EFTA01769155

From: Office of Terje Rod-Larsen Sent: Thursday, July 12, 2012 7:02 PM Subject: IPI Regional Insights - July 2012 INTERNATIONAL PEACE INSTITUTE IPI Regional Insights July 2012 The International Peace Institute's (IPI) Regional=Insights covers select regional and thematic developments based on informa=ion from a variety of sources. It draws on the research of IPI experts =nd is provided exclusively to major donors and members. Each monthly is=ue covers challenges and opportunities related to international peace, sec=rity and development. Africa Nigeria: As a result of=suicide attacks on five churches in northern Nigeria that killed 150 peopl= -- considered to be the work of the Islamist group Boko Haram -- and the =ise in sectarian violence in the oil-rich southern Delta, President Goodlu=k Jonathan fired National Security Adviser General Owoye Azazi and Defense=Minister Haliru Bello on June 22. President Jonathan cited the need for ne= tactics to counter the worsening security situation in the country. The P=esident appointed Colonel Sambo Dasuki as the new National Security Advise= and is consulting with former Nigerian heads of state on the choice of de=ense minister. Dasuki, a retired colonel and is a prominent northerner and cousin to the Sultan of Sokoto, Ni=eria's highest Muslim spiritual figure. <= class=MsoNormal style=lext-aligniustify5 Sudan: A =2.4 billion deficit and 30 percent inflation rate, combined with pressure =rom the International Monetary Fund to launch an emergency austerity progr=m, forced the government of Sudan to introduce tough austerity measures. F=nance Minister Ali Mahmoud announced a reduction in the number of civil se=vants and a gradual phase out of fuel subsidies that currently cost Sudan =ver $1 billion a year. After years of ongoing conflict, sanctions, and ris=ng food prices, the Sudanese population reacted immediately to the new aus=erity measures. Student-led protests erupted EFTA_R1_00079545 EFTA01769155 in Khartoum in mid-June and q=ickly spread to surrounding parts of the city joined by other groups inclu=ing lawyers, human rights defenders, and opposition members. The demonstra=ions have continued for three weeks, despite clashes with the riot police.=While comparing this situation to the Arab Spring may be premature, in the=last fifty years, popular revolutions have overthrown the Sudanese governm=nt, first in 1964 and again in 1985. Calls have multiplied for internal re=orms, which would aim both at reversing some of the austerity measures tha= angered the population, and initiate collaboration with the political opp=sition. The ability of the ruling National Congress Party to heed these ca=ls will determine whether Khartoum is willing to appease internal tensions= while also continuing to negotiate complex post-referendum issues with So=th Sudan. =o:p> Latin Americaaspan> Mexico: Enrique Pena Nieto, t=e candidate of the Institutional Revolutionary Party (PRI), was elected pr=sident on July 1, bringing back the PRI—which ran Mexico as a one-pa=ty state for seventy years—after twelve years of the National Action=Party's (PAN) hold on the presidency. While a partial vote recoun= confirmed Pena Nieto's win, protests by students claiming fraud t=rough vote-buying continue in Mexico City. The electoral tribunal has unti= September to investigate allegations of overspending and voter fraud. The=second place candidate, Andres Manuel Lopez Obrador of the far left, h=s threatened to file a legal challenge. Pena Nieto campaigned on a platf=rm to refocus the war on drugs and to combat the drug-fuelled violence res=onsible for the deaths of more than 50,000 Mexicans. Pena Nieto also pro=ised to implement economic reforms, such as opening the state-owned oil co=pany Pemex to private investment, which would help reinvigorate Latin Amer=ca's second largest economy. The PRI has a minority in both houses o= Congress, which could impede progress on its reform agenda. <1=> Paraguay: On =une 22, President Fernando Lugo was impeached just one week after land cla=hes between police and squatters left seventeen dead. Vice President Feder=co Franco was immediately sworn in as president to serve the remainder of =ugo's term ending August 2013. Labeling the abrupt impeachment a par=iamentary coup, both Mercosur (the regional economic alliance) and UNASUR =the regional organization integrating South =merican countries on issues including democracy, education, energy, and th= environment) have suspended Paraguay's membership until the =ext presidential election. Mercosur's decision to not impose sanctio=s against Paraguay averted potentially disastrous consequences for the lan=locked nation's economy, which is heavily reliant on trade within th= bloc. Jose Miguel Insulza, Secretary-General of the Organization of Ameri=an States (OAS), having completed a fact-finding mission to Paraguay, reco=mended against suspending Paraguay from the OAS and instead advised a grea=er commitment to avoid further isolating Paraguay and creating more proble=s. <=>Colombia: On June 14, Congress overwhelmingly ratified a const=tutional amendment that provides a Legal Framework for Peace talks between=the government and the left-wing guerrilla groups the Revolutionary Armed =orces of Colombia (FARC) and the National Liberation Army (ELN). The Frame=ork calls for soft sentences for rebels if they confess to their crimes, c=mpensate victims, and lay down their arms. Rebel leaders have given mixed =ignals that they are interested in talks. This controversial policy has be=n criticized by human rights groups and right-wing politicians for being t=o lenient and allowing crimes against humanity to go unpunished. In order =o become law, the bill must pass a final vote in a congressional commissio= and be signed by President Juan Manuel Santos. Passing this law would mar= a 2 EFTA_R1_00079546 EFTA01769156 shift from previous governments, which have refused to negotiate with r=bels, and show the current government's willingness to accept a nego=iated end to the conflict with Colombia's largest insurgency groups.=o:p> Central =merica: Central America continues to struggle to contain drug smug=ling from South America into the United States. In March, the Catholic Chu=ch in El Salvador arranged an accord between the country's tw= largest gangs, the Mara Salvatrucha and Barrio 18. As the truce passed th= 100-day mark, murders have dropped from fourteen a day in March to five a=day in June. The gang leaders have indicated they are ready for talks to m=ke the peace pact permanent. On June 27, a Guatemalan court sentenc=d 36 suspected members of a powerful Mexican drug cartel to prison for var=ous crimes, including dismembering a state prosecutor who was investigatin= the gang. In Honduras, U.S. Drug Enforcement Administration agents=killed several suspected Honduran drug traffickers in recent counter-narco=ics operations. This visible American presence is controversial as it unde=scores the issue of national sovereignty as U.S. participation in these op=rations in Central America increases. &=bsp; Middle East and North Afr=ca Egypt: Egypt's stock market is serving as an accur=te barometer of the level of political tension during the nation's h=storic political transition. On June 30, Muslim Brotherhood-backed candida=e Mohamed Morsi was sworn in as Egypt's first freely-elected Preside=t. The stock market, when it reopened the following Monday, July 2, hit a =ine-year high. Subsequently, when President Morsi ordered the Parliament&#=212;which was dissolved by the military based on a Constitutional Court ru=ing—to reconvene on July 8, the market tumbled 4.2 percent to a thre=-week low. The International Monetary Fund (IMF) welcomed Morsi's el=ction and once a government is formed is ready to finalize a $3.2 billion =oan. To access this and other multilateral financing and close the estimat=d $12 billion funding gap, the Muslim Brotherhood will have no choice but =o accept that these loans come with interest and will have to reconcile th=s fact with its position that interest on loans contradicts Islamic law. E=yptian foreign currency reserves stood at approximately $15.5 billion at t=e end of June compared to roughly $36 billion (before the January 2011 upr=sing). The Central Bank is expecting only 2 percent growth in 2012, down f=om 2.5 percent in 2011. Syria Tu=isia: The political struggle between Salafists, moderate=lslamists, and others continues in Tunisia. Examples include the recent=turmoil over prayer space and the wearing of the niqab (veil) by women whi=h occurred on the campus of Manouba University outside Tunis and riots in =he capital that forced the government to impose a curfew on a few major ci=ies for several days in mid-June. In addition, reflecting concerns of r=gional spillover, the spokesperson for the Tunisian government urged cleri=s to stop inciting young people to join the revolutionary fighting in Syri=. On the economic front, the economy is rebounding. Tourism revenue increa=ed by 36.2 percent in the first five months of 2012. According to the IMF,=growth is estimated to reach 2.2 percent in 2012 with a forecast of 3.5 pe=cent growth in 2013. Foreign investment has increased by 19 percent, altho=gh unemployment, the main economic factor behind the revolts last year, re=ains high (18 percent). Prime Minister Hamadi Jebali announced that the go=ernment will add 75,000 jobs in 2012. Gradual economic recovery appears=likely, although the European financial crisis could dampen foreign invest=ent. 3 EFTA_R1_00079547 EFTA01769157 Libya: Lib=a held elections for its National Assembly on July 7 with nearly two-third= of Libyans voting in the first free election in half a century. In con=rast to the trends in its Arab neighbors, early results show a liberal coa=ition in the lead. The security situation in the country is still extre=ely unstable as militias continue to carry out attacks and arms are still =eing trafficked from Libya to neighboring countries. Trends: In Algeria, more than a month after =egislative elections were held, President Abdulazziz Bouteflika has yet to=name a new Prime Minister. It is unclear whether there will be a new cabin=t or if the current one will be reinstated. The political make-up of the c=binet is a pivotal factor that could help insulate Algeria from an Arab up=ising. Negotiations between Iran and the five permanent members of =he Security Council plus Germany concerning Iran's nuclear program w=11 continue in Istanbul on July 24, although at the technical level. On Ju=e 20, Kuwait's constitutional court declared the February par=iamentary elections—which gave the Islamists a majority—null a=d restored the previous government-friendly assembly. The cabinet submitte= its resignation. Thousands of civilians denounced the court's actio= calling it a coup and took to the streets in protest. In Yemen, th= army regained control over three towns previously held by al-Qaeda. Presi=ent Abdu Rabbu Mansour Hadi continues to wrestle for control of the milita=y from former President Saleh's family and friends. On June 18, the =.N. Secretary-General announced his intention to open a small office of th= Special Adviser on Yemen for one year to support the implementation of th= Transition Agreement.<=p> &=bsp; South and Central Asia <= class=MsoNormal style=itext-aligniustify5.The International Peace Institute (IPI) is an independent, not=for-profit think tank with a staff representing more than 20 nationalities=with offices in New York across from the United Nations and in Vienna. =PI promotes the prevention and settlement of conflicts between and within =tates by strengthening international peace and security institutions. T= achieve this purpose, IPI employs a mix of policy research, convening, pu=lishing and outreach. The views expressed here do not necessarily repre=ent those of IPI. 4 EFTA_R1_00079548 EFTA01769158