Cisco CCNP and CCIE Study Notes

Consider two routers connected back to back via their serial interfaces. The configurations on the routers are

Router1

interface Loopback0
 ip address 10.10.10.10 255.255.255.255
!
interface Serial2
 ip address 192.168.16.1 255.255.255.252
 no fair-queue
!
router bgp 1
 no synchronization
 bgp log-neighbor-changes
 neighbor 20.20.20.20 remote-as 2
 neighbor 20.20.20.20 ebgp-multihop 2
 neighbor 20.20.20.20 update-source Loopback0
 no auto-summary
!
ip route 0.0.0.0 0.0.0.0 192.168.16.2

Router2

interface Loopback0
 ip address 20.20.20.20 255.255.255.255
!
interface Serial2
 ip address 192.168.16.2 255.255.255.252
 no fair-queue
!
router bgp 2
 no synchronization
 bgp log-neighbor-changes
 network 20.20.20.20 mask 255.255.255.255
 network 172.16.1.0 mask 255.255.255.0
 neighbor 10.10.10.10 remote-as 1
 neighbor 10.10.10.10 ebgp-multihop 2
 neighbor 10.10.10.10 update-source Loopback0
 no auto-summary
!
ip route 0.0.0.0 0.0.0.0 192.168.16.1

These BGP neighbors are stuck in active and never come up. Note that the two routers can ping each other's serial and loopback interfaces with their own serial and loopback interface addresses as the source address. Why are these routers unable to establish BGP neighborship?