July 2, 2026 - Daily News Digest

On this Day: in 1494, the Treaty of Tordesillas was ratified by Spain. In 1776, the Continental Congress [of British Colonies in the future United States] adopts the Lee Resolution severing ties with the Kingdom of Great Britain. The wording of the formal Declaration of Independence was agreed upon and publicly released two days later, on July 4.

QOTD: “We are doing everything we can to overcome our country’s structural weakness when it comes to economic growth,” Merz told a Berlin news conference, admitting the government is “under pressure from many sides”.

Runner up: “"We are accused of not respecting the pope," Pagliarani said. "But it is precisely because we love the pope as the vicar of Christ, as the head of the church, that we don't want to see the pope humiliated anymore, on the side of false shepherds representing false religions."

US/IRAN/TALKING ABOUT TALKING - US, Iran talks conclude in Doha, focused on Strait of Hormuz
https://www.reuters.com/world/asia-pacific/us-iran-enter-technical-talks-secure-peace-deal-restart-shipping-2026-07-01/

Iran and the United States concluded ​a round of indirect talks on Wednesday with no sign they had made headway toward a lasting peace, focusing instead on ‌issues that they said had been resolved when an interim agreement was announced two weeks ago.

Sources familiar with the discussions said negotiators for the two countries spent two days in Doha discussing maritime traffic in the Strait of Hormuz and unfreezing Iran's funds, two critical issues under the initial agreement.

The next meeting will take place after funeral processions for ​Iran's late Supreme Leader Ayatollah Ali Khamenei, who is due to be buried on July 9, Qatar's Foreign Ministry said.

The Doha discussions ​produced "positive progress" on issues related to the memorandum that halted the war in June and were "building on the outcomes" of ⁠a summit in Switzerland, the ministry spokesperson said in a post on X.

In Washington, U.S. President Donald Trump said the two sides were making progress ​on possible limits to Iran's nuclear program — the main reason he launched the war along with Israel in February. "The denuclearization of Iran is moving along well," ​he told reporters. "They've had very good meetings, and we'll see."

EU/MENA/ENERGY/IRAN/REALITY - European Nations Now Believe Some Hormuz Fees Are Inevitable
https://www.bloomberg.com/news/articles/2026-07-02/hormuz-european-nations-now-believe-some-fees-are-inevitable?srnd=homepage-americas

Some leading European powers now accept that ships transiting the vital Strait of Hormuz will have to pay fees to Iran and Oman, according to people familiar with the matter.

The prospect of some sort of service fee in the aftermath of the US and Israeli war with the Islamic Republic was described as a given by two of the people, who asked not to be identified discussing private deliberations.

Privately, some Gulf Arab officials hold the same view, they said, though this is not necessarily the formal position of their governments.

It’s unclear what type or the amount of fees any nation would be willing to accept. The US and Gulf Arab countries, meanwhile, continue to insist that Iran and Oman cannot impose charges of any kind for the Hormuz strait. Concerns include adhering to international maritime law and the risk it creates a precedent for other countries to impose fees on different waterways.

While coming to terms with the idea of the additional costs, European countries have pressed Iranian and Omani officials not to discriminate against ships based on their nationality, the people said. The UK, France and other European nations are also pushing for an international maritime coalition to help with clearing mines in Hormuz, but its deployment will depend on negotiations over a permanent peace deal progressing, they said.

Oman, Saudi Arabia, the United Arab Emirates, Qatar and Kuwait either declined to comment or didn’t respond to requests for comment from Bloomberg.

GERMANY/UKRAINE/RUSSIA - Nord Stream blast ordered by Ukraine, say German prosecutors
https://www.dw.com/en/nord-stream-blast-ordered-by-ukraine-say-german-prosecutors/a-77798230

Ukrainian state authorities were behind the 2022 sabotage of the Nord Stream gas pipelines linking Russia with Europe, German prosecutors said on Thursday.

In a statement detailing the charges brought against suspect Serhii K. on Wednesday, prosecutors said that he and six accomplices had acted "on the orders of state authorities in Ukraine."

According to prosecutors, K., now 50, was an "officer in the Ukrainian army" at the time of the operation, and his accomplices were also "military personnel."

They said the plan was to "destroy the Nord Stream 1 and Nord Stream 2 pipelines" with the objective of "permanently halting gas supplies via the pipelines and preventing Russia from using the revenue from natural gas trade to finance its war efforts."

Germany is one of the biggest military backers of Ukraine in its battle against the ongoing Russian invasion, making the incident potentially diplomatically awkward.

RUSSIA/EU/MIL/TECH  - Russia waged a drone campaign in Europe, likely using shadow ships, report says
https://apnews.com/projects/russian-drones-shadow-fleet/

Russia likely used shadow ships to launch drones over Europe that repeatedly disrupted civilian aviation, as it monitored military sites and tested the air defenses of NATO nations, according to a report published Thursday by the International Institute of Strategic Studies think tank.

The report, which was shared before publication with The Associated Press, plotted 144 suspected drone sightings across Europe, including in NATO members Germany, France, Belgium, the Netherlands, the U.K., and Denmark, between 2024 and 2026.

Those sightings peaked in late 2025, forcing the temporary closure of several European airports, including in Germany, Spain and Denmark.

Danish Prime Minister Mette Frederiksen described the incidents in her country as the “most serious attack on Danish critical infrastructure to date.”

The IISS said the Russian campaign was designed to fall below the threshold of triggering discussions for a collective NATO response and was a “strategic failure” for Europe that exposed how the continent’s air defenses are not fit to deal with the current threat.

Air Chief Marshal John Stringer, NATO's deputy supreme allied commander in Europe, told AP that it is up to each alliance member to decide how to respond to such threats — and many countries are taking them increasingly seriously.

Several senior European officials said it’s difficult to attribute the drone incursions to Russia, and Stringer did not blame Moscow. But he suggested the activity fits the pattern of behavior seen in a widespread campaign of disruption across Europe that Western officials have blamed on Russia since its invasion of Ukraine in 2022.

Of the handful of countries that have confirmed drone sightings, only Sweden has blamed Moscow directly — when a military drone flew toward a French aircraft carrier from a Russian spy ship.

President Vladimir Putin said in May that Russia is not waging a sabotage campaign against Europe.

GERMANY/POL/ECON - German coalition agrees on sweeping reform package in key breakthrough
https://www.aljazeera.com/news/2026/7/2/german-coalition-agrees-on-sweeping-reform-package-in-key-breakthrough

German Chancellor Friedrich Merz’s ruling coalition has unveiled a sweeping package of tax, labour and pension reforms aimed at reviving Europe’s largest economy and countering a surge by the far right.

The “Programme for Revival and Employment” announced on Thursday includes about 10 billion euros ($11.4bn) in annual income tax relief targeted at lower and middle-income earners, taking effect from January 1, 2027.

The 34 reform measures also include an overhaul of the creaking pension system, tougher rules for employees’ sick leave and a reduction of the country’s stifling bureaucracy.

The tax relief is to be financed primarily by restructuring the surcharge on top incomes.

“The highest earners in this country will therefore take on a larger share” of the tax burden, said Finance Minister and Vice Chancellor Lars Klingbeil of the centre-left SPD. “That is fair, so that our country can move forward.”

Trailing the far-right Alternative for Germany (AfD) in national polls ahead of critical eastern state elections this September, Merz’s centre-right CDU and their SPD coalition partners faced intense pressure to overcome months of internal deadlock.

RUSSIA/UKRAINE/MIL - Live Updates: Russia Hammers Ukraine’s Capital in Deadly Attacks
https://www.nytimes.com/live/2026/07/02/world/ukraine-kyiv-russia-attack

The Russian military blasted Ukraine’s capital, Kyiv, with waves of ballistic missiles and drones that lasted into Thursday morning, a deadly show of force after weeks of Ukrainian attacks within Russia that have heaped pressure on President Vladimir V. Putin.

At least 21 people were killed and 85 injured in the attacks, Ukrainian officials said, as firefighters raced to extinguish blazes in several districts of the capital. Several apartment buildings were partially destroyed and an unknown number of people were trapped in the rubble, according to the local authorities.

The Russian barrage was the latest in the deadliest spring for Ukraine since Moscow’s full-scale invasion in 2022, as Ukrainian strikes prompt Mr. Putin to respond militarily. Ukraine has been bringing the war home to Russia by using long-range drones and cruise missiles to attack fuel facilities and military installations deep inside Russia and in occupied Crimea.

These attacks have caused widespread fuel shortages and have eroded Mr. Putin’s ability to insulate large parts of his country, including Moscow, the capital, from the war.

Ukraine’s strategy on the battlefield rests on forcing the Russian military to pay a heavy price for every mile of land it seizes while raising the economic costs for the Kremlin. Moscow believes it can outlast Kyiv’s outnumbered forces on the front while inflicting such a heavy human and economic toll that it breaks the will of civilians, according to Western military analysts.

In a statement on Thursday, Russia’s defense ministry called the strikes on Kyiv a response to Ukraine’s recent attacks inside Russia.

Many Kyiv residents had been bracing for a large-scale Russian assault in part because about two weeks had passed since the last one, giving Moscow time to stockpile missiles and drones. President Volodymyr Zelensky of Ukraine had warned in recent days that Russia was preparing another “massive strike,” and he urged people to be “especially careful.”

PNG/US/MIL - Papua separatists claim to have shot dead a US pilot who transported Indonesian troops
https://apnews.com/article/indonesia-papua-american-pilot-killed-95cf2f16576961960960254e56384d65

A Papua separatist group said Thursday it shot dead an American pilot who allegedly transported Indonesian troops into the restive province.

A spokesman for the West Papua Liberation Army, or TPNPB, said its fighters fatally shot Nicholas F. Goselin and set fire to an aircraft operated by PT AMA, an Indonesian airline, in Balinggama village.

The plane was carrying one pilot and seven passengers, Indonesia’s Directorate General of Civil Aviation said. After the pilot reported that the aircraft had landed, communications with personnel at the airstrip were subsequently lost, the ministry said in a statement.

There was no immediate comment from the U.S. Embassy.

A decades-old insurgency in impoverished Papua between Indigenous Papuans and Indonesian security forces has spiked in the past year, with dozens of rebels, security forces and civilians killed. The rebels have especially targeted foreign pilots.

CUBA/US/SURVIVING IS NOT THRIVING - Cuba Says the U.S. Has Underestimated the Island’s Resiliency
https://www.wsj.com/world/americas/cuba-says-the-u-s-has-underestimated-the-islands-resiliency-d3ef8887?mod=world_feat3_americas_pos1

A top Cuban official acknowledged that pressure from Washington has isolated the island, forcing foreign investors to leave the country, but warned the Trump administration against underestimating the Communist government’s resolve.

The Trump administration has misjudged Cuba’s ability to withstand pressure, said Deputy Prime Minister Oscar Pérez-Oliva.

“The U.S. government wants to take us into a forced economic dependency to the detriment of partners from other countries,” Pérez-Oliva said in an interview.

Starting in January, the U.S. imposed an oil blockade on Cuba and later implemented devastating sanctions against state-run companies. Ratcheting up the pressure, U.S. prosecutors in May indicted former President Raúl Castro on murder charges relating to the downing of two civilian aircraft in 1996.

The U.S. has also sanctioned nearly 20 Cuban officials and Castro family members. President Trump has threatened to “free” Cuba, or in the best of cases, carry out a “friendly takeover” of the country. 

Cuba is resisting U.S. pressure as it contends with its worst economic crisis in decades. In a surprise move last month, the communist government pushed through a package of 176 economic measures to attract foreign investment, increase the island’s small private sector and stave off economic collapse, as well as possible U.S. military action.

“The people who run the U.S. have always been wrong because they have underestimated our country,” said Pérez-Oliva.

CHINA/ASSIMILATE OR DIE? - What’s China’s new ethnic unity law, and what does it mean for minorities?
https://www.aljazeera.com/news/2026/7/2/whats-chinas-new-ethnic-unity-law-and-what-does-it-mean-for-minorities

China has brought into effect a new ethnic unity law that rights groups and foreign officials have warned could accelerate the forced assimilation of ethnic minorities.

The world’s second most populous nation officially recognises 55 ethnic minority groups, which together account for 8.9 percent of mainland China’s population.

Beijing also announced that the new law, which entered into force on Wednesday, could apply to individuals outside the country’s borders, which has raised further alarm among rights groups, which said it could be used to target overseas critics of China.

The Chinese government, however, said Western media outlets “misinterpreted” the overseas povision and the country wants merely to exercise its right to combat separatist movements abroad.

Here is more about China’s new law and how it could impact minorities.

What is China’s ethnic unity law?

China passed the law on March 12 to create a “shared” national identity among the country’s 56 ethnic groups – the Han majority and 55 minority groups.

The largest communities among China’s ethnic minorities include the Uighurs, about 11 million people, and Tibetans, about 7 million people. Tibet and Xinjiang, where most Uighurs live, are China’s only two provinces where communities that nationally are ethnic minorities form the majority of the population.

The law, approved by China’s ceremonial legislature, is designed to foster “a stronger sense of community among all ethnic groups in the Chinese nation”, Lou Qinjian, a delegate to the National People’s Congress who introduced the proposal before the body, said in March.

CHINA/SEC - Beijing identifies pilot killed in crash into city's tallest building
https://www.reuters.com/world/china/beijing-says-plane-crash-into-skyscraper-was-caused-by-personal-reasons-2026-07-02/

The pilot killed when a plane crashed into ​Beijing's tallest building last Friday was a 66-year-old man surnamed Liu, Beijing's Chaoyang district government said ‌on Thursday, as officials sought to end speculation about the incident.

Without identifying the 108-storey CITIC Tower, headquarters of one of China's largest state-owned conglomerates, the Chaoyang government said Liu had deviated from his approved flight area and lost contact with the airport from which he took off before crashing ​into the building and dying at the scene.

Liu, a Beijing native, had long suffered from insomnia and anxiety, ​and his diary repeatedly mentioned ending his life, the statement said. The incident was caused ⁠by "personal reasons," it added.

Incidents like Friday's crash are rare in China, which maintains some of the world's strictest ​airspace controls and tight security around President Xi Jinping and other senior leaders, fuelling speculation in Beijing's central business district — ​where the building is located — about what happened.

The crash occurred days before the ruling Communist Party celebrated its 105th anniversary down the road in the Great Hall of the People off Tiananmen Square. Discussion of the crash on Chinese social media has since been scrubbed.

VATICAN - Vatican declares Society of St. Pius X in schism, excommunicates bishops
https://www.npr.org/2026/07/02/nx-s1-5878916/vatican-society-of-st-pius-x-in-schism

The Vatican responded aggressively Thursday to a traditionalist society that consecrated bishops without the pope's consent, declaring the Society of St. Pius X in schism, excommunicating its bishops and priests and warning its faithful they too face the harshest sanctions in the Catholic Church.

The Vatican's doctrine office went above and beyond the minimal sanctions foreseen by the church's canon law to respond to the consecrations Wednesday of four new bishops at the society's Econe, Switzerland, seminary.

The society, known by its acronym SSPX, celebrates the ancient Latin Mass and opposes the modernizing reforms of the Catholic Church, which it considers to be rife with heresies and errors and has accused of straying from the Catholic faith.

During a ritual-filled, five-hour Mass on Wednesday, attended by some 15,500 people and their children, the SSPX consecrated four new bishops in direct defiance of Pope Leo XIV, who had urged the SSPX to hold off for the sake of the church's unity.

In a decree, the Vatican excommunicated the four new bishops and the two bishops who participated in the ceremony. It declared the consecrations a "schismatic act" and declared the society itself had created a schism, or intentional rupture with the Catholic Church.

The Vatican warned the faithful who go to the society's Masses to stop, declaring "those who adhere formally" to the society are considered themselves schismatic and excommunicated. It declared SSPX priests to be schismatic, and therefore excommunicated, and invalidated the sacraments of confession and marriage that they administer.

The sanctions, especially those targeting the priests, the faithful and the sacraments they can receive, were particularly harsh and reversed concessions the Vatican had granted the SSPX in recent years as part of its outreach to bring the group back under Rome's wing.