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Nato’s Russian city

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Welcome to the Caspian Daily, where you will find the 10 most important things you need to know on Caspian Sea Region. We appreciate ideas, reports, news and interesting articles. Send along to Caspian[at]moderndiplomacy.eu or on Twitter: @DGiannakopoulos

1Nato’s Russian city. “Estonia is one of the countries in Eastern Europe where US tanks, artillery and other military equipment will soon start arriving, Defense Secretary Ash Carter said on Tuesday in the Estonian capital, Tallinn. But there is one community in Estonia that may have mixed feelings about these new US deployments. Narva and its castle are in Estonia, which means they’re in the EU and Nato. But Narva’s people are almost entirely – and often resolutely – Russian” writes Neal Razzell for the BBC.

2Business opportunities move Russia-Asia cooperation forward. Russia’s Asian Pivot is as much about economics as it is about politics. Although trade and investments between Russia and ASEAN countries are well below potential, there are several important projects in the pipeline” writes Alexandra Katz for the RBTH

3Iran is building a multi-purpose port near the Strait of Hormuz with 700 million euros of foreign investment, the state news agency IRNA reported on Thursday. The new port on the shores of Suza on the Qeshm island “will definitely become a shipping hub for international trade and transit”, deputy head of the Qeshm Free Zone Organization Farzin Haqdel said. The Qeshm island on the Persian Gulf lies along the North-South Transport Corridor which provides a rail, road and sea route for moving freight across Iran, Pakistan, India, Russia, the Central Asia, the Arabian Peninsula and Europe. “The new port in Suza can turn into one of the biggest and most discussed international ports in the world due to many advantages it has, including a draught of 50 meters,” Haqdel said.

4The Foundation of Central Asia: Kazakhstan’s Journey from Past to Future. “with projects such as the Caspian pipeline that links the Tengiz oilfield across the Caspian Sea to the Russian Black Sea port of Novorossiysk and the Kazakhstan-China pipeline that pumps oil to Alashankou and western China, Kazakhstan has become one of the largest producers of oil in the world. It is also quite possible that, in time, Kazakhstan will also become the world’s foremost producer of uranium” writes Jeanette JJ Harper for the Modern Diplomacy.

5“Works are underway to purchase new weapons, equipment, military property and include them into the inventory in order to increase the capabilities of the Armed Forces and improve the quality of comprehensive and continuous logistic support of troops”. Azerbaijani Defense Minister, Colonel-General Zakir Hasanov made this statement on the 97th anniversary of the country’s Armed Forces. Hasanov said that military products are repaired, modernized and re-processed under the development program.

6Turkmenistan Oil and Gas Strategic Analysis and Outlook 2015-2025. Amidst downfall in oil prices creating uncertainty on the future of Turkmenistan industry growth, the report details key strategies of government, oil and gas companies and investors in the country. Detailed outlook of the industry in terms of production forecasts of oil, gas, LNG, LPG, gasoline, diesel, fuel oil along with supporting parameters of primary energy demand, GDP and population are included. Current status of planned projects along with the possible commencement of the projects, feasibility of developing those projects in current market conditions, expected start up, impact of competing assets in other countries and overall industry developments, investments required and other related information on planned projects is provided in detail. [Research and Markets]

7Not Waiting For Nuclear Deal, Shell, Other Oil Firms In Talks With Iran.Executives from Royal Dutch Shell and Eni have met Iranian officials in Tehran to discuss investing in the country’s energy industry, the first time international oil firms have publicly confirmed such talks ahead of a possible nuclear deal with the West, the Financial Times has reported. The meetings, which took place in May and June, are evidence of the growing interest among big oil companies in Iran, which boasts the world’s third-largest oil and natural-gas reserves but which will need tens of billions of dollars of foreign investment to realize its ambitions to nearly double production by the end of the decade.

8Car insurance market grows in Kazakhstan. The car boom in Kazakhstan contributed to the growth of the insurance market, according to a report released by the Ranking.kz analytical service. “In January-April 2015, the volume of sales of policies of civil liability of car owners in Kazakhstan was 13.4 billion tenge (185, 95 tenge = $1), which is 40 percent more than in the same period of 2014,” said the report. There are 23 companies on the car insurance market in Kazakhstan, and an increase in sales has been recorded at all of them. Only in April 2015, the amount of premiums collected on policies of civil liability of vehicle owners in Kazakhstan increased by 3.8 billion tenge. Two new “billionaire” companies – Oil Insurance Company and Alliance policy came to the market, the report said.

9The “BRICS Bank”: Many challenges and many opportunities. “A significant challenge for the Bank is to not let the strategic interplay of China and India affect its working. The first few months since the announcement have seen no major hiccups but as the Bank grows in scale this will be something to watch out for. The Bank recently even announced the appointment of its first president KV Kamat a veteran and respected banker from India. On the other hand the opportunities for a financial institution that brings together five key developing countries are immense” writes Pallavi Roy for the Modern Diplomacy.

10On June 23-26th city of Medellin, Colombia hosts the 2015 United Nations Public Service Forum which is being attended by the Azerbaijani delegation headed by Mr. Inam Karimov, the Chairman of State Agency on Public Service and Social Innovations. During the forum “ASAN Service” will be granted the United Nations Public Service Award 2015 for the improvement of public services in the Republic of Azerbaijan. It is worth to note that only 18 of 71 states represented with 638 nominations have been awarded the highest prize.

Journalist, specialized in Middle East, Russia & FSU, Terrorism and Security issues. Founder and Editor-in-chief of the Modern Diplomacy magazine.

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War games will take place off Durban between South Africa, China and Russia

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South Africa’s government has finally shown its colours by inviting Russia and China for war games next month, London’s ‘Daily Mail’ writes with indignation and indignation.

SA President Cyril Ramaphosa has ditched his supposed ‘neutrality’ to the war by hosting the naval drills off the country’s east coast near Durban and Richards Bay from February 17 to 27. The move is the strongest indication yet of the strengthening relationship between South Africa, and the anti-West authoritarian regimes of China and Russia.

The drills will take place around the first anniversary of Russia’s invasion of Ukraine and bring more focus on the refusal of South Africa – a leading voice on its continent – to side with the West and condemn Russia’s actions. The South African government said last year it had adopted a neutral stance over Ukraine and called for dialogue and diplomacy.

But the upcoming naval drills have led the country’s main opposition party to accuse the government of effectively siding with Russia.

But the South African National Defence Force (SANDF), which incorporates all of its armed forces, said next month’s naval exercise would ‘strengthen the already flourishing relations between South Africa, Russia and China’. The aim of the drills was ‘sharing operational skills and knowledge’, the SANDF said.

The three countries also conducted a similar naval exercise in 2019 in Cape Town, while Russia and China held joint naval drills in the East China Sea last month.

The United States and European Union had hoped South Africa would support the international condemnation of Russia and act as a leader for other nations in Africa. But, South Africa appealed to be one of several African countries to ‘abstain’ in a United Nations vote last year condemning Russia’s special military operation.

South Africa and Russia share a long history, after the Soviet Union gave support to the ANC in its fight to bring down apartheid, the regime of repression against the country’s black majority, writes London newspaper. (And we should remember, how the British destroyed the Boers’ Transvaal and the Orange Republic of the at the beginning of the 20th century, and planted the apartheid regime here).

Apartheid ended in 1994 when the ANC won the first democratic elections in South Africa and Nelson Mandela became president.

South Africa is also a member of BRICS, a bloc of emerging economies, alongside Brazil, Russia, India and China.

South Africa’s obligations with respect to sanctions relate only to those that are specifically adopted by the United Nations. Currently, there are no UN-imposed sanctions on the particular individual, they say in Pretoria.

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Will South Korea build nuclear weapons?

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Washington’s attempt to curb North Korea’s nuclear ambitions are at a dead end. The nation is a nuclear state. Its arsenal is growing in both size and sophistication. Although Pyongyang will never be capable of staging a preemptive strike against the United States, it soon may be able to retaliate against Washington for defending South Korea, writes “Foreign Policy”.

The shifting balance has sparked a serious debate within the United States and South Korea over nuclear policy. The first question is whether it makes sense to pursue denuclearization — the famed CVID (complete, verifiable, irreversible dismantlement) — when the North already has the bomb. Although official Washington policy resolutely refuses to acknowledge North Korea as a nuclear state, reality may eventually force a policy retreat.

Even more significant, the South’s establishment wants to get its hands on, or at least close to, American nuclear weapons. Or, suggested South Korean President Yoon Suk-yeol, Seoul might develop its own. He suggested in a press conference last week that South Korea might develop its own nuclear weapon.

There has been a rolling debate in South Korea for about a year on its potential nuclearization. But that has been mostly limited to extra-governmental voices in think-tanks and academia. So it is genuinely surprising that this has already reached the presidential office.

Indeed, it speaks to just how threatening North Korea’s nuclear weapons are perceived in South Korea – and how unhelpful China has been in restraining Pyongyang – that no less than its president is now discussing this.

The South Korean fear is similar: in a spiraling crisis with North Korea, would its nuclear ICBMs compel the US to ‘slow-roll’ assistance for fear of crossing some retaliation threshold with North Korea? The answer is almost certainly ‘yes’, the author of the military portal ‘19fortyfive.com’ is convinced.

It is inconceivable now, in a nuclearized environment, that the US alliance commitment to South Korea is as automatic as it was in a conventional environment. Any US president will flinch at a course of action which might realistically incur a nuclear strike on US cities.

This new reality, since North Korea’s successful 2017 ICBM test, is only just sinking in. For a few years, it looked like former US President Donald Trump and former South President Moon Jae In might strike a deal with North Korea. That was always pretty far-fetched, but once it definitely fell apart by 2020, a South Korean nuclear debate was likely inevitable.

The debate on nuclearization in South Korea itself is culminating. South Korea public opinion is supportive. Nongovernmental opinion is tilting toward it. The country’s main conservative party has said South Korea should withdraw from the Non-Proliferation Treaty if North Korea tests another, seventh, nuclear weapon. And now the South Korean president has broached the issue too.

The big hurdle then is the Americans. The US is South Korea’s only treaty ally and its core foreign relationship. Without American defense guarantees, South Korea’s defense spending would double or triple. So South Korean governments have traditionally given American preferences wide berth.

And indeed, the American response was to play down Yoon’s comments.

In fact, the North Korean nuclear and missile threat will only worsen as the regime tests more and more, and they certainly are not going to stop. The more North Korea can threaten US cities with massive destruction, the less credible US alliance guarantees will be.

Luckily, this problem is not new. America’s European allies faced it during the Cold War because the USSR could strike the US homeland, and a variety of responses, including nuclear sharing and indigenous nuclearization, were tried with reasonable success. The US has also adapted to Israeli, Indian, and Pakistani nuclearization without a massive crisis.

So South Korean nuclearization need not lead to an alliance rupture unless the US insists on it.

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Jacinda Ardern resigned as New Zealand’s PM or was forcibly ousted from power?

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Jacinda Ardern (photo) has insisted her decision to resign as New Zealand’s Prime Minister is because she ‘doesn’t have enough in the tank’ – but there is speculation as to whether she is actually running scared of an election mauling following a public outcry over her draconian Covid lockdowns.

Ms Ardern, 42, choked back tears as she announced she will step down after just over five years in power. She insisted her decision to step down had nothing to do with the fact her Labour Party is trailing in the polls behind its conservative rivals from the National Party ahead of the upcoming election in October.

Her policies sparked nationwide protests – one protest against vaccine mandates that began on Parliament’s grounds last year lasted for more than three weeks and ended with protesters hurling rocks at police and setting fires to tents and mattresses as they were forced to leave.

As a result of the public anger over Ms Ardern’s response to Covid – which included a border closure that lasted more than two years – and her domestic policies, she was facing tough reelection prospects. This has prompted speculation that the real reason she decided to quit was because she didn’t want to face a humiliating defeat in the elections.

Ms Ardern continued: ‘I am not leaving because I believe we can’t win the election but because I believe we can and will. But we need a fresh set of shoulders for the challenges of both this year and the next three.’

Ms Ardern’s ratings have also dropped in recent months due to a worsening housing crisis, rising living costs and mortgage rates, and growing concerns about crime.

This has meant that the Labour Party, which has been in power since 2017, lost its consistent lead in the polls early last year.

Ms Ardern was elected just over five years ago on October 26, 2017, and at 37, was New Zealand’s youngest ever PM. Before that, she was the youngest sitting MP in 2008, elected aged 28.

During her resignation speech, Ms Ardern announced the next New Zealand general election will be held on October 14, 2023.

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