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The strategic effects of Brexit

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Brexit is the greatest strategic shock occurred in Europe after the “fall of the Berlin Wall” in 1989. Furthermore the 1989 myth had been nurtured by the EU small cultural elites, who regarded it as the beginning of the European century, different from the American Century analyzed by the Italian economist, Geminello Alvi, before and after the globalization.

Millions of euros were also spent for funding various intellectuals – often unreasonably famous – to create the myth of 1989 and Europe’s “new start”.

It was a great error of perspective: the fall of the Berlin Wall, built by East Germans in August 1961, did not mean the end of confrontation between the Communist and the liberal-democratic blocs, but its shifting to a different and higher context.

In 2006 President Putin stated that “the fall of the USSR had been the greatest geopolitical disaster of the twentieth century” and certainly he has not changed his mind in the meantime.

The Russian Federation has always dreamt – and not just recently – of a large Eurasia, not a remake of the old Bolshevik empire.

The Baltic republics are now completely Atlantic and Europeanized. Georgia and many Central Asian republics of the former Soviet Union have a more complex economy and strategy which does not look to the Kremlin only.

Moreover, under these conditions, Georgia – which has long been dismembered with the rebellions in Abkhazia and South Ossetia – will never enter the European and NATO sphere of influence.

That is enough for Russia.

Russia wants to penetrate and dominate the whole Central Asia, after the end of the failed Afghan experience.

President Putin’s real post-Soviet project, which explains much of what is currently happening with Brexit, was outlined by him in an old article published by Izvestiya on October 4, 2011.

It is a new “Eurasian union” joining together – just as the EU did – the former Soviet republics, the old Eastern Europe of the Warsaw Pact and the major expanding economies in the Asian-Pacific system.

Against this background, any strengthening of the old European Union runs counter to the line imparted to the Russian Federation by Vladimir Putin who, however, cannot positively view the coordination between the European Security and Defense Policy and NATO, which is relocating itself along the new Russian borders southwards, in connection with the Ukrainian crisis.

Indeed, in some circles there are rumors – groundless for the time being – about Russian strong support for Brexit so as to prevent the occurrence – on the same days – of something irreparable, namely a NATO-EU operation in Ukraine.

The news cannot be verified, but it shows us how a strategic balance between Russia and the West is reshaping and emerging in the South and in the Middle East.

A balance in which the EU is retreating and Russia is filling the void left by the European Union.

The Customs Union between Russia, Belarus and Kazakhstan of 2012 was a first step of President Putin’s project, followed by the treaties with the EFTA countries (Norway, Switzerland, Iceland and Liechtenstein) and later by the treaty with New Zealand, the new Russian asset in the Pacific.

Another Russian goal, shared with Norway, is to control the immense Arctic resources.

In short, President Putin is playing a zero-sum game with the European Union. He currently thinks that if there is no longer a European Union, there will not even be a significant US presence in Europe, particularly on our borders.

This Russian project also envisages military and strategic relevance: if the buffer zone traditionally represented by the European Union vis-à-vis the Russian Federation is weakened, the EU Member States will certainly be more sensitive to the Russian commercial appeal and to a future series of regional military agreements in the Mediterranean and the Balkans.

In particular, however, the European leaders will be less attentive to the link between Europe and NATO, which is certainly weakened by Brexit that marks the walking out of a large nuclear and military power present in the UN Security Council.

Furthermore the UK Treasury forecasts that the British GDP will decrease by 3.6% and that the pound sterling will lose 12% of its value compared to the period in which the UK was a member of the European Union.

Hence a 2% squeeze on military spending, already announced by Prime Minister Cameron – exactly the same percentage of the budget increase required this year by the Atlantic Alliance.

Probably the new British nuclear submarines will no longer see the light.

If this happens, Great Britain will have to redesign all its maritime engagements and its participation in the Inherent Resolve operation, thus creating a void which will certainly be filled by the alliance between Russia, the Syrian Arab Army of Bashar el Assad and the forces run by the Shiite Iran.

Furthermore all NATO and EU actions designed to control Russia and its allies in the Balkans, as well as in Mali, Somalia and the Mediterranean, will be weakened.

Even the actions in Libya, where the British special forces have been long operating, will be made less relevant.

For the time being the model for the redefinition of relations between Great Britain and the EU is following the Swiss and Norwegian example, which is the system of the EFTA area.

Currently EFTA has 25 trade agreements in place, while the EU manages exactly twice as many agreements with third parties.

If Great Britain adhered to EFTA, it would pay 17% fewer contributions than paid so far to the European Union.

There is no Schengen-style freedom of movement in the EFTA treaties and the EU has also little power of influence and commercial leverage on the European Free Trade Association.

Nevertheless, unlike the European Union, EFTA has no geopolitical, strategic and military relevance.

It is a good surprise for Russia.

China does not care much about Brexit, which is considered irrelevant, in the long term, for China’s economic development prospects in Great Britain and in the EU.

Indeed, according to some Chinese financial analysts, a fall in the value of the pound sterling could favor bilateral trade.

Moreover, no Chinese leader has hinted at a new definition of bilateral relations with the United Kingdom.

Between 2010 and 2014, Chinese companies invested 46 billion euros in the European Union for 1,047 Foreign Direct Investment (FDI).

Furthermore Great Britain was the largest beneficiary of this Chinese FDI, with 12,2 billion euros again for the 2010-2014 period.

At strategic level, China does not want any distortions of the world order.

China has been openly in favor of Bremain while, unlike Russia, it still regards the EU as a potential factor of weakening and separation – in the NATO European area – between the US interest and the interests of the other European countries – Germany, in particular.

Moreover, Great Britain’s walking out of the European Union could foster an improvement of the bilateral economic relations between Great Britain and China.

In the real estate sector, as well as on the financial and stock markets, it is unlikely for Brexit to change something in the relations between Great Britain and China.

Moreover this situation could favor the Chinese strategy for the internationalization of the renminbi, which would find – in the pound sterling – an effective channel, also widespread in the financial world.

Moreover, with a divided and weakened Europe, China would have much greater bargaining power not only with Great Britain, but also with the EU Member States.

However, as some British analysts maintain, an European Union “divided into two parts” is less competitive than usual on the market-world.

Hence, while the Russian-British trade is at minimum levels and trade with the EU is destabilized by the US sanctions and the Russian countersanctions, we can predict that China is the only real winner of Brexit.

For Israel, the temporary fall of European economies and of the British one, in particular, can become a problem – apart from the now widespread and naïve pro-European anti-Semitism – considering that trade with the EU is one of Israel’s major sources of liquidity.

The weakening of the pound sterling and the euro as against the shekel cannot but damage the Israeli export-oriented economy, even though Prime Minister Netanyahu has stated that there will be no direct impact of Brexit on Israel. Jointly with the Bank of Israel, his government has created a situation room to monitor the effects of Great Britain’s leaving the EU.

Basically, no one to blame but oneself: so far the European Union has exerted a regulatory power which has often be bordering on the ridiculous: from the regulations on basil to those on carrots, from those on heaters to those on pencils, everything has become “European” with such bureaucratic spending and slow pace as to make EU Member States lose most of their comparative advantages on the market-world, which opened up after the aforementioned “fall of the Berlin Wall” and the subsequent globalization-Americanization.

In fact, the euro was born as an overvalued currency so as to deal a crippling blow to the US dollar, but some actions backfire and recoil primarily upon those who carried them out.

As has been authoritatively maintained, with the changeover to the single European currency, in Italy the lira was devalued by six times.

The EU global strategy is virtually non-existent, if not banally rhetorical and declamatory.

Politics cannot be focused only on economic aspects and overregulation leads to lose global markets and increase the costs of production, which are magnified by a “Napoleonic” single currency.

And obviously so at strategic level: Germany is fed up with the sanctions on the Russian Federation. It has no interest in doing a favor to Poland by dismembering Ukraine and it does not intend to be heavily engaged in the Mediterranean.

Italy would have a vital need to stabilize the Mediterranean, especially in Libya, but it is faced with some EU allies that are more interested in sharing the Libyan oil and financial pie which, in the past, was an almost exclusive prerogative of ENI, an Italian oil and gas multinational company, and the Italian banking system.

Spain is focused on its traditional sphere of influence in Latin America and is scarcely interested in the continental and Mediterranean system, apart from the former Spanish Sahara region and Northern Africa’s Atlantic coast.

Hence where is the EU strategic rationale?

With hindsight, it was better to maintain Charles De Gaulle’s old idea that envisaged and conceded only a “Europe of nations” creating a Union stretching “from the Atlantic to Urals”, in view of a dissolution of the Bolshevik empire.

The cultural, spiritual and historical boundaries of our idea of Europe are those forgotten both as a result of the race to accept anyone after the fall of the USSR – which has led to the EU elephantine and bloated apparatus – and as a result of the pro-European obsession to find a strategic niche without “one’s own arms” that Machiavelli recommended to every Prince who wanted to stay in power.

Advisory Board Co-chair Honoris Causa Professor Giancarlo Elia Valori is an eminent Italian economist and businessman. He holds prestigious academic distinctions and national orders. Mr. Valori has lectured on international affairs and economics at the world’s leading universities such as Peking University, the Hebrew University of Jerusalem and the Yeshiva University in New York. He currently chairs “International World Group”, he is also the honorary president of Huawei Italy, economic adviser to the Chinese giant HNA Group. In 1992 he was appointed Officier de la Légion d’Honneur de la République Francaise, with this motivation: “A man who can see across borders to understand the world” and in 2002 he received the title “Honorable” of the Académie des Sciences de l’Institut de France. “

Europe

Baerbock has publicly declared ‘a war against Russia’

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image source: Wikimedia Commons

On January 25 Germany and the United States decided to provide Ukraine with Leopard 2 and Abrams tanks totaling 45 (respectively: 14 + 31). Some European countries also intend to join these supplies that could reach around 300 main battle and light tanks during this year. The Pentagon official confirmed that collected ‘the armor basket’ could include 300 tanks and ACV/APC during 2023. It will be 28th ‘basket’ of lethal military supplies of the transatlantic alliance to Ukraine that started on a massive scale in 2022.

– Unlike fascist Germany, current Germany openly declared a war against Russia on January 25. Arguing in favor of sending NATO tanks and ACV/APC to Ukraine, German Foreign Minister Annalena Baerbock said EU countries were fighting a war against Russia. US and EU officials have previously gone out of their way to claim ‘they were not a party to the conflict in Ukraine’.

This is a quotation from what Baerbock has stated at PACE. “And therefore, I’ve said already in the last days – yes, we have to do more to defend Ukraine. Yes, we have to do more also on tanks,” Baerbock said during a debate at the Parliamentary Assembly of the Council of Europe (PACE) on January 25. “But the most important and the crucial part is that we do it together and that we do not do the blame game in Europe, because

so far from the German Government, it means that her statement is fully shared by the FRG Government we are fighting a war against Russia and not against each other.”

If she has not been sacked and the Parliament.

It also means that the FRG has radically changed its foreign policy and once again is unleashing the next World War – the Third one.

It means that German tanks again will appear in Ukraine and Russia like in 1941-1945.

It also means that pro-Nazi coalition supports ultra-nationalist regime in Kiev that began its own and unprovoked aggression – initially against Donbass in April 2014, and later against Russia in October 2022.

It means that since January 25, 2023 current joint Ukrainian-NATO actions in Ukraine can be politically and juridically labelled as “a declared direct combined Ukrainian-NATO aggression against the Russian Federation”.

Russia angrily reacted to such abnormal statement. Kremlin spokesman Dmitry Peskov told reporters that tank supplies to Ukraine by Western countries testify their direct and growing involvement in their armed conflict. He added that the flow of western weapons to Ukraine does not help potential negotiations between Moscow and Kiev.

Russian Foreign Minister Sergey Lavrov warned that any shipments containing weapons for Ukraine would become a lawful target for Russian forces,

The Russian Embassy in Germany for its part warned that “this extremely dangerous decision [by Berlin] shifts the Ukrainian conflict to a new level of standoff.”

All five parliamentary political parties at the Russian State Duma are demanding from the highest military and political structures in the country to destroy all Ukrainian-NATO heavy weapons – not only at the front lines, but additionally and primarily near Ukrainian-NATO border as soon as such weapons cross it on land, in the air and at sea.

Such destruction will save a lot of innocent lives amongst civilians and military men.

– Moscow has also cautioned NATO and non-NATO members against supplying Ukraine with depleted uranium munitions (DUM) and with long-range weaponry capable of striking at cities deep within Russian territory.

Supplying Ukraine with DUM for western military hardware would be regarded by Moscow as the use of “dirty bombs,” said Konstantin Gavrilov, head of the Russian delegation to the Vienna Negotiations on Military Security and Arms Control. Speaking at a plenary meeting of the OSCE Forum for Security Cooperation in the capital of Austria Vienna, Gavrilov cautioned “western sponsors of Kiev’s war machine” against encouraging “nuclear provocations and blackmail.”

“We know that Leopard 2 tanks, as well as Bradley and Marder armored fighting vehicles, can use depleted uranium shells, which can contaminate terrain, just like it happened in Yugoslavia and Iraq,” he said. “If Kiev were to be supplied with such munitions for the use in western heavy military hardware, we would regard it as the use of ‘dirty nuclear bombs’ against Russia, with all the consequences that entails.”

Gavrilov also warned that Moscow will retaliate if the West were to supply Kiev with long-range weaponry to carry out strikes against Russian cities. “If Washington and NATO countries provide Kiev with weapons for striking against the cities deep inside the Russian territory and for attempting to seize our constitutionally affirmed territories, it would force Moscow to undertake harsh retaliatory actions. Do not say that we did not warn you,” he remarked.

– Ex-President Donald Trump called on Joseph Biden to end ‘crazy’ Ukraine conflict before it leads to the use of nuclear weapons.

“First come the tanks, then come the nukes. Get this crazy war ended, now. So easy to do,” Trump outlined.

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Davos more of a show, no longer so important

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“Davos has become more of a show, it’s no longer so important”, concluded Liviu Muresan from Eurodefense Romania at the end of the webinar recently jointly organized by Eurodefense Romania and the Bucharest-based MEPEI think-tank. In the aftermath of the Davos World Economic Forum, 20 key-note speakers invited to examine this year’s edition did not hesitate to cast a critical eye upon the outcome and some of them were very straightforward in assessing this year’s  WEF.

Adrian Severin, former Romanian minister of foreign affairs, gave a remarkable definition to the Davos WEF:  “something between mythology and reality because politicians come to Davos to look for intellectual validation and economic support, corporatists come to look for intellectual respectability and political assets, civil activists seek kinship with the political power and financial sponsorship. They make a network of self-legitimized supra-national power that combines the characteristics of occult interest groups, influence groups that associate oligarchic cynicism with democratic hypocrisy. A group of self- proclaimed prophets, self-confirming their prophecies.”

Experienced in foreign policy, Severin could identify new approaches during the Forum, so he portrayed in detail “the Davos WEF that turned from an incubator of ideas into a platform for launching messages and trial balloons, from a doctrinal workshop into a ballroom…from a political designer into a moral whistle-blower ….from a producer of doctrines into a producer of dogmas…from the champion of missionary realism into athlete of utopias ….from a platform of dialogue into a platform of war propaganda…from a believer in globalization into a promoter of globalism…from a follower of inclusion into a promoter of exclusion….Davos is at risk of losing popularity and political failure, it no longer solves problems, it either deepens the existing crisis or generates new crises .”

Severin argued that “this year’s edition was significant through the absences rather than through the presences because only Olaf Scholtz was present this year out of the G7 leaders….Russia and China were absent….The president of the European Commission has become a US ventriloquist , no longer representative of the European Union that is neither  Union, and no longer European…The main representatives of the US were absent. Those present discussed everything but the risk of having the world fractured into two blocks with incompatible cultural identities, with the Euro-Atlantic block increasingly weaker than the Indo-Pacific block and the Euro-African-South-American block…the discussion about green energy and other similar topics  is nonsense as long as solutions are not presented.”

Severin believes that the main concern should be “to stop the war in Ukraine and to normalize the dialogue between the Euro-Atlantic and the Euro-Asian blocks”, especially because this year’s theme was “Cooperation in a fragmented world”.

The most inspirational speech was given by Antonio Gutierez, the head of United Nations Organization, who referred indeed to the fragmented world, but Severin pointed to the fact that Antonio Gutierez gave such a speech in Davos and not in the UN in New York or Geneva, a sign of the failure of the UN, which means that the UN and the OSCE must be revived.

General Corneliu Pivariu, former head of the Romanian Military Intelligence, stressed that the Davos meeting actually does not solve any problem of the world. It speaks every year about economic inequalities without solving that, doing every year nothing else than acknowledging the deepening of inequalities. For instance, according to Credit Suisse, between December 2019  and December 2021, the global wealth increased with 42 trillion USD but 26 trillion USD belonged to the 1% richest population, and 16% to the rest of 99% of the world’s population. Another topic is global warming, which is also never curbed, and an Oxfam report released in November 2022 revealed that a billionaire’s annual emissions of CO2 are one million times higher than a person in the 90% of the world’s population.

Carlos Branco, senior analyst with the National Defense Institute in Portugal, confirmed that Davos meeting did not find solutions to the world’s problems. He reminded that, in Davos, Ursula Von Der Leyen, Olaf Scholtz and other leaders spoke of the need to make Europe independent in terms of energy but they did not explain how exactly Europe will manage to provide itself commodities and raw materials, since Europe currently has 37 strategic dependencies out of which 2% from China and 3% from Russia, while the new technologies will still make Europe dependent on Asia. “The future of Europe will depend on how it will position itself in relation to the advanced technologies, Artificial Intelligence,  a.s.o., but for the moment, Europe is trapped.”

As an outstanding expert on Asia, Viorel Isticioaia Budura, former Managing Director for Asia and the Pacific at the European External Action Service and former Romanian ambassador in China and Japan, pointed to the absence of many G7 leaders in Davos as well as of Asian leaders, among which China, which is “the beauty and Miss Universe of the world’s interdependency”, and mentioned the presence of many Asian business people in Davos this year, while reminding of the importance of Asian countries and of the three high-level summits organized in Asia last year, G20, APEC and ASEAN, and of what Anthony Blinken, the US secretary of state, called “the rest of the world”, namely, Asian countries that do not follow the Euro-Atlantic order but have become a significant part of the global economy. Isticioaia Budura wondered if the “re-globalization of the supply chains would be possible” and declared China “the champion and the promoter of globalization.”

Michael Zinkanell director of the Austrian Institute for European and Security, Vienna, expressed his opinion that “we a living in a bipolar world dominated by the US and China while Russia has no ability to project global power, and some clear conclusions after the Davos meeting are that instability is increasing in the world, the world is becoming more and more interconnected and energy independence and decarbonisation are very important for the future”.  Zinkanell sees natural disasters and socio-economic risks as the main concerns for the future, but also the interactions with some authoritarian countries that are trying to lead in this new multipolar world that will allow multilateralism.

Germano Dottori, editor of the Italian Geopolitical magazine, also agreed that Davos meeting became too politicized and not too useful but he sees the prospects for the future of the world “not so bleak like a few months ago.”

Flavius Caba Maria, president of MEPEI, the Bucharest-based think-tank that co-organized the webinar, expert on the MENA region, mentioned a few aspects among which that fact that the representatives of oil and gas companies were welcomed at Davos, unlike Glasgow, which is a sign that renewables cannot entirely meet the energy needs of humanity.

On the other hand, Caba Maria pointed to the BRICS countries and his remarks could be seen as complementary to the idea mentioned by several speakers that the Western institutions seem to have lost their ability to solve the global problems and to ensure economic equality.

Caba Maria emphasized that “the global South is establishing its own system of alliances, turning them into a source to transform global economy, thus creating a development alternative trend, different from the one promoted by the West, with three regional alliances looming: the African Union, the Community of Latin American States and Shanghai Cooperation Organization in Eurasia. Among all these countries, China stands out and everything that’s going on in China is of utmost interest for the other countries, because it has become the world’s largest economy.”

Facts to keep in mind for the organizers of next Davos meetings.

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Serbia must reject the ultimatum regarding Kosovo

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Photo: Presidency of Serbia / Dimitrije Goll

The President of Serbia, Aleksandar Vucic on January 20th  had a meeting with the Western negotiating team about the solution for Kosovo. European mediator Miroslav Lajcak, American envoy Gabriel Escobar, German and French special advisers Jens Ploetner and Emmanuel Bonne as well as Italian prime minister’s adviser Mario Talo once again discussed with the leaders of Serbia (and Kosovo) the plan(ultimatum) that should regulate relations between Belgrade and Pristina. Officially, the plan for a peaceful solution has not been presented to the public. However, Serbian media published the text of the plan and they clearly emphasize that it is an ultimatum from Quinta.  And what is even more important, no one from the Government of Serbia denied it.

Which clearly tells us that the Government of Serbia is releasing the plan(ultimatum) as a trial balloon. However, that decision turned out to be wise, because the reactions of the citizens of Serbia to the plan were more than clear on the point of view that the plan was unacceptable. Because that agreement, among other things, requires that Serbia in practice (de facto) recognize the violent secession of its own Province that is, allow Kosovo to join the United Nations.

The plan compiled by the advisers of the leaders of the two largest democracies in Europe – French President Emmanuel Macron and German Chancellor Olaf Scholz – represents a gross violation of UN Security Council Resolution 1244, the basic principles of democratic international relations, the UN Charter, and the OSCE Final Document.

The plan(ultimatum) for Kosovo, humiliates Serbia and the Serbian people by ordering that Serbia respect equality, sovereignty, territorial integrity and the so-called state symbols of Kosovo and all other countries, except it`s own sovereignty, territorial integrity and it`s internationally recognized borders confirmed by the UN, OSCE and other international organizations. Serbia is expected to cooperate in dismantling its own integrity, its own constitutional order and international reputation, so that no one could use the “Kosovo case” as a precedent for unilateral secessions, which primarily refers to Ukraine.

The fact that currently five members of the European Union (Spain, Romania, Slovakia, Greece and Cyprus) and four members of NATO do not recognize the independence of Kosovo shows how bad the acceptance of the plan would be for Serbia. The goal is also to place all responsibility for the victims and destruction on Serbia, as a victim of the NATO aggression in 1999, and to use this act to justify the aggression against Serbia, which was carried out against the international law.

Kosovo is not a frozen conflict, as claimed in the West and repeated by official Belgrade, nor it can be resolved by an ultimatum to Serbia. The best example of this is Cyprus, which was invaded by Turkey in 1974, and despite this, neither Turkey nor Cyprus (or Greece) agree to any ultimatums, nor does anyone give them. The question must be asked here, how is it possible for Quinta to issue an ultimatum to Serbia and why are the Serbian Government and the President of Serbia allowing it?!

The Serbian Government must apply new tactics

Negotiations on Kosovo with Quinta must first be conducted on essential matters. And that means, above all, the protection of the current Serbian population in Kosovo and the return of the 250,000 expelled Serbs. Regulating the status of Serbian state property in Kosovo, which was seized by the separatist government in the province. Plus, the return of stolen property to the Serbs, who were forcibly expelled from the province.

Also, bearing in mind the aggressive policy of the Kosovo separatists, who, contrary to the agreement with NATO, are sending special units to the north of the province, while perpetrating violence against the Serbs, a new strategy is needed. And this is primarily reflected in the fact that the Government of Serbia must help establish the Republika Srpska in the north of Kosovo. This means that the local Serbs would have their own police(including a special police unit), judiciary, prosecutor’s office, education, health care and control over border crossings. In other words, parity would be established in the armed forces, bearing in mind that it is not realistic to expect that Serbian president Aleksandar Vucic will ever approve the sending of the Serbian Army to Kosovo. In this way, Serbia would strategically strengthen its positions and would wait for a change on the geopolitical scene of the world, until favorable conditions are created for the full return of the southern Serbian province of Kosovo to Serbia.

Otherwise, if Serbian Government agree to Kosovo’s entry into the United Nations, it would mean that Kosovo could unite with Albania, about which Kosovo Prime Minister Albin Kurti also publicly spoke about. This would than open the issue of secession from Serbia of the Presevo Valley and the geographical region of Sandzak. And what is even more important, an incredibly strong pressure to abolish Republika Srpska in Bosnia and Herzegovina would begin. All of the above would have catastrophic consequences for the country of Serbia, but also for the entire Balkans.

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