Out with NAFTA, in with the United States-Mexico-Canada Agreement. On Sunday, the U.S. and Canada announced they had reached an agreement on trade. Canada made notable concessions on U.S. access to its dairy market, while the U.S. relented on keeping the Chapter 19 dispute resolution mechanism in place. Broader negotiations have been ongoing for over a year, but U.S.-Canada bilateral talks only really began in late August, after Washington reached a deal with Mexico it then attempted to use as leverage. The process was touch and go, but we always expected an agreement to be reached, even when U.S. officials leaked to the media that they wouldn’t make their deadlines. Had they not, there likely would have been significant opposition in all three countries.
Another referendum debacle, this time in Macedonia. Over the weekend, more than 90 percent of Macedonians who voted in a referendum to change the country’s name to North Macedonia voted yes, in theory ending a long-standing dispute with Greece. The problem was that only 36 percent of the population turned out at the polls – well short of the 50 percent threshold required to validate the result. Macedonian Prime Minister Zoran Zaev is undeterred and plans to bring the issue to a vote in Macedonia’s assembly, where a two-thirds majority will be needed to pass the name-change. (Zaev had previously said he would resign if the referendum failed, and he’s touting the result – though not the turnout – as a success.) But that’s not a guarantee, considering that the nationalist opposition party holds 49 of 120 seats in the legislature. Should the vote fail, snap elections will likely follow, and it’s possible that elections will be triggered before a vote is even brought to the floor. It’s hard to tell if low voter turnout was a result of apathy or opposition, and the answer may make all the difference in how lawmakers vote. In any case, the results of the referendum were inconclusive at best, and that doesn’t just mean Macedonia’s accession to NATO and the EU could be delayed – it means yet another Balkan country could be facing a political crisis.
A turbulent weekend in other parts of the Balkans. On Saturday, Kosovar President Hashim Thaci made a controversial visit to a lake in a Serb-majority area of Kosovo, the same lake Serbian President Aleksandar Vucic visited after the most recent round of EU-sponsored talks between the two blew up in September. Thaci was reportedly escorted to the area by Kosovo’s Special Forces. In response, Serbian military and police forces were put on their highest state of readiness. (The Serbian interior minister described the visit to the lake as “an Albanian attack against the north of Kosovo.”) Later that day, thousands gathered in Pristina to protest Thaci’s negotiations with Serbia over land swaps in a potential deal between the two. The hullabaloo comes after Thaci visited the United States – after which Kosovo’s Security Force minister said Kosovo would have an army by the end of the year. Vucic is due to meet with Russian President Vladimir Putin on Tuesday and has already announced he will bring up the issue. Bosnia-Herzegovina will hold elections on Oct. 7, and they already seem poised to throw the country into new chaos.
Iran strikes back. The country’s Islamic Revolutionary Guard Corps launched an assault against “terrorists” it claimed was responsible for the attack in Ahvaz on Sept 22. Iran reportedly launched six missiles at targets in Abu Kamal, a Syrian town on the border with Iraq and one of the last remaining pockets of Islamic State-controlled territory in Syria. The IRGC also said it also used drones to hit other enemy positions in the area. This is not the first time Iran has launched missiles into Syria – it did so after a terrorist attack on its parliament building last year – but such strikes are uncommon. At least one Iranian official said Iran’s main reprisal was still to come. The bigger story here is that Iran is demonstrating the capability to hit targets in neighboring countries with domestically manufactured missiles. Notably, an Iranian Foreign Ministry spokesperson said the strike had been “coordinated,” though he would not name the only likely party it could coordinate with – Russia.
- A South Korean official said the U.S.-South Korea military relationship was mutually beneficial and that the U.S. should keep that in mind as it negotiates defense cost sharing.
- Pakistan’s foreign minister arrived in Washington on Sunday for talks with U.S. Secretary of State Mike Pompeo and U.S. National Security Adviser John Bolton.
- Security talks between the United States and China later this month have been canceled. The cancellation is due to friction over trade and U.S. sanctions on Chinese military purchases from Russia.
- Japanese imports of Iranian crude are up 65 percent year on year, but the country plans to halt imports starting in October unless it can secure a waiver from the U.S. It does not appear one is coming.
- The situation on the Israel-Gaza border is deteriorating, with protesters hurling explosives at Israeli soldiers last night and members of the current Israeli government blaming the defense minister for failing to quell the violence.
- Argentina is reportedly on the verge of agreeing to a $9 billion currency swap deal with China.
- Turkish President Recep Tayyip Erdogan said his country will have “nothing to do with the IMF” as its economy struggles.
- Uzbekistan’s president is in India on an official visit. He signed contracts on 50 joint projects totaling some $3 billion on Sunday and 17 agreements on Monday on everything from visa-free travel to cooperation on military education.