naftogaz claims it had actually overpaid by $6 billion.

Russia is trying to pressure Ukraine and its European backers into compromising on debt repayment and pricing. The wrangling over debt and natural gas prices will continue, but the current cutoff is likely to be temporary and less detrimental to downstream buyers than previous cutoffs.

Click to Enlarge


Recently, ther…

U.S. Supreme Court Rejects Argentine Petition

A newsstand owner counts Argentine pesos bills in Buenos Aires.(LEO LA VALLE/AFP/Getty Images)

Analysis


The U.S. Supreme Court rejected a petition from the Argentine government June 16, effectively ending years of legal battles in U.S. courts. The decision not to hear Argentina's case means that a 2012 ruling by lower courts, which forced Argentina to pay holdout creditors, remains intact.

The decision by New York District Judge Thomas Griesa said that if Argentina intended to make payments to creditors holding bonds issued in 2005 and 2010, when it restructured its debt, it would have to pay the full value of bonds held by creditors who refused to renegotiate their bonds after the default, known as the holdouts.

Click to Enlarge


Of the original $95 billion default from Argentina's 2001-2002 economic crisis, a total of 93 percent of creditors participated in the previous debt restructures. Roughly $15 billion, a sum that includes estimated interest, remains in default. At stake in…

Finland Aims to Continue 'Finlandization'

Summary


Finnish EU Minister Alexander Stubb, who is likely to be appointed prime minister in the coming days, said June 14 that his country should join NATO. This comes amid an ongoing debate over the future of Finland, a country that has put military nonalignment at the core of its foreign policy. The debate highlights the extent to which the events in Ukraine are having a political and psychological effect on the line of countries from the Baltic Sea to the Black Sea that traditionally have been caught in the conflict between Russia and the West.

While there is room for greater cooperation between Finland and NATO, Helsinki is unlikely to formally join NATO any time soon. In the coming years Finland will remain particularly interested in cooperating with its main regional partners in Nordic Europe, especially Sweden.

Analysis


Finland is the quintessential borderland state, surrounded by powerful neighbors, and the Finns have spent the past 10 centuries worried about events to their east…