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MUNICH (AP) — German Chancellor Angela Merkel robustly defended European nations’ decision to stand by the Iran nuclear deal in a spirited backing Saturday of her multilateral approach to global affairs, but U.S. Vice President Mike Pence promptly accused Europe of once again undermining the United States.

Merkel’s comments at the Munich Security Conference, an annual gathering of top global defense and foreign policy officials, followed days of tensions between Washington and Europe over Iran.

U.S. President Donald Trump unilaterally pulled out of the 2015 Iran nuclear agreement last year, leaving the others involved — Germany, Britain, France, China, Russia and the European Union — scrambling to try and keep it alive. The deal offers Iran sanctions relief for limiting its nuclear program, and the International Atomic Energy Agency has said so far that Tehran is sticking to the agreement.

But the U.S. argues that the deal just puts off when Iran might be able to build a nuclear bomb. Pence pushed at the conference for Europeans to end their involvement in the nuclear deal, calling Iran “the leading state sponsor of terrorism in the world.”

“The time has come for our European partners to stop undermining U.S. sanctions against this murderous revolutionary regime,” Pence said. “The time has come for our European partners to stand with us and with the Iranian people, our allies and friends in the region. The time has come for our European partners to withdraw from the Iran nuclear deal.”

The comments came after Merkel said she shared concerns about many Iranian efforts to grow its power in the region. While she said the split with the U.S. over the nuclear agreement “depresses me very much,” she defended it as an important channel to Tehran.

“I see the ballistic missile program, I see Iran in Yemen and above all I see Iran in Syria,” she said. “The only question that stands between us on this issue is, do we help our common cause, our common aim of containing the damaging or difficult development of Iran, by withdrawing from the one remaining agreement? Or do we help it more by keeping the small anchor we have in order maybe to exert pressure in other areas?”

Merkel also questioned whether it’s good for the U.S. to withdraw troops quickly from Syria “or is that not also strengthening the possibilities for Iran and Russia to exert influence there?”

Turning to nuclear disarmament, Merkel said the U.S. announcement earlier this month that it was pulling out of the 1987 Intermediate-Range Nuclear Forces treaty was “inevitable” because of Russian violations.

Moscow followed suit by also withdrawing from the treaty, strongly denying any breaches. The U.S. administration also has worried that the pact was an obstacle to efforts to counter intermediate-range missiles deployed by China, which is not covered by the treaty.

Merkel noted the treaty was conceived “essentially for Europe,” where such missiles were stationed during the Cold War. She said “the answer cannot lie in blind rearmament.”

“Disarmament is something that concerns us all, and we would of course be glad if such negotiations were conducted not just between the United States … and Russia, but also with China,” she said.

Merkel also defended Germany’s progress in fulfilling NATO guidelines for countries to move toward spending 2 percent of gross domestic product on defense by 2024, which have been criticized as too slow. And overall, she rejected the idea of go-it-alone foreign policy.

She said it is better to “put yourself in the other’s shoes … and see whether we can get win-win solutions together.”

Pence stuck to the U.S. line that the 2 percent NATO guideline is a strict commitment rather than a target, saying while more alliance members have met the criteria, “the truth is, many of our NATO allies still need to do more.”

He also reiterated American opposition to the joint German-Russian Nord Stream 2 pipeline project, which Washington is concerned will make Europe overly reliant on Russian gas.

“The United States commends all our European partners who’ve taken a strong stand against Nord Stream 2,” he said. “And we commend others to do that same.”

Merkel defended the pipeline under the Baltic Sea, dismissing the American concerns as unfounded and assuring Ukraine that it won’t get cut off from Russian fuel.

Speaking as Ukrainian President Petro Poroshenko looked on, she told him his country would continue to be a transit country for Russian gas even after the pipeline is complete.

Merkel noted that Europe also has enough terminals to receive more liquefied gas from the U.S., among other options.

“There’s nothing that speaks against getting gas from the United States, but to exclude Russia is the wrong strategic signal.”

Merkel’s speech was warmly received, while Pence’s met with polite applause. The two met one-on-one after the speeches and Pence told reporters they had “frank” discussions on all of the issues they’d touched on in public.

Former U.S. Vice President Joe Biden, who was in office when the Iran nuclear deal was negotiated, went out of his way to thank Merkel and defended the Iran deal as a “significant agreement.”

“The America I see does not want to turn its back on the world,” Biden said.
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Moulson reported from Berlin.

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NEW YORK (AP) — Mexico’s most notorious drug lord, Joaquin “El Chapo” Guzman, was convicted Tuesday of running an industrial-scale smuggling operation after a three-month trial packed with Hollywood-style tales of grisly killings, political payoffs, cocaine hidden in jalapeno cans, jewel-encrusted guns and a naked escape with his mistress through a tunnel.

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DAVOS, Switzerland (AP) — The world economy absorbed more bad news Monday: The International Monetary Fund cut its growth forecast for 2019. And China, the world’s second-biggest economy, said it had slowed to its weakest pace since 1990.

The IMF cut its estimate for global growth this year to 3.5 percent, from the 3.7 percent it had predicted in October and down from 2018’s 3.7 percent. The fund cited heightened trade tensions and rising interest rates.

“After two years of solid expansion, the world economy is growing more slowly than expected and risks are rising,” said IMF Managing Director Christine Lagarde as she presented the forecasts at the World Economic Forum in Davos, Switzerland.

The IMF is not alone in its pessimism. The World Bank, the Organization for Economic Cooperation and Development and other forecasters have also downgraded their world growth estimates.

Among the key concerns is the Chinese economy. The country is slowing just as its leadership tries to turn it into a more modern economy by reducing its reliance on manufacturing and exports and increasing consumer spending.

The country reported Monday growth of 6.6 percent in 2018, the weakest since 1990. Demand for Chinese exports weakened last year and the IMF expects China’s growth to decelerate again this year — to 6.2 percent.

The IMF left its prediction for U.S. growth this year unchanged at 2.5 percent — though a continuation of the partial 31-day shutdown of the federal government poses a risk.

The IMF trimmed the outlook for the 19 countries that use the euro as their currency to 1.6 percent from 1.8 percent. Germany got a big downgrade from the IMF, the result of weaker demand for German exports and problems in the country’s auto industry.
Britain’s messy divorce from the European Union and Italy’s ongoing financial struggles also pose threats to growth in Europe.

Emerging-market countries are forecast to slow to 4.5 percent from 4.6 percent in 2018. That is partly a result of China’s deceleration, which pinches developing countries that supply it with raw materials such as copper and iron ore.

“China’s growth slowdown could be faster than expected especially if trade tensions continue, and this can trigger abrupt sell-offs in financial and commodity markets” — something that happened when Chinese growth sputtered in 2015, said IMF chief economist Gita Gopinath.

Under President Donald Trump the United States has imposed import taxes on steel, aluminum and hundreds of Chinese products, drawing retaliation from China and other U.S. trading partners.

“Higher trade uncertainty will further dampen investment and disrupt global supply chains,” Gopinath said.

Rising interest rates in the U.S. and elsewhere are also pinching emerging-market governments and companies that borrowed heavily when rates were ultra-low in the aftermath of the 2007-2009 Great Recession.

As the debts roll over, those borrowers have to refinance at higher rates. A rising dollar is also making things harder for emerging-market borrowers who took out loans denominated in the U.S. currency.
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Follow the AP’s coverage of Davos here: https://www.apnews.com/Davos

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LONDON (AP) — British Prime Minister Theresa May unveiled her Brexit Plan B on Monday — and it looks a lot like Plan A.

May launched a mission to resuscitate her rejected European Union divorce deal, setting out plans to get it approved by Parliament after securing changes from the EU to a contentious Irish border measure.

May’s opponents expressed incredulity: British lawmakers last week dealt the deal a resounding defeat, and EU leaders insist they won’t renegotiate it.

Opposition leader Jeremy Corbyn of the Labour Party accused May of being in “deep denial” about her doomed deal.

“This really does feel a bit like ‘Groundhog Day,'” he said, referring to the 1993 film starring Bill Murray, in which a weatherman is fated to live out the same day over and over again.

Outlining what she plans to do after her EU divorce deal was rejected by Parliament last week, May said that she had heeded lawmakers’ concerns over an insurance policy known as the “backstop” that is intended to guarantee there are no customs checks along the border between EU member Ireland and the U.K.’s Northern Ireland after Brexit.

May told the House of Commons that she would be “talking further this week to colleagues … to consider how we might meet our obligations to the people of Northern Ireland and Ireland in a way that can command the greatest possible support in the House.

“And I will then take the conclusions of those discussions back to the EU.”
The bloc insists that it won’t renegotiate the withdrawal agreement.

“She is wasting time calling for a revision or clarification over the backstop,” said German politician Udo Bullmann, head of the socialist group in the European Parliament. 

While May stuck doggedly to her deal, she also acknowledged that control over Brexit wasn’t entirely in her hands. She noted that lawmakers will be able to amend her plan when it comes to a vote in the House of Commons on Jan. 29, exactly two months before Britain is due to leave the EU.

Groups of “soft Brexit”-backing lawmakers — who want to keep close economic ties to the bloc — are planning to use amendments to try to rule out a “no-deal” Brexit and make May ease her insistence that leaving the EU means quitting its single market and customs union.

Britain and the EU sealed a divorce deal in November after months of tense negotiations. But the agreement has been rejected by both sides of Britain’s divide over Europe. Brexit-backing lawmakers say it will leave the U.K. tethered to the bloc’s rules and unable to forge an independent trade policy. Pro-Europeans argue it is inferior to the frictionless economic relationship Britain currently enjoys as an EU member.

After her deal was thrown out last week by a crushing 432-202 vote in Parliament, May said she would consult with lawmakers from all parties to find a new way forward.

But Corbyn called the cross-party meetings a “stunt,” and other opposition leaders said the prime minister didn’t seem to be listening.

On Monday, May rejected calls from pro-EU lawmakers to delay Britain’s departure from the bloc or to hold a second referendum on whether to leave.

In a nod to opposition parties’ concerns, she promised to consult lawmakers, trade unionists, business groups and civil society organizations “to try to find the broadest possible consensus” on future ties between Britain and the EU, and said the government wouldn’t water down protections for the environment and workers’ rights after Brexit.

May also said the government had decided to waive a 65 pound ($84) fee for EU citizens in Britain who want to stay permanently after Brexit.

Guy Verhofstadt, the head of the EU Parliament Brexit steering group, welcomed news that the fee was being dropped for 3 million EU nationals, saying it had been a “key demand” for the EU legislature.

May’s immediate goal is to win over pro-Brexit Conservatives and her party’s Northern Irish ally, the Democratic Unionist Party. Both groups say they won’t back the deal unless the border backstop is removed.

The backstop proposes to keep the U.K. in a customs union with the EU in order to avoid checks on the Irish border. It is meant as a temporary measure that would last until a permanent solution is found. But pro-Brexit U.K. lawmakers fear Britain could become trapped in it, indefinitely bound by EU trade rules.

Polish Foreign Minister Jacek Czaputowicz broke ranks with EU colleagues Monday by suggesting the problem could be solved by setting a five-year time limit on the backstop.

The idea got a cool reception. Irish Foreign Minister Simon Coveney said that “putting a time-limit on an insurance mechanism, which is what the backstop is, effectively means that it’s not a backstop at all.”

Britain’s political impasse over Brexit is fueling concerns that the country may crash out of the EU on March 29 with no agreement in place to cushion the shock. That could see tariffs imposed on goods moving between Britain and the EU, sparking logjams at ports and shortages of essential supplies.

Carolyn Fairbairn, director-general of the Confederation of British Industry, said Monday was “another bleak day for business.”

“Parliament remains in deadlock while the slope to a cliff edge steepens,” she said.

Several groups of lawmakers are trying to use parliamentary rules and amendments to May’s plan to block the possibility of Britain leaving the EU without a deal.

One of those legislators, Labour’s Yvette Cooper, said May was shirking her responsibility to the country by refusing to take “no deal” off the table.

“I think she knows that she should rule out ‘no deal’ in the national interest because it would be so damaging,” Cooper told the BBC. “She’s refusing to do so, and I think she’s hoping that Parliament will do this for her. That is not leadership.”
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Raf Casert reported from Brussels. Lorne Cook in Brussels and Monika Scislowska in Warsaw, Poland, contributed to this story.
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Follow AP’s full coverage of Brexit at: https://www.apnews.com/Brexit

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