China Asks U.S. to Stay Out of South Sea Dispute
As U.S. State Secretary Hillary Clinton arrived for a visit in Beijing, Chinese authorities said they hope she will not bring up the South China Sea dispute. The row concerns the sovereignty over the ocean area between China, the Philippines, Brunei, Malaysia, Indonesia, and Vietnam, as well as the two natural resource-laden island chains of the Paracels and the Spratlys. China claims that is has ruled over the whole area for over 2,000 years. Vietnam argues that China never claimed its sovereignty before the 1940s, and says it can prove it has been under vietnamese rule since the 17th century. The Philippines disagree, and say the Spratlys belong to them. Malaysia and Brunei have also claimed parts of the area as their own. There have been incidents involving the Chinese military over the past four decades, mostly with Vietnam and the Philippines. More recently, China’s authorities have asked the other nations to end exploration efforts and pushed back strongly against attempts to mediate this internationally, something the smaller countries have asked for. In 1982, the U.N. got involved with the Convention of the Law of the Sea, but it hasn’t been enough to resolve it. Clinton first spoke up in 2010, asking for a code of conduct, but China balked. The topic was brought up in a meeting in Indonesia yesterday where Clinton asked the nations of South East Asia to form a united bloc on this issue.
France, Italy Increase Pressure on ECB Ahead of Monthly Meeting
Italian Prime Minister Mario Monti and French President François Hollande today called on the European Central Bank to agree on steps that will help lower borrowing costs for nations like Greece and Spain. In a closed-door session yesterday, ECB President Mario Draghi told the European Parliament that the central bank must print money and buy bonds to regain control of the euro area’s interest rates and ensure the common currency’s survival. He argued that, far from abandoning the ECB’s responsibility to keep inflation under control, these measures will support it, adding that a failure to intervene will raise borrowing costs not just for governments, but also for corporations. Jens Weidmann, the top central banker of Germany, the European Union’s largest economy, is still resisting these proposals, and is said to consider quitting over it. The ECB will meet on Thursday and is expected to announce some new steps to help the region with its debt woes, but Draghi may not be able to deliver everything the markets are hoping for.
Syrian Government Calls on Reserve Soldiers as Refugee Ranks Swell
The Syrian army, led by President Bashar al-Assad, has been calling on reservists to support the 300,000 troops already on the ground, a sign that the government’s forces are under increasing pressure against the opposition. Only half of those who were called upon reported for service, as many of them joined the growing ranks of refugees. In August alone, 100,000 people left Syria, the United Nations said today, the most since the civil war began 18 months ago. This exodus brings the total number of refugees who have asked for UN help to 234,000. President Assad has nevertheless agreed to meet with a representative from the Red Cross, saying that the organization would be allowed to bring humanitarian help to the country’s population, “as long as it works in a neutral and independent way,” the Syrian state’s news agency reported. Assad supporters brought the conflict to the internet, hacking the web site for Qatar-based news organization Al Jazeera.
Egypt Closer to $1 Billion Rescue Deal with U.S.
A U.S. senior official said today Egypt and the U.S. are closer to closing a deal on $1 billion debt aid that’s been stalled since the uprising began in March 2011. This is a sign that American authorities are more willing to trust newly-elected Egyptian President Mohamed Morsi, who ran for the Muslim Brotherhood, an Islamic organization who has acted as opposition in various Arab states. The U.S. had close ties to deposed leader Hosni Mubarak, whose autocratic regime acted as a stabilizing force on behalf of the U.S. in the region. Experts believe that this gesture will help ensure good relations with the new government as political strife continues to shake the Middle East. The U.S. also backed Egypt for a $4.8 billion loan from the International Monetary Fund.
Facebook Shares Hit New Low on Mobile Advertising
The shares of Facebook Inc. fell to $17.73, their lowest price since the company began trading publicly on May 17, after Morgan Stanley (one of the banks who organized Facebook’s initial public offering) cut its outlook for the social network. Facebook will have trouble reaching its users with advertisements as more and more of them access it through their mobile devices, Morgan Stanley Analyst Scott Devitt said. He lowered his price projection to $32 in the next year, down from the IPO price of $38. Facebook lost over half its value as investors lowered their expectations for revenue growth. It has also caused the loss of an estimated $500 million for Wall Street firms after a NASDAQ glitch that caused market makers to place the same orders several times.