Connect with us

Russia

The Russia-OPEC-America Nexus: Reimagining the Great Oil Game

Published

on

The geopolitical implication to the sudden fall in oil prices has had broad-reaching ramifications for a number of very powerful countries. Two of those countries, Russia and Saudi Arabia, are the most important energy commodity exporters in the world. The other, the US, is the single most crucial oil importer in the world.

The possibility of Russian fatalism awakening is very real as the country faces tightening sanctions, severely underpriced oil exports, and rapid inflation as military spending has increased. Similarly, Saudi Arabia’s diminishing currency reserves and its military adventurism in Yemen have many questioning how the economy can diversify to stabilize the budget. In the US, shale companies have largely been cannibalized to consolidate power across fewer but larger corporations. At a time when the world is increasingly looking at alternative energies to lower pollution and greenhouse gases, oil industries have drastically lowered prices to the detriment of budgets and investors. The question that looms among these oil producers: who will blink first?

The Organization of Petroleum Exporting Countries (OPEC), controlling over 40% of the global crude oil production, curiously refused to cut production while oil prices were plummeting last summer, further exacerbating the price fall. OPEC stated that the decision was not politically based and that prices were simply returning to ‘normal.’ OPEC’s decision to force prices lower in the wake of the worldwide glut confounded oil market pundits. Many looked to shale oil for a formidable explanation. Producing over 5 million barrels a day, the US shale oil revolution has revitalized the local economies of North Dakota and Texas, while little regulation has allowed companies to produce at prodigious rates. This has lowered US oil imports and softened the influence of OPEC producers on US foreign policy.

While OPEC may have wanted to deliver a severe blow to the shale oil companies, who operate with smaller margins than traditional producers, the simple reality is that OPEC was too late to react. Shale oil production increased since the drastic price collapse last year and has only recently shown signs of stagnation. Large shale oil companies have repeatedly bought previously thriving small shale companies for pennies on the dollar as possible bankruptcies have loomed. This consolidation of the shale industry has provided more oil fields for future exploration to companies that have the capital to wait until prices again rise. While the US shale oil industry only accounts for roughly 6% of the global oil market, OPEC’s decreasing reach into the US market may have initiated the production glut. Thus, while the price decrease has recently slowed the shale oil market, consolidations have kept the industry alive.

The most intriguing geopolitical connection with oil prices collapsing is the Western sanction regime on Russia. As inflation hit the Russian economy and protracted recession weighed on Russian morale, OPEC ramped up production. Similarly, Russia has (as of May 2015) produced more oil since the end of the Soviet era. Interestingly, this economic stand-off brought the two biggest oil-producing countries (Saudi Arabia and Russia) to the bargaining table as Russia considers closer ties to OPEC. This tantalizing prospect of a Russian-OPEC alliance has almost always been an illusion since OPEC’s formation and would drastically increase OPEC’s global power in determining oil prices. OPEC has never really trusted Russia and an alliance may only form out of dire necessity. But that is something the United States would staunchly oppose.

As Iran will likely demand greater regional power responsibility as the lifting of sanctions occur in coming months, Saudi Arabia will find its close Western ties strained. Thus, a closer OPEC relationship with Russia would be a geopolitical conundrum for the Western world as the Middle East once again faces possible political destabilization. Witnessing the difficulties of Russian natural gas dependency in recent conflicts in Ukraine, Georgia, and Estonia, an OPEC-Russian alliance would control nearly half of the world’s oil, with Russia becoming the likely leading producer. This could echo the 1973 oil embargo, a time when OPEC controlled 53% of the world’s oil and subsequently handicapped Western economies. With Russia continually looking for ways to damage Western economies and strengthen its own geopolitical position, more Russian energy control would be deplorable to the West.

Contrary to the OPEC-Russian alliance is the simple fact that such cooperation would further strain interrelations with Western powers and would be a difficult political gamble for Saudi Arabia. As Western economies are projected to continually dwarf that of Russia for the foreseeable future, and with an apparent divide between the US and Saudi Arabia regarding Iran, any further strain would leave Saudi Arabia’s Western relations questionable. However, as China becomes the world’s major oil importer, Saudi Arabia has monopolized the Chinese market and increased Chinese sales 37% in the last year, while every other country lost market share. However, Russia is unlikely to agree with any OPEC policy of lowered production while Saudi Arabia continually strives for dominance in the coveted Chinese market.

While market competition has surely decreased oil prices, it remains the most geopolitically significant commodity in the world by all measures. In this environment of little policy clarification and OPEC’s failure to halt shale oil production, Russia has faced the harshest conditions of all oil-producing countries. Although Russia would benefit from an end to shale oil, its economy was already facing difficult projections. Vladimir Putin has had to balance his military adventurism with economic difficulties, exacerbated by the oil glut. In this way, Russia may be aligned with Saudi Arabia in wanting to damage the US shale oil industry (and, at the same time US oil giants, like Exxon), but has more to lose than Saudi Arabia. However, Saudi Arabia and Russia have deftly managed budgets, low debt (a meager 2% and 18% respectively), and strong nationalism. While they would serve each other better as partners in OPEC, the US cannot allow it and Saudi Arabia is, as of now, most unlikely to make that gamble.

All countries involved have much to gain and, similarly, much to lose by way of oil. The US will be the last to consider any kind of radical action in the oil market as low prices serves the White House’s policy for the moment. Russia has little history of giving into foreign pressures and most likely will adapt to lower oil prices. Saudi Arabia, as the leader of OPEC, will most likely act first to balance its budget. While this will leave Russia to increase oil production if OPEC lowers theirs, it may be the only workable political solution. As of now, however, production remains high as all sides stare down each other and decide which direction is the best direction to take. For the first time in a long time, because of so many diverse geopolitical maneuvers happening at one time amongst the world’s energy producers and consumers, the future of ‘status quo’ may indeed be very uncertain.

Brian Hughes is currently a student in the International Security and Intelligence Studies program at Bellevue University in Omaha, NE, USA.

Continue Reading
Comments

Russia

Russian Authorities Going Forth and Back with Migration Policy

Published

on

Deputy Mayor of Moscow for Economic Policy and Property and Land Relations Vladimir Efimov, in an interview published this mid-September in the newspaper Izvestia, a widely circulated and reputable Russian media, lamented that Moscow is still experiencing a shortage of labor migrants at various construction sites, now there is a shortage of about 200 thousand people.

“This problem remains today Moscow lacks about 200 thousand migrants. And we hope that in the near future the restrictions on their entry into the country will be softened,” Yefimov said, answering the question of the publication whether the issue of the shortage of migrant workers for construction sites in Moscow.

According to him, “the lack of labor resources leads to the fact that employers, primarily developers, outbid employees from each other, which increases the cost of their services. If we talk about the period before the pandemic, for several years, housing prices in Moscow have hardly grown. Against the background of the pandemic, the cost of housing has increased, actually catching up with inflation in previous years,” said the Vice Mayor of Moscow.

The announcement simply highlighted the inconsistency dealing with migrant policy and complete lack of foresight, especially what to do with migrants from the former Soviet republics. Thanks to these migrants, mostly employed in the construction fields and (cleaning, sewage disposal or removal services) in various neighborhood or districts, Moscow has won awards for being modern and clean smart-city in Europe. These migrants play an important role, most often underestimated, in building infrastructure and in general development of the society.

According to a survey of Promsvyazbank (PSB), Opora Rossii and Magram Market Research conducted in June 2021 found out that 45% of small and medium-sized businesses in Russia need new employees. Entrepreneurs still consider the unfavorable economic conditions caused by the pandemic to be the main obstacle to business expansion, and employing new staff requires extra cost for training in the social services sector.

Opora Rossii, an organization bringing together Russian small-and medium-sized enterprises (SMEs), and the Institute for Social Analysis and Forecasting of the Russian Presidential Academy of National Economy and Public Administration (RANEPA), among other business organizations and institutions, have been very instrumental on the significant role by migrant force, its combined objective and beneficial impact on the economy of Russia.

Several experts, in addition, have explained that migrants from the former Soviet republics could be useful or resourceful for developing the economy, especially on various infrastructure projects planned for the country. These huge human resources could be used in the vast agricultural fields to boost domestic agricultural production. On the contrary, the Federal Migration Service indiscriminately deports them from Russia.

Within the long-term sustainable development program, Russia has multibillion-dollar plans to address its infrastructure deficit especially in the provinces, and undertake mega projects across its vast territory, and migrant labor could be useful here. The government can ensure steady improvements are consistently made with the strategy of legalizing (regulating legal status) and redeploying the available foreign labor, the majority from the former Soviet republics rather than deporting back to their countries of origin.

Moscow Mayor Sergei Sobyanin has been credited for transforming the city into a very neat and smart modern one, thanks partly to foreign labor – invaluable reliable asset – performing excellently in maintaining cleanliness and on the large-scale construction sites, and in various micro-regions on the edge or outskirts of Moscow.

With its accumulated experience, the Moscow City Hall has now started hosting the Smart Cities Moscow, an international forum dedicated to the development of smart cities and for discussing changes in development strategies, infrastructure challenges and adaptation of the urban environment to the realities of the new normal society.

Kremlin Spokesman Dmitry Peskov has acknowledged that Russia lacks a sufficient number of migrants to fulfil its ambitious development plans. He further underscored the fact that the number of migrants in Russia has declined significantly, and now their numbers are not sufficient to implement ambitious projects in the country.

“I can only speak about the real state of affairs, which suggests that, in fact, we have very few migrants remaining over the past year. Actually, we have a severe dearth of these migrants to implement our ambitious plans,” the Kremlin spokesman pointed out.

In particular, it concerns projects in the agricultural and construction sectors. “We need to build more than we are building now. It should be more tangible, and this requires working hands. There is certainly a shortage of migrants. Now there are few of them due to the pandemic,” Peskov said.

The labor shortage is not only in Moscow but it applies to many regions including the Far East. During the 6th edition of the Eastern Economic Forum (EEF), the demography decline and labor shortage have been identified as factors affecting the development of the vast region. With plans to build residential blocks, establish industrial hubs and fix businesses, these depend largely on the working labor force.

The Russian government continues discussing a wide range of re-population program, hoping to attract in particular Russians there, even incentives such double income, mortgage system, early retirement and free plots of land, but little results have been achieved. Russia’s population is noticeably falling, and now stands at 146 million.

The Far East is almost the size of Canada with its current population (a mixture of natives plus legalized immigrants) more than 38 million. That compared, the Far East with estimated 6.3 million is one of the most sparsely populated areas in the world.

Kremlin has made this its absolute long-term priority, and the challenging task is to create an environment for investment and attract people. President Vladimir Putin acknowledged, at a meeting on the socio-economic development of the Far East, that the speedy outflow of the population from the Far East suggests that the region has not yet received enough support measures. “A lot is being done, but it is still not enough if we observe an outflow of the population.”

President Vladimir Putin has already approved a list of instructions aimed at reforming the migration requirements and the institution of citizenship in Russia, based on the proposals drafted by the working group for implementation of the State Migration Policy Concept of the Russian Federation for 2019-2025.

“Within the framework of the working group for implementation of the State Migration Policy Concept of the Russian Federation for 2019-2025, the Presidential Executive Office of the Russian Federation shall organize work aimed at reforming the migration requirements and the institution of citizenship of the Russian Federation,” an official statement posted to Kremlin website.

In addition, the president ordered the Government, the Interior and Foreign Ministries, the Federal Security Service (FSB), and the Justice Ministry alongside the Presidential Executive Office to make amendments to the plan of action for 2019-2021, aimed at implementing the State Migration Policy Concept of the Russian Federation for 2019-2025.

Continue Reading

Russia

Russia’s Far East: Transforming the Space into Modern Habitable Region

Published

on

Early September the 6th edition of the Eastern Economic Forum (EEF) under the theme “New Opportunities for the Far East in a Changed World” was held and considered as vital for strengthening especially economic ties among Asia-Pacific countries and the Far East region of Russia. What is known as the Far East covers approximately 40% of Russia’s territory.

 The Far East is almost the size of Canada with its current population (a mixture of natives plus legalized immigrants) more than 38 million. That compared, the Far East with estimated 6.3 million is one of the most sparsely populated areas in the world. The Russian government continues discussing a wide range of re-population programmes, hoping to attract in particular Russians there, even incentives such double income, mortgage system, early retirement and free plots of land, but little results have been recorded.

 The September forum, and all the previous ones, focused on raising sustainable development that primarily includes infrastructure, business investment and people. The question is on human habitation and sustenance, but this vast region of the country is sparsely inhabited. Kremlin has made this its absolute long-term priority, and the challenging task is to create an environment for investment and attract people.

 President Vladimir Putin acknowledged, at a meeting on the socio-economic development of the Far East, that the speedy outflow of the population from the Far East suggests that the region has not yet received enough support measures. “A lot is being done, but it is still not enough if we observe an outflow of the population.”

 “Our historical task is not only to keep people in the territories that were mastered by our ancestors for centuries, but to increase the population,” the Russian leader said. Putin stated that the rate of the outflow of people had decreased, but had not stopped. He called the growth of the population in the Russian Far East a “historical task.”

 For this purpose, it is necessary to develop production capacities, create jobs, and ensure people’s incomes. At the same time, Putin also called on using the resources that have already been allocated to the region. “Considerable resources have been allocated and they need to be used effectively,” he suggested, addressing the opening of the Far East Economic Forum.

 The September gathering brought together Russian and foreign entrepreneurs, politicians, experts, and representatives of the media as well as public organizations to exchange experiences and ideas, discuss the most pressing business and development issues and map out useful joint projects and initiatives for the region. Many of the speakers were very frank and objective in speeches, highlighted ways for developing the region.

 The average Far Eastern city fares about 10% worse than the Russian average in terms of housing provision and quality of medical services. “We need intensive breakthrough development. Master plans involving the integrated development of the region could provide the key to this development. What is required is a resource center for urban development covering the Far Eastern Federal District. Secondly, the region is facing a severe shortage of highly skilled workers, especially in architecture and urban planning,” Architect and Partner at KB Strelka, Alexey Muratov told the session on Urban Planning.

 The Far Eastern Federal District has significant economic potential and is of interest to both local and foreign business, but there is an imbalance between investment and economic potential in the region. For Artem Dovlatov, Deputy Chairman and Member of the Management Board of VEB of the Russian Federation, “the Far East is a very interesting region and of particular importance to the government. This is why the Russian President Vladimir Putin has declared that the Far East will be a priority region for Russia in the 21st century. From the perspective of investors, the region is of serious interest. It benefits from vast resources, proximity to the Asia-Pacific region, and diverse scientific and technological potential.”

 “There are certain barriers, of course, and investors still approach investing in the region with a degree of caution, since the barriers are objective. They are associated with the population (a lack of staff) and there are costs related to construction… The Far East is a highly urbanized region. This presents a huge challenge because we need to increase quality of life in the cities in order to prevent outward migration or attract new residents. Strategic planning in cities is needed here,” added Dovlatov.

 Further at the different session, Alexey Muratov, Architect and Partner at KB Strelka, simply puts it, “there aren’t enough people in the Far East. The region accounts for 40% of the country’s land mass but only 5.5% of its inhabitants. How can we solve the central challenge, which is to say the imbalance of economic and investment potential? The first and most obvious solution relates to rotation work. Modern workers’ settlements are in no way inferior to cities in terms of comfort. The second option is to attract residents to cities in order to create new jobs. The issue of the urban environment and quality of life is relevant here. According to all polls, quality of life is the key factor behind outward migration.”

 Nikolay Kharitonov, Chairman of the Committee for Regional Policy and Issues of the North and Far East, State Duma of the Federal Assembly of the Russian Federation, has, however, expressed worries about to curb migration from the Far East. “Getting a Far Eastern hectare helps people to get settled here [in the Far East] instead of leaving for the south or elsewhere,” he said, adding that for transforming the region, it need transportation network, good infrastructure and social facilities, employment opportunities and conditions for habitation.

 Admittedly, lack of social infrastructure constitutes a big hinderance to many projects. “Social infrastructure is of vital importance to the Far East. If people are fleeing the region, how can we motivate them to stay here? They need the right social infrastructure: health care, education, and everything in between,” according to the views of the Chief Executive Officer of VTB Infrastructure Holding Oleg Pankratov.

 The Far East offers a platform for Russia’s entry into global markets and attracting international investment. Russia is seeking to take its place in the global system of division of labor, so it’s concentrating on projects with high added value. “Russia currently has the best conditions in the world to attract human resources and financial resources and take the next technological step. Why would you just come to the Russian market? Let’s manufacture things here for the whole world to compete with other centres of power, relatively speaking. The Russian government has to provide the best conditions for this,” pointed out Arnika Holding President Alexander Generalov.

 Some foreign participants say it is necessary to expand support measures for business startups, consistently attempt to identify and remove development obstacles. “The Chinese experience is that high technologies and companies always play a very important role in the development of the local economy. We help them with resources, we allocate resources, and you do that too. The tech park should be connected to all resources and the international market. And human resources are very important. If you don’t have a good team to help startups, nothing will happen,” says International Association of Science Parks and Areas of Innovation Vice Chairman Chen Herbert.

 On one hand, entrepreneurs have little trust in the government due to its excessive control and supervision. There are still many problems including bureaucracy and red tape. On the other hand, based on the tasks defined by the country’s leadership, a set of measures is being implemented to enhance the business climate.

 The regulatory framework is being improved in the most important and problematic areas of government regulation. Institutions and infrastructure are being created for the development of investment activity. The best practices to support entrepreneurship are being introduced, including mechanisms for direct financial assistance, concessional lending, tax incentives, and moratorium on government inspections.

 Developing the transport and logistics infrastructure. The carrying capacity of the railways needs to be increased, to develop and upgrade the Trans-Siberian Railway. “Russia’s leadership also has concerns regarding the opportunities offered by the Trans-Siberian Railway. It is indeed a problem, because it is a major factor hindering economic growth in Russia, both in terms of foreign trade, and in terms of domestic transportation. We expect carrying capacity to be expanded in the near future,” believes Sergey Katyrin, President, Chamber of Commerce and Industry of the Russian Federation.

 The potential exists for Russia and South Korea to cooperate across a broad range of areas, including industry, energy, and the environment. “We particularly want to highlight the cooperation that has taken shape in relation to smart city projects, industrial parks, and multimodal terminals for shipping in Primorye Territory. One of our assets is a joint venture with the Zvezda Shipbuilding Complex. We have also acquired a grain terminal and are developing this business in Primorye Territory. Collaboration between our two nations is increasing in energy, fishing, and other areas,” Christopher Koo, Chairman, Korea International Trade Association (KITA).

 “South Korea has traversed a fairly long path in relation to the creation of a waste management system in the early 1990s. Since that time, the system has come to closely reflect our own targets in terms of waste disposal. At the start of this journey, virtually 80% of waste in South Korea went to landfill sites. Today, more than 60% is recycled. In Russia, the President has set the objective of processing – i.e., sorting – 100% of waste, and utilizing 50% of it by 2030. Naturally, we would be delighted to employ technological solutions in this area which have been implemented in South Korea,” added Denis Butsayev, General Director, Russian Environmental Operator Public Law Company.

 Besides South Korea, a number foreign countries strike deals at the forum, most of from the Asian Pacific region. Russia and Japan signed deals. China also signed several deals there as Russia has fast developing bilateral relations and both are members of BRICS. For instance, China has the following from the documents:

 China Railway International Group and Primorye Territory signed a statement of mutual interest and intent to implement an investment project for the Construction of Vladivostok ring road in Primorye Territory. Stage 1: Russky Island – Yelena Island – Ulitsa Kazanskaya in Primorye Territory. Investment volume: RUB 75 billion.

 VEB.RF and the ZED Development project company (part of Region Group) signed a cooperation agreement for the construction of an aerial lift across the Amur river at the section of the Russian-Chinese national border linking the cities of Blagoveshchensk (Russia) and Heihe (China). The construction project is being implemented jointly by the Russian investor and its Chinese partner, the China Railway Construction Corporation. VEB.RF will invest RUB 2 billion.

 The Ministry of Labour and Social Protection of the Russian Federation and the Ministry of Human Resources and Social Security of the People’s Republic of China signed a memorandum of understanding with the aim of establishing and strengthening cooperation on labour and social security issues of mutual interest.

 Pharmeco and the Union of Chinese Entrepreneurs in Russia signed a partnership agreement with the aim of developing cooperation between Russian and Chinese organizations and Asia-Pacific countries in the field of pharmacology and the construction of healthcare facilities.

 Zeleny Bulvar and KitayStroy signed a cooperation agreement on the construction of residential real estate in Vladivostok. Two 25-floor apartment buildings are set to be built in the Zeleny Ugol neighbourhood of Vladivostok by 2025.

 Stroytransgaz and KitayStroy signed an agreement on the implementation of a project to build a museum and accompanying educational and cultural centre in Vladivostok.

Japan

 The Ministry for the Development of the Russian Far East and Arctic, VEB.RF, ECN Group and Marubeni Corporation signed an agreement to implement a project to produce ships using methanol fuel at the Zvezda shipyard.

 GTLK and Mitsui O.S.K. Lines signed an agreement for Mitsui O.S.K. Lines to make an equity investment in GTLK Asia Maritime.

 The Ministry of Energy of the Russian Federation and the Ministry of Economy, Trade and Industry of Japan signed a bilateral agreement on the supply of LNG and gas condensate.

 Novatek and the Japan Bank for International Cooperation (JBIC) signed an agreement on strategic cooperation on low-carbon projects.

 The Europlast Primorsky Plant and Ryozai Kaihatsu signed a memorandum of cooperation on the expansion of exports to Japan between the parties.

 The Europlast Primorsky Plant and Ryozai Kaihatsu signed a contract on the sale and purchase of PET preforms.

 It is expected that the Far East will continue attracting investments, both Russian and foreign. “We will continue to try to constantly create new development opportunities, thus securing for the Far East this status of a testing ground for management technologies associated with the development of the region,” Deputy Prime Minister and Presidential Plenipotentiary Envoy to the Far Eastern Federal District Yury Trutnev said at the conference following the forum.

According to the official forum documents: “More than 380 agreements were signed at the forum. International and foreign companies, organizations, ministries and departments have signed 24 documents – 9 with China, 6 with Japan, 3 with Kazakhstan, by one agreement each with Austria, Vietnam, Canada, Serbia and Ethiopia.” And that agreements totaling 3.6 trillion rubles (US$49 billion) were signed at the Eastern Economic Forum (including agreements, the amount of which is not a commercial secret).

Until 2000, the Russian Far East lacked officially defined boundaries, according to historical archival documents. A single term “Siberia and the Far East” often referred to the regions east of the Urals without drawing a clear distinction between “Siberia” and “the Far East” on the territory of Russia. That however, the Far East is generally considered as the easternmost territory of Russia, between Lake Baikal in Eastern Siberia and the Pacific Ocean.

Continue Reading

Russia

The Fall of Kabul and the Balance of Power in Greater Eurasia

Published

on

The uniqueness of historical events is determined by the conditions in which they occur. States always act in the same way — what changes is the conditions that force them to act in one way or another, but, most importantly, any change in context leads to fundamentally different consequences of similar events. The withdrawal of Soviet troops from Afghanistan in February 1989 became possible precisely on the eve of truly global political changes — the end of the Cold War as a result of the de facto defeat of the USSR and its subsequent collapse.

Likewise, the disastrous end of 20 years’ of the US and allies’ presence in Afghanistan is of fundamental importance not in itself, but in the context of a changing global balance of power and a general reduction in the ability of Western countries to play a decisive role in international politics and the world economy. What matters is not the fact of another defeat of the United States — there have been and will be many victories and failures in the military history of this power, but in what circumstances this happens. Now the events in Afghanistan are unfolding amid the growth of the Chinese power and, at the same time, the ability of Moscow and Beijing to coordinate their actions on the most important issues for the state of affairs in Eurasia.

The effects of important events equally depend on the circumstances — short-term or strategic ones. The coming to power of a radical religious movement in Afghanistan in the mid-1990s prompted an attempt by the United States to consolidate its ability to determine the development of world politics. Then any actions of the Taliban on the sovereign territory of Afghanistan became a legitimate reason for international attention and, most often, condemnation. The military intervention of Western countries in Afghanistan received almost the same support as the international operation to liberate Kuwait in 1991.

In the longer term, the establishment in 1996 of a radical regime in Kabul created conditions for the expansion of the presence of the United States and states close to it in central Eurasia. The vulnerability of the Central Asian countries to influence from Washington has significantly increased. But also in Tashkent or Astana there were own efforts to balance Russian and growing Chinese influence in the region with reliance on the West. Until 2014, the United States maintained a direct military presence in the region in the form of bases and logistics centres where the American military was stationed.

But in 2021, the return of the Taliban to Kabul, following the sudden fall of the republican government of Ashraf Ghani, will have very different consequences. First of all, it leads to the further strengthening of China, to better conditions for Russia and a weakening of the West in its fierce competition with Moscow and Beijing. What the Taliban are doing or can do inside the country is not a reason for the general denial of their right to exist. The international context has changed, including in terms of the value dimension of politics and its role in making the most important decisions. Strategically, the return of the radicals to power could lead to the stabilisation of the region, a significant decrease in the United States’ ability to influence its countries and the relative isolation of India, as the country that most closely connects its future with the West.

We do not know if peace in Afghanistan becomes a reality. However, right now, for the first time in the past 40 years, internal political stabilisation in this country has the most solid foundation. First, it is a military victory for a relatively consolidated political movement with a unified leadership and control system. Second, the agreement of the leading regional powers like Russia and China that the Taliban movement should be given a chance to show prudent behaviour inside and outside. For China, this is cooperation in the implementation of major economic projects and refusal to support those religious groups that pose a threat to the security on the Chinese territory. For Russia, this means the absence of aggressive intentions towards the countries of Central Asia. To independently ensure its security, Moscow cannot have complete confidence, as well as a reduction in the flow of drugs coming from Afghanistan.

We have reason to expect that the stabilisation of the military situation in Afghanistan will lead to a revitalisation of Chinese efforts to rebuild the country economically. In the event that expectations become reality, and the United States and the European Union do not find opportunities to make Afghanistan back to the chaotic state of “war of all against all”, it can be expected that the “arc of instability” that girdles Eurasia will be broken. This will be an important geostrategic change in the region, which since the second half of the 19th century has been a field of rivalry between mainland Russia and the Anglo-Saxon powers — first Britain and later the United States.

But what is happening and will continue to happen in Afghanistan may have more varied consequences. With a high degree of probability, it will strengthen the position of Pakistan, which already closely cooperates with China and relies on its economic opportunities. India will feel more insecure — this country already estimates the fall of the republican government in Kabul as a serious blow to its strategic interests. It is likely that the US and its allies’ attempts to establish a dialogue with Iran will become more active — despite the fact that the current regime in this country is not friendly to the West, the internal situation there may be susceptible to external influence.

For Russia, it matters how the reduced US presence in Eurasia affects Turkey’s position. While this country is trying to behave confidently, it is still closely tied to the United States and Europe economically. In the event of strengthening Sino-Russian control over the space of their common neighbourhood, Ankara may have to restore relations with its NATO allies. Also, one cannot exclude Turkey’s chaotic attempts to restore relations with the countries of Central Asia that are close in language, which will also require some Russian attention.

In general, for Russia, the defeat of the United States in Afghanistan means not only a decrease in the capabilities of the main opponent in international affairs, but also a general change in the strategic situation. In particular, we cannot now exclude the possibility that under the new conditions Russia’s policy towards the countries of Central Asia may change.

Most of them are in one way or another connected with Russia by allied relations, but bilateral cooperation does not always develop smoothly. After the United States has lost an important part of the resources to interfere in the regional affairs, Moscow may even face increasing responsibility for its internal stability.

But the United States itself will be looking for ways to return to the central part of Eurasia in one form or another. The defeat in Afghanistan did not have a serious impact on the military and economic capabilities of this power. After the initial shock wears off, we must be prepared for a new round of regional clout. Now, in this struggle, the objective interests of China are on the side of Russia, and this greatly facilitates the situation in comparison with all previous episodes.

The fall of Kabul on August 15, 2021, was an important historical event because it meant the actual end of the US attempts to exert a determining influence on international politics. Such efforts will continue, albeit under new ideological slogans, and the United States has long since abandoned attempts to create a truly holistic order under its leadership. In fact, we are dealing with yet another change in the dynamic balance of power that is now defining the nature of international relations. And, as in any case, this change brings new opportunities and new questions for Russia, which will need to answer in the very near future.

From our partner RIAC

Continue Reading

Publications

Latest

Middle East1 hour ago

From ‘Decisive Storm’ to Secret Talks: The Journey of Saudi Conquest of Yemen

In the last days of the spring of 2015, Saudi generals were sitting around a V-shaped table in front of...

Energy3 hours ago

Trans-Caspian Gas Pipeline – An ‘apple of discord’ between Azerbaijan and Russia?

A broad range of strategic, economic and cultural ties between Azerbaijan and Russia create an illusion of quite stable bilateral...

South Asia7 hours ago

The Post-US Withdrawal Afghanistan: India, China and the ‘English Diplomacy’

The recent developments in Afghanistan, the impatient Tri-axis and the emphatic India at SCO, with the ‘English Diplomacy’ at display...

Health & Wellness11 hours ago

COVID vaccines: Widening inequality and millions vulnerable

Health leaders agree that a world without COVID-19 will not be possible until everyone has equal access to vaccines. More...

Tech News13 hours ago

Moscow electronic school — the future of education

The Moscow Electronic School (“MES”) project is a cloud-based Internet platform launched in 2016 that unites all educational institutions in...

Economy17 hours ago

Economy Contradicts Democracy: Russian Markets Boom Amid Political Sabotage

The political game plan laid by the Russian premier Vladimir Putin has proven effective for the past two decades. Apart...

city business city business
Finance17 hours ago

Over 50 Companies Reporting on Stakeholder Capitalism Metrics as International Support Grows

The World Economic Forum announces today the continued growth of the coalition of companies supporting the Stakeholder Capitalism Metrics initiative....

Trending