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The agreement between Saudi Arabia and the Russian Federation

Giancarlo Elia Valori

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In early October, King Salman of Saudi Arabia – with 1,500 members of his private entourage and 459 tons of luggage – landed at the Vnukovo airport for the first official visit of a Saudi king to the Kremlin. At military level, Saudi Arabia has already bought from Russia the S-400 Triumph anti-missile system (NATO reporting name: SA-12 Growler), already fully operational in China, which can intercept aircraft and missiles at a speed up to 4.8 kilometers per second (17,000 kilometers per hour) and has the ability of intercepting up to 36 targets at the same time.

 In addition, the Saudi purchase of the anti-tank missile Kornet and other advanced weapon systems is already in an advanced phase of negotiations between the two countries.This is a deal worth 3 billion US dollars, but the sale of weapons is a fundamental strategic priority for Russia.

 According to the 2016 data, the Russian Federation produces over one fifth of the weapons sold in the world while, also thanks to Russia, India and China have now almost reached technological and military self-sufficiency.

 Hence Russia is looking for other markets to sell its weapons, with the consequent and immediate strategic and economic influences and constraints.

 Currently everything works thanks to the unquestionable success achieved so far in Syria.

 Hence Russia is looking for new markets in the Middle East, an excellent area for selling weapons.

 At military level, however, the commercial relations between Russia and Saudi Arabia had already begun in 2012, when the latter had bought a C-300 missile system, with the tacit agreement that said supply would not be sent to Iran.

 The C-300 is one of the most powerful anti-missile systems currently available.

 In my opinion, Saudi Arabia is reemerging from the long phase of more or less explicit support to the jihad in the great arc of crisis stretching from Afghanistan to Syria.

 In Afghanistan, Saudi Arabia is moving away from the well-known support for the Taliban, backed with the largest amount of funds.

 On August 7 last, Mishari al-Harbi, the most prominent Saudi diplomat in Afghanistan, defined the Taliban as “armed terrorists,” while the Saudi Kingdom is seeking in all ways to block the private donations of its citizens to the Afghan “students”.

 There is a fully rational reason underlying this new policy line: Saudi Arabia can no longer see a political advantage in arming and supporting the Taliban, but above all it wants to put a spoke in the wheels of the mediation, organized by Qatar, between the Kabul government and the above-mentioned “students” trained in the Pakistani Qur’anic schools.

  At the beginning of jihad in Afghanistan, the United States and the other countries present there interpreted the Pakistani and Saudi support  as a way to contain the Iranian designs in the Western part of the country, but now King Salman is radically changing the Saudi foreign policy.

 Whatever happens, Afghanistan will have wide regional autonomy – hence the jihad to keep Iran and its regional allies out has no longer much reason to exist.

 From this viewpoint the radical change, which has long been experienced in the relations between Israel and Saudi Arabia, is significant.

 The meaning of this unusual manoeuvre is obvious, namely to join  forces against Iran and its old and new proxies.

 Nevertheless, as recalled by one of the leaders of the Afghani Mujahidin, before 2013 Saudi Arabia had strongly supported Qatar’s efforts to “open up” to the Taliban. But now that the relations of the “Afghan students” with Turkey, Egypt and the United Arab Emirates have weakened, Saudi Arabia is revising its preferential relations with the old supporters of the Afghan jihad (Turkey, the Arab Emirates and Egypt) and, above all, it is isolating Qatar, the only support left to the jihadist “students”.

 It is a fact that the Taliban still collaborate with Iran and Qatar.

Hezb’ollah was born as a movement of Islamic resistance, without any preconceived idea vis-à-vis the various traditional factions of Islam.

  However, can the support of these two countries replace the relationship with the Saudi private individuals and their Kingdom? Probably so.

 In all likelihood, the Saudi efforts to separate the United States from Qatar – hosting its CENTCOM – could push the United States directly into Saudi hands, while Qatar is putting pressures on the US forces for a quick transfer of their Command, which could possiblybe moved to the Al Dhafra base in Abu Dhabi.

 Reverting to King Salman’s State visit to Russia, he has understood that Russia – and no longer the United States – is now distributing cards in Syria and hence he acts accordingly.

 In all likelihood, the now old King Salman is also promoting the Russian support for his son, Crown Prince Mohammed bin Salman, who is expected to inherit his throne.

 An agreement to increase the oil price, which is essential for both countries, has been still discussed, but nothing leaks out of the Kremlin, while Putin has argued for the need to further use the Saudi sovereign funds in the Russian economy.

 Out of the 10 billion US dollars promised by Saudi Arabia to Russia in 2015, only one has been provided so far.

 The King’s visit to Russia had been promised in a phone call with Putin as early as March 2015, but it had been postponed many times.

 Ironically, however, the USSR was the first to recognize the independence of the Kingdom created by King Abdulaziz.

 The official relations between Russia and the Kingdom of Hejzah and Nejid – the official name of the Al-Sauds’ Kingdom until 1936 – started as early as 1926.

 The strategic reason is obvious and is similar to the one which led Stalin to be the first to recognize the State of Israel, namely to be a thorn in the flesh in a region dominated by the British Empire, by favouring both the “quasi-friends” (Israel) and the “future enemies” (Saudi Arabia).

 In 1938, however, following the “elimination” – during the Stalinist purges – of the Russian envoy to Saudi Arabia, Karim Kharimov, who was a personal friend of the King, the relations between the two countries were broken off.

 Bilateral relations were resumed only in 1991.

   An “Indian Spring”, the distance between Russia and Saudi Arabia, an extraordinary stroke of luck for the US strategic and economic interests in the Middle East – a stroke of luck that today, with the meeting between Putin and King Salman, is virtually over.

 King Faisal, assassinated by his nephew Faisal bin Musaid in 1975, when he was Saudi Foreign Minister, visited Russia only in 1933, but it was a visit having scarce bilateral importance.

 It is worth recalling that, after discarding the other three previous candidates, last mid-July Russia had provided to Saudi Arabia its agreement on the appointment of Ahmed al Wahishi as Yemen’s Ambassador to Russia.

 Russia is interested in not making the conflict in Yemen turn into a war against Iran.

 While for Iran the primary strategic interest of the Houthi insurgency in Yemen is to create an expensive, unpredictable, lasting and dangerous engagement for Saudi Arabia.

  Well before the meeting between Putin and King Salman, an agreement had been signed between the two countries to further reduce the oil output, thus making the crude oil price increase.

 After a long struggle to become China’s first supplier – won by Russia  against Saudi Arabia in 2014 with the signature of a 30-year contract with China worth 400 billion US dollars only for natural gas – last year King Salman signed contracts to the tune of 13 billion dollars with Malaysia, Indonesia and Vietnam.

In October 2016, however, the Russian Federation purchased – through Rosnet – a 49% shareholding of Essar Oil, the first private Indian oil company having a 50% stake in Kenya Petroleum Refineries Ltd, which is fully owned by Essar.

  India is the primary market where, in the future, Russia and Saudi Arabia will clash for their oil and gas.

  Currently Saudi Arabia and Russia together produce a quarter of all the oil used in the world. Obviously, the agreement between the two countries to limit the extraction of crude oil is related to the new extraction of oil and gas in the United States, which is already a danger to all the old OPEC countries or the autonomous countries such as Russia (or Norway).

 Reducing the crude oil price means potentially driving the US shale oil and shale gas out of business – and this is the first strategic goal uniting the Russian Federation and Saudi Arabia.

 The Russia-OPEC agreement on the reduction of crude oil price has finally been postponed until March 2018, but said agreement will be probably extended at least until the end of 2018.

 Saudi Arabia, however, still wants a closer relationship with the Trump’s US administration, which can provide technology to put an end to Saudi Arabia’s economic dependence on oil by the end of 2030, according to King Salman’s plans.

 This is key to the current relationship between Russia and Saudi Arabia: the latter agrees with the winner in Syria, namely Vladimir Putin, to reduce the crude oil price and put the United States in trouble. Nevertheless the latter remains the primary market for transforming the Saudi economy – by force, taking the fast track, as was the case with the Soviet “five-year plans”.

 Moreover, it is the same plan of the current Russian leadership that can achieve it only by signing effective agreements with all OPEC countries.

 The magnitude of Saudi investment in the United States is still extraordinary and unique: last May Saudi Aramco signed a 50 billion dollar contract with the US oil companies, while Minister Khalid al Falih has finalized a further 200 billion US dollar contract to produce in Saudi Arabia goods and equipment that were previously imported from the United States.

 King Salman’s plan, however, is to limit Saudi Arabia’s oil dependence and, in the meantime, to turn his country into an active trading platform for the Greater Middle East.

 Hence no more trouble spots in Saudi Arabia’s neighbouring countries.

 With the exception of Iran and its allies, at least for the time being.

 They are the only oil, political and religious competitors capable of attracting and pushing the many Shiite minorities throughout the Sunni Middle East to rebellion – including the Saudi largest oil extraction region.

 Another bilateral economic system, which was certainly not disrupted – at least for a short time – was that of military supplies between the United States and Saudi Arabia.

 While, according to 2016 data, Saudi Arabia currently absorbs 35 billion US products and services, it is worth noting that the Saudi  Kingdom is the fifth largest arms buyer in the world.

 In 2017 the Saudi military spending alone has accounted for 61 billion US dollars, namely 21% of the country’s current budget.

 As is well-known, the United States is currently the largest exporter of weapons in the world.

 Hence it is by no mere coincidence that the first meeting between King Salman and Putin has been held precisely for the purchase of a Russian weapon system that the United States has not at such an advanced level and that could block its missiles.

 Therefore Saudi Arabia fears the possible reactions of Middle East countries which have US-made missiles available.

 A goal that defines Saudi Arabia’s utmost strategic autonomy from the United States.

Not to mention a globally important project – certainly designed by the Saudi leaders to “make money”, namely Aramco’s new presence on the stock market.

 Next year Saudi Arabia is expected to start selling a 5% shareholding of Aramco on the market – the largest takeover bid in the stock market history.

 The competition between the New York and the London Stock Exchange to obtain this transaction is already fierce, but – at this juncture – nothing prevents the Russian Federation from acquiring oil companies of the Saudi network.

 Yet another level of contrast between the two old bilateral competitors, namely the old United States and the old Soviet Union, in the new guises prepared for celebrating globalization.

King Salman, however, does not want to put all his eggs in one basket.

 In fact, last May the Crown Prince, Mohammad bin Salman, already visited Russia to discuss the Syrian and oil issues.

 As far as Syria is concerned, Saudi Arabia recognizes the de facto victory of the Russian-led coalition and accepts the possible construction of the South Pars gas pipeline from the sea between Qatar and Iran across the Syrian territory- probably in exchange for a financial compensation.

 In all likelihood, Jordan – a traditional ally of Saudi Arabia – will play a special role in the new gas pipeline.

 Later Saudi Arabia and the Russian Federation signed a 3.5 billion US dollar military cooperation agreement, preceding the one previously mentioned, envisaging technology transfers that are extremely important for the new Saudi local industry.

 With specific reference to Syria, it is worth recalling that, only thanks to Saudi Arabia, Russia could have a platform for the negotiations – through Egypt – between the Russian forces and the Syrian opposition for Ghouta East and Rastan – an agreement that would have never been possible without the Saudi mediation.

 In short, King Salman does no longer want clashes around his country. He only wants a peaceful route for the new future trade that will characterize the Saudi non-oil-dependent economy.

 Moreover, the rapprochement between Russia and Saudi Arabia is viewed favourably by Israel, which – as many people say – is Russia’s “silent ally” in the Greater Middle East.

 It is worth recalling that Iran is using the clash in Yemen to push Saudi Arabia into a very long, expensive and unpredictable war.

 Russia has no reason to support Iran in the Houthi insurgency against the Yemeni Sunnis. Russia does not need many clashes around its immediate strategic interests in the Middle East oil fields.

 Not even in Syria, Russia and Iran shall have the same goals in the future.

 Iran wants an allied and dependent Syria, while Russia does not want only Westerners near its military ports in the Mediterranean exercising hegemony over  a traditionally friendly country like Syria.

 Neither does it want Syria and any other Middle East country to be too closely dependent each other, because this would deprive the Russian Federation of its autonomous line of communication with its Mediterranean ports.

 Not to mention the control of jihad – a contagion that could spread to Chechnya – and the creation of a rampart towards the Arabian peninsula.

 Another Russian essential goal in Syria.

 Obviously while Russia is particularly interested in a new relationship with Saudi Arabia from the oil, economic and strategic viewpoints, it has no reason to disregard Iran.

 The common interests between Russia and Iran are decisive and inevitable in Afghanistan, Iraq and also in Syria.

 Russia cannot certainly lose these strategic axes only to rush to embrace Saudi Arabia.

Hence the Russian Federation will maintain its ties with the Shiite Republic. It will accept some Saudi interests in the Middle East region, between Jordan and the Lebanon, but it will support Iran in the Central Asian system, which Russia cannot certainly neglect.

  Nevertheless it will not even disregard the new oil and military system,  established in the new agreements with Saudi Arabia, which could also be a stabilizer of Russian interests in the Middle East and an economic partner to be taken away from the United States.

  If all goes well, Russia could create a strategy based on two options between Saudi Arabia and Iran, without either of them being in a position to threaten – too closely – the Russian interests stretching from the Greater Middle East to Central Asia.

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 "La Centrale Finanziaria Generale Spa", he is also the honorary president of Huawei Italy, economic adviser to the Chinese giant HNA Group and member of the Ayan-Holding Board. 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 of "Honorable" of the Académie des Sciences de l'Institut de France

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G20 Summit: Looking for Compromise

Natalia Eremina

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The G20 is an important international forum, a meeting place for representatives of the world’s largest economies. Now, we can say that the division into the so-called “developed” and “developing” economies is irrelevant within this forum. Additionally, the G20 generally does, indeed, represent the interests of the global population, since its countries account for over 80 percent of the gross world product and two thirds of the entire population of the planet. It is also important to remember that such venues are very convenient for privately owned businesses, which, through the support of governmental agencies, can get favourable opportunities to hold talks with their foreign partners. Additionally, a rather large number of meetings and talks at G20 summits remains outside the spotlight, but their results confirm the significance of the many unofficial meetings, informal negotiations and talks on the side-lines of the summits. These meetings, which take place in a variety of formats, are vital for understanding the issues that are most important for leading international participants and whether there is consensus among them on the approaches required to resolve these issues. Moreover, as we consider meetings and agreements concluded on the side-lines of G20 summits, we can, to a degree, draw conclusions on the current configuration or re-configuration of international relations.

From the outset, we will note that the importance of G20 summits is gradually growing, even though they started out as meetings of ministers of finance and their initial goal was to formulate a joint response to global financial issues. Today, the summit has transformed into an international venue for discussing issues of global financial and economic policies and other pressing matters of the day. However, economic and financial issues remain significant for G20 discussions.

The summit is also important for the expert and political communities of various countries that assess the prospects of inter-country interactions. Apparently, at the Argentina summit, the meeting between Donald Trump and Vladimir Putin attracted the greatest interest, but it never happened, since the U.S. President cancelled it at the eleventh hour, which certainly demonstrates the growing tensions in U.S.–Russia relations.

At the same time, the summit is useful, since its function is not to settle bilateral relations, but to develop common approaches that satisfy different states with different economic indicators and representing different political regimes.

G20 summits are convened to discuss several pressing issues proposed by the presiding state.

The summit held in Argentina was devoted to building a consensus for fair and stable development. Face-to-face meetings between heads of state are particularly important for handling the task. The goal of the summit indicates that the global community is aware of the current tectonic shifts in the global economy and in world politics. For a full-scale scale discussion of the problem, four issues were put on the agenda: the future of work and new professions, infrastructure for development, sustainable food future and gender mainstreaming.

Clearly, the G20 is not just a venue for discussing issues that have been defined as key; it is also an opportunity to “compare notes” via different formats “inside” the summit. For instance, we can say that France, Germany, Austria and Italy did not represent themselves or their interests alone, but were also united by their common tasks as EU countries. In addition, as one of the world’s largest economies, the European Union is a member of G20 as a single body. At the present summit, the European Union was represented by the heads of the European Council and the European Commission, Donald Tusk and Jean-Claude Juncker. Similarly, BRICS countries use G20 to discuss issues of their own.

G20 in Implementing Russia’s Strategic Tasks

Russia’s current strategic priority is to take part in the establishment of the concept of a multipolar world and in elaborating new principles of interaction within integration processes in Eurasia. Therefore, special emphasis will invariably be placed on the possibilities for implementing the idea of “integrating integrations” at G20 summits, and this summit was no exception. In particular, special attention was paid to mechanisms for connecting the development of the EAEU with the “One Road – One Belt” strategy. In addition, issues of stepping up cooperation within BRICS are also addressed, and there is an ongoing search for parties interested in bolstering global political and economic stability through the instruments of “integrating integrations,” which entails Russia paying attention to China, India and other Asian partners, as well as the gradual stable growth of Russia’s interests in Latin America.

As for meetings that have the greatest significance for Russia, the key talks for understanding the development of Russia’s foreign policy are the now traditional sessions held with BRICS countries. In addition, a meeting was also held between the heads of state of Russia, India and China (in the RIC format). Objectively, this format could be the most efficient, since interaction between Eurasia’s three largest states is of principal significance for both regional and global security. The dialogue on security issues and collaboration in all areas will be continued at the second Belt and Road Summit in April 2019 that Xi Jinping invited Vladimir Putin to attend.

The President of the Russian Federation was probably one of the most active figures at the present summit. Naturally, he had a meeting with representatives of Argentina. It is all the more important today since the EAEU and MERCOSUR are building up their cooperation potential, and a Memorandum on Cooperation is being prepared. What is more, Russia and Argentina concluded an agreement on nuclear power generation that will allow Russia to start construction of Russian-designed nuclear power plants in Argentina.

The main topic of discussion at the meeting between Chancellor of Germany Angela Merkel and Vladimir Putin was the Syrian agenda. Indeed, an exchange of opinions on this question now, when various formats of building up the peace process are being discussed, is of particular importance. In addition, the President of the Russian Federation discussed the current situation in Syria with his Turkish counterpart, President Recep Tayyip Erdogan, who also confirmed the significance of the Turkish Stream for the stable and secure development of the economy of Turkey and other states.

The meeting between the President of the Russian Federation and Saudi Arabia’s Crown Prince Mohammed bin Salman focused on energy issues, with the two parties agreeing to extend the agreement on cutting oil production.

Vladimir Putin also met with Prime Minister of Japan Shinzo Abe, with the Japanese side raising the issue of concluding a peace agreement. For Russia, the issue is not particularly relevant anymore, and at the meeting, the two heads of state agreed to continue active cooperation to increase the level of mutual trust between the two sides.

Of course, a great number of people were interested in the informal conversation between Vladimir Putin and Donald Trump, who only had time to exchange opinions on the “Kerch Strait incident.” Trump’s refusal to meet with the President of the Russian Federation means a further loss of confidence between the two countries.

On the whole, meetings between heads of state were of particular importance at the summit, since, for instance, the meeting at the level of ministers of foreign affairs was downsized due to the absence of Russian and French ministers of foreign affairs, the U.S. Secretary of State and the High Representative of the Union for Foreign Affairs and Security Policy.

G20: The International Agenda

The so-called Iran nuclear deal has become one of the most crucial problems in international relations. Russia and the European Union have adopted the same stance on this issue.

In addition to economic matters, G20 also tackled the climate change problem and proposed complete and utter compliance with the decisions of the Paris Agreement on climate change. However, significant progress is unlikely after the withdrawal of the United States from the accord.

No less important were the discussions on the problem of terrorism. The G20 countries agreed that their Leaders’ Hamburg Statement on Countering Terrorism needed to be implemented. Incidentally, that statement declared the need to fight terrorism internationally in all its forms and manifestations. However, the current situation is extremely complicated, and discussions concerning Syria confirm this fact.

The influence of the European Union and the United Kingdom on the international security agenda and their claim that Russia is the main disrupting force are just as worrying. The European Union, in the person of Donald Tusk, sought to expand the summit’s agenda with a discussion of Russia’s so-called aggression against Ukraine, which he likened to the problem of trade wars. However, despite the suggestion put forward by both Tusk and the United Kingdom that the G20 discuss Russia’s allegedly impermissible conduct and use some instruments against it, the proposal failed to gain traction. It say a lot that the “Kerch Strait incident” did not overshadow any of the meetings held by the President of the Russian Federation at the G20 Summit.

The attention of international actors was also focused on the meeting between Donald Trump and Xi Jinping, who failed to achieve a consensus on economic interaction, but agreed to a 90-day moratorium on introducing increased tariffs. Accordingly, special hopes are pinned on this interim measure. Clearly, China will not make the unilateral concessions that the United States is calling upon it to do, appealing instead to the idea of a compromise.

Results of the G20 Summit

While the summit’s final declaration does not contain specific figures and objectives for the most sensitive issues on the agenda, it does offer mechanisms for their resolution. In this respect, the summit did not turn out to be a breakthrough in resolving pressing issues. However, it demonstrated that no issue will ever be resolved if the parties abandon dialogue and compromise.

The results of Russia’s efforts at the summit include the signing of a large set of bilateral agreements between public and private bodies. The summit also demonstrated that Russia is actively and successfully stepping up cooperation with Latin American countries and enhancing its multi-format collaboration with the BRICS nations, particularly with China and India.

It is both curious and telling that the media was most interested in the meetings held by Vladimir Putin, Xi Jinping, and Donald Trump. However, we should mention the different approaches of these heads of state. For example, the President of the United States demonstrated that his country was not especially interested in following the established rules and was far more concerned about retaining the right to develop new rules of the game independently of other participants in international relations. Meanwhile, China’s and Russia’s leaders spoke about cooperation and compromise both in their joint meetings held in various formats and in their conversations with other heads of state. Additionally, the fact that the world is changing rapidly was recognized at the summit, meaning that the rules of the game can and should be changed and that new rules need to be formulated, but only through collaboration and compromise.

The heads of state also appealed to the IMF and the World Bank to work towards improving the economic situation in various countries and increasing the transparency of their work in interacting with states. This should help reduce sovereign debt and ensure that the recommendations offered by international financial institutions in individual states are implemented more effectively.

In addition, the leaders of the G20 countries concluded that responses need to be developed to current and future challenges in the development of the WTO and attempts should be made to avoid excessive contradictions, sanctions and tariff restrictions. The parties also agreed that the WTO needs to be reformed for it to work more efficiently. This aspect will be considered at the next summit in Japan.

Interestingly, virtually all countries supported multi-laterality, confirmed their commitment to the rules of international trade and agreed that efforts to overcome crisis trends in the global economy should be stepped up in order to avoid a repetition of the 2008 global crisis. The final declaration states that the global economic growth is increasingly less synchronized between countries, which entails risks to economic security, particularly given geopolitical tensions and financial unpredictability. To overcome this problem, it is important to step up interaction and increase trust among all parties in international relations.

The G20 states also announced that it was necessary to continue joint work on studying the impact that the digitalization of economy has on the global tax system, which needs to be adapted to current conditions by 2019 (final decisions on the matter will be elaborated and published in 2020).

Thus, the G20 Summit in Buenos Aires once again demonstrated the significance of the mechanisms of dialogue and achieving compromise based on constant information exchange between countries. The compromise-based approach was officially adopted as the foundation of all agreements, and was the leitmotif of the event. Given the circumstances, an increasing number of states recognize their significance as participants in international relations and, with each passing year, they strive to more forcefully state their stance on the most sensitive issues. Clearly, the Russian Federation wholeheartedly welcomes this trend.

Therefore, it should be noted that the recent summit in Argentina demonstrated that the G20 is just that – a group of countries – and not a political club. This fact increases its significance as an organization exhibiting a multilateral, multi-format and pluralistic nature of today’s international relations. Active discussions in such a format confirm the relevancy of multipolarity and the current processes of reconfiguring the world. In such circumstances, Russia can most fully implement its interests and convey its vision of international matters. An analysis of the volume of news reports in the European media is quite telling in that it proves that EU journalists were primarily interested not so much in meetings of heads of EU states, but in meetings with the participation of the leaders of Russia, China and the United States, meaning that EU representatives were running second in the newsfeeds of many news agencies. Thus, the results of the summit allow us to state that there has been a significant increase in the international community’s attention on Russia.

First published in our partner RIAC

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Russia Calling the Shots: Extrapolating from the Kerch Strait

Dr. Matthew Crosston

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The quasi-standoff this past week between Russia and Ukraine over the Kerch Strait has been painted in the West with a decidedly anti-Russian brush. After Russia fired near three Ukrainian naval ships attempting to enter the strait (which sits as a small maritime passageway between the eastern edge of Crimea and the western tip of the Krasnodar region of the Russian Federation, allowing ships to move between the Black and Azov Seas) and ultimately resulted in their seizure by Russian border guards, political actors all across the West have been quick to snap judgment against ‘Russian aggression:’ the EU has debated whether it needs to enact new sanctions against Moscow; Ukraine invited NATO to send a heavier naval presence into the Black Sea; even the Trump administration has at least temporarily canceled a future visit that was scheduled between the American president and Vladimir Putin, although it is not entirely certain that this is perfectly aligned with the Kerch Strait incident.

As has been the standard media and political play when it comes to Russian-American relations over the past several years, no one seems to be attempting to analyze what the Russian position is, other than derisively dismissing the Russian accusation of the entire incident being a Ukrainian ‘provocation.’ Regardless of the strong desire to put the black cowboy hat on to Putin (and to be fair, Putin sometimes seems to actually enjoy donning it, if at least to thumb his nose at the West), the Russian position, if taken more seriously, does give Western leaders important information about how Russia views not just its immediate region but also its political mentality on the global stage. America would do well to pay attention to this at least for the insights it can give into the Russian mindset.

First, Russia clearly still harbors irritation and resentment over what it considers to be continued interference from the West in Ukraine, ostensibly giving Ukraine a false sense of being able to ignore Russia as the true regional power and harbor false dreams of closer military ties to the European Union and NATO. This gives Russia the marked perception that the West is thereby purposely fomenting dissension between Russia and Ukraine. Second, Poroshenko, the President of Ukraine, has a unique talent for enflaming this Russian perception to near hysterical heights, what with his penchant for making nearly continuous claims about Russia intending to ‘steal his entire country’ and installing ‘partial martial law’ over part of his own country when it comes to access to Crimea. Third, the consequences of the first two problems create Russian exasperation with what the Kremlin considers a ‘foreign policy double standard’ that favors the United States, causes its neighbors to act ‘irrationally’ (at least irrational according to Russian national security interests) and which will simply never be accepted by Russia.

The Crimean referendum, which led to Russia accepting Crimea back into the regional fold of the Russian Federation formally, was the first obvious (to Russia) example that false promises were being made to Ukraine. After all, it was the Russian military that came into Crimea after the referendum and literally dared NATO or the EU to come forward and try to expel it from the peninsula. It was calling out the NATO promise – made to the leaders of the Maidan revolution in Kiev – that it would not allow Russia to make ‘any incursions’ into Ukraine, and proving it to be nothing but a bluff. Russia marched. Kiev called. NATO didn’t pick up. Even now, Arseniy Yatsenyuk, the former Prime Minister of Ukraine, recently expressed disappointment with NATO over the Kerch Strait incident, declaring how the ‘good relations’ between Ukraine and the Western defense organization have not materialized into ‘stronger military communication.’

This has been the foundation of Russia’s tough love approach to Ukraine and its misplaced Slavic shuffle: stop thinking you have a bigger or more powerful ally than the one that has always been on your Eastern border and has deep historical, religious, and cultural ties to you. The EU and NATO will never stand up to Russia in favor of Ukraine when the issue is relatively small on the global conflict scale. And despite what current Russophobes may think, Crimea and the Kerch Strait, since they have not escalated into something bigger or more violent, apparently do not pass the Western intervention sniff test. Thus, with the Kerch Strait today (which not coincidentally is the maritime pass over which Russia built a massive superhighway, literally connecting the Russian mainland directly to Crimea and which, understandably, the Kremlin is a bit sensitive about when it comes to any appearance of military maneuvers near it by another nation), Russia is challenging what seems to be a second NATO bluff. Instead of hoping for NATO to draw a red line, Ukraine might be better off paying attention to the Russian red line.

In the end, this is not Russia trying to escalate violence or war with Ukraine. It is not Russia attempting to bring Western powers deeper into what it considers its own sphere of neighborhood influence (based on very simple, classical realist power considerations). Rather, it is Russia attempting to ‘educate’ Ukraine about who its real allies should be and who its false friends are. Perhaps more than anything, it is Russia somewhat condescendingly telling the West that no matter how much nonsense it fills in the heads controlling Kiev (consider Putin just announcing that Kiev would get away with ‘eating babies’ as long as it would make things more difficult for Russia, all major decisions in this region of the globe are going to remain firmly in Russian hands. The West may not like it, but so far in the game of Ukrainian Bluff, it is Russia 2, the West 0.

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BRICS leaders’ meeting in Buenos Aires

Kester Kenn Klomegah

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Due to efficient cooperation between the BRICS members and coordination within international organisations and forums, the strategic partnership has grown stronger and continues to actively develop in the most diverse areas, Russian leader Vladimir Putin said at a meeting with his colleagues at the G20 summit held in Buenos Aires, Argentina.

Putin supported much of what his colleagues have said about the difficult situation in global politics, economy, trade and finance, and noted that such risk factors as an increase in global debt, volatility of stock markets and escalating trade disputes.

“In general, we cannot help noticing that unfair competition often takes the place of fair and equitable intergovernmental dialogue. The nefarious practice of imposing unilateral sanctions and protectionist measures without regard to the UN Charter, WTO rules and other generally accepted legal norms is spreading,” he stressed.

All of these seriously undermines the atmosphere of cooperation on the global stage and leads to declining business ties and loss of trust between participants of economic relations, distorting the very fabric of the global economy, Putin explained further.

The BRICS countries plan to continue working together to create a fair and equitable system of international relations. For this, collective action based on mutual respect and consideration of interests is needed in order to overcome the critical challenges facing the international community.

He noted that the danger posed by international terrorism is not subsiding and enlist the support of BRICS members in counteracting this global problem.

He suggested BRICS play a more significant role in the global financial system, push for the continuation of the IMF reform and for greater influence in the IMF.

The BRIS members pledged to get committed to sustainable development of agriculture. Russia is a large producer and exporter of agricultural produce, contributing significantly to food security. Over the last 10 years, we supplied over 650,000 tonnes of food and humanitarian aid to more than 110 countries.

It is expected that the bond and national currencies fund of the BRICS countries to become available in 2019, which would allow strengthening financial and investment stability and expanding the interaction of national payment systems.

They pledged to pay special attention to coordinating the BRICS countries’ positions on issues related to energy and climate change. Russia, as a reliable exporter of energy to many countries and regions in the world, intends to continue to actively participate in harmonising global energy markets jointly with other suppliers and consumers of fuel and to provide global energy security.

A significant contribution to financial stability has been made by the new development bank, which is now supporting 26 projects in BRICS countries with US$6.5 billion in financing.

President Vladimir Putin arrived in Buenos Aires to attend the Group of Twenty summit. Before that, he held an informal meeting with his BRICS counterparts where he congratulated President of South Africa, Cyril Ramaphosa, for organising everything during his chairmanship in July 2018 and further promised similar support for President of Brazil, the new chair, for the next summit in 2019.

The leaders of the BRICS (Brazil, Russia, India, China and South Africa) nations have agreed to hold their next summit in Brazil in 2019, according to the statement passed after their informal meeting on the sidelines of the Group of Twenty summit in Buenos Aires, Argentina.

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