Spain to unveil $50 billion in spending cuts for 2013; China urges Japan not to infringe on China's "territorial integrity" in South China Sea; North Korea's stalled nuclear talks with six nations to begin again in China; US to ease import ban on Burma; China denies influencing Venezuelan election; and more
Top of the Agenda: Spain to Unveil New Austerity Measures
Spanish Prime Minister Mariano Rajoy's government is set to release a new budget for 2013 today that will include $50 billion in spending cuts and tax increases (AFP), on the heels of two days of anti-austerity protests (DerSpiegel) on the streets of Madrid. The move is expected to pave the way for Spain to request a formal bailout from the European Union, allowing it to be a beneficiary of the European Central Bank's recently announced bond-buying program. Separately, the government this past summer accepted a $128 billion EU loan for its beleaguered banking sector. An audit of the country's banks is to be released on Friday.
"As a Spain trapped in the eurozone crisis tries to battle its way through a wrenching recession, it must now contemplate the real possibility that its plurinational state, which replaced the suffocatingly centralist Franco dictatorship with highly devolved regional government, may break up. The eurozone crisis that has brought down governments across Europe's periphery now threatens the survival of a nation-state," writes the FT's David Gardner.
"Amid all their talk of haircuts (on debt values) and tranches (of loans), European leaders have barely talked about the people who are bearing the brunt, first of the crisis and then of the throat-clearing that passes for firefighting in Brussels. This is not accidental. The euro project has relied upon draining the politics out of the inherently political: the very existence of a 17-nation economic union without a common treasury is testimony to that," say this Guardian editorial.
"Where does austerity fit in to this story? Mostly it doesn't. Shaving an extra couple of points off the structural deficit will make very little difference to long-run solvency, nor will it do much to accelerate the pace of internal devaluation. It will, however, depress employment even further and inflict a lot of direct suffering too through cuts in social programs," writes the New York Times' Paul Krugman.
China Slams Japan Over Island Row
The Chinese Foreign Ministry said it was outraged by Japanese Prime Minister Yoshihiko Noda's alleged obstinacy over the disputed Senkaku/Diaoyu Islands (Xinhua) in remarks to reporters at the UN General Assembly, and urged Japan not to infringe upon China's "territorial integrity." Japan recently purchased three of the five islands.
NORTH KOREA: Officials from the six nations involved in stalled talks on North Korea's nuclear program met Thursday in Dalian, China, for an annual security conference, where the country's nuclear ambitions will likely top the agenda (Yonhap).
US to ease import ban on Burma
China denies influencing Venezuelan election