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New anti-Russian sanctions to hit European energy sector

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The US plans to tighten sanctions against Russia, scheduled for November, is causing growing concern from the international business community, in the first place, from Europeans and those economic areas in which key players demonstrate maximum interdependence, including in the energy sector.

Among those who lashed out at the US intention to impose restrictions on Russian companies Rosneft, Gazprom and LUKOIL similarly to sanctions slapped on US Rusal in April this year, is the head of British Petroleum Bob Dudley. BP owns 19.75% of Rosneft shares and is Rosneft’s major private shareholder.

According to Bob Dudley, in the event of such a tightening of US sanctions, the European energy system will crumble. “I do not think this will happen. If you impose sanctions like Rusal on Rosneft, Gazprom or LUKOIL, you will cut off European energy systems, which is a little bit too much”, he said as he spoke at an Oil & Money 2018 Conference in London.

Bob Dudley is fully aware of the contemporary realities and the potential of Russian companies, particularly since BP and Rosneft have been developing a variety of joint projects. In 2015 BP acquired 20% in the Srednebotuobinsky field in Eastern Siberia and has been prospecting for oil within the framework of a joint venture with Rosneft – “Ermak Neftegaz”.

Reports say the share in the Russian company accounts for a third of the total production of British Petroleum. “In general, we consider Rosneft a fairly good partner,” Bob Dudley said in an interview with The Bloomberg, an American business news agency.

At present, the US Congress is considering two packages of anti-Russian sanctions. In the case of “spotting Russia’s attempts to influence the course of elections in the United States”, the White House is to block the resources of major Russian banks, including Sberbank, VTB and Vnesheconombank, and energy companies. Among the latter are  “Gazprom”, “Rosneft” and “LUKOIL”.

The forecast by the BP chief that the European energy sector will face severe crisis should the US Congress launch new sanctions echoes the moods that are gaining strength in Europe. A statement to this effect came from the Eastern Committee of the German Economy (Ost-Ausschuss der Deutschen Wirtschaft e. V.) which represents the interests of about 350 German companies and associations operating in Russia and other former Soviet republics, as well as countries of South Eastern Europe. The Committee’s Managing Director Michael Harms said that business in the European Union should not suffer because of cooperation with Russia. According to reports released in Germany, Western sanctions and Russian counter-sanctions have “negatively affected” more than 70% of German companies since March 2018. A study conducted by the above organization reveals that 94% of these companies would prefer the existing sanction regime against Russia eased. The East Committee of the German economy has expressed “tremendous concern” over the possibility of the US imposing new sanctions against Russia and against European companies running  joint projects with Moscow, including those involved in the construction of the Nord Stream 2 gas pipeline.

“We believe that any attempts to see implementation of sanctions in an extraterritorial format are unacceptable and at odds with international law,” Michael Harms said. He deems as inadmissible the imposition of sanctions on European business for cooperating with Russia.

This position is shared by top management of the French energy giant Total, which has been pursuing a number of joint projects with Russia which are vital for ensuring Europe’s energy security, including in the production of liquefied natural gas (LNG). In an interview with the French edition of Capital, Total CEO Patrick Pouyanne questioned the very effectiveness of anti-Russian sanctions – in other words, he doubted the key factor that caused their coming into effect: “I believe that the sanctions are ineffective. What they lead to is the fact that leaders consolidate forces around themselves without changing their policies.”

“Business communities in most European countries – the Czech Republic, France, Germany, Spain – believe that sanctions should be lifted at an early date. Some experts think that this should happen gradually but business thinks differently,” – says Ernest Ferlenghi, president of Confindustria Russia, an association of Italian business in Russia, who is a staunch opponent to sanctions. “Every lost day provides an opportunity for our competitors, especially in Asia. They have vast opportunities, particularly the Chinese, for investing money in various projects. They become more competitive due to a strong financial resource,” – emphasizes the Italian businessman.

Significantly, the most critical position on the further tightening of sanction against Russia has come from countries and companies which guarantee stability on the European energy market, in particular, those representing Germany and Austria. The Vienna-based newspaper Der Standard cites in this connection the successful activities of the Austrian energy concern OMV: “OMV relies on Russia, its CEO Seele maintains good relations with Russia. The head of the state-subsidized concern has managed to secure what he had already succeeded in achieving as head of BASF subsidiary Wintershall – participation in the development of a large gas field in Siberia, Urengoisky.” “As for the second major project – the construction of the Nord Stream 2 pipeline from Germany to Russia through the Baltic Sea – Seele enjoys political support”, – the newspaper says.

By introducing sanctions against top Russian energy companies that closely cooperate with European business the Donald Trump administration is in fact trying to make use of national legislation to secure the US financial and economic interests in Europe. According to reports, one of the reasons for tightening sanctions is the currently observed positive trends in the implementation of Russian projects in areas where the US is particularly vulnerable  – the export of pipeline gas and the production of LNG.

As for Russian gas supplies to Europe – which Washington sees as a direct competition considering its own liquefied natural gas supplies – this year PJSC Gazprom has the potential, for the first time after 2011, to reach a production level of over 500 billion cubic meters of gas annually. At the same time, annual exports to foreign countries can hit a record high of over 200 billion cubic meters.

Meanwhile, Russia’s PJSC NOVATEK, which mainly deals with LNG production, has announced the discovery of a gas condensate field with reserves of at least 320 billion cubic meters in the Arctic, on the North Obsk license area in the waters of the Gulf of Ob. This field can become a resource base for NOVATEK’s third LNG producing facility, the Arctic LNG-3. “The discovery of a new field is an important starting point for one of our future Arctic LNG projects. The North-Ob field is unique in terms of its reserves, boasts an advantageous geographical location, and has a huge resource base. On top of that, the experience we have gained suggests that we have every potential for the successful implementation of the new LNG project,” – said Leonid Mikhelson, Chairman of the Board of PJSC NOVATEK.

By 2030 the company expects to bring LNG production to 57 million tons per year, and provided extra resources have been tapped – up to 70 million tons. This will enable Russia to successfully compete with the top LNG producer, Qatar, thereby leaving the United States far behind.

Success of Russian energy projects and expansion of Russia’s ties with European partners in energy and other major sectors of the economy present, in the eyes of the administration of US President Donald Trump and the Congressmen, a key threat to American business interests. This is what underlies Washington’s “sanctions” policy and European leaders have increasingly been making a point of it lately.

First published in our partner International Affairs

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Time to Tackle the Stigma Behind Wartime Rape

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Images: UN Women Kosovo

The youngest capital city in Europe, Pristina, is the ultimate hybrid of old and new: Ottoman-era architecture stands amongst communist paraphernalia, while Kosovars who lived through the bloodshed of the 20th century share family dinners with a generation of young people with their sights set on EU accession.

This month, the capital’s Kosovo Museum welcomed a new force for change; Colours of Our Soul, an exhibition of artwork from women who survived the sexual violence of the Yugoslav Wars, showcases the world as these women “wished it to be.”

Colours of Our Soul isn’t the first art installation to shine a light on the brutal sexual violence thousands of Kosovar victims suffered throughout the turmoil of the conflict which raged from 1988 to 1999. In 2015, Kosovo-born conceptual artist Alketa Xhafa-Mripa transformed a local football pitch into a giant installation, draping 5,000 dresses over washing lines to commemorate survivors of sexual violence whose voices otherwise tend to go unheard. “I started questioning the silence, how we could not hear their voices during and after the war and thought about how to portray the women in contemporary art,” said Xhafa-Mripa at the time.

Victims, and their children, pressed into silence

The silence Xhafa-Mripa speaks of is the very real social stigma faced by survivors of sexual violence in the wake of brutal conflict. “I would go to communities, but everyone would say, ‘Nobody was raped here – why are you talking about it?’”, remarked Feride Rushiti, founder of the Kosovo Rehabilitation Centre for Torture Victims (KRCT).

Today, KRCT has more than 400 clients— barely a scratch on the surface given that rape was used in Kosovo as an “instrument of war” as recently as two decades ago. Some 20,000 women and girls are thought to have been assaulted during the bloody conflict; the fact that the artists whose work is featured in the Colours of our Soul exhibition did not sign their work or openly attend the installation’s grand opening is a sign of how pervasive the stigma is which haunts Kosovar society to this day.

As acute as this stigma is for the women who were assaulted, it is far worse for the children born from rape, who have thus far been excluded from reparation measures and instead dismissed as “the enemy’s children.” In 2014, the Kosovar parliament passed a law recognising the victim status of survivors, entitling them to a pension of up to 220 euros per month. Their children, however, many of whom were murdered or abandoned in the face of community pressure, are barely acknowledged in Kosovar society and have become a generation of young adults who have inherited the bulk of their country’s dark burden.

A global problem

It’s a brutal stigma which affects children born of wartime rape all over the world. The Lai Dai Han, born to Vietnamese mothers raped by South Korean soldiers, have struggled for years to find acceptance in the face of a society that views them as dirty reminders of a war it would rather forget. The South Korean government has yet to heed any calls for formal recognition of sexual violence at the hands of Korean troops, let alone issue a public— and long-awaited— apology to the Lai Dai Han or their mothers.

In many cases, as in the case of Bangladesh’s struggle for independence, the very existence of children born from rape has often been used as a brutal weapon by government forces and militants alike. Official estimates indicate that a mammoth 200,000 to 400,000 women were raped by the Pakistani military and the supporting Bihari, Bengali Razakar and al-Badr militias in the early 1970s. The children fathered, at gunpoint, by Pakistani men were intended to help eliminate Bengali nationhood.

Their surviving mothers are now known as “Birangana”, or “brave female soldier,” though the accolade means little in the face of a lifetime of ostracization and alienation. “I was married when the soldiers took me to their tents to rape me for several days and would drop me back home. This happened several times,” one so-called Birangana explained, “So, my husband left me with my son and we just managed to exist.”

No end in sight

Unfortunately, this barbaric tactic of rape and forced impregnation is one that is still being used in genocides to this day. The subjugation of the Rohingya people, for example, which culminated in a murderous crackdown last year by Myanmar’s military, means an estimated 48,000 women will give birth in refugee camps this year alone. Barring a major societal shift, the children they bear will suffer ostracization similar to that seen in Kosovo, Vietnam and Bangladesh.

Initiatives like the Colours of Our Soul installation in Pristina are not only central in helping wartime rape survivors to heal, but also play a vital role in cutting through the destructive stigma for violated women and their children. Even so, if the number of women who submitted their paintings anonymously is anything to go by, true rehabilitation is a long way ahead.

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EU–South Africa Summit: Strengthening the strategic partnership

MD Staff

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At the 7th European Union–South Africa Summit held in Brussels Leaders agreed on a number of steps to reinforce bilateral and regional relations, focusing on the implementation of the EU-South Africa Strategic Partnership. This includes economic and trade cooperation and pursuing the improvement of business climate and opportunities for investment and job creation which are of mutual interest.

Leaders also discussed common global challenges, such as climate change, migration, human rights, committing to pursue close cooperation both at bilateral level and on the global stage. A number of foreign and security policy issues, including building and consolidating peace, security and democracy in the African continent and at multilateral level were also raised. Leaders finally committed to work towards a prompt resolution of trade impediments affecting smooth trade flows.

Jean-Claude Juncker, President of the European Commission and Donald Tusk, President of the European Council, represented the European Union at the Summit. South Africa was represented by its President, Cyril Ramaphosa. EU High Representative for Foreign Affairs and Security Policy/Vice-President of the European Commission, Federica Mogherini, Vice-President for Jobs, Growth, Investment and Competitiveness Jyrki Katainen and Commissioner for trade Cecilia Malmström also participated, alongside several Ministers from South Africa.

President Juncker said: “The European Union, for the South African nation, is a very important trade partner. We are convinced that as a result of today’s meeting we will find a common understanding on the open trade issues. South Africa and Africa are very important partners for the European Union when it comes to climate change, when it comes to multilateralism. It is in the interest of the two parties – South Africa and the European Union – to invest more. It will be done.” A Joint Summit Statement issued by the Leaders outlines amongst others commitment to:

Advance multilateralism and rules based governance

Leaders recommitted to work together to support multilateralism, democracy and the rules-based global order, in particular at the United Nations and global trade fora. South Africa’s upcoming term as an elected member of the United Nations Security Council in 2019-2020 was recognised as an opportunity to enhance cooperation on peace and security. As part of their commitment to stronger global governance, Leaders stressed their support to the process of UN reform, including efforts on the comprehensive reform of the UN Security Council and the revitalisation of the work of the General Assembly. Leaders reiterated their determination to promote free, fair and inclusive trade and the rules-based multilateral trading system with the World Trade Organisation at its core and serving the interest of all its Members.

Bilateral cooperation

Leaders agreed to step up collaboration in key areas such as climate change, natural resources, science and technology, research and innovation, employment, education and training including digital skills, health, energy, macro-economic policies, human rights and peace and security. The EU and South Africa will, amongst others, explore the opportunities provided by the External Investment Plan. Linked to this, Leaders committed to exploring opportunities for investment, technical assistance including project preparation, and the improvement of business and investment climates to promote sustainable development. Leaders welcomed the conclusion and provisional implementation in 2016 of the EU-Southern African Development Community (SADC) – Economic Partnership Agreement (EPA).

Leaders also committed to find mutually acceptable solutions to impediments to trade in agriculture, agri-food and manufactured goods. They agreed to work towards a prompt resolution of these impediments.

Regional cooperation

Leaders welcomed the new Africa-Europe Alliance for Sustainable Investment and Jobs put forward by the European Commission. They exchanged views on foreign and security policy issues, addressed a number of pressing situations in the neighbourhoods of both the EU and South Africa, and welcomed each other’s contribution to fostering peace and security in their respective regions. Leaders agreed to explore opportunities to enhance cooperation on peace and security, conflict prevention and mediation.

Leaders confirmed common resolve to reform the future relationship between the EU and the countries of the African, Caribbean and Pacific Group of States. To this end they are looking forward to the successful conclusion of negotiations for a post-Cotonou Partnership Agreement, that will contribute to attaining the goals of both the United Nations 2030 Agenda on Sustainable Development and the long-term vision for African continent – Agenda 2063.

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Macron so far has augmented French isolation

Mohammad Ghaderi

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French President Emmanuel Macron has recently criticized the unilateral pullout of the US from the Joint Comprehensive Plan of Action (JCPOA) but at the same time expressed pleasure that Washington has allowed France and the other JCPOA signatories to stay in the Iran nuclear deal.

In an exclusive interview with the CNN, Macron said that he has “a very direct relationship” with Trump. “Trump is a person who has tried to fulfill his electoral promises, as I also try to fulfill my promises, and I respect the action that Trump made in this regard. But I think we can follow things better, due to our personal relationship and talks. For instance, Trump has decided to withdraw from the Iran pact, but at the end, he showed respect for the signatories’ decision to remain in the JCPOA.”

There are some key points in Macron’s remarks:

First, in 2017, the French were the first of the European signatories to try to change the JCPOA. They tried to force Iran to accept the following conditions: Inspection of military sites, application of the overtime limitation on nuclear activities, limiting regional activities, including missile capabilities within the framework of the JCPOA.

Macron had already made commitments to President Trump and Israel’s Prime Minister Benjamin Netanyahu to push Iran to accept the additional protocols to the deal, and he pushed to make it happen before Trump left the JCPOA.

Second, after the US withdrawal from the Iran nuclear deal, although France expressed regret, they had secret negotiations with US Secretary of State Mike Pompeo over the JCPOA.

The result of the undisclosed talks was deliberate delay on the part of the European authorities in providing a final package to keep the Iran deal alive. In other words, after the US unilaterally left the JCPOA, the French have been sloppy and maybe somewhat insincere about making the practical moves to ensure it would be saved.

Third, France has emphasized the need to strengthen their multilateralism in the international system and has become one of the pieces of the puzzle that completes the strategic posture of the Trump Administration in the West Asia region.

Obviously, French double standards have irritated European politicians, many of whom have disagreed with the contradictory games of French authorities towards the US and issues of multilateralism in the international community. Also, France’s isolation and its strategic leverage in the political arena has grown since the days of Sarkozy and Hollande. Some analysts thought that Macron and fresh policies would stop this trend, but it has not occurred.

First published in our partner MNA

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