Insight and Analysis

July 2016

After the narrow victory of the Leave campaign in June’s Brexit referendum, it is only a matter of time before the UK officially leaves the European Union. There are, however, ways to soften the blow that Brexit is expected to cause once the new UK Prime Minister Theresa May triggers Article 50 – the clause that allows an EU nation to sever its EU membership.

Although she was firmly seated in the Remain camp in the run up to the referendum, Prime Minister May has consistently insisted that she will not trigger Article 50 until the UK has undergone thorough negotiations with the EU regarding the split. No other EU member country has withdrawn from the EU to date.  She has not strayed from this position, despite prominent EU officials encouraging a fast exit from the Union in order to minimize economic uncertainty.

While the economic uncertainty provoked by Brexit will continue to be analyzed on a daily basis, Brexit’s security implications have received less attention. 

It is clear that the EU needs to undergo significant reforms in the wake of Britain’s vote to leave, but a European Union in the midst of both Brexit and major reforms will be distracted. This situation opens the way to the EU’s enemies allowing them to threaten EU security, something that Russia and dangerous non-state actors like ISIS have noted.

The UK has been one of the most powerful voices in the EU insisting on Russia sanctions in response to the illegal occupation of Crimea since March 2014. Without the British present at EU discussions, there are doubts that these sanctions will last.  While President Putin of Russia tried to hide his delight at the Brexit outcome, other Russian politicians aligned with President Putin were less diplomatic. Moscow’s mayor, Sergey Sobyanin, for example, told the press that, “without the UK in the EU there won’t be anyone to so zealously defend the sanctions against us.” 

Within the EU, support for sanctions, except in the Baltics and Poland, has been weakening.  Italian Prime Minister Matteo Renzi, for example, attended the St. Petersburg International Economic Forum (SPIEF) in June, appearing on a panel with President Putin and saying that he would encourage his European colleagues to “thoroughly discuss” the continuation of sanctions.  Losing the UK’s strong support for sanctions could have an immediate impact, as Russia will now feel even less pressure to stop engaging in illegal border incursions in Ukraine and in other nearby countries and allow Russia to potentially become a greater threat to EU security.

Another challenge confronting Prime Minister May is how to effectively negotiate matters concerning European intelligence. Britain is the EU’s largest contributor of intelligence data, and with all the evidence demonstrating how ineffective intelligence sharing is within the EU, not having access to British data would be a massive blow to EU security.

Ex-PM of Belgium Guy Verhofstadt has already called upon the EU to create its own intelligence agency, but whether or not this will include any British input is unclear.

What has remained clear so far, however, is Britain’s relationship with the U.S.. President Barack Obama has already said that the U.S. will be unable to contribute much to post-Brexit discussions until the process is well underway. And while Brexit could impact U.S.-UK trade, it seemingly will not have an effect on U.S.-UK security ties.

Outside of NATO, the U.S. also shares intelligence with the UK via the Five Eyes network (the intelligence-gathering alliance between the U.S., the UK, Australia, Canada and New Zealand). With the UK leaving the EU, the Union could see a decrease in shared intelligence as the intelligence from Five Eyes was passed through the UK. 

The UK and the U.S. enjoy what is often referred to as a “special relationship.” High Representative of the European Commission for Foreign Affairs and Security Policy Federica Mogherini has emphasized that the EU will work to strengthen and “deepen” its bond with the United States before Brexit happens. This will prove to be especially important in a post-Brexit EU, where communication between the US and Europe will likely undergo changes without the British serving as middlemen.

July 2016

Brazil’s interim President Michel Temer (PMDB) will open the 2016 Olympic Games at Rio de Janeiro’s Maracanã Stadium Friday, August 5th . His message to the world will be one of confidence in Brazil’s economic and political future and a portrayal of Brazil’s readiness to return to the global stage. Temer is a big market favorite.  The Brazilian financial market has rallied tremendously since May, when he assumed the presidency, following the vote to begin the impeachment process against President Dilma Rousseff. 

The Brazilian real appreciated 21 percent in 2016 and the Ibovespa stock index is up 31 percent. Analysts surveyed by the central bank expect the economy to grow more than 1 percent in 2017 after significant contractions through 2015 and 2016. Brazilian assets are outperforming expectations based on optimism that Temer’s administration will win over investors.

Temer’s economic team is in favor of a series of market-friendly policies and plans to rein in the high budget deficit. The platform includes auctioning licenses to improve infrastructure, selling state assets to boost revenue, curbing pension payouts, and deregulating the labor market. Brazil's Congress recently approved Temer’s central bank nominations and revisions to this year’s budget target, and he hopes to obtain approval for a constitutional reform that would cap government spending.

Temer’s positions are expected to be bolstered by the conclusion of the impeachment proceedings against President Dilma Rousseff (PT). The impeachment process and trial are expected to conclude by the end of August 2016 in advance of the G20 summit (scheduled for September 4-5 in China), solidifying Temer’s position and legitimacy to push for broad economic reforms.  Furthermore, the recent election of Rodrigo Maia, an economist in the right-leaning Democrats party (DEM), as the new speaker of Brazil’s lower house of Congress, the Camara Federal, is a critical victory for Temer. Maia has indicated that he is supportive of a number of the interim Administration’s economic measures and will make economic reforms the priority of the lower house agenda. 

However, despite recent positive market sentiment in Brazil, the country is still facing a period of political and economic instability that threatens to overshadow the 2016 Olympic Games starting this week. The deep recession, a massive corruption scandal, and dysfunctional politics creates a perfect storm amid concerns about security, the Zika virus, and the potential for a weak, lame duck administration given Temer’s unpopularity with the Brazilian electorate. His centrist party, the PMDB, is implicated in a number of corruption scandals. Three members of his cabinet have resigned because of allegations of corruption. The former president of the lower house who led the drive against Rousseff, Eduardo Cunha (PMDB), was forced to step down because of bribery allegations.

It remains to be seen whether Temer can pull the country out of its fifth consecutive quarter in a recession. Temer’s promises to implement austerity measures and jumpstart the economy are weakened by the crippling recession and doubts over the approval of large structural reforms due to upcoming municipal elections in October 2016, as well as political uncertainty and lower commodity prices that may create a lag in the reform process. 

June 2016

By James LeGrice, Insight Consulting Group

It was the best of times; it was the worst of times. Such is the polarized atmosphere in Britain following the EU referendum. The 51.9 percent of Britons who voted to leave the EU see June 23rd as Independence Day and the start of a Great British renaissance. The other 48.1 percent see it as Doomsday and the beginning of irreversible ruin. More accurately, the referendum has brought the UK to a crossroads where either direction is equally possible at this stage. Which way the country goes largely depends on the steps that David Cameron’s successor takes before the exit negotiations begin.

In his resignation announcement, David Cameron said he did not think it would be right for him “to try to be the captain that steers our country to its next destination”. The governing Conservative Party must now elect a new leader by September. Boris Johnson, former Mayor of London and leading Brexit campaigner, is widely tipped to win, though he faces a strong challenge from Theresa May, the Home Secretary, who, supporters argue, would reduce the likelihood of an early general election.

Whoever wins, and the “Brexit Government” they form, will have to trigger Article 50 of the Lisbon Treaty, which will initiate the two-year EU exit procedure.  However, there is no set timeline for this. Priorities are for a tiered and managed exit, and it is possible that Article 50 will not even be triggered this year.

This will buy the Brexit Government time to tackle the crucial tasks at hand that will determine the direction the country takes. First and foremost, this means restoring confidence in the British economy.

The economic shocks that followed the referendum results – a 30 year low for the pound, stock indices hemorrhaging value, and a downgraded credit rating – were to be expected, given the way referendum campaigning was conducted. Both the Remain and Leave campaigns are equally to blame.

Remain resorted to increasingly extraordinary scare tactics to persuade the public that leaving the EU was too risky. Its opponents labeled this “Project Fear” and its proponents are now back-peddling on a number of claims including the need for an emergency Budget with new austerity measures. Leave is guilty for its failure to explain what would happen after a vote for Brexit, including how economic set-backs would be mitigated. This has led to perceptions that they never expected to win and as a result, have no plan.

It will be David Cameron’s final job to “steady the ship” and prevent these economic shocks from spiraling out of control over the next two months. His successor will then have the challenge of setting out a clear, coherent and positive vision for post-Brexit Britain, in order to reverse the market trends in Britain’s favor.

The biggest coup that the Brexit Government could pull off to restore confidence is to announce an in principle trade agreement with a major economy before it triggers Article 50.  At the least, the Brexit Government will need to secure expressions of interest for future trade that it can readily quote. Having a positive and credible vision to sell to trade partners is a prerequisite to making this possible.

It is also a prerequisite to reconciling what is now a Disunited Kingdom. The EU referendum has re-awakened many historic divisions including those between socio-economic classes, town and country, London and the regions, and between nationalities. A new Scottish independence referendum is back on the cards, and Sinn Fein has reissued its call for a united Ireland.

The Brexit Government will need to take ownership of the post-referendum narrative to heal these rifts. There is a widely-held misconception that the Brexit vote was simply a vote on immigration. Immigration was undeniably a rallying point for many, but the vote for Brexit reflects a very diverse range of views from across the political spectrum.

For some, it was a vote in defense of national sovereignty and democracy. For others, it was a libertarian vote for free markets. For others still, it was a vote to be global-facing rather than Euro-centric. And for some, it was a vote to protect the welfare state.

However, those for whom it was a vote on immigration were the most vocal, and this has led to damaging perceptions that Brexit was a victory for xenophobia. The Brexit Government will face the challenge of moving the narrative along from immigration, whilst carefully managing the expectations of those for whom this was the primary selling point, towards more positive points that can enthuse the broadest section of the public.

The Brexit Government will also have to decide quickly on how Britain should react to the international repercussions of its referendum. Many EU leaders fear that Brexit is the beginning of the end for the EU, and it is possible that the union could start unravelling before Article 50 is triggered.

In the final televised debate ahead of the referendum, Boris Johnson said, “If we stand up for democracy, we will be speaking for hundreds of millions of people around Europe who agree with us but currently have no voice.”

This is already coming true as politicians in Italy, France, Holland and Denmark have all called for their own EU referenda in the wake of Britain’s vote. The question is whether the Brexit Government should actively encourage the policies that Britain is passively inspiring.

Doing so will undoubtedly jeopardize Britain’s ability to exit the EU on favorable terms. However, if the break-up of the EU looks more certain, Britain could yet find itself at the head of an all new European alliance.

Beyond Europe, other groups seeking self-determination may cite Brexit as their inspiration. Massoud Barzani, British ally and President of the Kurdistan Regional Government in Iraq, has previously said that he wants a Kurdish independence referendum this year. Brexit could be the catalyst for this, which will put Britain on the spot over which of its regional allies to side with.

These challenges, and the way that Britain’s new leadership responds to them will determine whether the events of June 23rd have heralded the “best of times” or the “worst of times”. What is certain though is that this has been a revolution for British democracy. With voter turnout of 72%, the highest level in two decades, the referendum has reversed the recent trend of voter apathy. It has also shaken the political establishment on both the right and the left, who found their policies to be out of touch with the majority view. The Brexit Government will have major challenges to tackle, but also an invigorated electorate holding them to account to deliver the best results. That in itself should be cause for hope. 

June 2016

On July 8, 2016 the world’s eyes will turn to Warsaw as the leaders of the world’s largest security alliance gather at the annual NATO summit. One month ahead of the official summit, the Atlantic Council offered a preview of the forthcoming talks with a major conference on “The Future of NATO Enlargement and New Frontiers in European Security.” The conference brought influential politicians, military leaders, and thinkers from across the world to Washington to discuss the state of the NATO alliance and prospects for its future.

Blue Star Strategies COO Sally Painter moderated the first panel of the day focused on the efforts of Montenegro, Georgia, and Ukraine to join NATO. Sally opened by noting that NATO now finds itself at an inflection point, where it can choose to be bold or give in to fear. That calculus will shape the future of the alliance and the fate of each of the three countries on the panel, who each aspire to full NATO membership but find themselves at very different stages in their relationship with the alliance.

Montenegro has been formally invited to join NATO, and accession is proceeding on schedule. Reflecting on Montegro’s success story, Defense Minister Milica Pejanovic-Durisic said that the debate on NATO enlargement has too often been focused on fear of provoking Russia rather than the benefits of the policy. She noted that other countries aspiring to join NATO need to explain the importance of membership from a political point of view, as Montenegro did. This kind of positive advocacy is needed to convince skeptics to “fill the gaps” in the alliance, said Pejanovic-Durisic.

Next, Georgian Foreign Minister Mikheil Janelidze spoke of his country’s status as an “ally to the alliance” whose aspirations to full membership have been delayed. According to Janelidze, the appeal of NATO is not merely its security guarantees but its values system. “NATO is about the security of the free world, and Georgia wants to be part of the free world,” he said. Janelidze noted that there is an overwhelming consensus in Georgia in favor of NATO and that the country is militarily ready; the question is not Georgia’s will to join but the tactical decisions needed to make Georgia a full member.

Speaking on behalf of Ukraine, parliamentarian Hanna Hopko movingly reminded the audience of the human costs of Russia’s aggression, sharing a story about an internally displaced friend and mentioning the 10,000 citizens who have been killed in the fighting. Hopko stated bluntly that the Minsk ceasefire brokered in 2015 was “a fiction,” and that Putin will not stop unless he is forced to. Hopko argued that the West needs to be more pragmatic in supporting countries like Ukraine that aspire to join the free world, and noted that Ukrainian public support for NATO enlargement has increased dramatically since Russia’s invasion in 2014.

Painter advocated that at the Warsaw Summit: Macedonia should receive an invitation for membership after having successfully completed 10 Membership Action Plans, a strong message must be sent that Georgia will receive all the military training and support they require, regardless of MAP, and that a plan for Ukraine that details a path forward to enhanced NATO cooperation is of critical importance.  Moreover, Putin must understand that NATO is unified and will be as strong as necessary to protect its interest and those countries in Europe that share NATO's values and want to work together. 

The conference’s opening conversation paved the way for the summit. One of the key issues discussed was Macedonia’s status. The Balkan country has had a Membership Action Plan since 1999, but the name dispute with Greece has prevented its full membership. Defense Minister Zoran Jolevski nonetheless expressed confidence that Macedonia would begin accession talks with NATO at Warsaw, and noted that his country’s NATO aspirations have strengthened its democracy as well as its military.

The event featured lively discussions among many distinguished speakers and officials, including Georgian Defense Minister Tinatin Khidasheli, former Deputy Assistant Secretary of Defense Evelyn Farkas, and General Philip Breedlove, the Former Supreme Allied Commander Europe. One of the few dissenting voices was the University of Chicago’s Dr. John Mearsheimer, who made the case that NATO’s post-Cold War expansion was a major blunder that needlessly antagonized Russia. Although this opinion was vociferously opposed by most participants, the conference did feature a variety of views on the question of how to deal with Russia. General Breedlove argued that NATO must keep lines of communication with Russia open, despite Moscow’s aggressive anti-NATO posture.                                      

These debates are soon to be revisited in Warsaw, where NATO members and aspirants will meet to determine its future. One month ahead of the summit, the Atlantic Council provided a timely reminder that NATO remains as vital an alliance as ever.  To watch the full event please click here.

June 2016

The Organization of the American States (OAS) held an emergency meeting on Thursday, June 23 to consider OAS Secretary General Luis Almagro’s invocation of the Inter-American Democratic Charter against Venezuela. The Democratic Charter was signed by 34 countries in the Western Hemisphere in 2001 to defend democracy. Article 20 allows either the Secretary General or any member state to call an emergency meeting if they there has been “an unconstitutional alteration of the constitutional regime that seriously impairs the democratic order in a member state.” Venezuelan Chancellor Delcy Rodríguez opened the permanent OAS session asking for its cancellation, claiming that the democratic charter was a “coup from [Secretary General] Almagro of this organization and of Venezuela.”

Since its founding in 1948, the OAS has played a meaningful role in fulfilling its mission of defending and promoting democracy, monitoring elections, and promoting human rights in the Western Hemisphere. However, the effectiveness and credibility of the OAS faded over the last decade, as member states forged new alliances (such as the Bolivarian Alliance for the Peoples of Our America, or ALBA, and the Union of South American Nations, or UNASUR) and turned away from the forum. Under Almagro, the OAS has taken a strong stance in the context of sustained regional silence surrounding Venezuela, signaling a renewed readiness to promote dialogue, advance democracy and human rights, and advocate for regional and hemispheric partnerships.

On May 30, Almagro presented his assessment to the permanent council, justifying his position that Venezuela has acted in contravention of the Democratic Charter. Maduro, Hugo Chavez’s successor, faces an emboldened opposition, widespread frustration, and a deteriorating state. Almagro argued that Maduro’s government has violated basic democratic principles, such as the erosion of the separation of powers, lack of due process for political prisoners, and obstacles to fair and free elections. He also highlighted the increased rates of poverty and violence in the nation. The country’s fiscal mismanagement has contributed to many social problems; Venezuela now has an inflation rate of over 700 percent, a fiscal deficit of 17 percent, and $130 billion in foreign debt. The lack of sufficient dollars to purchase imports and the decline in the price of oil, coupled with a strong black market, has contributed to food and basic-good scarcities. Additionally, hospitals lack basic and specialized drugs.

While the session ended with strong opposition from Venezuela and its allies, such as Ecuador and Bolivia, and no decision on whether or not to invoke the Democratic Charter, Almagro forced member-states to face the deteriorating situation in Venezuela and spurred a new debate surrounding democracy and human rights in the region. Regardless of whether Venezuela will be suspended from the OAS, this is an important moment in OAS history as it aims to recover trust and credibility and assert hemispheric leadership.

June 2016

On June 22nd Blue Star hosted a round table discussion with Ambassador Paula J. Dobriansky as part of Blue Star’s “America in the World 2017” lecture series.  Ambassador Dobriansky is a Senior Fellow at the Future of Diplomacy Project at the Harvard Kennedy School’s Belfer Center for Science and International Affairs and the former Under Secretary of State for Democracy and Global Affairs.  Her comments, on the “Future of Europe,” focused on the major challenges which Europe is facing, particularly from Vladimir Putin’s Russia, and the need for the United States to band with Europe and defend the liberal international order. 

Although our European allies agreed to extend another round of sanctions on Russia, it appears that their commitment to stand firmly against Russia is weakening.  German’s Foreign Minister, for example, has hinted that Germany may support removing sanctions this year. Moreover, the Brexit vote plays into Putin’s hands because it weakens a united Europe.  Ambassador Dobriansky argued that the US and Europe need to stay strong on sanctions, while at the same time help Ukraine succeed.  A successful Ukraine is the last thing Putin wants.  To that end, the US and EU must continue supporting Ukraine as it makes reform and most importantly fight against the “Ukraine fatigue” which appears to have set in. 

This led to a lively discussion on the best way to manage Russia – whether the nation should be isolated through further sanctions or engaged via diplomacy and an open dialogue.   Ambassador Dobriansky argued that, considering Putin’s actions in recent year’s dialogue is, at best, a temporary bandage and that isolation and increased sanctions may have a stronger effect on Russia’s behavior. 

Many around the table concurred believing that because sanctions will continue impacting Russians daily lives and the Russian economy, it may diminish Putin’s domestic support; however, some argued that sanctions have not worked thus far and that dialogue with Russia is a better solution.   With regards to ramping up sanctions against Russia it was suggested that the EU and allied countries stop refurbishing Russian oil apparatuses because this would have an immediate impact on the nation’s finances and further deplete popular support for Putin’s government, particularly with middle class voters. 

To continue weakening Russia the US also needs to work with the countries that have a vested interest in standing up to Russia like the Nordic and Baltic States.  The May Nordic Summit, Ambassador Dobriansky said, was an “excellent” initiative by the Obama administration because it brought natural partners together and was a way for the US to demonstrate leadership and forge closer bonds with these countries.  Outreach to the Nordic states, she said, should be continued by the next administration regardless of whether there is a Democrat or Republican in the White House.

Not all of the Nordic nations are NATO members and, if Sweden and Finland become more interested in joining NATO, they should be encouraged. The US should work with other NATO member countries to expand the alliance further even after Montenegro formally becomes a member.  This could include Georgia and Macedonia, and Ukraine could be granted some sort of special status to strengthen the alliance and provide a stronger counter-weight to Russian influence in the region. 

While many at the breakfast said that they felt that diplomacy was not enough to challenge Russia’s activities in Eastern Europe, active diplomacy should be undertaken by the next administration and by the State Department at all levels of government to reinforce the liberal international order.  One nation in particular which Ambassador Dobriansky said the US should engage with more deeply is Germany.  Germany could use the moral support in a time when it is trying to keep Europe together post-Brexit and when it is under increasing pressure both domestically and from other EU states over the migrant crisis. 

The breakfast concluded with a conversation on how to re-interest Americans in Europe.  All commented that too few people in the US seem to care about Europe or NATO and that instead the policy community and government officials have been increasingly focused on the Middle East and Asia.  It was widely agreed that the next administration needs an extensive communication strategy to explain to the American public how critically important relations with Europe are and why the liberal world order and its values need to be defended through a transatlantic alliance. 

April 2016

Whoever takes office as President in January 2017 will face an unpredictable and ever-changing world, where the next foreign policy crisis cannot always be seen from afar. As the United States prepares for a change in leadership, how can the next administration formulate a grand strategy to combat tomorrow’s threats? This was the question discussed at a high-level lunch on April 22, sponsored by Blue Star Strategies as part of its “America in the World 2017” discussion series.

The lunch provided a bipartisan perspective on national security. The event’s two main speakers were Michele Flournoy, the CEO of the Center for a New American Security and former Under Secretary of Defense for Policy in the Obama administration, and Dr. Colin Dueck, an author and associate professor at George Mason University. In a wide-ranging discussion moderated by Richard Fontaine, the president of the Center for a New American Security, Flournoy and Dueck engaged with an audience of diplomats, policymakers, and thought leaders to discuss the main factors driving America’s future strategy.

From the start, the lunch was characterized by thoughtful bipartisan consensus-building. Both Flournoy and Dueck agreed that creating a long-term vision for American policy is essential, despite the unforeseen crises that inevitably arise during any presidency. There was widespread agreement that the President needs to set a top-down agenda that clearly delineates the strategic role of each agency. For instance, one potential reform would be to downsize the National Security Council, making it smaller and more strategic while still offering dissenting points of view to the president. In this regard, smart staffing is essential, as a successful national security team needs to work effectively without succumbing to groupthink or competing egos.

Strategy cannot exist in a vacuum, however; it needs to be linked to resource allocation and budgeting decisions. In this regard, the panelists argued, the executive might try to consult more closely with Congress, so that leaders on the Hill better understand the strategic rationale behind budget requests. Too often, interagency strategies that have been carefully shaped by the executive fall apart because of distorted Congressional budget priorities.

Another key strategic consideration is the role of transparency and secrecy. In the age of WikiLeaks and the Panama Papers, many outside voices clamor for increased government transparency as an end in itself. Yet when it comes to national security, Dueck argued, we need less transparency, not more. Top-level strategic decisions about risk management cannot always be subject to public scrutiny. Any national security team needs to take strong measures to prevent data leaks, and find the appropriate balance between publicly signaling its strategy and closely guarding its secrets.

As the lunch went on, one guest asked about the three prime strategic threats facing the United States today: ISIS, China, and Russia. There was some discussion about whether to include Iran on the list, and how to frame ISIS as part of a larger strategic threat. Yet there was broad consensus that no single approach could address all of these distinct competitors. Rather, the next administration needs to lead an interagency effort to craft tailored strategies for dealing with each threat, and create institutional structures for long-term planning, rather than reacting on a day-to-day basis.

At the same time, the U.S. cannot afford to limit its strategy to a few major threats. The next administration needs to make a long-term strategic commitment to Europe and invest in rules-based institutions like the EU. The U.S. will also need to keep a close watch on hotbed regions that could erupt into conflict overnight, like India and Pakistan.  

As the presidential election enters a new phase over the next few months, foreign policy will play an increasingly important role. Already, Donald Trump’s remarks on NATO and Russia have caused consternation among American allies, who fear that the U.S. will abandon its leadership role in the world. In a heated and partisan election climate, this lunch was a welcome reminder that cooler heads can prevail, offering substantive bipartisan insight into the key decisions underpinning national security strategy.

April 2016

In July 2007 the U.S. changed its visa-waiver program to enhance security and provide an opportunity for all EU member countries to enter the U.S. visa free. Prior to these changes the visa waiver program criteria relied on an evaluation of visa rejection and over stay rates.  When the law was changed the new criteria relied instead on shared security measures.

Unfortunately, the Senate imposed a sunset clause that provided insufficient time for all EU countries to achieve the new security criteria.

At the time of the sunset, EU citizens from Romania, Bulgaria and Poland remained outside the visa waiver program. Today there are more EU citizens who cannot travel visa free to the US including Croatia and Cyprus.  Because not all EU citizens are treated the same under the U.S. visa regime, the European Union passed law No. 1289 obliging the European Commission to implement a 12-month suspension of visa-free travel for citizens of a country that does not have VWPs with all Member Countries in the EU.  According to this statute, the Commission and Parliament have 24 months to analyze best approaches towards solving the issue, as well as the possible "adverse consequences" that the decision would have on the relationships with the third country.  In April 2014, the European Union initiated the two-year examination process when it published a report in its Official Journal, announcing that Japan, Brunei, Australia, and the US do not offer visa waivers with certain Member nations. 

Although, Japan and Australia have restored their visa waiver programs with all EU countries, the United States and Canada have remained intransigent in their visa policies.  The United States declared that Bulgaria, Croatia, Cyprus, Poland, and Romania do not meet security standards defined by US law.  Although Canada recently affirmed its commitment to extending Electronic Travel Authorization (eTA) to Bulgarian and Romanian nationals who have traveled to the country in the previous ten years these reforms have been implemented.

The U.S. visa policy is predicated on the US Immigration and Nationality Act forbidding the implementation of visa waiver programs for nations with a higher than three percent rejection rate.  After the 2015 San Bernardino shooting, Congress tightened this policy to deny Electronic System for Traveling Authorizations or (ESTAs) to nationals that hold a dual citizenship from Iraq, Iran, Syria, or Sudan.  The law also bans granting ESTAs to any person that has traveled to Libya, Somalia, or Yemen after March 1, 2014.   The EU suggested and the U.S. has agreed to two modifications: the new ESTA form includes a section that allows applicants to provide information on why they should be eligible for visa-free travel and the restrictions for those who have traveled to Iraq, Iran, Syria or Sudan are less restrictive for “bona fide” EU travelers.

This month the European Commission and the European Parliament considered suspending visa-free travel for citizens of the United States and Canada because both countries continue to refuse visa waivers for all citizens of EU countries.  The situation appears to be deadlocked since recent terror attacks in France and Belgium make it unlikely that the U.S. will expand the visa-waiver program to include all EU citizens. Nevertheless, it is important to understand that were the EU to adhere to is laws, it would have severe ramifications for US travelers. At a minimum tourist and business travelers to the EU would experience a more costly and more complicated entry process.

Moreover, the costs to the EU for terminating its visa waiver program with the United States and Canada would be high. A report published on April 12th, states that the infrastructure needed to process additional visas would cost the EU roughly Є 25 million. Currently, the EU maintains 45 consulates that support 30,000 visa applicants every year.  If the EU were to impose visas European countries would have to expand their embassy numbers and staff to process an estimated 10 million US and 2 million Canadian applications per year. 

Furthermore, a European decision to abolish visa waivers with the United States and Canada would have a negative economic impact on Europe since U.S. and Canadian travelers represent the largest number of international travelers to the EU. A recent European Union study estimated that this impact would result in a Є 1.8 billion reduction in the EU economy, and a five percent decrease in the number of tourists. 

Given the negative economic and travel implications it is essential that a common approach that promotes global security and allows reciprocity all EU citizens to travel to the U.S. and Canada be developed. Moreover, since evaluating overstay and rejection rates has not been found to promote greater security, we would urge that the U.S. Congress eliminate visa rejection and overstay rates as essential criteria and reinstitute meaningful security criteria to achieve its ends. 

While this is not an easy process, since only the U.S. Congress can amend the law to allow all EU citizens to travel visa free to the U.S., we urge the US Congress to do so. Our important transatlantic relationship depends on fair and equal treatment for all EU citizens.

April 2016

As part of the regional turn against leftist populism in Latin America, Peru is currently heading towards a presidential run-off election on June 5^th between two right-leaning candidates, Keiko Fujimori (40) of the Popular Force (Fuerza Popular) party and Pedro Pablo Kuczynski (77) of the Peruvians for Change (Peruanos por el Kambio).  Fujimori is perceived as the more conservative of the two, she has promised to crack down on crime and insecurity, while Kuczynski is more socially liberal.  Both are committed to free markets and continuing Peru’s integration with the wider global economy; when it was announced that they were the final two candidates the Peruvian stock market jumped by 12 percent reflecting the business community’s concerns about another leftist president. 

Fujimori though has a name that evokes negative memories in many Peruvians because Keiko Fujimori’s father Alberto Fujimori was Peru’s president turned authoritarian dictator from 1990 to 2000.  Alberto Fujimori was ultimately impeached on charges of corruption and crimes against humanity and is currently less than halfway through a twenty-five year prison sentence for human rights violations, embezzlement and bribery. 

Read more ...

April 2016

Climate change is real.The world has finally come together and acknowledged that we need to preserve our planet. Following the United Nations Paris Climate Change Conference in November last year, a historic meeting took place a week ago at the United Nations Headquarters in New York City, where 155 countries committed to signing the Paris Agreement on Climate Change. The countries pledged to work towards limiting global warming.

Read more ...