Ending the Oil Age & more – 19th Dec 2023

Saluton from BA! This is Rorshok’s Multilateral Update from the 19th of December twenty twenty-three A summary of what's going down in the world's major multilateral institutions.

At the COP28 climate summit in Dubai that took place between the 30th of November and the 14th of December, representatives from almost 200 countries agreed to start reducing global fossil fuel consumption, marking a significant step towards ending the oil age.

Despite resistance from the Organization of the Petroleum Exporting Countries, led by Saudi Arabia, the summit concluded with a strong commitment to transitioning away from fossil fuels. This transition includes tripling renewable energy capacity by twenty thirty and accelerating decarbonization technologies like carbon capture and storage.

The deal also faces challenges in implementation, with countries like the U.S. struggling to align national policies with climate goals.

Moving on to Africa, the African Union Transition Mission in Somalia (or ATMIS) has resumed transferring security responsibilities to Somali government forces, including the State House and parliament building. The transition includes handing over ten bases and withdrawing 3,000 soldiers by the 31st of December. This development follows a ninety-day pause the Somali government requested due to military challenges against al-Shabab militants.

Somalia's security plan involves building substantial land, naval, air, police, and custodial forces. With international support, Somali authorities are preparing to manage security independently, bolstered by the recent lifting of an arms embargo. The ATMIS mission, set to hand over all responsibilities by the end of next year, will transition to a new mission focused on capacity building and protecting critical infrastructure and populated areas, with a continued AU presence beyond twenty twenty-four. Somalia is also negotiating a multilateral protection force to work alongside Somali Security Forces post-ATMIS.

Staying in Africa but moving a few miles to the west, the Economic Community of West African States (or ECOWAS) has suspended Niger's membership following the military coup that overthrew President Mohamed Bazoum's government. This decision, announced after the ECOWAS summit in Abuja on Sunday the 10th, marks a shift from the previous stance where Niger was not suspended and Bazoum’s government members were allowed to attend ECOWAS meetings. The suspension remains in effect until constitutional order is restored in Niger.

ECOWAS leaders, during their meeting, called for the release of Bazoum in exchange for lifting sanctions imposed on Niger. However, Omar Abdourahmane Tchiani, the junta leader, refused to release Bazoum. The bloc also urged the junta to shorten the currently planned three-year transition period. Even though Tchiani agreed to reduce the transition duration, he did not specify the extent of this reduction. Despite these negotiations, ECOWAS decided to maintain sanctions against Niger until further notice.

In an attempt to address a long-standing obstacle within the North Atlantic Treaty Organization (or NATO), on Thursday the 14th, U.S. President Joe Biden and Turkey’s President Recep Tayyip Erdogan discussed the importance of accelerating Sweden's NATO membership, an issue that has been pending for over seventeen months. Turkey, citing concerns over Sweden's alleged support for Kurdish groups, which Sweden denies, has been a key roadblock in the accession process. Finland applied alongside Sweden in May twenty twenty-two and joined NATO in March twenty twenty-three. However, Sweden's bid has faced delays in the Turkish parliament despite Erdogan signing a protocol for Sweden's accession in October twenty twenty-three.

The details of Biden and Erdogan's conversation were not fully disclosed, but John Kirby, U.S. National Security Council spokesperson, indicated the discussion likely included the potential U.S. support for modernizing Turkey's F-16 fighter jets. Erdogan has previously linked Sweden's NATO bid approval to the US’ agreement to sell F-16s to Turkey.

Interpol and the World Customs Organization's annual Operation Thunder, involving 133 countries, resulted in 500 arrests and over 2,000 confiscations of wildlife and timber. Seized items included fifty-three primates, four big cats, over 1,300 birds, 300 kilograms of ivory, turtle eggs, and rhino horns. The operation targeted wildlife and timber trafficking, with the confiscated animals intended for the pet trade, egg harvesting, or meat, and wildlife parts used in jewelry and rituals. The crackdown emphasized the intersection of environmental crime with violence, corruption, and financial crime. It involved extensive searches and inspections using sniffer dogs and X-ray scanners. The World Customs Organization advocated for strict border controls and intelligence-sharing to disrupt criminal networks.

In Southeast Asia, Japan and the Association of Southeast Asian Nations (or ASEAN) agreed to collaborate on developing a competitive and green automotive industry. This decision came in a Tokyo summit on Sunday, the 17th, marking fifty years of Japan-ASEAN relations. Fumio Kishida, Japan’s Prime Minister, emphasized the summit's role in shaping a roadmap for future cooperation, focusing on economic and societal advancement, peace, and stability. The ASEAN-Japan Co-Creation Initiative for the Next-Generation Automotive Industry aims to create a master plan, decarbonize the industry's value chain, and establish resilient supply chains. Japan and ASEAN also plan to strengthen economic security by diversifying critical mineral sources and enhancing defense cooperation through ASEAN-led frameworks. They committed to peaceful dispute resolution in maritime security, in line with international law.

The International Energy Agency (or IEA) forecasts that global coal use will reach a record high in twenty twenty-three, with demand rising by almost 1.5%, surpassing 8.5 billion metric tons. This surge is primarily driven by increasing usage in India (with an 8% hike) and a 5% increase in China due to higher electricity demands and reduced hydropower output. Conversely, the IEA expects coal use in the European Union and the United States to drop by around 20% each in twenty twenty-three. However, the organization does not anticipate a significant decline in global coal consumption until twenty twenty-six, when expanded renewable capacity could reduce usage by over 2% from twenty twenty-three levels. Despite this, consumption is projected to remain over 8 billion metric tons in twenty twenty-six. China, accounting for over half of the global renewable expansion, is expected to see a decline in coal demand from twenty twenty-four. This year, China, India, and Southeast Asia will constitute three-quarters of global coal consumption, with Southeast Asia's use expected to exceed that of the U.S. and the EU.

In global security issues, on Thursday the 14th, the United Nations Security Council (or UNSC) extended the mandate of the Sanctions Monitoring Team against the Taliban for another year. Despite requests from the Taliban to lift sanctions, concerns over ongoing terrorist activities and human rights issues have led the UNSC to sustain its measures. Even though China and Russia are against the sanctions, they did not veto the extension of the Monitoring Team's work.

The sanctions include freezing funds and assets, imposing travel bans, and restricting arms transfers. The Monitoring Team has to report on non-compliance with these sanctions and aiding Member States in capacity-building.

On the same day, International Monetary Fund (or IMF) Managing Director Kristalina Georgieva emphasized the need for clear regulations and infrastructure to mitigate risks associated with cryptocurrencies. Noting their increasing adoption, particularly in emerging markets, Georgieva highlighted the potential threats to macro-financial stability. She stressed the importance of establishing clear tax rules and a legal framework to prevent issues like money laundering and terrorism financing. Georgieva cited Korea's efforts to amend anti-money laundering laws and craft new crypto legisation as positive examples. She warned that the widespread use of cryptocurrencies could undermine monetary policies and bypass capital flow management measures.

The World Bank warns that debt servicing costs in some of the world's poorest countries are set to reach critical levels due to high-interest rates, with a 40% increase expected over the next two years. High rates are pushing developing countries into financial distress, with a stark choice between servicing debts and investing in public needs. The situation has worsened due to reduced access to international financing and a withdrawal of private creditors. As a result, the World Bank projects economic activity in these countries to be significantly below pre-pandemic levels by twenty twenty-four. The recent years have seen a notable increase in sovereign defaults, and interest payments have quadrupled over the past decade. The World Bank emphasizes the need for greater support for these countries to manage their burgeoning debt burdens effectively.

Aaand that's it for this week!

The Rorshok Multilateral Update is taking a break for the holidays. We'll catch up with you again on the 9th of January.

Happy holidays!