Thank you, Eric, for all of our foreign news updates!
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Sorry about last week guys, I had some issues I got stuck dealing with in my neck of the woods. Here is what happened the last two weeks.
**China**
Chinese People Demand War With United States
I’ve been warning for months now that Chinese leaders have been pushing the possibility of war with the US as a means of rallying their people to a nationalistic banner. That saber rattling may have gone too far as a ground swell of anger and nationalism leading to demands for the Chinese government to declare war on the US.
Hong Kong Politicians Call for Independence
Secessionists of various stripes have always been part of Hong Kong politics. However, previously they were fringe positions which were ignored by a majority of the population – ala the UK Independence Party not too long ago. Now, with China undermining the One Country, Two Systems Policy which was intended to protect Hong Kong’s financial markets as a means of boosting China’s economy, calls for independence are gaining ground and becoming mainstream in Hong Kong.
In spite of losing their case in The Hague, China has announced they will build more military sandcastles in the South China Sea. This is yet another part of China’s saber rattling towards their neighbors. Most likely, the State Run Press will characterise this recent building spate as a reaction to foreign aggression.
It’s not.
China Not Even Pretending Anymore
For the last few decades, China has tried to pretend to be benevolent. Their claims to hegemony over the area were always presented as the natural leadership of the strongest power in a region – something akin to Germany’s role as the hegemon for Europe or Egypt’s role as the hegemon of North Africa. Now, China isn’t even pretending anymore.
China’s Attempt To Have Cake And Eat It Too Backfiring
If you want to grow your economy, you need to invest in basic infrastructure and manufacturing. Both increase the efficiency with which you can produce goods and services and drive down costs – which increases the equality of your standard of living. However, this causes short term shortages and can be bad for politicians’ job security and requires allowing failed businesses to go under. China is unwilling to do that, and as such they are putting the long term health and growth of their economy in danger.
Which is a serious mistake now that manufacturing firms are looking to move their physical plants to Vietnam and India.
Philippines Threatens Bloody War Against China
With China continuing to ignore the judgement from The Hague, President Rodrigo Duterte is threatening war.
China Upset With South Korea Over Anti-Missile System
As with Russia in East Europe, China is upping pressure on US allies in the region not to build systems to protect themselves against hostile powers with ballistic missiles.
**Russia and Ukraine**
Russia Moving Tactical and Strategic Warplanes Into Striking Range of Ukraine
Engineering and technical personnel are accompanying the move, which indicates this is intended to be a long duration deployment.
Russia Expels Mormon Missionaries
Russia accused them of violating the new laws against religious proselytizing.
Donetsk People’s Republic Increases Heavy Vehicle Usage Twentyfold
Though officially separate from the Russian government, the number of heavy weapons and vehicles which are making their way into the hands of separatists is raising questions.
**India and South Asia**
Vietnam A Strong Emergening Market
Strengthened by foreign investments and natural resource usage, Vietnam is a quickly growing economy.
One Dead, Dozens Injured in Kashmiri Riots
Continuing riots in Kashmir led to more deaths this week. The riots are sparked by Pakistani radicals who wish to see Kashmir merge with Pakistan.
Prime Minister Modi Seeks Radical Modernization Scheme
Following on the heels of the economic rationalization scheme from a few weeks ago, PM Modi is seeking to modernise the administrative system of his country in order to cut costs and increase efficiency. If successful, this could drastically increase the relative strength of the Indian economy above and beyond the effects of the tax rationalization scheme.
**Middle East**
Kurds Withdrawing From Hard-Won Areas Ahead of Turkish Intervention in Syria
Turkish government has admitted they are only acting to stop Kurdish gains, but they have managed to capture the primary entry point for ISIS recruits regardless. The question remains though as to how well Turkey will do at stopping the flow of new ISIS recruits after several years of profiting from ISIS’ black market oil trade.
Kurdish radicals are being blamed for a car bomb outside the Police HQ in Cizre, Turkey. The Council of Aleppo – a Kurdish led political body which serves as the civilian oversight for the Kurdish militias in Syria – had previously called for resistance to the Turkish intervention in Syria.
Airstrikes Continue Hurting ISIS Revenues
US and Coalition airstrikes against ISIS controlled oil fields continue to cut into the ISIS coffers. They are still managing to export ~30k barrels per day, but this is well below the peak of ~400k barrels per day.
Ayman al Zawahiri Urges ISIS Sympathizers To Focus on Iraq
Anticipating the destruction of ISIS, Al Qaeda’s chief is urging Sunni fighters to focus on fighting for control over Iraq and fighting against the Shia forces which the Iraqi government has imported from Iran to bolster their stability.
US-Iranian Confrontations Up 50%
Iranian patrol craft in the Persian Gulf have challenged US Navy vessels in the region 50% more often this year, including 30 incidents which the Pentagon labeled as “dangerous”.
Corruption Rampant in Egypt’s Wheat Industry
I’ve focused on this for a reason. Egypt was previously a breadbasket, but has become a net importer of wheat. This drives up prices for staple foods which – in turn – ramps up unrest in the Third World. With 200k tons missing from Egypt’s wheat storage silos, expect even worse unrest this year than previously.
**Europe**
East Europe Urges EU Army
With Russia continuing to fund and supply manpower for Ukrainian conflict, Eastern European states are urging Germany to establish a joint EU army.
ISIS Sends New Wave Of Mujahideen To Europe
“Shockingly”, the Muj used fake passports to sneak into Europe. I don’t want to say “I told you so”, but…
Europe Rethinking Refugee Policy
It may be shutting the barn door after the flood got in, but Europe seems to be waking up to the dangers of their previous refugee policy.
Facing a credit downgrade, Portugal is at risk of having their bonds rendered ineligible for future QE programs from the European Central Bank. Yields on 10 Year T-Bills from Portugal’s government have jumped above 3% in response.
**Africa**
Japan To Invest In Africa
Following up on plans to invest heavily in India recently, Japan is announcing a plan to regain the dominance in the African market after China gained dominance in the area. New investments will focus on infrastructure and commercial expansion.
**South America**
Maduro To Double Down”
President Maduro, idiot, of Venezuela is expected to double-down on policies which led to the economic collapse. Citizens have gathered enough votes to recall Maduro, but the government is doing its best to prevent that recall from happening.
Trust me, the next one won’t be much better…
Deadly Malaria Strain In South America
Zika isn’t the only thing to worry about when it comes to South AMerican mosquitos. A new strain of malaria is on the rise due to the global health system transferring focus to Zika, which is carried by a different mosquito species, just in time for the new outbreak in Colombia. The ongoing economic crisis in Venezuela has completely eliminated their ability to stockpile the needed course of treatments. Stay safe, HMGB.
