FORECAST
The US Diplomatic Offensive
Unable to attack Iran militarily the United States has increased its diplomatic efforts to alienate and weaken the country. The US seeks to increase its power in the Middle East and set the stage for a future attack against Iran.
Accepting Russia and China’s ability to thwart American ambitions in the Middle East, the US has begun a diplomatic offensive to gain support for UN Security Council sanctions against Iran on the pretence of its nuclear program and IAEA non-compliance.
Like ten years of sanctions weakened Iraq, the United States seeks to weaken the country in order to make a military strike viable.
Consensus Building
While the US has bargaining chips including its level of support for an independent Kosovo for Russia and its arms sales to independence seeking Taiwan for China, long-term compliance is unlikely.
It is understood that ceding Iran to the US would, for Russia, be the loss of an important bargaining chip and Gazprom oil and gas profits, and for China, be the loss of an important source of oil. More fundamentally for both countries, a global balance of power can only be obtained by working together against the US. The Shanghai Cooperative Organization, which includes Iran, was formed for this reason.
The Gulf Cooperative Council
The diplomatic offensive has been taking place in the Middle East as well. President Bush’s recent visit to announce US arms sales to Gulf Cooperative Council (GCC) countries including Saudi Arabia was aimed at gaining support for US aggression against Iran.
Saudi King Abdullah’s invitation to Iranian President Mahmoud Ahmadinejad for the Muslim Hajj pilgrimage to Mecca suggests that US convincing is required.
Such convincing was attempted with the Pentagon created Strait of Hormuz story on the eve of Bush’s visit to the Middle East. It served as a reminder to GCC countries that their oil exports are dependent on the strait and provided an opportunity for public condemnation of Iran.
If the US is willing to pay the price it will be able to gain concessions from key nations to increase the pressure on Iran. Any support gained in this manner will be of a temporary and tenuous nature, however. In the long-term it makes strategic sense to have positive relations between Iran and China, Russia and the GCC to counter US dominance, promote stability in the region and share in the country’s wealth.
SUMMARY OF EVENTS: January 7 – January 14, 2008
NORTH AMERICA
United States
Goldman Sachs on Wednesday said it expects the U.S. economy to drop into recession this year, prompting the Federal Reserve to slash benchmark-lending rates to 2.5 percent by the third quarter.
Gold soared to a record high after Federal Reserve Chairman Ben Bernanke pledged to cut interest rates, undermining the dollar and boosting demand for the metal as a safe investment.
EUROPE
Georgia
Pro-West Georgian leader Mikhail Saakashvili hailed his election win as a triumph for democracy but his defeated opponent said it was rigged and was gearing up to hold mass protests in the capital.
Serbia / Kosovo
Kosovo’s parliament approved the new government proposed by Prime Minister Hashim Thaci to lead the ethnic Albanian UN-run province to independence from Serbia.
THE MIDDLE EAST
Turkey
Turkish Prime Minister Recep Tayyip Erdogan said Thursday he would hold three-way talks with French and German leaders on Turkey’s EU membership bid, which the two heavyweights of the bloc oppose.
Iran
In what U.S. officials called a serious provocation, Iranian Revolutionary Guard boats were accused of provoking three U.S. Navy ships in the strategic Strait of Hormuz, threatening to explode the American vessels.
Iran’s ambassador to Pakistan said that January 25 is the date the two sides will sign the so-called peace pipeline, a multibillion-dollar project to send Iranian natural gas to Pakistan.
Iraq
US President George Bush met with his visiting Turkish counterpart Abdullah Gul in the White House on Tuesday and both vowed to keep working together to confront the separatist Kurdistan Workers’ Party (PKK).
US warplanes rained bombs on a rural area just south of Baghdad with the American military saying Al-Qaeda in Iraq safe havens were destroyed in “one of the largest air strikes” since 2003.
Israel / Palestine
Food is running short for hundreds of thousands of Palestinians in the impoverished Gaza Strip and more aid is urgently needed to prevent a humanitarian crisis, the World Food Programme said.
Saudi Arabia
The Bush administration will move ahead with a high-profile arms sale to Saudi Arabia as part of a $20B USD package of deals with the Gulf States.
SOUTH ASIA
Pakistan
The Pakistani military reacted angrily to reports that the US is considering covert military operations in the country’s volatile tribal areas bordering Afghanistan. The plan would allow CIA operatives to call on direct military support in Pakistani territory.
Bilawal Bhutto Zardari, the 19-year-old son of Benazir Bhutto, Pakistan’s assassinated opposition leader, said at a news conference in London that the United States would have to stop “supporting dictators” in Pakistan for Islamic extremism to be defeated there.
Sri Lanka
According to the military Sri Lankan troops have captured a section of rebel-held territory in the island’s northwest and killed 44 Tamil Tigers, as a new chapter in the 25-year civil war intensifies.
Sri Lanka’s government rejected a Tamil Tiger offer to abide by the terms of a newly scrapped six-year ceasefire and vowed to push on with a military campaign to crush the rebels.
EAST ASIA
China
China has contingency plans to dispatch troops into North Korea and secure nuclear weapons in the event of instability in the hard-line communist state, according to US experts who have talked to Chinese military researchers.
The first signs that China’s stock market bubble may be about to burst emerged as research from the Chinese Xinhua Finance Company and the Milken Institute indicated a sharp decline in the value of shares recently floated on the Chinese exchanges.
Taiwan
Taiwan’s opposition Nationalist Party won a landslide victory in legislative elections, beating the ruling Democratic Progressive Party. The Nationalist Party supports closer and more stable relations with China while the Democratic Progressive Party is a vocal proponent of separation from China.
AFRICA
Nigeria
Gazprom, Russia’s state-owned energy giant, has offered to invest billions of dollars in developing the gas sector in Nigeria, where western majors have traditionally put most of their efforts into extracting oil. Nigeria, Africa’s biggest oil exporter, is believed to have some of the largest untapped gas reserves in the world.