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On September 4-5, the leaders of the North Atlantic Treaty Organization s (NATO) 28 member states will meet in Wales for the alliance s 2014 summit. This will be their first meeting since Russia began providing large-scale military support to separatist forces fighting in Ukraine, and their last before the planned completion by the end of 2014 of NATO s mission in Afghanistan, the longest and most ambitious operation in NATO history. As such, some analysts portray the summit as an opportunity to consider a possible strategic shift for NATO, away from the broad, out of area focus embodied by the Afghanistan mission, toward a more narrow focus on territorial defense and deterrence, largely in response to a resurgent Russia. Although the allies are considered unlikely to make such decisive declarations, summit deliberations are expected to center on responding to Russian aggression in Ukraine and elsewhere in the region. NATO leaders have outlined three formal agenda items for the Wales summit: (1) enhancing allied readiness and strengthening collective defense capabilities in response to Russian aggression; (2) marking the planned withdrawal at the end of 2014 of the NATO s International Security Assistance Force (ISAF) in Afghanistan, and launching a non-combat security sector training mission in the country; and (3) boosting NATO support for partner countries outside the alliance, including through a new Defense Building Capacity Initiative. The cornerstone of NATO s collective defense initiative is expected to be a Readiness Action Plan focused on Central and Eastern Europe that could include enhanced military infrastructure and pre-positioning of equipment, designation of bases for increased troop rotations, and more military exercises in the region. Although some allies have called for permanent NATO troop deployments in Central and Eastern Europe, others are reluctant due to concerns about the possible ramifications of further militarization in the region., Prepared for Members and Committees of Congress

Over the past decade, Greece borrowed heavily in international capital markets to fund government budget and current account deficits. The reliance on financing from international capital markets left Greece highly vulnerable to shifts in investor confidence. Investors became jittery in October 2009, when the newly-elected Greek government revised the estimate of the government budget deficit for 2009 from 6.7% of GDP to 12.7% of GDP. There are now questions about whether Greece will be able to repay its maturing debt obligations and interest payments, totaling 54 billion ($73 billion), in 2010. This report analyses the Greek financial situation and identifies its implications for the United States. The debt crisis has both domestic and international causes. Domestically, analysts point to high government spending, weak revenue collection, and structural rigidities in Greece's economy. Internationally, observers argue that Greece's access to capital at low interest rates after adopting the euro and weak enforcement of European Union (EU) rules concerning debt ceilings facilitated Greece's ability to accumulate high levels of external debt. During the crisis, the Greek government has sold bonds on international capital markets in order to raise needed funds, although investors have demanded high interest rates to compensate for the perceived risk of these investments. Greece's government has also unveiled, amidst domestic protests, austerity measures aimed at reducing the government deficit below 3% of GDP by 2012. At the end of March 2010, the Eurozone member states, led by Germany and France, announced after much debate that they would provide financial support to Greece if necessary and if accompanied by financial support from the International Monetary Fund (IMF). A common method for addressing budget and current account deficits, currency devaluation, is not possible for Greece as long as it uses the euro as its national currency., CRS Report for Congress

German Chancellor Angela Merkel began her first term in office in November 2005 and was elected to a second term in September 2009. Most observers agree that under her leadership relations between the United States and Germany have improved markedly since reaching a low point in the lead-up to the Iraq war in 2003. U.S. officials and many Members of Congress view Germany as a key U.S. ally, have welcomed German leadership in Europe, and voiced expectations for increased U.S.-German cooperation on the international stage. German unification in 1990 and the end of the Cold War represented monumental shifts in the geopolitical realities that had defined German foreign policy. Germany was once again Europe's largest country, and the Soviet threat, which had served to unite West Germany with its pro-western neighbors and the United States, was no longer. Since the early 1990s, German leaders have been challenged to exercise a foreign policy grounded in a long-standing commitment to multilateralism and an aversion to military force while simultaneously seeking to assume the more proactive global role many argue is necessary to confront emerging security threats. Until 1994, Germany was constitutionally barred from deploying its armed forces abroad. Today, approximately 7,000 German troops are deployed in peacekeeping, stabilization, and reconstruction missions worldwide. Since the end of the Cold War, Germany's relations with the United States have been shaped by several key factors: growing support for a stronger, more capable European Union, and its continued allegiance to NATO as the primary guarantor of European security; ability and willingness to undertake the defense reforms many argue are necessary for it to meet its commitments within NATO and a burgeoning European Security and Defense Policy; and German popular opinion, especially the influence on German leaders of strong public opposition to U.S. foreign policies during the George W. Bush Administration., CRS Report for Congress.

The North Atlantic Treaty Organization (NATO) celebrated its 60th anniversary in 2009. While NATO members can point to several significant accomplishments since the end of the Cold War, the Alliance faces a host of new challenges that might well define the purpose and role of NATO in the 21st century. At the same time, most observers agree that the 111th Congress and the Obama Administration are likely to continue to view NATO as the key alliance through which to confront security threats to the Euro-Atlantic community, including the principal threats of terrorism and the proliferation of weapons of mass destruction. For the short and medium term, most analysts expect NATO's political agenda to be dominated by its mission in Afghanistan (the International Security Assistance Force, or ISAF), by its relations with Russia, and by the drafting of a new strategic concept for the Alliance., CRS Report for Congress.

The mission of the North Atlantic Treaty Organization (NATO) in Afghanistan is seen by many as a test of the alliance's political will and military capabilities. Since the Washington Summit in 1999, the allies have sought to create a "new" NATO, capable of operating beyond the European theater to combat emerging threats such as terrorism and the proliferation of weapons of mass destruction. Afghanistan is NATO's first "out-of-area" mission beyond Europe. The purpose of the mission is the stabilization and reconstruction of Afghanistan. The mission has proven difficult, an "industrial-strength" insurgency according to General David Petraeus, head of U.S. Central Command, because it must take place while combat operations against Taliban insurgents continue. The situation in Afghanistan has seen a rise in the overall level of violence due to increased Taliban military operations, an increase in terrorist-related activities, and recent major offensive operations conducted by the allies. U.N. Security Council resolutions govern NATO's responsibilities in Afghanistan. The NATO-led International Security Assistance Force (ISAF) faces formidable obstacles: shoring up a weak government in Kabul; using military capabilities in a distant country with rugged terrain; and rebuilding a country devastated by war and troubled by a resilient narcotics trade. NATO's mission statement lays out the essential elements of the task of stabilizing and rebuilding the country: train the Afghan army, police, and judiciary; support the government in counter-narcotics efforts; develop a market infrastructure; and suppress the Taliban., CRS Report for Congress

Germany is the world's fifth largest economy and the largest in Europe, accounting for about onefifth of the European Union's (EU) GDP. Germany is also the largest European trade and investment partner of the United States. Mutually profitable and growing U.S.-German commercial ties historically have been facilitated by a strong German economy. The health and functioning of the German economy, as well as its approaches to international economic policy issues, thus, are of considerable importance to the United States as well as to the rest of Europe., CRS Report for Congress.

At the April 2-4, 2008 NATO summit in Bucharest, Romania, a principal issue was consideration of the candidacies for membership of Albania, Croatia, and Macedonia. The allies agreed to extend invitations to Albania and Croatia. Although the alliance determined that Macedonia met the qualifications for NATO membership, Greece blocked the invitation due to an enduring dispute over Macedonia's name. After formal accession talks, on July 9, 2008, the foreign ministers of Albania and Croatia and the permanent representatives of the 26 NATO allies signed accession protocols amending the North Atlantic Treaty to permit Albania and Croatia's membership in NATO. To take effect, the protocols had to be ratified, first by current NATO members, then by Albania and Croatia. On April 1, 2009, the two countries formally became the 27th and 28th members of the Alliance when the Ambassadors of the two nations deposited the ratified instruments of accession at the State Department. On April 4, 2009, Albania and Croatia were welcomed to the NATO table at a ceremony held at the NATO summit in Strasbourg, France. Both nations are small states with correspondingly small militaries, and their inclusion in NATO cannot be considered militarily strategic. However, it is possible that their membership could play a political role in helping to stabilize southeastern Europe. Over the past 15 years, Congress has passed legislation indicating its support for NATO enlargement, as long as candidate states meet qualifications for alliance membership. On April 9, 2007, former President Bush signed into law the NATO Freedom Consolidation Act of 2007 (P.L. 110-17), expressing support for further NATO enlargement. On September 10, 2008, the Senate Foreign Relations Committee held a hearing on the accession of Albania and Croatia as a prelude to Senate ratification., CRS Report for Congress.

On April 3 and 4, 2009, the heads of state and government of the 26 members of the North Atlantic Treaty Organization (NATO) met in Strasbourg, France, and Kehl, Germany for a summit marking the 60th anniversary of the alliance. The summit was one of three stops on President Obama's first official visit to Europe as President. Alliance leaders used the anniversary summit to pay tribute to NATO's past achievements and to reaffirm their commitment to the alliance as the preeminent transatlantic security framework. They also completed a new round of NATO enlargement, sought common positions on the range of challenges currently facing the alliance, and began to set the parameters for NATO's future direction. The key issue facing the alliance is the ongoing mission in Afghanistan, where allied governments are struggling to reach a strategic consensus on how to stabilize the country. The deteriorating security situation in the country has caused many to question the ability of NATO's International Security Assistance Force (ISAF) to achieve its objectives and has exposed rifts within the alliance as to ISAF's mission and the appropriate means to accomplish it. NATO's strained relations with Russia are a second key issue. The allies announced the resumption of formal ties with Russia after having suspended relations in the NATO-Russia Council following Russia's August 2008 invasion of Georgia. However, alliance members continue to disagree on how to manage relations with Russia and their other eastern neighbors in the future. NATO enlargement was a third issue on the summit agenda., CRS Report to Congress.

The factors that shape French foreign policy have changed since the end of the Cold War. The perspectives of France and the United States have diverged in some cases, although their core interests remain similar. Both countries' governments have embraced the opportunity to build stability in Europe through an expanded European Union and NATO. Each has recognized that terrorism and the proliferation of weapons of mass destruction are the most important threats to their security today. Several factors shape French foreign policy. France has a self-identity that calls for efforts to spread French values and views, many rooted in democracy and human rights. France prefers to engage international issues in a multilateral framework, above all through the European Union (EU). European efforts to form an EU security policy potentially independent of NATO emerged in this context. However, more recently, policy makers in France, Europe, and the United States have come to view a stronger European defense arm as a complement to, rather than a substitute for, NATO. From the September 11, 2001, attacks on the United States through the Iraq war of 2003 until today, France has pressed the United States to confront emerging crises within a multilateral framework. France normally wishes to "legitimize" actions ranging from economic sanctions to military action in the United Nations. The election of Nicolas Sarkozy to the French presidency in May 2007 appears to have contributed to improved U.S.-French relations. Sarkozy has taken a more practical approach to issues in U.S.-French relations than his predecessor, Jacques Chirac. Perhaps most notably, in April 2009, Sarkozy announced France's full reintegration into NATO's military command structure, more than 40 years after former President Charles de Gaulle withdrew his country from the integrated command structure and ordered U.S. military personnel to leave the country., CRS Report for Congress.

German Chancellor Angela Merkel took office in November 2005 promising a foreign policy anchored in a revitalized transatlantic partnership. Most observers agree that since reaching a low-point in the lead-up to the Iraq war in 2003, relations between the United States and Germany have improved. U.S. officials and many Members of Congress view Germany as a key U.S. ally, have welcomed German leadership in Europe, and voiced expectations for increased U.S.-German cooperation on the international stage. German unification in 1990 and the end of the Cold War represented monumental shifts in the geopolitical realities that had defined German foreign policy. Since the early 1990s, German leaders have been challenged to exercise a foreign policy grounded in a long-standing commitment to multilateralism and an aversion to military force while simultaneously seeking to assume the more proactive global role many argue is necessary to confront emerging security threats. Until 1994, Germany was constitutionally barred from deploying its armed forces abroad. Today, approximately 7,400 German troops are deployed in peacekeeping, stabilization, and reconstruction missions worldwide. However, as Germany's foreign and security policy continues to evolve, some experts perceive a widening gap between the global ambitions of Germany's political class, and a consistently skeptical German public. Since the end of the Cold War, Germany's relations with the United States have been shaped by several key factors, including Germany's growing support for a stronger European Union, and its continued allegiance to NATO as the primary guarantor of European security. President Obama's popularity in Germany suggests that many Germans expect the new U.S. Administration to distance itself from the perceived unilateralism of the Bush Administration. However, some observers caution that policy differences between the two countries remain., CRS Report for Congress.

At the April 2-4, 2008, NATO summit in Bucharest, Romania, a principal issue was consideration of the candidacies for membership of Albania, Croatia, and Macedonia. The allies agreed to extend invitations to Albania and Croatia. Although the alliance determined that Macedonia met the qualifications for NATO membership, Greece blocked the invitation due to an enduring dispute over Macedonia's name. After formal accession talks, on July 9, 2008, the foreign ministers of Albania and Croatia and the permanent representatives of the current 26 NATO allies signed accession protocols amending the North Atlantic Treaty to permit Albania and Croatia's membership in NATO. To take effect, the protocols must now be ratified, first by current NATO members, then by Albania and Croatia. Albania and Croatia are small states with correspondingly small militaries, and their inclusion in NATO cannot be considered militarily strategic. However, it is possible that their membership could play a political role in stabilizing southeastern Europe., CRS Report for Congress

German Chancellor Angela Merkel took office in November 2005 promising a foreign policy anchored in a revitalized transatlantic partnership. Most observers agree that since reaching a low-point in the lead-up to the Iraq war in 2003, relations between the United States and Germany have improved. With recent leadership changes in the United Kingdom, France, and Italy, U.S. officials view Germany under Chancellor Merkel as a key U.S. ally in Europe. Despite continuing areas of divergence, President Bush and many Members of Congress have welcomed German leadership in Europe and have voiced expectations for increased U.S.-German cooperation on the international stage. Under Merkel's leadership, Germany has sought to boost transatlantic cooperation in areas ranging from economic and trade relations, climate change policy, and global counterterrorism and non-proliferation policy, to peacekeeping, reconstruction and stabilization efforts in Afghanistan, the Middle East, and the Balkans. Merkel has enjoyed relatively strong domestic support for her transatlantically-oriented foreign policy agenda. However, as her term progresses, and domestic political tensions mount, she may be more hard-pressed to justify her Atlanticist foreign policy to a public which appears increasingly skeptical of U.S. influence in the world. This report may be updated as needed., CRS Report for Congress

NATO will hold a summit in Bucharest on April 2-4, 2008, and a principal issue will be the consideration of the candidacies for membership of Albania, Croatia, and the Former Yugoslav Republic of Macedonia (FYROM, or the Republic of Macedonia). These candidate states are small, with correspondingly small militaries, and their inclusion in the alliance cannot be considered strategic in a military sense. However, it is possible that they could play an important role in the stabilization of southeastern Europe. At Bucharest NATO will also consider whether to offer a Membership Action Plan (MAP) to Georgia and Ukraine. The MAP is a viewed as a way station to membership. However, Russia's strong objection to the two countries eventual membership, as well as internal separatist conflicts in Georgia and public opposition to allied membership in Ukraine are among several factors that may slow the two countries path to closer association with NATO. Energy security for candidate states in a future round of enlargement may also prove to be an important issue. Most observers believe that Macedonia and Albania have made strides in modernizing their militaries. However, some questions about other qualifications persist for example, concerning internal political conflict, and measures to tackle corruption and organized crime. An enduring dispute with Greece over Macedonia s formal name could also delay Macedonia s entry. The allies appear to believe that Croatia has moved well along the road to membership; modest Croatian public support for NATO membership has been a concern to allies. Process is important in the three countries efforts to join the alliance. Each of the current 26 allies must agree at Bucharest to extend invitations. The candidate states will be considered individually, and a lack of consensus on a candidate can block its invitation to join.

Recent increases in energy prices and a steady escalation in global energy demand expected to rise by nearly 60% over the next 20 years have led U.S. policy-makers to engage in a wide ranging debate over how best to address the country's future energy requirements. Similarly, energy security has become a policy priority for the European Union (EU) and its 27 member states. Together, the United States and Europe represent the world's largest energy market. Although they produce approximately 23% of the world s energy, they consume almost 40% of the world s supply. The member states of the EU account for approximately 18% of global oil consumption and consume 19% of gas produced. Today, the EU imports about 50% of its energy needs. Barring significant changes, the European Commission (Commission) expects this figure to rise to 65% by 2030. Approximately half of the EU s imported energy in the form of oil and natural gas comes from Russia. Europe s growing dependence on Russian energy has fueled speculation that Moscow will use the energy weapon to try to influence future foreign or economic policy in Europe., CRS Report for Congress

German Chancellor Angela Merkel took office in November 2005 promising a foreign policy anchored in a revitalized transatlantic partnership. Most observers agree that since reaching a low-point in the lead-up to the Iraq war in 2003, relations between the United States and Germany have improved. U.S. officials view Germany under Chancellor Merkel as a key U.S. ally in Europe. Despite continuing areas of divergence, President Bush and Congress have welcomed German leadership in Europe and have voiced expectations for increased U.S.-German cooperation on the international stage. German unification in 1990 and the end of the Cold War represented monumental shifts in the geopolitical realities that had traditionally defined German foreign policy. Since the early 1990s, German leaders have been challenged to exercise a foreign policy grounded in a long-standing commitment to multilateralism and an aversion to military force while simultaneously seeking to assume a more proactive global role against emerging security threats. Until 1994, Germany was constitutionally barred from deploying its armed forces abroad. Today, over 7,000 German troops are deployed in peacekeeping, stabilization, and reconstruction missions worldwide. As Germany's foreign and security policy continues to evolve, some experts perceive a widening gap between the global ambitions of Germany's political class and an increasingly skeptical German public. Since the end of the Cold War, Germany's relations with the United States have been shaped by several key factors. These include Germany's growing support for a stronger European Union, and its continued allegiance to NATO as the primary guarantor of European security. Merkel has enjoyed relatively strong domestic support for her transatlantic-oriented foreign policy agenda. However, as her term progresses, it may be more difficult for her to justify this agenda to a public that appears increasingly skeptical of U.S. influence in the world., CRS Report for Congress.

Most observers agree that moral considerations surrounding the Holocaust continue to compel German leaders to make support for Israel a policy priority. Since 1949, successive German governments have placed this support at the forefront of their Middle East policy and today, Germany, along with the United States, is widely considered one of Israel's closest allies. Germany ranks as Israel's second largest trading partner and long-standing defense and scientific cooperation, people-to people exchanges and cultural ties between the two countries continue to grow. On the other hand, public criticism of Israel in Germany, and particularly of its policies with regard to the Israeli-Palestinian conflict, appears to be on the rise. Since the mid-1990s, German policy toward Israel has become progressively influenced by Germany s commitment to a two-state solution to the Israeli- Palestinian conflict. Germany has been one of the single largest contributors to the Palestinian Authority (PA) and an increasingly vocal advocate for European Union (EU) engagement in the Middle East. Germany s September 2006 decision to send a naval contingent to the Lebanese coast as part of an expanded United Nations mission after Israel s July 2006 war with Hezbollah is considered to have significantly raised German interest in a resolution to the Israeli-Palestinian conflict and sparked widespread debate within Germany regarding the evolution of the German-Israeli relationship and Germany s role in the region. Stating that the Israeli- Palestinian conflict lies at the root of other challenges in the Middle East, German Chancellor Angela Merkel has announced her intention to revive international engagement in the peace process while Germany holds the EU s rotating presidency during the first half of 2007., The original document contains color images.

The U.S. Congress and successive U.S. administrations have supported the European Union (EU) and the process of European integration as ways to foster a stable Europe, democratic states, and strong trading partners. In recent years, a number of trade and foreign policy conflicts have strained the U.S.-EU relationship. Since the divisive dispute over Iraq in 2003, however, both the United States and the EU have sought to improve cooperation and demonstrate a renewed commitment to partnership in tackling global challenges., The original document contains color images. CRS Report for Congress.