Archived Bulletin

Issue No.24 of 2019

Issued on June 15, 2019

US carrier in Persian Gulf region sends clear signal to Iran

by Robert Burns, Associated Press

Source: Yahoo News

Under a starry sky, U.S. Navy fighter jets catapulted off the aircraft carrier's deck and flew north over the darkened waters of the northern Arabian Sea, a unmistaken signal to Iran that the foremost symbol of the American military's global reach is back in its neighborhood, perhaps to stay.

The USS Abraham Lincoln , with its contingent of Navy destroyers and cruisers and a fighting force of about 70 aircraft, is the centerpiece of the Pentagon's response to what it calls Iranian threats to attack U.S. forces or commercial shipping in the Persian Gulf region. In recent years, there has been no regular U.S. aircraft carrier presence in the Middle East.

U.S. officials have said that signs of heightened Iranian preparations to strike U.S. and other targets in the waters off Iran as well as in Iraq and Yemen in late April emerged shortly after the Trump administration announced it was clamping down further on Iran's economy by ending waivers to sanctions on buyers of Iranian crude oil.

The administration went a step beyond that on Friday, announcing penalties that target Iran's largest petrochemical company. On Saturday the Lincoln was steaming in international waters east of Oman and about 200 miles from Iran's southern coastline. One month after its arrival in the region, the Lincoln has not entered the Persian Gulf, and it's not apparent that it will. The USS Gonzalez, a destroyer that is part of the Lincoln strike group, is operating in the Gulf.

Rear Adm. John F. G. Wade, commander of the Lincoln strike group, said Iran's naval forces have adhered to international standards of interaction with ships in his group.

"Since we've been operating in the region, we've had several interactions with Iranians," he said. "To this point all have been safe and professional — meaning, the Iranians have done nothing to impede our maneuverability or acted in a way which required us to take defensive measures."

The Lincoln's contingent of 44 Navy F-18 Super Hornets are flying a carefully calibrated set of missions off the carrier night and day, mainly to establish a visible U.S. "presence" that Marine Gen. Frank McKenzie, the head of Central Command, said Saturday seems to have caused Iran to "tinker with" its preparation for potential attacks. He said on Friday that he thinks Iran had been planning some sort of attack on shipping or U.S. forces in Iraq. Two other officials, speaking on condition of anonymity to discuss sensitive details, said Iran was at a high state of readiness in early May with its ships, submarines, surface-to-air missiles and drone aircraft.

"It is my assessment that if we had not reinforced, it is entirely likely that an attack would have taken place by now," McKenzie said.
In an interview on the bridge, or command station, of the Lincoln with reporters who are traveling with him throughout the Gulf region, McKenzie said the carrier has made an important difference. "We believe they are recalculating. They have to take this into account as they think about various actions that they might take. So we think this is having a very god stabilizing effect," he said.

"They are looking hard at the carrier because they know we are looking hard at them," McKenzie said.

He said earlier in the week that he had not ruled out requesting additional defensive forces to bolster the deterrence of Iran, whose economy is being squeezed hard by U.S. sanctions after President Donald Trump pulled the U.S. last year from the 2015 nuclear deal between Tehran and world powers. The U.S. already has announced plans to send 900 additional troops to the Mideast and extend the stay of 600 more as tens of thousands of others also are on the ground across the region.

Iran's influential Revolutionary Guard has said it doesn't fear a possible war with the U.S. and asserted that America's military might has not grown in power in recent years. "The enemy is not more powerful than before," the Guard spokesman, Gen. Ramazan Sharif, said in late May.

The U.S. has accused Iran of being behind a string of recent incidents, including what officials allege was sabotage of oil tankers off the coast of the United Arab Emirates. McKenzie spent two days aboard the Lincoln to confer with naval commanders, observe both daytime and nighttime flight operations, and to thank crew members. Their deployment plans were disrupted when the White House approved McKenzie's request in early May that the Lincoln cut short its time in the Mediterranean Sea and sail swiftly to the Arabian Sea.

"I am the reason you are here," the general said in an all-hands announcement to the nearly 6,000 personnel on the Lincoln Friday night shortly after he flew aboard by Navy helicopter from Oman. "I requested this ship because of ongoing tensions with Iran," he said. "And nothing says you're interested in somebody like 90,000 tons of aircraft carrier and everything that comes with it. Our intent by bringing you here was to stabilize the situation and let Iran know that now is not the time to do something goofy."

McKenzie also requested, and received, four Air Force long-range B-52 bombers. They were in the region 51 hours after being summoned and were flying missions three days later. They are now operating from al-Udeid air base in Qatar. There had been no U.S. bomber presence in the Gulf region since late February.

In an interview Friday after speaking with B-52 pilots at al-Udeid, McKenzie said it's hard to know whether that gap in a bomber presence had emboldened the Iranians. "Cumulatively, the fact that we had drawn down in (the Mideast) may have had an effect on Iranian behavior," he said. "We do know that bringing stuff back in seems to have had an effect on their behavior," noting that there have been no Iranian attacks on U.S. forces.

On Saturday aboard the Lincoln, McKenzie was asked whether there have been any incidents between Iranian and American naval force in recent weeks.

"No, actually I think things are pretty quiet right now," he said.

Trump leaves China tariff deadline open, calls relationship 'testy'

by Jeff Manson, Reuters

Source: Yahoo Finance

U.S. President Donald Trump declined to set a deadline on Wednesday for levying tariffs on another $325 billion of Chinese goods and called the relationship with Beijing good but "testy" after China walked back commitments for a trade deal.

The president, who said he still plans to meet with Chinese President Xi Jinping later this month, has repeatedly threatened to escalate an already months-long trade war by putting tariffs on nearly all of the remaining Chinese imports that are not already affected by U.S. levies, which include products such as cell phones, computers and clothing.

Asked if he had a deadline for China to make progress towards a deal before facing the further penalty, Trump said no. "I have no deadline," he told a news conference, gesturing to his head. "My deadline is what's up here. We'll figure out the deadline. Nobody can quite figure it out." Trump has said previously that he would decide after the G20 meeting in Japan at the end of June whether to carry out his threat. Washington has already imposed 25 percent tariffs on $250 billion of Chinese goods, ranging from semi-conductors to furniture, that are imported to the United States.

Trump reiterated his belief manufacturers were pulling out of China under pressure from the tariffs that the United States has already imposed, in a boon to U.S. manufacturing.

"I think that we'll end up making a deal with China. We have a very good relationship, although it's a little bit testy right now, as you would expect. I think they really have to make a deal."
Though Trump has said he plans to meet with Xi at the G20 summit in Japan, Beijing has not confirmed any planned talks.

Trade talks between the world's two largest economies fell apart in May. Trump administration officials said China had watered down commitments it made on issues such as stopping intellectual property theft. "We thought we had a deal, and unfortunately they decided that they were going to change the deal, and they can't do that with me. But something's going to happen and I think it's going to be something very positive," Trump said.

The United States wants China to change its trade practices by not requiring U.S. companies to share their technology in order to do business there, curbing subsidies for Chinese state-owned enterprises and increasing access to Chinese markets.

India, Japan@G20: quality infrastructure a priority

by Suresh Reddy, Joint Secretary (Multilateral Economic Relations), Ministry of External Affairs, Government of India

Source: gatewayhouse

Japan hosts the 2019 G20 Osaka summit on June 28-29. India’s priorities at the G20 are similar to those of all developing countries, but it is significantly aligned with Japan in its emphasis on infrastructure, the silver economy and countering corruption, among others, says Suresh Reddy, Joint Secretary (Multilateral Economic Relations), ministry of external affairs, government of India, in this interview with Gateway House.

Gateway House (GH): What are the government of India’s priorities for the G20?

Suresh Reddy (SR): The priorities for India are almost the same as for all developing countries. First, it is the realisation of the Sustainable Development Goals (SDGs). We all share similar challenges, be it climate change or food security or developing our own infrastructure: these are important priorities for India – and India also takes up these issues on behalf of other emerging economies, other developing countries.

Some of the other key priorities for India are: disaster-resilient infrastructure. Disaster has become a major threat to the national economy because of the mass destruction it causes. While we can provide immediate response and relief to the affected, the fact that the infrastructure is destroyed affects people’s long-term ability to return to their livelihoods – and India has, therefore, been emphasising the creation of disaster-resilient infrastructure. We have proposed the establishment of a coalition for this and are working closely with Japan and other partners within the G20 towards this end.

This is a Japanese priority too, they are also talking about quality infrastructure – but not just in terms of the standard of the infrastructure, but more importantly, in terms of the standards of transparency necessary to ensure that corruption-related issues are addressed and that the costing of the project is kept within a reasonable amount so that there is no leakage of funds. Secondly, ‘quality infrastructure’ has also to be seen in terms of the benefit

occurring to local society. Third, I would extend the term to describe its ability to withstand disasters. So, in a way, our two countries’ priorities on infrastructure are aligned. Furthermore, ‘quality’ also refers to the quality of the financing of infrastructure, where too our views are aligned. The financing of infrastructure has always been a challenge, especially in the emerging economies. India has been taking the lead in having infrastructure described as an asset class in itself so that pension funds and other international lending institutions can extend larger amounts of funding to it.

Another important area for India is the issue of fugitive economic offenders. India has actually taken the lead in this. We have proposed a nine-point agenda, which covers: a) strengthening international cooperation; b) arriving at a common understanding in terms of definitions; c) introducing a platform for the sharing of good, best practices in this; d) and identifying legal mechanisms so that we can tackle the issue more meaningfully, fulfilling domestic legislations.

This is again an area where we are working very closely with Japan and our other friends within the G20 – because one of the key areas for the Japanese (presidency) too is corruption. And corruption, I believe, will continue to be a focus area for future presidencies, including Saudi Arabia, which will be president of the G20 next year, in 2020.

As an emerging economy with a large population, we are naturally concerned about food security, increasingly a concern for all countries, including the developed economies. Food security is not to do only with the availability of materials to the people, but also the importance of sustainable agricultural practices.

This is where the role of climate change comes in – and its impact on agriculture. Naturally, climate change is an important topic in the Japanese presidency. It has always been an important issue within the G20 agenda since the Paris Agreement of 2015, and will continue to be, especially post 2020, when India takes over the presidency of the G20 in 2022. This is when the implementation phase of the Paris accord on climate change will start coming into play, and with India holding the presidency, it will become critical and we will need to see how much progress has been made.

Another issue we have been talking about is the portability of social welfare schemes as we have many Indian citizens abroad who contribute quite a hefty amount to the welfare schemes existing in the countries where they work. We have been working with our partners in the G20 to achieve this portability so that when these citizens return to India their contribution comes with them for their benefit.

Terrorism is an important area for us. At the Hamburg G20 summit in 2017, we issued a special statement on countering terrorism, including issues, such as money laundering and financing of terrorism, and we hope to continue the engagement in this important area with the Japanese presidency too. So far, a focus area for the Japanese presidency has been the silver economy or ageing. This is not a challenge yet in India, but an important area of focus for the Indian government as also for all countries. The policy prescriptions which are required to be developed to address the silver economy are still not in place: it’s the first time that ageing is on the G20 agenda, and members are working together to come out with a set of policy options which will enable countries to deal with it more effectively.

The silver economy poses a unique challenge. Take the pension scheme. We would never have envisaged the sustainability of the pension scheme itself becoming a challenge – because as life span increases so does the period over which one pays the pension. But proportionately, the problem with the silver economy is that the percentage of youth joining the workforce is declining. This means that revenue generation for the government, which enables it to meet pension requirements, is also decreased.
Similarly, with increasing life spans, a larger number of elderly people will need greater healthcare support – and this involves some financial implications. So, these are some of the new challenges arising out of the silver economy.

The objective behind having ageing as one of the priorities is to ensure that even the elderly have a quality of life and are respected – in the sense of being entitled to their own set of comforts just as any other citizen of the country.

Another key area for the Japanese presidency is addressing the challenge of marine plastic debris. Different
countries have been talking about it in the past few years, but it’s the first time it has come to the forefront of the G20 agenda – and we are very glad it has. This has serious implications on food security because of the large-scale damage it does to the marine ecosystem. It is estimated that by 2050, the weight of the plastics in the ocean is going to be much more than the weight of the fish in it. This means millions of fishermen around the world will not be able to fish meaningfully. Hundreds of millions of people, who are dependent on the sea for their livelihood, will be directly affected. It is also time we started addressing seriously the large-scale impact of this on the environment, the ecosystems. We are therefore very glad it has been brought to the forefront of the Japanese agenda.

Discussions also continue on achieving the SDGs, strengthening cooperation on climate change and supporting the multilateral trading system: you are aware of the challenge being faced by the World Trade Organization (WTO) today and the discussions on the need for urgent reforms, which will take place during the Japanese presidency too.

As for multilateral systems, India has been urging reform of the multilateral architecture, multilateral governance systems, the international governance architecture itself, because we have been talking about reformed multilateralism. The point here is: do we strengthen the existing international governance architecture when it does not reflect today’s reality? We want it to be reformed to reflect today’s reality.

An example is the ongoing reform process in the IMF. We have been pushing for the conclusion of the discussions so that the review of the quota system takes place with the IMF before the end of 2019. Similarly, with the WTO too, it is important that the discussions on its reform are held in a way which supports the multilateral trading system, while also protecting the WTO’s unique character whereby emerging economies are given special rights within it in recognition of their unique requirements.

To recapitulate, the focus will continue to be on the SDGs, climate change, reform of the international financial architecture and the importance of quality infrastructure. Broadly, these are the themes important also for the Japanese presidency.