EU Carrot and Stick Policy: European Union toughens stance on Russian sanctions - by Suzanne Lynch

The European Union voted to suspend visa-liberalisation discussions with Russia, and suspend talks on a new economic cooperation package, but stopped short of imposing asset freezes or travel banks on specific individuals, at an emergency meeting on Ukraine in Brussels. 

In a summit that over-ran by more than two and a half hours, EU member states toughened their language on sanctions, with Germany in particular hardening its stance towards Russia. The US’s decision earlier in the day to implement asset freezes and travel bans on Russian individuals involved in the military incursion into Ukraine, also increased pressure on the EU to act, according to officials. 

Among the actions taken was the decision to suspend bilateral talks with the Russian Federation on visa matters as well as talks on an economic agreement. “We support the decision of the European Members of the G8 and the EU institutions to suspend their participation in G8 Summit preparations until further notice,” the European Council said in a statement. The European Union said it would also decide on “additional measures, such as travel bans, asset freezes and the cancellation of the EU-Russia summit,” should negotiations between Russia and Ukraine not commence and yield results. 

British Prime Minister David Cameron said that asset freezes and travel bans on Russia could happen “relatively quickly” unless progress is made on dialogue with Ukraine. Poland – which was been one of the strongest voices in support of sanctions on Russia – said a decision on travel bans and asset freezes could be made “within days.”

Speaking after the meeting, Taoiseach Enda Kenny said the outcome of the summit sent “a strong message to Russia and to President Putin that his actions in Crimea are not acceptable, are not going to be tolerated.” 

Earlier Ukrainian prime minister Arseny Yatseniuk, who met with EU leaders, told reporters that Ukraine was “ready to protect” its country. “In case of further escalation and military intervention into Ukraininan territory by foreign forces, the Ukrainian government and military will act in accordance with the constitution and laws,” Yatseniuk said before leaving for Dublin. 

The meeting of EU leaders in Brussels took place against a background of rapidly changing events. The Crimean parliament announced it was to seek accession to the Russian Federation, and put the decision to referendum on March 16th.

Read more: European Union toughens stance on Russian sanctions - European News | Latest News from Across Europe | The Irish Times - Thu, Mar 06, 2014

Iran: US Congress -Tea Party Republicans Considering New Iran Sanctions

As early as next week the U.S. Congress could approve tough new sanctions on Iran, a move the White House warns may undermine diplomatic efforts to curb the country’s controversial nuclear program.

It was smiles in Geneva when U.S. Secretary of State John Kerry and other foreign ministers congratulated each other over last month’s interim accord on Iran’s nuclear program.

Tough economic sanctions drove Iran to the bargaining table.

And now some members of Congress want to put even more economic pressure on Tehran by approving a new round of sanctions.

“The Congress believes that sanctions, along with the threat of credible military force by the United States and Israel, has gotten us to this point, that if you back off now, you're sending the worst possible signals,” said Sen. Lindsey Graham.

Some members of Congress are concerned the interim nuclear deal allows Iran to continue enriching uranium.

The top Republican on the Senate Foreign Relations Committee, Bob Corker, says that’s a mistake.

The Obama administration says new sanctions will violate the interim agreement with Iran and could possibly divide the U.S. from its international partners. 

Read more: US Congress Considering New Iran Sanctions

EU Commission proposes improved rules to enforce EU rights under international trade agreements

The EU Commission is proposing a Regulation to establish a clear and predictable framework for adopting implementing acts following international trade disputes that have a negative economic impact on the EU. In cases of last resort, trade sanctions can be put in place to encourage the offending country to remove illegal measures.

Action could also be taken to compensate for import restrictions that be imposed on EU products in exceptional situations (so-called safeguard measures), or to react to cases where a WTO member country changes its trade regime in a way that negatively affects EU trade (such as raising its import tariffs) without adequate compensation.

Such implementating acts can only be taken under certain well-defined conditions and might take the form of new or increased customs duties or quotas on imports or exports of goods, among other possible measures.

The proposal is for an EU Regulation of the Council and the European Parliament and will now be discussed by the Council and the European Parliament under the ordinary legislative procedure.

The proposal is part of the Commission's broader objective to improve the exercise of EU rights for the enforcement of international trade rules. It was set out in the Commission Communication on "Trade, growth and world affairs" and endorsed in the Council conclusions of 21 December 2010 . Specifically, the EU committed to step up its efforts to enforce its rights under bilateral and multilateral agreements to open markets that are illegally closed.

The Commission's proposal intends to remedy to the current situation where the EU does not have a single horizontal framework to react swiftly and efficiently on enforcing international trade rulings. The establishment of a framework of rules is needed following the entry into force of the Treaty of Lisbon, under which legislative and executive functions are clearly divided between EU institutions. Previously, action to enforce EU rights under international trade agreements followed an ad hoc approach that no longer responds to the needs of the EU.

Read more: Commission proposes improved rules to enforce EU rights under international trade agreements - Updated with the regulation. - Trade - European Commission

China: The Renminbi Runaround - by Paul Krugman

"Last weekend China announced a change in its currency policy, a move clearly intended to head off pressure from the United States and other countries at this weekend’s G-20 summit meeting. Unfortunately, the new policy doesn’t address the real issue, which is that China has been promoting its exports at the rest of the world’s expense.

In fact, far from representing a step in the right direction, the Chinese announcement was an exercise in bad faith — an attempt to exploit U.S. restraint. To keep the rhetorical temperature down, the Obama administration has used diplomatic language in its efforts to persuade the Chinese government to end its bad behavior.

The proof that China is, in fact, keeping the value of its currency, the renminbi, artificially low is precisely the fact that the central bank is accumulating so many dollars, euros and other foreign assets — more than $2 trillion worth so far. There have been all sorts of calculations purporting to show that the renminbi isn’t really undervalued, or at least not by much. But if the renminbi isn’t deeply undervalued, why has China had to buy around $1 billion a day of foreign currency to keep it from rising?

So what comes next? China’s government is clearly trying to string the rest of us along, putting off action until something — it’s hard to say what — comes up. That’s not acceptable. China needs to stop giving us the runaround and deliver real change. And if it refuses, it’s time to talk about trade sanctions."

For more: Op-Ed Columnist - The Renminbi Runaround - NYTimes.com