Wednesday 27 November 2013

ISRAELIS, SAUDIS AND THE IRANIAN AGREEMENT



THE IRANIANS' PRIMARY GOAL IS

 REGIME PRESERVATION


By George Friedman via Stratfor

A deal between IRAN and the P-5+1 (the five permanent members of the U.N. Security Council plus GERMANY) was reached. The Iranians agreed to certain limitations on their nuclear program while the P-5+1 agreed to remove certain economic sanctions. The next negotiation, scheduled for six months from now depending on both sides' adherence to the current agreement, will seek a more permanent resolution. The key players in this were the UNITED STATES and IRAN. The mere fact that the U.S. secretary of state would meet openly with the IRANIAN foreign minister would have been difficult to imagine a few months ago, and unthinkable at the beginning of the Islamic republic. 

The U.S. goal is to eliminate IRAN'S nuclear weapons before they are built, without the UNITED STATES having to take military action to eliminate them. While it is commonly assumed that the UNITED STATES could eliminate the IRANIAN nuclear program at will with airstrikes, as with most military actions, doing so would be more difficult and riskier than it might appear at first glance. The UNITED STATES in effect has now traded a risky and unpredictable air campaign for some controls over the IRANIAN nuclear program. 

The IRANIANS' primary goal is regime preservation. While Tehran managed the Green Revolution in 2009 because the protesters lacked broad public support, WESTERN sanctions have dramatically increased the economic pressure on IRAN and have affected a wide swath of the IRANIAN public. It isn't clear that public unhappiness has reached a breaking point, but were the public to be facing years of economic dysfunction, the future would be unpredictable. The election of President Hassan to replace Mahmoud Ahmadinejad after the latter's two terms was a sign of unhappiness. Supreme Leader Ali Khamenei clearly noted this, displaying a willingness to trade a nuclear program that had not yet produced a weapon for the elimination of some sanctions. 

The logic here suggests a process leading to the elimination of all sanctions in exchange for the supervision of IRAN'S nuclear activities to prevent it from developing a weapon. Unless this is an IRANIAN trick to somehow buy time to complete a weapon and test it, I would think that the deal could be done in six months. An IRANIAN ploy to create cover for building a weapon would also demand a reliable missile and a launch pad invisible to surveillance satellites and the CIA, National Security Agency, Mossad, MI6 and other intelligence agencies. The IRANIANS would likely fail at this, triggering airstrikes however risky they might be and putting IRAN back where it started economically. While this is a possibility, the scenario is not likely when analyzed closely.

TWO “ARCH FOES” ALLIED IN OPPOSING IRAN DEAL?

While the unfolding deal involves the UNITED STATES, BRITAIN, FRANCE, CHINA, RUSSIA and GERMANY, two countries intensely oppose it: ISRAEL and SAUDI ARABIA.

Though not powers on the order of the P-5+1, they are still significant. There is a bit of irony in ISRAEL and SAUDI ARABIA being allied on this issue, but only on the surface. Both have been intense enemies of IRAN, and close allies of the UNITED STATES; each sees this act as a betrayal of its relationship with Washington.


Comment by Geopolitical Analysis and Monitoring: 

As mentioned numerous times on this blog, mainstream media and to some extend even alternative media report that IRAN presents the most serious threat to ISRAEL, and that IRAN’S nuclear threat should be a concern for the entire world is mainly a convenient bargaining tool for both, ISRAEL and IRAN. In most likelihood the behind the scene scenario looks rather different. Like with AZERBAIJAN, ISRAEL may conduct secrete wheeling and dealings with the PERSIAN state, a scenario not at all impossible, since ISRAEL’S new political doctrine fosters geopolitical as well as economic alliances with non-Arab Muslim stated. After all the two countries, in the not too distant past, had not always been arch enemies. See:

ARE IRAN AND ISRAEL REALLY ARCHENEMIES, OR IS IT JUST A FACADE?  

IRAN SOFTENS TUNE ON ISRAEL 

AZERBAIJAN'S ISRAEL DIPLOMACY TESTS IRAN 

ISRAEL’S IRAN “WARMONGERING RHETORIC’S” ARE DECEIVING TACTICS FOR A GREATER CAUSE 


THE VIEW FROM SAUDI ARABIA

In a way, this marks a deeper shift in relations with SAUDI ARABIA than with ISRAEL. SAUDI ARABIA has been under BRITISH and later AMERICAN protection since its creation after World War I. Under the leadership of the SAUDS, it became a critical player in the global system for a single reason: It was a massive producer of oil. It was also the protector of Mecca and Medina, two Muslim holy cities, giving the SAUDIS an added influence in the Islamic world on top of their extraordinary wealth. 

It was in BRITISH and AMERICAN interests to protect SAUDI ARABIA from its enemies, most of which were part of the Muslim world. The UNITED STATES protected the SAUDIS from radical ARAB socialists who threatened to overthrow the monarchies of the ARABIAN PENINSULA. It later protected SAUDI ARABIA from Saddam Hussein after he invaded KUWAIT. But it also protected SAUDI ARABIA from IRAN.

Absent the UNITED STATES in the PERSIAN GULF, IRAN would have been the most powerful regional military power. In addition, the SAUDIS have a substantial Shiite minority concentrated in the country’s oil-rich east. The IRANIANS, also Shia, had a potential affinity with them, and thereby the power to cause unrest in SAUDI ARABIA. 

Until this agreement with IRAN, the UNITED STATES had an unhedged commitment to protect SAUDI ARABIA from the IRANIANS. Given the recent deal, and potential follow-on deals, this commitment becomes increasingly hedged. The problem from the SAUDI point of view is that while there was a wide ideological gulf between the UNITED STATES and IRAN, there was little in the way of substantial issues separating Washington from Tehran. The UNITED STATES did not want IRAN to develop nuclear weapons. The IRANIANS didn't want the UNITED STATES hindering IRAN'S economic development. The fact was that getting a nuclear weapon was not a fundamental IRANIAN interest, and crippling Iran's economy was not a fundamental interest to the UNITED STATES absent an IRANIAN nuclear program.

If the UNITED STATES and IRAN can agree on this quid pro quo, the basic issues are settled. And there is something drawing them together. The IRANIANS want investment in their oil sector and other parts of their economy. AMERICAN oil companies would love to invest in IRAN, as would other U.S. businesses. As the core issue separating the two countries dissolves, and economic relations open up -- a step that almost by definition will form part of a final agreement -- mutual interests will appear.

There are other significant political issues that can't be publicly addressed. The UNITED STATES wants IRAN to temper its support for Hezbollah's militancy, and guarantee it will not support terrorism. The IRANIANS want guarantees that IRAQ will not develop an anti-IRANIAN government, and that the UNITED STATES will work to prevent this. (IRAN'S memories of its war with IRAQ run deep.) The IRANIANS will also want AMERICAN guarantees that Washington will not support anti-IRANIAN forces based in IRAQ. 

From the SAUDI point of view, IRANIAN demands regarding IRAQ will be of greatest concern. Agreements or not, it does not want a pro-IRANIAN Shiite state on its northern border. Riyadh has been funding Sunni fighters throughout the region against Shiite fighters in a proxy war with Iran. Any agreement by the AMERICANS to respect IRANIAN interests in IRAQ would represent a threat to SAUDI ARABIA.

THE VIEW FROM ISRAEL

From the ISRAELI point of view, there are two threats from IRAN. One is the nuclear program. The other is IRANIAN support not only for Hezbollah but also for Hamas and other groups in the region. Iran is far from Israel and poses no conventional military threat. The ISRAELIS would be delighted if IRAN gave up its nuclear program in some verifiable way, simply because they themselves have no reliable means to destroy that program militarily. What the ISRAELIS don't want to see is the UNITED STATES and IRAN making deals on their side issues, especially the political ones that really matter to ISRAEL.

The ISRAELIS have more room to maneuver than the SAUDIS do. ISRAEL can live with a pro-IRANIAN IRAQ. The SAUDIS can't; from their point of view, it is only a matter of time before IRANIAN power starts to encroach on their sphere of influence. The SAUDIS can't live with an IRANIAN-supported Hezbollah. The ISRAELIS can and have, but don't want to; the issue is less fundamental to the ISRAELIS than IRAQ is to the SAUDIS.

But in the end, this is not the problem that the SAUDIS and ISRAELIS have. Their problem is that both depend on the UNITED STATES for their national security. Neither country can permanently exist in a region filled with dangers without the UNITED STATES as a guarantor. ISRAEL needs access to AMERICAN military equipment that it can't build itself, like fighter aircraft. SAUDI ARABIA needs to have AMERICAN troops available as the ultimate guarantor of their security, as they were in 1990. ISRAEL and SAUDI ARABIA have been the two countries with the greatest influence in Washington. As this agreement shows, that is no longer the case. Both together weren't strong enough to block this agreement. What frightens them the most about this agreement is that fact. If the foundation of their national security is the AMERICAN commitment to them, then the inability to influence Washington is a threat to their national security.

There are no other guarantors available. ISRAELI Prime Minister Benjamin Netanyahu went to Moscow, clearly trying to get the RUSSIANS to block the agreement. He failed. But even if he had succeeded, he would have alienated the UNITED STATES, and would have gotten instead a patron incapable of supplying the type of equipment Israel might need when ISRAEL might need it. The fact is that neither the SAUDIS nor the ISRAELIS have a potential patron other than the UNITED STATES.

Background Information:

POLITICAL DYNAMICS IN THE SOUTH CAUCASUS AND IRAN’S PRIORITIES IN THE REGION

ISRAEL SUCCESSFULLY ESTABLISHED DIPLOMATIC RELATIONS WITH NINE NON-ARAB MUSLIM STATES

ISRAEL’S ARMENIAN, IRANIAN AND AZERBAIJAN EQUATION


U.S. REGIONAL POLICY

The UNITED STATES is not abandoning either ISRAEL or SAUDI ARABIA. A regional policy based solely on the IRANIANS would be irrational. What the UNITED STATES wants to do is retain its relationship with ISRAEL and SAUDI ARABIA, but on modified terms. The modification is that U.S. support will come in the context of a balance of power, particularly between IRAN and SAUDI ARABIA. While the UNITED STATES is prepared to support the SAUDIS in that context, it will not simply support them absolutely. The SAUDIS and ISRAELIS will have to live with things that they have not had to live with before -- namely, an AMERICAN concern for a reasonably strong and stable IRAN regardless of its ideology.

The AMERICAN strategy is built on experience in IRAQ and AFGHANISTAN. Washington has learned that it has interests in the region, but that the direct use of AMERICAN force cannot achieve those goals, partly because imposing solutions takes more force than the UNITED STATES has and partly because the more force it uses, the more resistance it generates. Therefore, the UNITED STATES needs a means of minimizing its interests, and pursuing those it has without direct force.

SUNNI VERSUS SHIA, ARABS VERSUS PERSIANS

With its interests being limited, the UNITED STATES' strategy is a balance of power. The most natural balance of power is Sunni versus Shia, the ARABS against the IRANIANS. The goal is not war, but sufficient force on each side to paralyze the other. In that sense, a stable IRAN and a more self-reliant SAUDI ARABIA are needed. SAUDI ARABIA is not abandoned, but nor is it the sole interest of the UNITED STATES.

In the same sense, the UNITED STATES is committed to the survival of ISRAEL. If IRANIAN nuclear weapons are prevented, the UNITED STATES has fulfilled that commitment, since there are no current threats that could conceivably threaten ISRAELI survival. ISRAEL'S other interests, such as building settlements in the WEST BANK, do not require AMERICAN support. If the UNITED STATES determines that they do not serve AMERICAN interests (for example, because they radicalize the region and threaten the survival of JORDAN), then the UNITED STATES will force ISRAEL to abandon the settlements by threatening to change its relationship with ISRAEL. If the settlements do not threaten AMERICAN interests, then they are ISRAEL'S problem.

ISRAEL has outgrown its dependence on the UNITED STATES. It is not clear that ISRAEL is comfortable with its own maturation, but the UNITED STATES has entered a new period where what AMERICA wants is a mature ISRAEL that can pursue its interests without recourse to the UNITED STATES. And if ISRAEL finds it cannot have what it wants without AMERICAN support, ISRAEL may not get that support, unless ISRAEL'S survival is at stake. 

In the same sense, the perpetual SAUDI inability to create an armed force capable of effectively defending itself has led the UNITED STATES to send troops on occasion -- and contractors always -- to deal with the problem. Under the new strategy, the expectation is that SAUDI soldiers will fight SAUDI ARABIA'S wars -- with AMERICAN assistance as needed, but not as an alternative force. 

With this opening to IRAN, the UNITED STATES will no longer be bound by its ISRAELI and SAUDI relationships. They will not be abandoned, but the UNITED STATES has broader interests than those relationships, and at the same time few interests that rise to the level of prompting it to directly involve U.S. troops. The SAUDIS will have to exert themselves to balance the IRANIANS, and ISRAEL will have to wend its way in a world where it has no strategic threats, but only strategic problems, like everyone else has. It is not a world in which ISRAELI or SAUDI rigidity can sustain itself.

And where does the EUROPEAN UNION  come in on all the wheeling and dealing about IRAN?


Monday 25 November 2013

TURKEY ON THE MOVE

                


TURKEY PUSHES CROSSROADS POLITICS


By Pepe Escobar via AsiaTimes

While everyone is concentrated on the possibility of a tectonic shift in US-IRAN relations, and while a solution may be found for the SYRIAN tragedy in another upcoming set of negotiations in Geneva, TURKEY is silently toiling in the background. Let's see what these sultans of swing are up to.
We start on the internal front. Abdul Mejid I, the 31st Ottoman sultan (in power from 1839 to 1861) always dreamed of a submerged tunnel under the Bosphorus linking EUROPE to ASIA.

It took "Sultan" Erdogan, as in Prime Minister Recep Tayyip Erdogan, to make it happen, when last month he inaugurated – on the 90th anniversary of the founding of Ataturk's Republic - the US$3 billion, 76-kilometer Marmaray rail system which, in the hardly hyperbolic words of Mustafa Kara, mayor of Istanbul's Uskudar district (where the tunnel comes out), will "eventually link London to Beijing, creating unimagined global connections".
It certainly helps that this technological marvel fits right into CHINA'S extremely ambitious New Silk Road(s) strategy which, just like the original Silk Road, starts in XIAN, and aims to cross to EUROPE via, where else, Istanbul.

Background Information:
CHINA AND TURKEY 
CHINESE - TURKISH GEOPOLITICAL AND ECONOMIC AMBITIONS COINCIDE



SECURITY DILEMMAS

TURKEY AND CHINA AT ODDS OVER 10 MILLION TURKISH UYGHUR MINORITIES LIVING IN CHINA

ERDOGAN’S MEGA-PROJECTS - SUPPORTED BY MILLIONS IN RURAL ANATOLIA

So the fact remains that "Sultan" Erdogan simply has not been downed by the Gezi Park protests last June. All the ruling party AKP's mega-projects - supported by millions in rural Anatolia, ignored for decades by the secular elites in Istanbul - are alive and kicking.
By 2025, more than a million commuters will be using the Marmaray. The third Bosphorus bridge, close to the Black Sea, is being built - despite Alevi fury that it will be named after Selim The Grim, a sultan who ordered the slaughter of thousands of Alevis. Same for the new six-runway airport northwest of Istanbul. And then there's the 50 km "crazy canal" (Erdogan's own definition), linking the Sea of Marmara to the Black Sea, so monstrous tanker traffic may be diverted away from the Bosphorus. The TURKISH green movement insists this could destroy whole aquatic ecosystems, but Erdogan is unfazed.

THAT OILY KURDISH FACTOR

In the wider world, TURKISH foreign policy is now on overdrive. And inevitably, it's all related to energy.
Foreign Minister Ahmet Davutoglu earlier this month hosted IRANIAN Foreign Minister Javad Zarif in Ankara. Then he went to Baghdad and met Iraqi Prime Minister Nouri al-Maliki.
Davutoglu also visited Washington; he wrote an editorial published by Foreign Policy praising the US-TURKISH "strategic partnership", now facing "an increasingly chaotic geopolitical environment"; and he made sure to support US-IRAN negotiations.

Background Information:

KURDISH EQUATION
TURKEY’S DREAMS OF BEING ENERGY HUB STRENGTHENED BY PKK NEGOTIATIONS?

KURDISH MARCH TOWARD AUTONOMY GAINS MOMENTUM

TURKEY'S GAMBLE ON KURDISTAN OIL

TURKEY WILL TAKE MILITARY ACTION IF THE SYRIAN KURDS MAKE MOVES TOWARD AUTONOMY & TURKEY – SYRIA - WATER DISPUTE (1989)





Recently, Davutoglu teamed up with Erdogan for a high-level meeting with RUSSIAN President Vladimir Putin and Foreign Minister Sergei Lavrov in St Petersburg. In due course he'll be in Tehran.
The question is what does Ankara want from Washington for so eagerly supporting a US-Iran normalization?
The key is IRAQI KURDISTAN. Ankara wants Washington's blessing for the now famously fractious 250,000 barrel-a-day oil pipeline from northern IRAQ, bypassing Baghdad. This pipeline would add to the perennially troubled Kirkuk-Ceyhan, controlled (sort of) by Baghdad; currently operating at best at one-fifth of its official capacity of 1.6 million barrels a day, bombed virtually every week, and with zero maintenance.
It's not as much about the oil (which TURKEY badly needs) as a political/economic alliance that ideally translates into more KURDISH votes for the ruling AKP party in the 2014 TURKISH elections.

The (insurmountable) problem is the Obama administration has no intention - at the present negotiation junction - to provoke Tehran by allowing a TURKISH project that most of all provokes IRAN'S ally Baghdad. That's just another instance that everything of consequence happening in SOUTHWEST ASIA nowadays involves IRAN.

So it all depends on how far the US-Iran rapprochement will go - leaving Ankara unable to alienate Baghdad and Tehran at the same time. Ankara, though, is also aware of huge potential benefits down the line. That would mean much more oil and gas flowing from IRAN than the current long-term annual contract for natural gas via the Tabriz-Ankara pipeline if - and when - Western investment start pumping again into IRAN'S energy industry.

THAT WAHHABI-LIKUDNIK AXIS

President Obama gets along very well with TURKISH Prime Minister Erdogan. But while Obama has nothing but praise for Erdogan, for the House of SAUD the name "Obama" is now worse than any plague. And Erdogan is not exactly that much popular.

Erdogan enthusiastically supported Morsi and the Muslim Brotherhood in EGYPT, while the House of SAUD'S hero is coup plotter General Sisi. In SYRIA, Erdogan once again supports the Muslim Brotherhood-linked "rebels", while the SAUDIS, with Bandar Bush ahead of the pack, de facto finance and weaponize all sorts of nasties including the al-Qaeda offshoot Islamic State of IRAQ and the Levant. Erdogan has evolved an extremely fractious relationship with ISRAEL, while the Wahhabi - Likudnik anti-IRAN/SYRIA axis has never been stronger.

It's easy to forget an Ankara-Damascus-Tehran alliance was in place before the foreign-imposed SYRIAN civil war. That was part of Davutoglu's "zero problems with our neighbors" doctrine, then morphed into "all kinds of problems". The House of SAUD obviously did what it could to undermine the former alliance with the carrot of more trade and investment in TURKEY. It worked for a while, when the myth of an "Arab Spring" still held sway, and TURKEY and the Saudis were even coordinating their support for assorted SYRIAN "rebels".
Now it's a totally different configuration. Only in TURKEY we find assorted Islamists, secularists, the left and assorted liberals all in agreement that the House of SAUD is a pretty nasty bunch. And not by accident "Sultan Erdogan" - who allegedly wants the return of the Caliphate - has been derided non-stop all over pan-Arab media, which for all practical purposes is 90%-controlled by SAUDIS.

SYRIAN KURDS ARE FIGHTING SAUDI-SUPPORTED JIHADIS

Ankara seems to have finally realized it must be very careful regarding its SYRIA position. Not very far from its borders, SYRIAN KURDS are fighting SAUDI-supported jihadis.
Worse; scores of al-Qaeda-linked jihadis-to-be - a Mujahideen International - are congregating in a network of safe houses in southern TURKEY, including Antakya, the capital of Hatay province, before being smuggled over the border to mostly join the Islamic State of IRAQ and the Levant (ISIL). Predictably, NATO is not amused.

IT'S ALL ABOUT PIPELINEISTAN

TURKEY'S number one foreign policy aim is to position itself as a critical energy crossroads for any oil and natural gas coming from RUSSIA, the CASPIAN, CENTRAL ASIA and even the MIDDLE EAST to EUROPE.
Yet TURKEY has been squeezed by two conflicting Pipelineistan narratives. One is the never-ending soap opera Nabucco, which basically means delivering natural gas to EUROPE from just about anywhere (AZERBAIJAN, TURKMENISTAN, IRAN, IRAQ, even EGYPT) except RUSSIA. And the other is the South Stream pipeline, proposed by RUSSIA and crossing the Black Sea.


Insisting in its role as a neutral bridge between East and West, Ankara hedged its bets. But after the EUROPEAN financial crisis took over, Nabucco was, for all practical purposes, doomed. What's left now is the so-called Nabucco West - a shorter, 1,300 km pipeline from TURKEY to CENTRAL EUROPE - and the much cheaper Trans-Adriatic Pipeline (TAP), just 500 km from TURKEY across the BALKANS to ITALY.

The consortium (including BP, Total and AZERBAIJAN'S SOCAR) developing the huge Shah Deniz II field in AZERBAIJAN ended up choosing TAP. So Nabucco is now virtually six feet under.

To say that's been a nifty deal for Moscow is a huge understatement. TAP does not threaten Gazprom's hold on the EUROPEAN market. And besides, Moscow got closer to Baku. Dick Cheney must adjust his pacemaker for another heart attack; after all his elaborate energy plans, Moscow and Baku are nothing less than discussing transporting RUSSIAN oil through the notorious Baku-Tbilisi-Ceyhan (BTC) pipeline, which Dr Zbig Brzezinski dreamed up to exactly bypass RUSSIA. On top of it, they are also bound to reverse the Baku-Novorossiysk pipeline to pump RUSSIAN oil into AZERBAIJAN.

TURKEY AND ITS EAST-WEST ENERGY TRANSIT CORRIDOR

Additionally, that's the end of TURKISH (and EUROPEAN) pipe dreams of having wacky "gas republic" TURKMENISTAN supplying energy across the CASPIAN through the CAUCASUS and TURKEY to EUROPE. For Moscow, this is non-negotiable; we control the transit of CENTRAL ASIAN energy to EUROPE. Moreover, TURKMENISTAN already has better sturgeon to fry - via its ultra-profitable gas pipeline to CHINA.

The bottom line: RUSSIA getting even more ascendant in the CAUCASUS equals TURKEY - which imports nearly all of its oil, coal and natural gas - becoming even more energy dependent on RUSSIA. RUSSIA supplies nearly 60% of TURKEY'S natural gas - and rising. IRAN supplies 20%. Moscow is sure TURKEY will soon overtake GERMANY as its biggest energy client.
That's certainly what Erdogan was discussing in detail this past Wednesday in Moscow. And then there is TURKEY'S ambitious plan to build 23 nuclear power plants by 2023. Guess who's ahead? Moscow, of course. Not only as builder but also as primary supplier of nuclear fuel. No package of Western sanctions seems to be on the horizon.

So Ankara seems to be (silently) hectic on all fronts. Erdogan is carefully cultivating his friend Obama - positioning himself as a privileged sort of messenger. Erdogan supports Iran's civilian nuclear program - which instantaneously placed him as highly suspicious in the eyes of the Wahhabi-Likudnik axis of fear and loathing. That's the key reason for the widening estrangement between Ankara and Riyadh.


Ankara's desire to be a key actor in an eventual US-IRAN rapprochement springs out of a simple calculation. Faced with tremendous political, economic and security barriers, TURKEY may only fulfill its wish of becoming the privileged EAST-WEST energy transit corridor with IRAN by its side.

Saturday 23 November 2013

URUGUAY:



SOUTH AMERICA’S NEW- ZEALAND?

Will tiny URUGUAY get squeezed between its two much larger neighbors, BRAZIL and ARGENTINA, or prove itself resilient?

By Tim Harcourt  

URUGUAY is the classic small player who “punches above its weight.” It only has 3.3 million people and is dwarfed by its larger neighbors BRAZIL and ARGENTINA, with 197 million and 41 million people, respectively.
But historically, it was a wealthy country.

According to URUGUAY’S Deputy Economy Minister, Luis Porto, back in 1870, URUGUAY — like ARGENTINA and AUSTRALIA — was one of the world’s richest economies.
This was largely thanks to its rich agricultural endowment.
For a small nation, it was not only rich, but also competitive, as became apparent on the world sporting stage. It won the inaugural FIFA Football World Cup in 1930.
Then URUGUAY backed it up in 1950 in a shock 2:1 win over that year’s hotter-than-hot favorite host nation, BRAZIL, at the newly built Maracana Stadium in Rio de Janeiro.
That game was played in front of 200,000 people (mainly consisting of shocked BRAZILIANS who have been haunted by the result ever since).

SWITZERLAND OF THE SOUTHERN HEMISPHERE

Punta del Este
When URUGUAY was wealthy, it was known as the “SWITZERLAND of the southern hemisphere” In the modern context, the best comparison is probably with NEW ZEALAND.
NEW ZEALAND and URUGUAY have a lot in common. Both are small countries dependent on agriculture, services and tourism and are also economically tied to the fortunes of their considerably larger neighbors.
While NEW ZEALAND has benefited from having “The Lucky Country,” AUSTRALIA, as its main next-door neighbor, URUGUAY has had ARGENTINA.
ARGENTINES woes are well documented — and URUGUAY is strongly influenced by the boom-bust cycle of the ARGENTINE economy in terms of trade flows.

Background Information: ARGENTINA

ARGENTINA, BARELY 30 YEARS OF DEMOCRACY, A YOUNG NATION TRYING TO FIND ITS BEARING http://geopoliticsrst.blogspot.co.at/2012/11/argentine-evolution.html)


ARGENTINES "INVISIBLE OPPOSITION", CONSISTING OF SELF - SEEKING ONE MAN SHOWS, MANIPULATED BY LOCAL MEDIA GIANT TO OPPOSE THE GOVERNMENT http://geopoliticsrst.blogspot.com.ar/2012/04/argentina-country-without-visible.html


MAIN STREAM MEDIA INFLUENCE IN ARGENTINA http://geopoliticsrst.blogspot.co.at/2011/10/impartiality.html

THE CENTRAL BANK OF ARGENTINA BREAKS RANKS WITH NEO-LIBERAL BANKING POLICY AND TARGETS JOBS OVER LOWER INFLATIONhttp://geopoliticsrst.blogspot.co.at/2012/06/argentinean-central-bank-targets-growth.html


But URUGUAY also has BRAZIL next door, and the previously often erratic fortunes of their neighbor have been on the up over the past decade, especially when compared to poor performances in the 1980s and 1990s.
URUGUAY, BRAZIL, ARGENTINA, PARAGUAY and VENEZUELA make up the common market trade pact Mercosur.
It would be expected that URUGUAY, like CHILE, could benefit from being a small open economy opening up to other nations including its economically larger neighbors.
But unlike CHILE, URUGUAY can’t sign up to an FTA with another country without the permission of its Mercosur partners.
In fact, URUGUAY finds itself almost squeezed by the new divide in LATIN AMERICA.

LATAM PROTECTIONISM AND POPULIST POLITICS EMERGED PARTLY IN RESPONSE TO THE EXCESSES OF THE IMF’S POLICIES IN THE REGION (AND ELSEWHERE) DURING THE 1990's.

The nations that have formed the Pacific alliance and look towards institutions like APEC — MEXICO, CHILE, PERU and COLOMBIA — have largely supported free trade and open economies, even when the global financial crisis of 2008 was at its worst.
On the other hand, nations like ARGENTINA, VENEZUELA and BOLIVIA have supported protectionist and populist policies, partly in response to the excesses of the IMF’s policies in the region (and elsewhere) during the 1990s.


The key question remains about the elephant in the room, BRAZIL, and which way it will lean.
Most MEXICAN economists and business representatives claimed BRAZIL was already going down the protectionist path, particularly when it comes to MEXICAN industrial products.
But the world is hoping BRAZIL will keep an open economy stance as it gains more economic weight on the global scale.
In any case, URUGUAY may be keen to be seen as a “Pacific style” South AMERICAN nation in terms of philosophy.
But with its geography tied down on the Atlantic side of the continent, wedged between ARGENTINA and BRAZIL, many URUGUAYAN businesses are concerned that, despite the existence of Mercosur, most of their goods and services get tied up in red tape in both BRAZIL and ARGENTINA.
In some ways, URUGUAY is caught between its two large neighbors and finds it therefore difficult to shine.
URUGUAY may no longer be “the SWITZERLAND of the southern hemisphere” as it was in 1870.
But being the NEW ZEALAND of SOUTH AMERICA in the 21st century may suit URUGUAY just fine.
And it would underscore URUGUAY’S commitment to openness, excellence, human capital development and occasionally being able to knock off larger players in football.
In short, count on URUGUAY living up to its reputation as 
“el paĆ­s corajudo” — the plucky country.






Related Topics:

HEDGE FUND ELLIOTT MANAGEMENT, HEADED BY THE BILLIONAIRE PAUL E. SINGER VERSUS ARGENTINA:http://geopoliticsrst.blogspot.co.at/2013/09/argentina-geopolitics-of-international.html

ELLIOT CAPITAL HEDGE FUNDS IS A CLIENT AND SHAREHOLDER OF FITCH RATING AGENCY http://geopoliticsrst.blogspot.co.at/2013/02/argentinean-politics-under-claw-of.html

US COURT RULING ON ARGENTINE BOND DEFAULT- THE PARIS CLUB, USA AGRICULTURE COMPANIES, AND INTERNATIONAL FINANCIAL SPECULATORS “GRAB” FOR ARGENTINA