Good morning, and welcome to the Global Situation Report for Friday, 05 April 2024.
- IRGC VOWS PAYBACK, ATTACK POSSIBLY IMMINENT: Iranian Revolutionary Guard Corps (IRGC) commander General Hossein Salami vowed reprisal attacks against Israel for the recent killings of IRGC Quds Force generals.
- There’s been media speculation that the U.S. Central Intelligence Agency (CIA) has warned Israel of an Iranian attack coming within the coming days. U.S. national security spokesman
Why It Matters: From Iran’s perspective, retaliation needs to be meaningful in order to save face, but the Iranians have previously avoided escalation into a broader Israel-Iranian war. U.S. officials are reportedly “very concerned” that the situation will escalate into a larger war. In addition to large-scale rocket attacks, the Iranians are likely targeting senior Israeli officials for assassination. That could include attacks on Israeli embassies abroad where Iranian proxy groups are active. – M.S.
- YELLEN TO HOLD “CONTENTIOUS” TALKS WITH CHINA: U.S. Treasury Secretary Janet Yellen is holding multiple days of talks with Chinese officials over their “excess production.”
- Yellen and the Biden administration are specifically concerned that China’s overproduction of subsidized electric vehicles, solar panels, and other items will undercut U.S. competitiveness and could potentially drive some U.S. companies out of business.
Why It Matters: Chinese officials defended their production as “simple economics.” During the Obama administration, Chinese producers flooded U.S. markets with cheap tires, almost certainly in a bid to drive U.S. tire manufacturers out of business. Then-president Obama entered a short-lived tariff/trade war and China ultimately backed off. So far, Yellen has been vague about adverse actions the U.S. might take, but the escalation of another trade war is probably not off the table. – M.S.
- SCO LOOKING AT PATH TO DE-DOLLARIZED TRADE: Shanghai Cooperation Organization (SCO) Secretary-General Zhang Ming said that officials are studying ways to increase bilateral currency trades within the SCO to reduce dependency on the U.S. Dollar.
Why It Matters: The SCO agreed to move forward with a plan to settle trade in national currencies in 2022. Like the BRICS economic alliance, the SCO will face challenges in moving significant portions of its trade off the dollar due to limitations on liquidity and credit in its members’ national currencies. These efforts are part of China’s strategy to displace, but not replace, the USD as the world reserve. – M.S.
- NEW ZEALAND TO APPROVE NEW NATO PARTNERSHIP: New Zealand signaled they’ll be partnering with NATO this year, fearing that an undesired outcome in Ukraine could affect security in the Indo-Pacific.
- New Zealand Foreign Minister Winson Peters will meet with senior U.S. officials this month to discuss increased cooperation after attending the NATO foreign ministers meeting earlier this week.
Why It Matters: NATO has steadily increased military cooperation with Japan and South Korea in previous years. NATO meetings with South Korea have specifically focused on improving military interoperability between the two countries. Despite protests from China, NATO’s increased cooperation with New Zealand and others is a sure sign that “global NATO” foresees an increased presence in the Indo-Pacific. – M.S.
THAT’S A WRAP: This does it for today’s edition. Thank you for reading. If you know folks who would also like to receive this email, would you please forward it to them? We appreciate you spreading the word. – M.S.