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The geopolitics of sanctions against Russia

Giancarlo Elia Valori

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The US and EU sanctions currently operating against the Russian Federation were imposed following the Russian support for the “separatists” of the Eastern areas of Donetsk and Lugansk, Ukraine, namely ethnically Russian areas, which wanted to separate – or more likely to become autonomous – from the rest of the country.

It is hard to say whether the Ukrainian conflict was started   at first by the Euromaidan‘s pro-Western militants or if either one or the former used violent ways and means  because, as usual, the issue of sanctions is mainly political: to force – with mandatory commercial limitations extra omnes or, in any case, for the countries adhering to the primary international organizations – to reduce the political, economic, financial and hence military potential of a target country.

With four executive orders, the United States has imposed a sequence of sanctions against Russia, while it is still unclear whether the sanction regime always fully hits the target country or if it manages to direct its negative repercussions only to the geopolitical sector to be targeted.

In the long history of sanctions the excess of punishments towards the target country has always been a classic strategy, which later succeeds inadvertently to create mass support for the “bad” leader or the “dangerous” party, regardless of its being populist, sovereignist, “racist” or otherwise.

Today the old ideologies of Evil do not apply any longer – hence we need to invent a new labelling for global defamation, well beyond the usual totalitarianism. Or we need to artfully create many media opportunities that often –  if photographed – have no actual relationship with the crimes perpetrated by the target State.

In a way, sanctions are essentially the planned exclusion of the target country from the world market: in the case of Russia, the US sanctions are aimed at restricting the Russian access to the international financial services, to the US energy industry and obviously to the military industry.

These goals purpose are attainable both by reporting and blocking the personal and financial movements of specific personalities, such as entrepreneurs, financiers and managers of the target State placed in specific lists, now often public.

Or goods and capital are blocked.

Or again, always according to the American operating tradition, the potential for debt of an enterprise of the enemy State may be reduced significantly, but only on the international market. Or there may be the prohibition of making certain goods, services and technologies available to the “target country”.

In essence, for the Russian Federation this still regards the extraction and refining of natural gas and oil.

Furthermore, the US sanctions against Russia are aimed at restricting the export of Russian military products and, in any case, imposing the block for spare parts or the construction of weapon systems that can ultimately be used in Russia as well.

In the United States the economic sanctions are administered by OFAC and export controls are managed by the US Department of Commerce, Bureau of Industry and Security, in addition to the US Department of State, Directorate of Defense Trade Controls.

Without further complicating the framework, Directive No. 1 of OFAC regards the financial and service sectors of the Russian economy.

It prohibits any transaction longer than thirty days with all the subjects included in the lists regarding people of Russian origin or, in any case, operating in favour of the Russian government.

Directive No. 2 prevents any type of economic or financial transaction for individuals and entities dealing with, offering or carrying out transactions, on behalf of the Russian system, relating to natural gas and oil coming from the Russian territory.

Following the same procedure of the above mentioned transactions, Directive No. 3 deals with control and exclusion of the Russian Federation from the global market of military technologies.

Finally, Directive No. 4 regards the ban on normal commercial relations with Russia regarding the oil and gas from the Arctic and the unspecified “neighbouring areas”.

In 2014, by imposing measures “against the Russian industrial sector”,   the above mentioned Bureau of Industry and Security (BIS) implemented and improved the sanctions imposing a specific license on Russia for some commercial products, especially if the exporters “know whether what they sell to Russia can be used, directly or indirectly, for gas and oil extraction or whether these exports can be used for deepwater exploration in Russia or anyway in the Arctic.

Furthermore, the aforementioned BIS blocks any export of products that may anyway contain parts which can be used in the current weapon systems.

After the “events” occurred in Crimea, the EU sanctions against Russia are quite different from the US ones, although they may often overlap.

This is the sign of a political and strategic overlapping that cannot takes us a long way and that, indeed, many military elites, including NATO’s, consider obsolete.

This is certainly not due to anti-Americanism, but to a complex assessment of the EU and US strategic and commercial goals.

Overlapping of new areas of influence or their natural future divergence? Naturally different interests between the EU and the United States in Africa and the Middle East or not?

The issue is complex and not well-defined yet.

Europe, however, has imposed more traditional sanctions  against the Russian Federation, regarding individuals and implying travel bans or freezing of funds.

Furthermore, measures are envisaged in the EU limiting the access to financial capital for specific Russian financial and defence institutions.

There are also restrictions on the export of dual-use goods and technologies that may somehow refer to war operations, as well as other restrictions relating to the technologies included in the Common Military List, and obviously other restrictions on oil technologies.

There are many differences between the two sanction regimes.

The United States scrutinizes both oil and those working in this industry, while Europe only oil.

With specific reference to the EU sanctions, however, the Duma proposes to block the “commercial paper” issued by GAZPROM, which would imply that the European oil companies could be sanctioned if they bought GAZPROM payment notes which, however, are extraterritorial.

For the EU, currently the companies Rosneft, Transneft and Gazpromneft are the only ones that have been sanctioned.

None of the two sanction regimes, however, makes explicit references to “natural gas” – only oil is always mentioned.

Moreover the EU legislation is not extraterritorial while, in case of suspicious dollar “transactions” through American  banks, the US legislation can manage these transactions as if they were made on its national territory.

Has the United States probably built the complex web of anti-Russian sanctions since 2004 with a view to weakening the European competition?

As we will see later on, this is another possible hypothesis.

Besides seriously harming the European economy, which some important media sources estimate at over 100 billion euro for the whole EU, as well as two million jobs lost, we must consider that the effects are even more complex for the United States.

For the Russian Federation, however, the sanction effects are quite complex, even though it is a simple “target country”.

In 2009 the Russian economy shrank immediately by 2.8%, following the classic rule whereby the economies subjected to sanctions are more sensitive to the asymmetric shocks coming from outside.

The following year, however, Russia grew by 4.5%, thus showing signs of recovery indicating a centralized and planned reaction to both the global crisis and the economic war operations, namely the sanctions against it.

Foreign investment in Russia is still falling and, according to the latest data of the Bank for International Settlements, loans from abroad have fallen from 225 to 103 billion euro.

Hence not many dangerous effects, except for the magnification of the negative fluctuations on international markets.

So far Russia has reacted to the closure of some Western markets with a brilliant and unexpected geopolitical move for the United States, namely the rapprochement with China.

In this regard, the effects are clear: the rapprochement has favoured the block of the Ukrainian crisis, which becomes secondary in the Kremlin scenario. It has also facilitated the entry – even informally – of a large mass of Chinese capital into Russia and has finally added strategic value to the economic relationship between Russia and China.

The rapprochement has favoured not only the commercial flows between the two countries, which had been falling since 2015, but has mainly given rise to old and new bilateral projects: a pipeline, other infrastructural networks and cross-border free trade areas.

Furthermore, Russia and China, which are alien and even opposed to the logic of sanctions, are creating financial and commercial institutions according to their autonomous criteria, which will certainly be immune from US and EU sanctions.

As Putin knows all too well, the problem is that the relationship with China is fully asymmetric and runs the risk of generating Russian dependence on China.

Furthermore Russia is not interested in the tension between China and the United States and does not want to be “involved” in the bilateral trade competition between China and the United States.

The positive aspects for Russia are the following: Russian weapons are particularly suitable for the Chinese market and the plans for the Siberian pipeline between Russia and China are still in place; Shanghai and Hong Kong will soon become the financial bases for many Russian companies; the vast commercial area thus created between South Korea, Vietnam and Taiwan already establishes a small Asian “EU system” that can act as an important stimulus for reviving the Russian economy.

On the other hand, China has never appreciated the Russian move on Crimea, even though it has never officially pronounced itself in this regard.

Never “make a sound in the East, then strike in the West”. Currently there are not the conditions for China to require – at  military and strategic levels – what the “Western devils” can already provide at economic level.

Moreover, the strategic suicide of the West is already fine as it is.

And again, the US and EU sanctions have enabled China to prevent its worst-case scenario in the Heartland, namely the final economic and political integration between Russia and Eastern Europe in the EU.

Moreover, this expansion east of the Russian Federation corresponds to a series of counter-sanctions  culminating, for Russia, in the ban on European fruit and vegetables. The agricultural sector has been systematically brought to its knees by the Russian policies, which have created farmers’ strong political pressure to lift the sanctions against the Russian Federation.

Political use of an economic choice, namely counter-sanctions where the European “enemy” is weaker,  that is in the protected and subsidized economy of the European agribusiness sector.

The Russian response has been the expansion of domestic production, with the strong help of Belarus supporting the “missing share” of the new “internal production”.

The countermeasures of Russian consumers are as follows: certainly prices have risen, but they buy less and even fish consumption is falling.

Nevertheless, if we go back to the general architecture of  sanctions against the Russian Federation, we can note many other facts.

For example, we can note that – apart from the weak traditional and media justification, with many “violent acts” artfully caused by militants of uncertain nature – the oil sanctions are designed to reach one single purpose, namely to make Europeans – who for too long have not “resorted to” the US producers – buy the shale oil and gas they are finally able to produce, indeed already in a situation of almost full energy self-sufficiency.

Hence sanctions decided in the United States to compete with the North Stream 2 between Russia and Germany, crossing the Baltic and cutting the cost of natural gas to such levels that only dumping from the United States can be  carried out to impose its gas against the one which can be found closer to our countries.

Dumping is useless: we can build an integrated economy between the United States, the EU and Russia, with new geopolitical “rules of engagement”.

Hence the US sanctions are sanctions against Europe to rebuild manu militari the transatlantic market that could not be put back together elsewhere, not even in the agri-food sector where, in fact, the laws  are already so differentiated between the United States and the EU to make any exchange impossible.

Economic war through rules and regulations.

However, while the dollar has risen to 76% against the ruble since the beginning of sanctions in 2014, it remains anyway excluded from the Russian domestic market – hence it is a Pyrrhic victory.

In short, the Russian Foreign Minister, Sergei Lavrov, is right when he says that “sanctions are used to impose a regime change in Russia”.

Between 2014 and 2017, some studies ascertained that there was a fall in the Russian GDP and some damage to its economy worth at least 170 billion US dollars.

Italy alone lost at least 1.25 billion euros, especially in the agri-food and small craft sectors.

However, let us revert to Lavrov: he is the right mediator and broker to gradually and reasonably put an end to the sanction regime imposed by the United States and the EU against the Russian Federation, of which he has been the Minister for Foreign Affairs since 2004.

Lavrov, who knows that “there are no alternatives to dialogue”, also knows that Russia has not well clarified the situation of Crimea – beyond the objective truth which is hard to verify.

In this case it is not a matter of discussing the right of the Russian-speaking populations in the region to join the motherland. The issue lies in finding how to create a united Ukraine, really respectful of its minorities and, above all, as autonomous from Russia as from the European and NATO designs.

A trilateral treaty between the EU, the United States and  Russia could be a good starting point.

Lavrov has the mediation skills and long experience needed for the job.

At strategic level, it must be clear that NATO no longer expands itself towards the Donbass area and the Ukrainian-Georgian region, while the Russian influence operations – either covert or not – on those countries’ governments will be prohibited.

Obviously old wounds and new appetites return: Poland’s  desire to regain Ukraine it misses; the US and NATO passion for encircling the Russian Federation which, however, has already emerged from this encirclement with a clear victory in Syria, which proves its great strategic wisdom.

The encirclement of Russia with the NATO and US autonomous power is fully irrational.

The US bases encircle also Iran, another Russian inevitable ally: but what is the US strategic logic?

Hence a mediation will be needed, implying to reassure the United States that in Ukraine and Georgia there will never be “anti-Western” regimes, but Russia must be sure that all EU, Polish, US and other countries’ operations will not be such as to try to convince Ukrainians and Georgians to let  Russia down in the region.

Moreover Russia shall make it clear that – after years of disastrous legacy of the “Cold War” – its policy is trying to let the United States enter again new and old regions. These regions, however, must not be thought as no longer being in a situation of equilibrium – as we could reason at the time of the “Cold War” and of the unfortunate post-Cold War period – since said equilibrium does no longer rely on strategic thinking, but on small territorial or positional conquests.

Furthermore, the United States could de-escalate tension with China through its new relations with Russia, which would act as an effective mediator and broker just because Russia has not – and will never have – common strategic and geopolitical interests with China.

If we begin to think in multipolar terms – where the United States has often developed its longest and most brilliant  geopolitical projects – everything gets clearer.

This could be Lavrov’s new job to be performed along with his US counterpart Tillerson.

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. “

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Navalny, Nord Stream 2 and Moscow’s Response

Kester Kenn Klomegah

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As expected, Alexei Navalny’s case is seriously tearing apart relationship between European Union and Russian Federation. The alleged “poisoning” of the opposition leader Alexei Navalny, on August 20 in Tomsk (Siberia), has similarities to the murder of former Russian spy Alexander Litvinenko, and that of Sergei Skripal, a former Russian military officer and double agent for the UK’s intelligence services, and his daughter, Yulia Skripal, in the city of Salisbury, England. Russia’s political history is dotted with that well-colored inerasable image.

Navalny is a Russian opposition politician and anti-corruption activist. He came to international prominence by organizing demonstrations and running for political office, to advocate reforms against corruption in Russia. As a citizen, he has the fundamental right to freedom of expression and to associate with social and political groups. But his activities has angered the officialdom and becomes most hated politician. He has been detained several times by Russian authorities.

Now Navalny, who was “allegedly poisoned” in August, stands a determining factor shaping the relationship between Western world and European Union and Russia. Sanctions are the punitive measures against Russia. When he was first treated in a Russian hospital in Omsk, the doctors claimed that there were no traces of poison in his body, a claim that Russian authorities continue to endorse.

Specialist labs in France and Sweden have confirmed Russian opposition leader Alexei Navalny was poisoned with the Soviet-era nerve agent Novichok, the German government Spokesman Steffen Seibert said mid-Sept, and confirmed that the Hague-based Organization for the Prohibition of Chemical Weapons had also received samples and was taking steps to have those tested at its reference laboratories.

According to Seibert, the European Union’s summit, set to take place on September 24-25. The world would be looking for what measures be collectively adopted with regard to Navalny and against Russia.

On Sept 17, Russian Foreign Ministry spokesperson Maria Zakharova told the local media that there were another series of anti-Russian sanctions being initiated by the West amid the situation involving Russian opposition politician Alexei Navalny, all these designed to deliver a blow to relations between Russia and the European Union.

“The main goal today, at least it appears to be this way, is to deliver a blow to the relations between our countries and the European Union, and countries that are part of the union. Everything is going in this framework,” Zakharova said in the 60 Minutes show on the Rossiya 1 (VGTRK) television channel.

On Sept 15, during its session the European Union planned to create a global regime sanctioning human rights violations around the world and the intention to name it after Alexey Navalny. The Russian Foreign Ministry believes that will erode the basic principles of international law and undermines the prerogatives of the UN Security Council through endless illegitimate unilateral sanctions imposed by Brussels and Washington.

As for whether it would be advisable to name this sanctions regime after Alexei Navalny, it viewed  “this exclusively as an undisguised attempt to give a manifestly anti-Russia tonality to the new EU restrictions. At the same time, Berlin persists in brushing off proposals to work together in order to get to the bottom of what happened, using clearly far-fetched pretexts. We hope that common sense will prevail in the European Union and our partners will renounce the arbitrary practice of assigning blame and in the future will draw conclusions based on real and confirmed facts.”

That however Moscow readies to hit back on EU sanctions. Local daily newspaper Izvestia also wrote that Russia vows to retaliate against potential European Union sanctions. Even though the European Union is trying to elbow Russia out of the gas market, it is unlikely that the Nord Stream 2 gas pipeline project will be abandoned over the incident with Russian opposition figure Alexey Navalny, quoting sources in the Russian Federation Council (Upper House of Parliament).

The resolution approved by the European Parliament (EP) stresses the need for an international investigation into the alleged poisoning of Navalny with a Novichok-type toxic agent. European MPs called for suspending Nord Stream 2 and slapping sanctions on Russia. Meanwhile, Moscow is urging Berlin to cooperate in the investigation of what happened to Navalny. If the EU levies sanctions on Russia, Moscow can provide a tit-for-tat response, Russian MPs told the paper.

“I don’t think this option will come to life, because it is difficult to connect the situation with Navalny to the construction of Nord Stream 2. This is just an excuse to push Russia out of the gas market. We need to react calmly and not be dragged into those discussions,” Deputy Chairman of the Russian Federation Council’s Committee on Foreign Affairs Vladimir Dzhabarov told Izvestia, commenting on the resolution.

Similarly, Deputy Chairman of the State Duma’s Foreign Affairs Committee Alexei Chepa explained to Izvestia that in the event of any real anti-Russian sanctions, Russia could provide a tit-for-tat response. For example, if the European Union approves personal restrictions and a sanctions list, Moscow will do the same.

“Of course, we will respond. However, this will impact both our economy and the economy of Germany and the European Union. No one wins here. However, there may be a tit-for-tat blacklist that would include, for example, the MPs that called for anti-Russian sanctions or for the suspension of Nord Stream 2,” the MP said, stressing that Moscow will only retaliate if the European Union introduces real sanctions against Russia.

Russian newspaper Kommersant wrote that European Union to loosen legal mechanism for new sanctions against Russia. It said that the European Commission is working on broadening its legal instruments that would enable the introduction of personal sanctions against human rights violators in different countries, counting Russia among them. President of the European Commission, Ursula von der Leyen, has announced plans to adopt Europe’s version of the Magnitsky Act and suggested adjusting the mechanism for approving sanctions in such a way that does not require the support of all European Union member states.

According to Kommersant, this amendment, if adopted, will no longer allow Moscow to count on friendly European countries that have called on European Union allies not to impose tough sanctions on Russia. According to von der Leyen, the proposals for a European ‘Magnitsky Act’ will be ready soon. She explained the European Union should be able to respond clearly and quickly to what is happening anywhere, whether in Hong Kong, Moscow or Minsk.

The German Council on Foreign Relations, does not believe that the European Union will be able to agree on an extensive package of sanctions against Russia soon. Rather, an agreement on a blacklist similar to the ‘Magnitsky list’ could be expected. According to experts, regarding the Nord Stream 2 pipeline, Germany and the European Union would rather allow the project be implemented in full, and then introduce some measures to restrict or prohibit transportation of gas through the pipeline.

“With the crises around Navalny and Lukashenko unfolding, the freezing of Nord Stream 2 seems to be in the cards. Nevertheless, we are not talking about a complete breakdown of relations. Even during the Cold War, economic ties between the USSR and the West were not completely severed,” Head of the European Political Studies Department at the Institute for World Economy and International Relations (IMEMO),Nadezhda Arbatova, told Kommersant newspaper. “Today’s confrontation between Russia and the West is a struggle of ideology and real politics. Minimal interaction will be maintained, but this will not change the quality of relations between Russia and the EU,” she predicted.

European Union and Russia have strategic partnership agreement signed in 2011 but that was later challenged following the annexation of Crimea and the war in Donbass. Russia has five member states: Estonia, Finland, Latvia, Lithuania and Poland share its border. The relations are determined by European Union member on bilateral basis, but all the members adopt common or collective policies toward the Russian Federation.

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Forgiving Old Debts: Russia’s Diplomatic Maneuver

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With economies experiencing contractions across the globe and with governments in the third world most vulnerable, discussions of debt relief have been revived. Yet, forgiving old debts is nothing new to the Kremlin. For the Russian government, it has been just one part of a wider diplomatic toolkit to rekindle ties that have faltered since the end of the Cold War.

Once the primary backer of numerous states over large swathes of the globe, Moscow largely retreated from the non-Soviet space during the presidency of Boris Yeltsin and it continued to not be a primary concern during Vladimir Putin’s first two terms as head of state. However, Russia’s resurgence on the international arena over the past few years has not only made the country more willing to re-engage with the region but also more capable.

International media has primarily viewed this through the lens of military strength. Whether it is sending trainers and advisors to the Central African Republic, allegedly supporting rebels in Libya, or deploying Wagner Group forces to fight an Islamic State-offshoot in Mozambique, the focus has primarily been conflict-oriented. However, less explored is the quieter and more economic measures that the Russian government has taken in order to win hearts and minds outside of the West.

As part of a debt-for-development programme, Russia has forgiven approximately $20 billion worth of debt to various African governments that was accrued during the Soviet period. Beneficiaries include the Commonwealth nation of Tanzania and Francophonie member Madagascar, along with others. In forgiving these loans, the Kremlin has acknowledged a reality that many countries continue to deny: such debts are unpayable. At the first ever Russia-Africa Summit, Putin stated explicitly that “It was not only an act of generosity, but also a manifestation of pragmatism, because many of the African states were not able to pay interest on these loans.”

These measures have yielded concrete benefits for the previously indebted countries. For example, the decision to forgive Mozambique’s $40 million debt was done in conjunction with the United Nations World Food Programme, with the money that was intended for debt repayment instead being used to provide free school meals for 150,000 children over the course of five years.

While Russia will potentially be losing some money in the short term, debt forgiveness is likely to open new doors moving forward. Many of the countries that have seen their debts written off have significant economic and geopolitical potential. With improved political relations as a consequence, it is hoped that Russian companies will get preferential treatment should contracts be offered to international firms. This could help explain the Kremlin’s decision to forgive 90% of North Korea’s $11 billion debt despite the latter’s weak position. Russia has been eager to develop a trans-Korean gas pipeline that would transport fuel to South Korea. While the likelihood of this being realised remains slim, in the context of Pyongyang’s inability to repay the debt in any case, it is a reasonable gamble to make on the part of the Russian government.

This is somewhat similar to China’s efforts over the past few years, albeit in an inverse form. With Beijing less cash-strapped than Moscow, it is able to invest directly whereas Russia is using debt forgiveness to redirect cash payments away from servicing old debts and instead towards domestic reinvestments. Free projects, such as the Chinese-funded and constructed headquarters of the African Union, have been followed by ever-growing economic and political relations.

Russia’s debt policy has been used to strengthen existing alliances and partnerships. While not all Soviet-era allies have retained close ties to Moscow, many have done so continuously since the Cold War. One of the biggest beneficiaries of Russian debt forgiveness has been Cuba. In July 2014, ahead of a visit to the island nation by Putin, the Russian government wrote off 90% of Cuban debt. Though Russia was not only the country that showed willingness to restructure Cuba’s debt obligations at the time, it was by far the most generous. China restructured approximately $6 billion while Japan and Mexico forgave $1.4 billion and $478 million, respectively; Russia forgave $32 billion.

The decision did reaffirm the close relations between Moscow and Havana. Cuba has repeatedly voted in support of the Russian Federation at the United Nations on sensitive topics, such as Crimea, and Russian firms have received multiple drilling and mining contracts from the Caribbean country.

However, this strategy has its limitations. The overwhelming majority of these debts date back to the Soviet era and are therefore limited in scope. Some countries, such as Angola and Ethiopia (which saw most of their debts forgiven in the 1990’s), were primarily recipients of military support during civil wars so their debts were not as vast as other heavily indebted countries with other creditors. Since then, despite respite from Moscow, such countries have continued to become increasingly burdened by growing debts. While Ethiopia is often heralded as an example of rapid economic growth, its debt, both in total but also has a percentage of GDP, has grown considerably during the post-Soviet era.

While debt relief is undeniably beneficial to the third world, the fact that Russian-owned debts constitute a mere fraction of all foreign-owned debts in most cases means that the act of writing debts off cannot achieve much in of themselves. Consequently, in several countries, the gesture is mostly a PR move. In the case of Afghanistan, where Russia was the largest creditor due to loans handed out during the 1980’s, Kabul had for decades refused to recognise the debt. The decision to forgive the debt was therefore more of a signal of a desire to improve relations than any hope to achieve instantaneously tangible rewards.

The largest stumbling block for the Kremlin’s efforts remain structural issues afflicting the indebted nations, the nature of which vary considerably from country to country. For example, while Russia has forgiven a majority of Iraq’s debt to the country, which in turn helped revive talks over potential oil contracts, the continued instability in the Middle Eastern nation makes it difficult to reap many benefits. Though it is true that Baghdad has continued to purchase Russian T-90 tanks and attack helicopters, this is more of a sign that Russia has partially managed to pivot Iraq away from the United States’ sphere of influence as opposed to gaining economically.

With the onset of coronavirus, however, Russia might not be the leading debt forgiver for very long. In places such as sub-Saharan Africa, where economies are expected to continue shrinking while deficits are set to grow, other creditors could potentially step in and likewise forgive debts. In April of this year, G20 leaders agreed to extend debt relief in the form of a moratorium on debt repayment yet this can only serve as a short term solution. With many governments already increasing their borrowing, creditor nations are well positioned to leverage their position in order to improve geopolitical relationships as well as set the stage for favourable contracts for their firms. If more countries follow Moscow’s path, then the significance of what the Kremlin has done will only recede and lose much of its relevance.

Debt forgiveness can win friends but can only go so far. For Russia’s diplomatic maneuvers to stick, they will need to continue complementing it with other efforts, such as improving trade and boosting security partnerships, in order to truly make the most of its financial generosity.

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The Case of Belarus: Russia’s Fear of Popular Revolutions

Emil Avdaliani

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For Russia, the crisis in Belarus caused by the August presidential election result is of a geopolitical nature. Moscow might not be openly stating its geopolitical calculus, but in its eyes, the Belarus problem resembles the uprisings in Ukraine, Moldova, Georgia, and Kyrgyzstan and represents a similar problem in the long run.

Whatever the arguments propounded by world analysts that protests in Belarus are not about geopolitics and more about popular grievances against President Alexander Lukashenko, the issue will ultimately transform into serious geopolitical game.

For Moscow, the Belarus problem has been about geopolitics from the very beginning, though it was only on August 27 of this year that Vladimir Putin announced the creation of a special “law enforcement reserve” for use in Belarus should the situation get “out of control.”

The Russians understand that an “Armenia-style” revolution in Belarus could theoretically take place, but it would open the country more to Europe and thereby create geopolitical dilemmas similar to those created in Ukraine before 2014. The Russians further grasp that in Ukraine, the situation was out of control even before the Maidan Revolution. Moscow’s influence was not sufficient to stop Ukraine’s gradual shift toward closer ties with the collective West.

For the Russian leadership, events in Belarus are a continuation of the “revolutionary” fervor that has been spreading across the former Soviet space since the early 2000s. What is troubling is whether or not the Russians see this process as an expression of the popular will that is largely independent of the West. Several indicators point to an ingrained belief within the Russian political elite that in fact the West has orchestrated the popular upheaval in Belarus.

Russian history might be of help here. Throughout the nineteenth century, the Russian Empire fought the spread of European revolutionary thought along and inside its borders. It built alliances to confront it and fought wars to forestall its progress. But in the end, the Bolshevik Revolution and the subsequent policies of the Communist Party were largely based on European thought, though many western ideas were changed or entirely refashioned.

Similar developments took place during the late Soviet period. By the 1980s, popular disapproval of the Soviet system had grown exponentially. A revolutionary fervor for independence ran amok in the Baltic states, Ukraine, and elsewhere. True reforms would have served as a cure, but half-hearted economic and social measures only deepened the crisis. Military power was used in a number of capitals of Soviet republics, but again only half-heartedly. Thus was the entire Soviet edifice brought down.

Modern Russian leadership should see that there is essentially no cure for popular grievances and mass movements along its borders. Russian history gives multiple examples of how military intervention against revolutionary fervor can bring immediate results but leave long-term prospects bleak. The defeat of revolutionary passions can only take place by minimizing those economic, social, and state-system problems that usually generate popular upheaval. This is the dilemma now facing modern Russia. The revolutions that occurred over the past 20 years, and the situation today in Belarus, all fit into this pattern.

For the moment, Lukashenko has won this round of strife with the protesters, and his rule is highly likely to continue. But what is equally certain is that the protests gave birth to a massive popular movement in a country that was once famous for the quiescence of its population.

Russia fears that eventually, this revolutionary tide will close in on Russian society. Lukashenko has stressed this idea, saying in an interview that mass disturbances will one day reach Moscow. Many rightly believed this was a ploy by Lukashenko to scare the Russians into supporting him—after all, Belarus is far smaller than Russia and much less important than Ukraine. Still, Lukashenko was right insofar as he pinpointed possible long-term problems Russia could face as it moves closer to 2036.

Much depends on the West as well. It faces a dilemma in which it ought to pursue a policy of vocal condemnation and perhaps even impose heavy sanctions—but from a balance of power perspective, moves like those would distance Minsk and push it closer to the Russian orbit. This dilemma of morality versus geopolitical calculus will haunt the West in the years to come.

Belarus exports 10.5 million tons of oil products per year, including about six million tons through the ports of the Baltic states to world markets and another 3–3.5 million tons to Ukraine. Redirecting flows from the Baltic ports to Russian ones has been discussed, but this option is less attractive to Minsk because of the longer distances involved. This comes at a time when the Baltic states imposed sanctions on high-ranking Belarussian officials and the EU is pondering serious measures.

With each such move from the West, Russia gets another opportunity. Russia has professed interest in encouraging Belarus to redirect its oil exports to Russian ports and has agreed to refinance a $1 billion debt to Russia.

A broader picture might help put the events in Belarus in context. In the South Caucasus, the Russians appear to have reached the limit of their influence. They more or less firmly control the overall geopolitical picture, but have nevertheless failed to derail Western resolve to compete in this region. In Central Asia, Russia has more secure positions, but the region in general is less important to the Kremlin than the western borderlands.

It is thus the western front—Belarus and Ukraine—that is a major theater for Moscow. Since 2015, many have believed that Syria is Russia’s top geopolitical theater, but this assumption is based simply on the intensity of the immediate processes that are transpiring in the Middle East. With or without Syria, Moscow’s global standing will not be fundamentally damaged. Belarus is a different matter entirely. Changes there, and by extension a potentially anti-Russian state, would constitute a direct threat to Moscow.

For Russia, Belarus is the last safe buffer zone on its western border. Ukraine is lost, as is Moldova, and the Baltic states have long been under NATO protection. Only Belarus serves as a bridge for Russia to move militarily into the heart of Europe. To lose it would be tantamount to a complete “encirclement” of Russia by the West, as argued by Russian politicians.

This geopolitical reality also means that Belarus is the country that will remain most susceptible to Russian geopolitical influence. No wonder Russia is pushing to station its air base on Belarussian soil, reinvigorate the Union state, and intensify Minsk’s economic dependence on Moscow. As was the case with Ukraine, the upheaval in Belarus is about regional geopolitics.

Author’s note: first published in besacenter.org

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