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NATO-Russia: No “business as usual”

Dimitris Giannakopoulos

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Welcome to the Greater Caspian Brief, where you will find the most important things you need to know about diplomacy, intelligence, military and economy of the Caspian 5, Central Asia and Caucasus. We appreciate ideas, reports, news and interesting articles. Send along to Caspian[at]moderndiplomacy.eu or on Twitter: @DGiannakopoulos

DIPLOMACY

NATO and Russia held “frank and serious” talks despite “profound disagreements” as their ambassadors met on Wednesday for the first time since 2014, alliance chief Jens Stoltenberg said. The two sides agreed to keep communicating following the meeting of the NATO-Russia Council, which has been on ice since the alliance cut practical ties with Moscow to protest the annexation of Crimea from Ukraine in early 2014. The aim of the talks was to ease military tensions over the simmering violence still gripping eastern Ukraine, although former Norwegian Prime Minister Stoltenberg admitted there was no major breakthrough. Russia blames NATO for increasing the risk of conflict by building up its troops in eastern European countries, many of which have been lobbying for more Western support.

Obama meets Saudi king with Iran on agenda

U.S. President Barack Obama arrived in Riyadh on Wednesday to meet Saudi Arabia’s King Salman ahead of a summit with other Gulf Arab leaders on Thursday and with regional tensions with Iran likely to be high on the agenda. The White House shares the view of Gulf Arab states that Tehran plays a destabilising role, but has said it hopes to bring them and Iran to develop a “cold peace” in which their rivalry does not further inflame smouldering Middle East tensions.

Shinzo Abe to visit Russia on May 6

Russian President Vladimir Putin said on Wednesday that Japanese Prime Minister Shinzo Abe will visit the Black Sea resort city of Sochi on May 6, with a long-simmering territorial dispute expected to top the agenda.”I expect that the working visit of Prime Minister Shinzo Abe planned to take place in Sochi on May 6 will facilitate the widening of Russian-Japanese ties on the basis of mutual advantage and taking each other’s interests into account,” he told foreign ambassadors at the Kremlin.

Tokyo-Moscow relations have been hamstrung by the row that dates back to the end of World War II when Soviet troops seized the four southernmost islands in the Kuril chain, known as the Northern Territories in Japan. The lingering tensions have prevented them from signing a peace treaty, which has hindered trade and investment ties.

INTELLIGENCE

10,000 ISIL Fighters in Afghanistan ‘Trained to Expand to Central Asia, Russia’

The presence of DAESH in Afghanistan, is a significant security threat, said Zamir Kabulov, the head of the Asia and Middle East department of the Russian foreign ministry, who also serves as special envoy of the Russian president to Afghanistan. “There are now 10,000 DAESH fighters in Afghanistan. A year ago there was a hundred. This growth over a year is huge. The Afghan branch of DAESH is definitely specialized against Central Asia. Russian is even one of their working languages,” Kabulov added. “They are being trained against Central Asia and Russia.”

Moscow believes that Afghan government forces are either unable or unwilling to fight DAESH-affiliated groups, focusing whatever resources they have on opposing the militant group Taliban. The Taliban suffered from DAESH growth too, losing men, lands and influence to the group.

MILITARY

Azerbaijan and NATO meeting in Brussels

The meeting took place between Azerbaijan and NATO to discuss the Planning and Review Process document for 2016. Head of the Military Cooperation Department of MOD major-general Huseyn Mahmudov briefed NATO representatives, in detail, on provocative and destructive actions taken by Armenian units against Azerbaijani citizens and settlements along the front line in the first days of April. NATO representatives were also informed on responsive measures and necessary security actions taken by Azerbaijani Armed Forces in different directions of the front line in order to prevent Armenian destructive actions and protect civilians.

Russia to finish deliveries of S-300 missiles to Iran by year-end

Russia will complete its deliveries of S-300 air defence missile systems to Iran by the end of the year, Interfax news agency cited Sergei Chemezov, the head of the Russian state-owned high- tech conglomerate Rostec, as saying on Tuesday.

Gulf, US agree joint patrols to block Iran arms

Gulf Cooperation Council (GCC) countries and the United States have agreed to carry out joint patrols to stop any Iranian arms shipments reaching Yemen, the bloc’s secretary general, Abdullatif al-Zayani, said on Wednesday. Iran denies accusations by Gulf states that it is smuggling weapons to Yemen, where GCC countries are involved in a military campaign against the Tehran-allied Houthi movement.

ECONOMY

OPEC will invite Russia, Oman, and Azerbaijan to June talks in Vienna

The three major oil producers, who are not OPEC member states, last met with members of the oil exporting cartel in Doha on April 17, in a failed bid to put through a February decision on capping oil production. The output freeze is expected to be brought up again at the talks in the Austrian capital. Oil prices have plunged more than 60 percent from their peak of $110 a barrel in June 2014 amid fears that the global oil production was outpacing the world’s demand.

Doha meeting disappoints Kazakhstan

The results of Doha meeting held in Qatar on April 17 between OPEC member states and non-OPEC oil producers fell short of the expectations of Kazakhstan, said Rashid Zhaksylykov, chairman of the presidium of KazService Union. Kazakhstan is concerned about the oil prices and its impact on the country’s development. The failure of the meeting is related to the intense geopolitical relations between Saudi Arabia and Iran. Saudi Arabia said it would not put a cap on the volume of oil it produces if other oil producers, particularly Iran do so. However, Tehran has no intention to freeze its oil production and did not even attend the meeting.

Azerbaijan, Georgia, Kazakhstan create railway consortium

The railway agencies of Azerbaijan, Georgia and Kazakhstan agreed to create the International Trans-Caspian Transport Consortium. Azerbaijani companies ADY Express and ACSC Logistics, Kazakh KTZ Express JSC and Georgian Trans Caucasus Terminals LLC are the members of the consortium. The Trans-Caspian international transport route runs through China, Kazakhstan, Azerbaijan, Georgia and then through Turkey and Ukraine goes to Europe. This is a multimodal corridor using railway, maritime and roadways for transporting goods.

Kazakhstan waits for potential participants of Eurasia project

Kazakhstan believes that potential participants of the Eurasia project will soon take a decision on the study and exploration of hydrocarbon deposits in the Caspian basin. The Eurasia project, to be implemented in 2016 to 2020, targets studying deep-water geological structure of the region to enable discovery of new and huge hydrocarbons recources. The government expects to receive intentions of participation in this project by late May, Kazakh Energy Minister said.

The prospects of realizing the Eurasia project are huge and it can bring huge benefits to Kazakhstan, in particular huge investments and financial revenues, new technologies and decrease of dependence on old oil fields. Experts believe that Kazakhstan, which desires the participation of international companies in the Astana-initiated project, will see more interest of big oil companies in its Eurasia project. The main condition on the way of involving leading energy companies in this project is the oil price in the world markets as in the current low oil prices and a glut of oil on the world markets the Eurasia project probably does not look so attractive.

Iran and Kazakhstan have reached an agreement to set up a joint shipping company

The planned freight shipping line would improve mutual trade through the Iranian port of Bandar Anzali and Kazakh port of Aktau, both on the Caspian Sea. Moreover, the Islamic Republic and Kazakhstan also decided to increase rail transportation through a railroad joining Iran, Turkmenistan and Kazakhstan.

Turkmenistan plans to privatize large industrial enterprises

The country has adopted a state program for privatization of state enterprises and facilities in 2013-2016. To date, 39 out of 89 facilities have been privatized as part of the first and second stages of the state program. It is planned to privatize 29 facilities during the third stage. Turkmenistan pursues the policy of gradual transition to market economy and has taken a number of measures such as denomination of the national currency, unification of exchange rates for this purpose. The country actively carries out privatization in the spheres of construction, communication and services.

LUKOIL builds gas processing plant in Uzbekistan

Russian company LUKOIL commenced construction works of Kandym gas processing plant in Uzbekistan, representative of Uzbekneftegaz, national holding company said on April 19. A gas processing plant with an annual production capacity of 7.819 billion cubic meters of commercial gas, 134,360 tons of stable condensate and 212,900 tons of elemental sulfur is planned to be constructed during the first phase of the complex construction and development of Kandym fields. Construction of 77 planned wells, six multiple-well platforms, two gathering stations, gas pipeline, rotational camp and external infrastructure are also under consideration. It is the largest investment project of LUKOIL in Uzbekistan. Total amount of investments to the project is estimated at over $3 billion.

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

EU Politics

PES Europe Ministers call for a European Budget that rises to the challenge

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President of FEPS Maria João Rodrigues MEP, First Vice President of the European Commission Frans Timmermans, and Germans Minister of State for Europe Michael Roth photo: PES

Europe needs ambitious short- and long-term planning, the Ministers of European Affairs from the PES agreed today during their discussion of the European budget for 2021-2027.

The chair of the network, German Minister for Europe Michael Roth, called for a European budget that promotes social wellbeing, innovation and sustainability across Europe.

Roth said:“The fundamental role of the European budget is to ensure cohesion, convergence and growth. It is the main tool Europe has to invest in the future, to bring countries closer together, and to make sure our children and grandchildren have a good life. When negotiating the European Budget both the short and long term must be kept in mind. Our ambition today, shapes the Europe of tomorrow. I want a bright Europe for tomorrow.”

The Ministers continued their discussion on the state of the rule of law in Europe.

Roth added:“Democracy and the rule of law cannot be interpreted freely. All Member States have to abide to the same clear set of rules. We will continue keeping a close eye on the issue. And we will continue supporting the great work that the EU Commission’s First Vice President Frans Timmermans is carrying out.”

The meeting was attended by:

  • Michael Roth, Minister of State for Europe, Chair, Germany
  • Helena Dalli, Minister for European Affairs and Equality, Malta
  • Ana Paula Zacarias, Secretary of State for European Affairs, Portugal
  • Hans Dahlgren, Minister for EU Affairs, Sweden
  • Frans Timmermans, First Vice President of the European Commission, European Commission
  • George Katrougalos, Foreign Affairs Ministers, Greece (observer)
  • Maria Joao Rodrigues, Vice President of the S&D Group, chair of the PES FEN Network, European Parliament
  • Javier Moreno, Secretary General of the S&D Group, European Parliament
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EU Politics

Migration and asylum: EU funds to promote integration and protect borders

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MEPs backed on Tuesday increasing the EU budget for migration and asylum policies and to reinforce borders.

The Civil Liberties Committee endorsed the renewed Asylum, Migration and Integration Fund (AMIF), the 2021-2027 budget of which will increase up to €9.2 billion (€10.41 billion in current prices, 51% more than in the previous financial framework). It also backed the creation of a new Integrated Border Management Fund (IBMF) and agreed to allocate €7.1 billion (€8 billion in current prices) to it.

The AMIF should contribute to strengthen the common asylum policy, develop legal migration, in line with the member states’ economic and social needs, contribute to countering irregular migration and ensure effective, safe and dignified return, readmission and reintegration in non-EU countries.

But it should also ensure “solidarity and fair sharing of responsibility between the member states, in particular towards those most affected by migration challenges, including through practical cooperation”, MEPs state.

MEPs also want to make sure that funds can be allocated to local and regional authorities, and to international and non‑governmental organisations, working in the field of asylum and migration.

Integrated Border Management Fund to secure EU’s external borders

IBMF will provide funding to build and enhance member states’ capacities in border management and visa policy. The funding dedicated to member states (60 % of the total envelope) will reflect their needs and take into account additional pressures. Furthermore, a new EU thematic facility (40% of the total envelope) will ensure flexibility to channel emergency funding to member states and EU-level projects when urgent action is needed.

MEPs also added safeguards to ensure that actions and measures funded through the Instrument comply with the EU’s fundamental rights obligations, in particular with the principles of non-discrimination and non-refoulement.

Both funds will operate in full synergy. They will also work closely with the reinforced Internal Security Fund (ISF) focusing on tackling terrorism, organised crime and cybercrime.

Next steps

The draft proposal on the renewed AMIF passed with 31 votes to 23 and 1 abstention. The new IBMF was backed by 41 MEPs, 9 voted against and 2 abstained. The full House will have to confirm its position in the first March plenary, ahead of the negotiations with the Council of the EU.

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EU Politics

Trade negotiations with US can start under certain conditions

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The Trade Committee on Tuesday endorsed the mandate to start limited EU-US trade talks, but set conditions on the conclusion of a deal.

Starting talks is in the interest of European citizens and companies, as it would ease current tensions in EU-US trade relations, brought about by the US administration’s actions, said International Trade Committee MEPs in the report adopted by 21 votes to 17, with one abstention.

They nevertheless note that the conclusion of a trade agreement based on the current negotiating mandate can only be successful if the following conditions are met:

  • the US must lift tariffs on aluminium and steel;
  • a comprehensive consultation process with civil society and a sustainability impact assessment are carried out;
  • the EU insists on including cars and car tariffs in the talks, and on excluding agriculture;
  • talks will be suspended if the US levies another tariff;
  • more clarity on how rules of origin (which lock in how much of the value of a product must be created locally for trade preferences) are handled during the talks.

Background

The European Commission submitted its draft negotiating mandates to the Council for approval on 18 January. The mandates will authorise the Commission to negotiate with the US on eliminating tariffs on industrial goods and on harmonising conformity assessment.

Next steps

Parliament will vote on its stance on the mandates in March. EU Council of Ministers is expected to adopt the draft negotiating mandates in the same month. The Commission will start negotiations on the basis of the final mandate.

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