Good morning, and welcome to the Global Situation Report for Wednesday, 28 February 2024.
- BRICS PREPARES REPORT ON COMMON CURRENCY DEVELOPMENT: Finance ministers and central bankers of the BRICS (Brazil, Russia, India, China, South Africa) economic alliance met on Tuesday to discuss economic issues and cooperation.
- BRICS members are also expected to publish the findings of the common payment system working group, which was tasked with developing the path towards a BRICS common currency. The report will be discussed at this year’s BRICS annual conference in October.
- Russian officials this week also discussed a central bank digital currency (CBDC) as the basis for a BRICS-wide payment system.
Why It Matters: Despite Indian opposition and strong doubts about its viability from others, elements within BRICS continue pressing for the development of a common currency. These are discussions about concepts and not concrete steps to develop a currency. – M.S.
- U.S. ARMY ANNOUNCES MAJOR CUTS TO PERSONNEL: According to a new white paper, the U.S. Army is cutting 32,000 counterterrorism and counterinsurgency billets due to recruiting shortfalls while adding 7,500 billets focused on large-scale war.
- The Army’s Multi-Domain Task Forces (MDTF) will be completed and assigned to the Pacific, European, and Central Commands.
- The Army is specifically reducing special operations forces (SOF) billets that have been hard to fill or vacant for an extended period.
Why It Matters: U.S. Pacific Command is receiving three MDTFs in preparation for war with China. Earlier this month, we reported that Military Information Support Operations (MISO) – the Army’s updated name for Psychological Operations – was a likely target for personnel cuts, as the PSYOP mission is not a priority in a high-end conventional conflict with China. – J.V.
- CHINA PROMISES MORE ESCALATION AGAINST THE PHILIPPINES: Philippine President Ferdinand Marcos Jr. said he had reports of China’s People’s Liberation Army Navy (PLAN) ships near Filipino fishing grounds in the West Philippine Sea when it was previously only the Chinese Coast Guard. Marcos promised to continue defending the Philippines’ maritime territories and support the fishermen in the shoals.
- China’s Ministry of Foreign Affairs Spokeswoman Mao Ning said China “ will continue to take necessary measures to firmly safeguard our territorial sovereignty and maritime rights and interests, and keep the South China Sea peaceful and stable.”
Why It Matters: Despite previously conducting patrols in the region, this is likely the first time that PLAN ships are taking part in territorial protection in the South China Sea. China continues to frame this as legal and necessary due to Filipino aggression, thus implying that they will continue to escalate if they think their current methods are ineffective or failing. As a professional military is now involved, we are likely to see increased Philippine Navy patrols and possibly joint patrols between them and regional allies such as the U.S., Australia, or Japan. Having multiple navies in a disputed area increases the lethality potential but also reduces the potential for miscalculation as they are more equipped for de-escalation and cross-deck communications. – J.V.
- OLMERT WARNS ISRAEL AGAINST RAFAH OFFENSIVE: Former Israeli Prime Minister Ehud Olmert warned current Prime Minister Benjamin Netanyahu about a planned offensive in Rafah, saying it represents a red line for the international community.
- “The patience of the international community has reached a point from where I don’t think they’ll be able to absorb it [a Rafah offensive],” Olmert said. “It may shatter the peace agreement between Israel and Egypt,’ he added.
- The Netanyahu government says destroying Hamas necessitates clearing an estimated 5,000-8,000 fighters from Rafah. Israeli officials also reportedly believe 100 hostages are being held there.
Why It Matters: Egyptian officials have previously warned Israel against an invasion of Rafah and escalating the Gaza conflict. Netanyahu, over the weekend, seemed nonchalant over Egypt’s opposition to the new offensive. Rafah sits on the southern end of Gaza, near the Egyptian border. Olmert’s proposal of removing Israeli forces from Gaza and replacing them with an international peacekeeping force is an unlikely scenario, at least in the near term. Meanwhile, the Biden administration continues to pressure Israel for a ceasefire, which is opposed by the Netanyahu government, so the risk of escalation with Israel’s Islamic neighbors remains on the table. – 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.