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Nato’s Russian city

Dimitris Giannakopoulos

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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. follow @DGiannakopoulos

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UNIDO, Italy support small manufacturers in Iran to comply with global environmental agreements

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The United Nations Industrial Development Organization (UNIDO) and Iran’s National Ozone Unit (NOU) today organized a workshop in Tehran to formulate a technical and business strategy to support small manufacturers of refrigeration equipment and insulation material with the adoption of new ozone- and climate-friendly substances and technologies. This will contribute to Iran’s efforts to comply with its commitment, under the Montreal Protocol, to reduce its use of ozone-depleting substances – specifically, hydro-chlorofluorocarbons (HCFC) – commonly used in this sector.

Through the Multilateral Fund for the Implementation of the Montreal Protocol, UNIDO and Italy assist small manufacturers of refrigeration equipment in Iran – ranging from small chillers to domestic and commercial-scale refrigerators – to adapt their manufacturing processes and products in compliance with the second stage of the HCFC phase-out plan set by the Iranian government.

During the workshop, technology suppliers explained how small manufacturers can continue their operations with alternative chemical substances, while maintaining safety. “The NOU will consider the outputs of this workshop in the national strategy, hoping to successfully meet challenges ahead, specifically for small and medium-sized enterprises,” said Medi Bakhshizade, project coordinator of Iran’s National Ozone Office.

Several alternatives to HCFCs are readily available, but some of them are known to have high global warming potentials (GWP). Under the Kigali Amendment to the Montreal Protocol, a direct switch to natural refrigerants, which have zero ozone depleting potential (ODP) and low GWP, is encouraged.

In the case of Iran, the most promising alternative for small companies is cyclopentane, which could be locally produced if there is enough demand. However, the substance is high flammable, meaning new technical skills and safety installations and equipment would be required and these constitute a major financial barrier for small companies. Active cooperation between companies, local chemical formulators and technology suppliers could help tackle this barrier.

UNIDO project manager Fukuya Iino said, “UNIDO would like to promote energy-efficient technologies while phasing out HCFCs. Small companies are faced with challenges to adopt new technologies, and this is why we are asking possible technology suppliers to share their know-how with them.”

A number of technology and financing options to support small manufacturing companies were presented during the workshop. The event offered a platform for small beneficiary manufacturers, technology suppliers, chemical material formulators, governmental focal points, and other stakeholders, to share knowledge and develop partnerships.

Among participating speakers were technology suppliers from Italy (two), Australia (one) and Iran (one). Forty-five participants actively joined the discussion between speakers, panel members, and the audience.

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The Future of the Armenian-Chinese Relations

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December 13-16, 2018, Yerevan- leading scholars from the Chinese Academy of Social Sciences were invited by the “China-Eurasia” Council for Political and Strategic Research, foundation to visit Armenia. Within the framework of the visit with their Armenian colleagues Dr. Xiao Bin, Dr. Bao Yi and Dr. Wu Hongwei participated in an academic seminar “China, Eurasia and Armenia: Views from Yerevan and Beijing.” It is worth mentioning that Chinese initiative “One Belt, One Road” provides a lot of opportunities to other states to get Chinese investments, but they are not any big Chinese investments in Armenia, even if we compare with other South Caucasian countries. Professor Wu Hongwei emphasized that the Chinese-Georgian relations have developed dynamically, and the Chinese side is making huge investments there. He expressed hopes that through the information and contacts with Armenian specialists obtained during the visit, it will be possible to draw new recommendations through which it will be possible to develop economic relations with Armenia. In turn, Dr. Bao Yi presented her research on China’s humanitarian cooperation with Central Asian countries and noted that this successful experience can also be used in the South Caucasus. Dr. Xiao Bing introduced his paper on promotion of the cooperation of international capacity under One Belt, One Road initiative in the era of technological transformation.

The head of the ARMACAD, Dr. Khachik Gevorgyan told  about the  prospects of the ARMACAD in the  development of Sino-Armenian academic relations in the framework of the One Belt, One Road.

The organizer of this academic event, Dr. Mher Sahakyan, head of the “China-Eurasia” Council for Political and Strategic Research, foundation, spoke about the prospects for the development of the Armenian-Chinese relations in the framework of the Chinese initiative. As he noted, if a branch of one of the leading Chinese banks opened or if Armenia and China establish a joint bank, the result will be significant financial investments in Armenia. The financial field of the country will be diversified, and if Dram-Renminbi conversion is implemented, bilateral trade between Armenia and China will be realized in their own currencies. He recommended, that Armenia can try to stand a Regional member of the Asian Infrastructure bank and after get sovereign backed or non-sovereign backed loans for its state-owned noncommercial organizations, private organizations, and international organizations which works in the territory of Armenia, that they invest this money in Armenian North-South Road Corridor, whichwill significantly enhance Armenia’s capabilities to be involved in the Silk Road Economic Belt’s China-Central Asia-West Asia Economic Belt. Armenia and China can also start cooperation in UN peacekeeping missions, as both states are interested in it.

Dr. Mher Sahakyan, also talked about the possibility of creating an Armenian-Chinese joint military-industrial center in Armenia, which will produce military robots, drones and so forth.

He also noted that Armenia can negotiate with China for its participation in the “Digital Silk Road,” Armenia and China can also cooperate on the research of the development of the 5G.

After the academic seminar Chinese and Armenian scholars agreed to strengthen cooperation between the Armenian Foundation “China-Eurasia” Council for Political and Strategic Research and the Chinese Academy of Social Sciences, to conduct joint research and make recommendations for the development of Armenian-Chinese relations.

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Circular Economy: Proposal to boost the use of organic and waste-based fertilisers

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The EU institutions have found an agreement on new EU rules on fertilisers proposed by the Commission in 2016 as a key deliverable of the Circular Economy Package.

Negotiators from the European Parliament, Council and Commission have reached a preliminary political agreement on the Commission’s proposal from March 2016 which built on the Commission’s 2015 Circular Economy Action Plan.

The new rules will facilitate the access of organic and waste-based fertilisers to the EU Single Market. It also introduces limits for cadmium and other contaminants in phosphate fertilisers. This will help to reduce waste, energy consumption and environmental damage, as well as limit the risks to human health.

Jyrki Katainen, Vice-President for Jobs, Growth, Investment and Competitiveness, said: “Unlike traditional fertilisers which are highly energy intensive and rely on scarce natural resources, bio-waste fertilisers have the potential to make farming more sustainable. These new rules will also help to create a new market for reused raw materials in line with our efforts to build a circular economy in Europe.”

Elżbieta Bieńkowska, Commissioner for Internal Market, Industry, Entrepreneurship and SMEs, added: “The new EU rules will open up new market opportunities for innovative companies producing organic fertilisers and create new local jobs, provide wider choice for our farmers and protect our soils and food. At the same time we are also making sure that our European industry will be able to adapt to the proposed changes.”  

The main elements of the new rules are:

Opening the Single Market for organic fertilisers: The agreement on the Fertilising Products Regulation will open the market for new and innovative organic fertilisers by defining the conditions under which these can access the EU Single Market. The Regulation will provide common rules on safety, quality and labelling requirements for all fertilisers to be traded freely across the EU. Producers will need to demonstrate that their products meet those requirements before affixing the CE mark.

Introducing limit values for toxic contaminants in certain fertilisers:The Regulation for the first time introduces limits for toxic contaminants, including a new 60 mg/kg limit for cadmium which will be further reviewed 4 years after the date of application. This will guarantee a high level of soil protection and reduce health and environmental risks, while allowing producers to adapt their manufacturing process to comply with the new limits. To encourage the use of even safer fertilisers, producers will also be able to use a low-cadmium label applicable to products with less than 20mg/kg cadmium content. These rules will affect those fertilisers that choose to affix CE marking.

Maintaining optional harmonisation:The Regulation also offers the possibility to opt for optional harmonisation. A manufacturer who does not wish to CE-mark the product can choose to comply with national standards and sell the product to other EU countries based on the principle of mutual recognition.

Next steps

The preliminary political agreement reached by the European Parliament, Council and Commission in so-called trialogue negotiations has today been confirmed by the Member States’ representatives and is now subject to formal approval by the European Parliament and Council. The Regulation will then be directly applicable in all Member States and will become mandatory in 2022.

Background

Under the 2015 Circular Economy Action Plan, the Commission called for a revision of the EU regulation on fertilisers to facilitate the EU-wide recognition of organic and waste-based fertilisers. The sustainable use of fertilisers made from organic waste material in agriculture could reduce the need for mineral-based fertilisers, the production of which has negative environmental impacts, and depends on imports of phosphate rock, a limited resource.

Under current rules, only conventional, non-organic fertilisers, typically extracted from mines or produced chemically can freely be traded across the EU. Innovative fertilising products produced from organic materials are outside the scope of the current Fertilisers Regulation. Their access to the single market is therefore dependant on mutual recognition between Member States, which is often difficult due to diverging national rules. Such products therefore have a competitive disadvantage which hampers innovation and investment in the circular economy.

According to estimates, if more bio-waste was recycled, it could replace up to 30 % of non-organic fertilisers. Currently, the EU imports around 6 million tonnes of phosphates a year but could replace up to 30% of this total by extraction from sewage sludge, biodegradable waste, meat and bone meal or manure.

The Commission has also recently presented a new Bioeconomy Strategy, as announced by President Juncker and First Vice-President Timmermans in their letter of intent accompanying President Juncker’s 2018 State of the Union Address, which will further support the scaling up the sustainable use of renewable resources and  boost jobs, growth and investment into a sustainable circular bioeconomy in Europe.

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