Putin visits the French Riviera. Russian President Vladimir Putin was in southern France yesterday for talks with his French counterpart, Emmanuel Macron, ahead of this weekend’s G-7 summit in Biarritz. The talks lasted three and a half hours and were closed to the media. The two were scheduled to discuss Libya, Syria, the Iran nuclear deal and Ukraine, which took center stage. Macron said that Ukrainian President Volodymyr Zelenskiy’s election provides the chance to reopen talks between Kyiv and Moscow on eastern Ukraine, and both he and Putin apparently said they were willing to engage in talks that would include Germany and Ukraine. During the joint press conference, Macron also spoke about a new European security architecture in cooperation with Russia, saying he believes in “Europe from Lisbon to Vladivostok.” All this points to the French president’s efforts to become the main Western interlocutor for Russia-Europe relations – a role usually reserved for Germany.
Netanyahu goes to Kyiv. On Monday, Israeli Prime Minister Benjamin Netanyahu arrived in Ukraine – the first official visit by an Israeli leader to the country since 1999. Netanyahu met with the Ukrainian president to address the creation of a free trade zone, a pension agreement, visa issues, and war and security. During the talks, Zelenskiy asked that Israeli officials recognize the Holodomor, the 1932-33 man-made famine in Soviet Ukraine, as a genocide of the Ukrainian people. He also noted that Ukraine has much to learn from Israel when it comes to security and defense.
Battening down the economic hatches. The world’s major economies appear to be readying themselves for potential recession. Germany’s finance minister said over the weekend that $55 billion would be available to help prop up the economy if needed. That’s a rather modest amount for a nearly $4 trillion economy. However, Bloomberg quoted anonymous sources as saying that a larger stimulus program is already in the works that will boost economic activity through consumer spending and includes bonuses for consumption, incentives to improve residential energy efficiency, promotion of short-term hiring and increases to social welfare. Over the weekend, China’s central bank announced that the benchmark rate for new loans would be set at the rate typically granted only to preferred customers. In practice, this means much lower commercial borrowing costs for individuals and small companies in China. Finally, in the U.S., President Donald Trump called on the Federal Reserve to lower interest rates again. There are also reports that the White House may be considering temporary payroll tax cuts – something more within its power and that could support economic activity. None of these moves reflect the full fire power of any of these governments in the event of a recession – but the preparation for contingency measures is telling.
A draft peace deal for Afghanistan. The lead U.S. negotiator in talks with the Afghan Taliban on Friday submitted a draft peace deal to the White House. The draft calls for 5,000 U.S. troops to immediately leave Afghanistan; the remaining 9,000 U.S. troops will have up to 18 months to make their exit. In exchange, the Taliban will agree to cut ties with al-Qaida and block the group from operating in areas under Taliban control. It’s not clear what will happen to any residual U.S. presence that’s not purely military. And the future of relations between the Taliban and other factions in Afghanistan remains ambiguous, though Washington made a cease-fire a precondition for withdrawal. The timing of the latest round of talks and the draft agreement are important – Afghanistan’s elections are just six weeks away, and the parties have said that an agreement would be announced shortly after the elections (though in the past, elections have been rescheduled).
- The Pentagon confirmed tests of a new ground-based cruise missile, the first such test of an intermediate-range missile after the cancellation of the Intermediate-Range Nuclear Forces Treaty. Russia condemned the test.
- Bahrain agreed to join the U.S.-led maritime coalition that is working ensure freedom of navigation in the Persian Gulf and counter Iranian maritime threats in the area.
- Qatar Ports Management Company will partner with Somalia to build a new maritime port in Hobyo on Somalia’s central coast.
- The China National Petroleum Corporation canceled its planned oil shipments from Venezuela for the month of August because of U.S. sanctions. The Chinese company planned to load 5 million barrels of Venezuelan crude.
- The Palestine Committee of Jordan’s House of Representatives suggested to Foreign Minister Ayman Safadi that Amman close the Israeli embassy, cancel the Jordan-Israel peace treaty, recall the Jordanian ambassador from Israel, and lodge an official diplomatic protest over Washington’s support for Israel.
- Uzbekistan’s central bank will no longer regulate currency exchange rates, choosing instead to let the exchange rate value be set by the market price.