Editor's Note: The following is reprinted with the permission of the Council on Foreign Relations.
Meeting at an EU Council summit in Brussels late into Thursday night, leaders of the seventeen eurozone countries agreed to sign a new intergovernmental treaty (NYT) mandating greater fiscal coordination and budget discipline. The highly anticipated decision is meant to quell months of market volatility by offering a long-term solution to the ongoing eurozone sovereign debt crisis.
German Chancellor Angela Merkel and French President Nicolas Sarkozy had pushed for a full overhaul of the existing EU treaty. However, British Prime Minister David Cameron rejected such a move when he failed to obtain concessions (DeutscheWelle) to protect Britain from a European financial tax harmonization plan.
The pact is expected to include twenty-three EU countries (WSJ), including six non-eurozone states that hope to join the single currency in the future. EU leaders will continue to meet today to hash out the details of the agreement.
What is clear of the EU Council summit is that after a long, hard, and rancorous negotiation, at about 5 a.m. this morning, the European Union split in a fundamental way, says the Economist.
Cameron and Merkel are convinced they are playing clever national politics. In fact, both are playing poor European ones, argues this Guardian editorial.
The new EU fiscal pact, which Merkel had strongly advocated, has a crucial flaw: Britain is not on board. Prime Minister David Cameron will not be able to prevent his country from becoming a second-class EU member, writesDer Spiegel's Carsten Volkery.
Iran Files UN Complaint over Alleged U.S. Drone
Iran filed a complaint with the United Nations over an alleged U.S. drone that it shot down when the unmanned plane entered Iranian airspace last week (al-Jazeera). The government called the drone incursion an "act of hostility."
Targeted killings have become a central component of U.S. counterterrorism operations around the globe. Despite pointed criticism over transparency and accountability issues, analysts say the controversial practice seems likely to expand in the future, explains this CFR Backgrounder.
SYRIA: Tensions are mounting between the rebel Free Syrian Army–comprised of Syrian soldiers that have defected–and Syria's main opposition group, the Syrian National Council, over the latter's insistence that the rebel army only employ defensive action (NYT).
Dutch Apologize for Indonesia Massacre
The Dutch government formally apologized for a 1947 massacre on Indonesia's Java island (al-Jazeera), which killed at least one hundred and fifty people during the country's struggle for independence from Dutch colonial rulers.
PHILIPPINES: Former president Gloria Arroyo (BBC) spoke out against the current administration for the first time since her arrest last month on charges of rigging a 2007 election. Arroyo said she believed the courts would find her innocent.
SOUTH AND CENTRAL ASIA
Zardari to Remain in Dubai Hospital
Pakistani President Asif Ali Zardari will stay under medical observation (GulfNews) at the American Hospital in Dubai for an undetermined period of time, amid continued speculation that he may be forced to resign.
PAKISTAN: A Pakistani security official said the country had upgraded its air defense system (AFP) along the Afghan border, giving it the ability to shoot down aircraft. The move follows last month's NATO airstrikes that killed twenty-four Pakistani soldiers along the AfPak border.
Pakistan's stability is of great consequence to regional and international security. Examine the roots of its challenges, what it means for the region and the world, and explore some plausible futures for the country with this CFR Crisis Guide.
UN Chief Visits Somalia
UN Secretary General Ban Ki-moon visited the Somali capital of Mogadishu, where he vowed to open a UN political office (Reuters) in January. Ban's visit, the first by a UN secretary-general since 1993, comes as Somali government and African Union troops continue to battle the Islamist al-Shabaab rebel group.
This CFR Backgrounder offers a profile of the al-Shabaab Islamist militant organization based in southern Somalia.
ZIMBABWE: President Robert Mugabe called for elections next year (BBC) to replace his power-sharing deal with Prime Minister Morgan Tsvangirai, a government coalition that has brought greater stability to the country since 2009.
Noriega to Return to Panama
France is set to extradite former Panama dictator Manuel Noriega (WashPost) back to his home country on Sunday, twenty-two years after the U.S. military toppled and arrested him. Noriega faces a long prison sentence in Panama for the disappearance of political opponents during his 1983-1989 tenure.
ARGENTINA: The UN called on Argentina to strengthen measures to protect the rights of the country's indigenous groups (MercoPress), and urged the government to develop a mechanism for dialogue with them.
Croatia Set to Join EU
After over ten years of negotiations, Croatia signed an accession treaty (DeutscheWelle) to join the twenty-seven member European Union. The agreement is expected to be ratified by July 1, 2013.
Unemployment Claims Drop to Nine-Month Low
Claims for state unemployment benefits fell to 381,000, exceeding Department of Labor estimates (Reuters). The drop reflects the increase in hiring and the latest unemployment rate of 8.6 percent, the lowest level in over two years. However, analysts predict a rise in joblessness next year if the European debt crisis impacts the U.S. recovery.
MANUFACTURING: The Washington, DC-based Council on Competitiveness released a report offering solutions to U.S. manufacturing challenges, including relaxed immigration laws for skilled workers and a reduction in international taxes. The authors argue that addressing these issues will keep increase innovation andkeep the United States competitive (U.S. News and World Report).
Renewing America is a special CFR project focused on the domestic underpinnings of U.S. global competitiveness, including the debt and deficit, infrastructure, education, innovation, trade, and corporate regulation and taxes.