Greek workers strike ahead of parliament's decision on austerity (+ analysis: no easy solutions); International court issues warrant for Qaddafi and son; Afghan central banker flees after exposing embezzlement; Obama confident debt deal is close; Japanese PM promises to resign; and more
Top of the Agenda: Greek Unions Strike over Austerity Plan
Greek unions began a forty-eight-hour countrywide walkout at midnight and are conducting rallies and marches on parliament today to protest Prime Minister George Papandreou's five-year plan of budget cuts and asset sales (Bloomberg). The government has called more than five thousand police officers to guard central Athens, where anti-austerity protests earlier this month ended in violence.
Parliament is meeting this week to debate whether to approve an austerity plan (Guardian) needed for a bailout loan of €110 billion from the EU and the International Monetary Fund. Without the loan, Greece could become the first eurozone country to default on its debts, which could spark problems in other struggling EU countries. European stocks rebounded (WSJ) early Tuesday after French banks proposed a plan to roll over the majority of their $21.3 billion in Greek debt, which would give Greece more time to meet its other financial obligations. But European stocks later fell over continuing concerns about Greece's long-term prospects (Reuters). Even if Greece is able to get control of its debt, it will still need to address rising unemployment and social unrest (AP), which the reforms might exacerbate.
Analysis:
CFR's Sebastian Mallaby says Greece's government escaped a no-confidence vote, but the crisis over its massive sovereign debt continues and there are no easy solutions.
In this CFR interview, Daniel Gros, deputy director of the Centre for European Policy Studies, says it remains to be seen whether Greek default is inevitable and if banks and other private bondholders will also take a hit.
European economist Iain Begg contends that although the Greek crisis calls into question the eurozone's future, it will paradoxically have the effect of deepening EU integration.
PACIFIC RIM: China Rejects US Resolution Condemning China Sea Actions
China rejected a US Senate resolution criticizing Beijing's actions in the South China Sea, saying its sponsors should promote peace in other ways (AP). This CNN explainer looks at the situation in the South China Sea.
CFR's Elizabeth Economy says ideally China, the Philippines, and Vietnam should sit down and honor the 2002 "Declaration on the Conduct of Parties in the South China Sea."
Japan: Prime Minister Naoto Kan said he will resign after the passage of major bills (WSJ) focusing on renewable energy, earthquake reconstruction, and deficit-covering bond issuance.
ELSEWHERE:
- ICC Issues Warrant for Qaddafi
- Afghan Bank Head Flees Country
- White House Says a Debt Deal Likely
This is an excerpt of the CFR.org Daily News Brief. The full version is available on CFR.org.