Thursday, December 28, 2017

Issue 14


THE BRETON/GEROL NEWSLETTER



HAPPY NEW YEAR TO OUR LOYAL READERS!



APRÈS MOI, LE DÉLUGE?

President Putin filing his candidacy documents at the Central Election Commission, December 27th
©Website of the President of Russia

There will probably be a lot of agitation around alternate candidates and even non-candidates, but there is, of course, little doubt about Vladimir Putin winning the Presidential election that will be held on March 18, 2018. The question that puzzles observers is: what next? As for Putin himself, it seems rather clear that this will be his last term as President. The most likely option for him afterwards is to assume the role of pater patriae, something of a cross between what Deng Xiaoping did in China and what Lee Kuan Yew did in Singapore. Two elements are at stake: a residual high-level involvement in the political life of the country, outside of politics (Putin, by the way is running as an independent not as the representative of a party), immunity from prosecution (you never know what could happen).

The question as to whether Putin might choose not to complete his six-year term does arise. The option indeed exists. Whereas it would not be like Vladimir Putin to abandon the ship, his “weakness is not an option” mantra may compel him not to want to become a lame-duck in a country where strong personal leadership is crucial.

Beyond Putin himself, the key question is to what kind of political system does Putin want the country transition to, after his departure. The simplest most efficient option would be to install a president that would essentially be a clone, politically speaking. The right person could then be president for up to 12 years. The main requirements for the new President would be loyalty to the Putin tradition and experience in government. In that context former President and Current PM  Dmitry Medvedev, albeit not inspiringly, tops the list.

President Putin, PM Medvedev, Deccember 21st
©Website of the President of Russia

The problems with that option are that electoral success is not guaranteed and that this would further aggrieve the young generation, essentially the people born after the end of the Soviet Union. Experienced pollsters have observed that although Vladimir Putin’s popular support is broad, it is not deep. The manipulation that allowed Putin to return  to the presidency in 2012 was not fatally unpopular, but it led to the lowest ever score for the party of power at the December 2011 parliamentary elections. The high overall rating of Putin does not mean there is strong support for the entirety of his political program, especially among younger people. The authoritarian bent as well as the lackluster economic performance create a long-term vulnerability for Putin’s managed democracy system.

For Putin, there is little if any attraction even to try to replicate the democratic systems of Western Europe and North America. To him Russia would need to develop progressively its own type of democracy that would meet the twin requirement of maintaining stability while opening up the political process, (essentially shifting the emphasis from authoritarian to liberal). He himself used the word “flexible” to describe the political system he sees for Russia. One possibility might be to make Russia more parliamentary than presidential, something President Nazerbayev seems to want to try in Kazakhstan. In a country that traditionally likes strong leaders, that has a long one-party tradition and where political parties do not seem up to the task, the challenge is daunting, the outcome uncertain. Yet, Putin the historian knows that evolution is unavoidable and that history will judge him on how he will address this last challenge.

--o--

WAR AFTER THE OLYMPICS?





The Winter Olympics in South Korea, to be held from February 9th to 28th, may be the last reprieve for the North Korean regime before the US decides to go ahead with a limited, but devastating attack on Kim Jong Un’s nuclear sites and possibly decapitating strikes against the regime’s upper echelon. According to military experts, the operation under consideration would definitely include various precision air strikes, including the heaviest, non-nuclear munitions like bunker busting bombs and the use of US Special forces with the expertise required for neutralizing and securing potential nuclear sites inside North Korea. Discussions around this issue have intensified in the last several weeks. There were back and forth visits and discussions among experts from the US, China and Russia. A recent visit to Pyongyang by a Russian Defense Ministry delegation was possibly a last ditch attempt to relay to Kim the seriousness of his situation. In addition US Secretary of State Tillerson just admitted that the United States gave assurances to China that should the above-mentioned military operation take place, the American troops would not remain in North Korea, but transfer day to day management of further developments to the Chinese. The Chinese have not gone as far as confirming what Tillerson said, but interestingly enough they also did not deny it.

If North Korea does not back down or come up with some pacifying and acceptable statement before the end of the Olympics, or if renewed diplomatic efforts do not show signs of progress, the war maybe a reality.

--o--

WEAPONS OF MASS DELUSION


Both the US and Canada announced in mid-December that the sale of some lethal weapons to Ukraine would henceforth be authorised. Those, including President Poroshenko, who have argued for more active support for Ukraine on the part of Western countries rejoiced. There is, however, limited ground for celebration.


President Poroshenko, Foreign Minister Freeland, Kyiv, December 21st
©Website of the President of Ukraine
First, allowing the sale of weapons is not the same as providing weapons. It may become legal to export certain weapons, but in the absence of outside funding, Ukrainian buyers will have to pay for their purchases. It is not clear that funds are available for that purpose in Ukraine, or that the US or Canada would provide funding assistance directly related to such purchases.

Second it is not clear either that the weapons that have been cleared for export to Ukraine are needed or would make any difference in the ongoing conflict in Eastern Ukraine. The US statements refer to defensive weapons, the Canadian one to automatic weapons. There was speculation about the sale of some anti-tank weapons, but US officials seemed reluctant to provide any details.

When it comes to assessing Ukrainian weapon needs, it might be useful to remember that Ukraine is itself a large exporter of weapons, consistently ranking among the 10 top exporters. The weapons in question are mostly leftovers from the large arsenal of weapons that were stored in Ukraine during the Soviet period. The state of conservation of the weapons in question occasionally comes into focus when major explosions in destroy part of the arsenal, as was the case twice in 2017.

As for Canada, when it comes to authorising the export of weapons, the long-standing policy is that weapons cannot be exported to zones of conflict. It is worth reading the fine print in the official announcement:

“This change will enable Canadian companies and individuals to apply for a permit to export certain prohibited firearms, weapons and devices to Ukraine. Each permit application will be assessed on a case-by-case basis to ensure its consistency with Canada’s international obligations and foreign policy and defence priorities. (…) Inclusion in the Automatic Firearms Country Control List does not guarantee that exports of prohibited firearms, weapons and devices to a country will be approved.”

The gesture of authorising the sale of lethal weapons to Ukraine was highly symbolic. As could be expected, it upset Russia. Its actual impact remains, however, unusually vague for now.


--o--

SAAKASHVILI VS POROSHENKO, AND THE WINNER IS TYMOSHENKO



Mikheil Saakashvili
Facebook Profile
Mikheil Saakashvili continues his anti-corruption popular campaign that more and more looks like an anti-Poroshenko action. As legal attempts to either arrest or extradite Saakashvili have not succeeded, attempts were made to discredit Saakashvili by releasing a conciliatory personal letter he had just sent to Poroshenko. After the release of the first letter, Saakashvili wrote a second open letter in which he called for Poroshenko to resign, hinting, rather arrogantly, that resignation might result in “mitigation of punishment as well as pardon,”. Poroshenko created the problem by stripping Saakashvili of his Ukrainian citizenship, but cannot get rid of him through legal or political means. Saakashvili’s stature protects him so far from non-legal attempts, but his popular following is not strong enough to topple Poroshenko. He can however continue to annoy Poroshenko for the foreseeable future, especially now that Poroshenko has refused his peace proposal. The real impact is the constraint it imposes on Poroshenko’s attempt to work usefully at his campaign for a second presidential mandate, which he seems intent on seeking. This serves the interest of Yulia Tymoshenko, former Prime Minister and Poroshenko’s main challenger, who seems to be making a come-back in public opinion polls.


Yulia Tymoshenko
Facebook Profile



--o--

NEW GUIDELINES, OLD RIVALS





President Trump just announced a new National Security Strategy (NSS). It is based on four pillars:

Protect the homeland, the American people, and the American way of life

Promote American prosperity

Preserve peace through strength

Advance American influence

Two countries have been named as major "revisionist powers" attempting at rivaling the US: Russia and China and, as the text of the NSS memorandum goes, "use technology, propaganda, and coercion to shape a world antithetical to our interests and values".

Curiously and of note, China is mentioned 12 times while Russia only 6.

It did not take long for the Chinese rebuff. The Ministry of Foreign Affairs in Beijing categorically rejected being branded as an expansionist and revisionist. The Kremlin spokesman Dmitry Peskov shrugged the matter off, saying he could see traces of an “imperial nature” in the NSS “as well as unwillingness to abandon the unipolar world idea and accept a multipolar world. Some observers in Moscow sardonically commented that few people managed to do so much with so little to bring Russia and China closer together. This document owes a lot to President Reagan's principled stand in his Cold War strategy.

Trump allegedly participated directly in the elaboration of this new strategy. Whereas it will serve as guidance for the Administration as a whole, this does not mean that he will not improvise, depending on political circumstances or his own mood swings.

--o--

REX TILLERSON: TRUMP'S FOREIGN POLICY GLADIATOR



Secretary of State Tillerson, PM Trudeau, Ottawa, December 19th
©State Department


Rumors about the imminent resignation of Rex Tillerson as US State Secretary do persist but are most likely slightly exaggerated. While it looks certain that Rex Tillerson will not remain part of Trump's team until the end, today he serves a purpose: Tillerson’s more diplomatic approach, often contradicted by his boss (in his night-time tweets, or statements) and this tandem of foreign policy "bad cop, good cop" approach seems to be working for the time being as far as the White House is concerned. Boris Johnson, the British Foreign Minister, who visited Moscow in December, expressed different, sometimes controversial views, but we can be certain that all of it was coordinated with PM May. In Tillerson's case no foreign colleague of his can ever be certain that the next day White House would not either correct, deny, or even totally contradict what Rex stated. 

Not so long ago, the State Secretary assured the media that his negotiators were ready to travel to North Korea for some diplomatic efforts to ease the tensions. Two days later on his official visit to Asia, President Trump denied that such plans were in the works and put his personal touch on it by advising his State Secretary not to "waste time" on fruitless talks. As some observers noted such unconventional approach may have some purpose: to disorient enemies and allies alike to pursue certain political objectives.

Tillerson may, however, be remembered for having presided over the atrophy of the State Department, leaving a large number of positions unstaffed. The damage done to the institution is likely to be felt for years. The traditional US interests as defined by the liberal leaning State Department do not fare well against the more isolationist “make America great again” approach.

--o--


PERSON OF THE MONTH: PATRICK POUYANNÉ, CHAIRMAN AND CEO, TOTAL 


Patrick Pouyanné took over as head of Total in October 2014, after Christophe de Margerie was killed in a tragic accident at Moscow's Vnukovo airport. Total's executive jet was rammed by a fuel truck driven by a drunk employee. The three crew members also died. The driver was sentenced to prison time.

Total is one of the 7 "supermajor" oil and gas companies, which means that it covers the entire cycle of oil and gas from exploration, production, power generation, transportation, refining, product marketing and global crude oil and product trading. The company has a work force more than 100,000 people in 130 countries. Its total assets amounted to USD 230 billion in 2016, while profit was over USD 6 billion.

Total carries a special significance for the Russian economy and investment environment. At the time when Western sanctions substantially undercut Russian joint projects with scores of Western partners, Total not only remained in Russia during this difficult period, but also actively took part in the gigantic Yamal LNG project.

Yamal LNG processes natural gas from the giant onshore South Tambey gas and condensate field, located on the Yamal peninsula. The project includes an integrated gas treatment and liquefaction facility with three trains each having a capacity of 5.5 million tons per year, storage tanks, port and airport infrastructures. The construction of the first train as well as of the logistic facilities was successfully completed with more than 30,000 personnel actively involved on site at peak. The second and third trains will be commissioned in 2018 and 2019 respectively.

The project is operated by Yamal LNG Company, owned by Russian independent gas producer Novatek (50.1%), Total (20%), CNPC (20%) and Silk Road Fund (9.9%).

On December 8th, 2017 Total announced that the first cargo of liquefied natural gas (LNG) from Yamal LNG is ready to leave Russia. This first shipment is a big step for Yamal LNG and the Russian energy export structure, one of the biggest liquefied natural gas projects in the world. Yamal LNG has reserves of 4.6 billion barrels of oil equivalent in Northern Russia.


Symbolically, the first Russian tanker built for this project was named after Christophe de Margerie.



©Total

--o--



CHINA'S ONE BELT ONE ROAD INITIATIVE (OBOR), EURASIAN ASPECT




Four years ago when Beijing came up with the exotic initiative to resurrect in a modern context the ancient Great Silk Road that goes back more than 2,000 years and in its heyday dominated trade in Asia, Middle East, South Europe and Africa, it was not taken seriously. Today it has gained strategic and political traction. OBOR is not a unified political or economic structure. It is rather based on specific agreements with one or a group of countries that could serve as major junctions along that way. The main routes of the OBOR will go through Eurasia: Russian and Kazakhstan's Trans-Siberian railroads, Georgian and Turkish ports with further routes to the Middle East, Southern Europe plus auxiliary paths into Africa. On the surface it looks like a grand, but conventional plan to deliver Chinese-made goods all over the world by the shortest and cheapest possible route. On a deeper level, it brings with it joint investments into transit countries’ economies, joint projects (logistical, industrial or scientific) and consequently becomes a global project.

Politically, the gradual and long-term implementation of that project requires reduction in military conflicts along the way such as, among others, Ukraine-Russia in Donbass, Azerbaijan-Armenia in Nagorno-Karabakh and Afghanistan’s permanent civil war.

The question is whether OBOR can help to reduce the intensity of local conflicts in favor of trade and coexistence or whether it will fail to do so and remain only a hypothetical construct.

--o--


BRIEFLY NOTED


NORTH KOREA


A BGN source in Ottawa's diplomatic community confirmed that the conference that Canada is trying to arrange in Vancouver involves the participation of the US, Russia, China, South Korea and Japan to discuss the growing tensions around the North Korean nuclear program and overall rising chances for a full scale war between North Korea and the US. Russia's relations with Canada are at an all-time low, but it seems so far Russia is ready to come if China agrees to join. So the only hold out is China as Beijing has yet to reply positively to the invitation.

RUSSIA


The Central Election Committee denied Alexei Navalny, a Russian opposition leader, the right to register as a candidate for the March 18, 2018 presidential election on account of his criminal conviction for economic crimes. In a widely disputed and politicised verdict, Navalny was handed a 5-year conditional sentence. Alexei Navalny is the most notable opposition candidate and has election offices in dozens of Russian cities. His campaign attracted many dissatisfied voters, mainly younger generation of Russians. His presidential campaign dealt mainly with the widespread corruption of Putin and his inner circle and, to a lesser extent, the annexation of Crimea and certain aspects of Putin's foreign policy.

UKRAINE-RUSSIA 


After months of intense negotiations between Kiev and the self-proclaimed Eastern Ukrainian republics part of an all-for-all exchange of POW's took place on December 26th.
In November Putin and Medvedev met the special envoy of the Ukrainian President, Mr. Medvedchuk and the deal was finalized. The Ukrainian side has returned 306 prisoners and separatists 76. According to the deal, this is only the first phase of the prisoner exchange and more swaps are planned for later dates. This is the first prisoner exchange in 14 months. The conflict, according to human rights organizations has claimed over 10.000 lives.

The conflict is far from a peaceful resolution, but this prisoner exchange is a step in the right direction.


UZBEKISTAN


President Shavkat Mirziyoyev spoke on the phone with Donald Trump on December 19. He assured the American President that Uzbekistan is fully committed to the war against Islamic terrorism especially in light of a deadly car attack in New York City by an Uzbek national who pledged his alliance to ISIS. Uzbekistan also has a long border with Afghanistan and the White House counts on Uzbekistan's help in assisting America's efforts in the area. Uzbekistan's foreign policy is known for its balanced approach and friendly relations with both Moscow and Washington.

MOLDOVA


Moldova's government recalled its ambassador from Moscow for "consultations" as a gesture of protest against Moscow's attempts at undermining this country's efforts to strengthen its ties with EU. Moldova's president Igor Dodon, who is known for his pro-Moscow position, has condemned his government's actions. As a sign of its inevitable movement westwards, Moldova changed the name of its official language from Moldovan to Romanian. 


SYRIA


During his December 11th visit to Syria, President Putin announced the withdrawal of Russian troops from Syria. At the same time, he also re-confirmed that Russia would keep two military bases in Syria, the old one for the navy in Tartus and the relatively new one for the air force in Hmeimin, so that "they could deal a crushing blow to the terrorist threat should it rise ever again". Of note, in his congratulatory remarks to the troops, he thanked them for having defended the motherland, presenting the threat of terrorism originating from Syria as a direct threat to Russia itself. 




THE AUTHORS

Ilya Gerol, former foreign editor of the Citizen in Ottawa, syndicated columnist in Canadian, US and European media specializing in international affairs. His particular area of expertise includes Russia, Eurasian Economic Union, Eastern and Central Europe.  Ilya Gerol has written several books, one of them, The Manipulators, had become a textbook on relations of media and society.



During his career in the Canadian Foreign Service, Gilles Breton had three assignments at the Canadian Embassy  in Moscow. His first posting there began during the Soviet period, in 1983. His last was from 2008 to 2012 as Minister-Counsellor and Deputy Head of Mission. He also served as Deputy Director responsible for Canada’s relations with Russia from 2000 to 2008. As an international civil servant, he was Deputy Director of the OSCE Office for Democratic Institutions and Human Rights in Warsaw from 1994 to 1997.


1 comment:

  1. Happy New Year, BGN!
    Looking forward to another year of your excellent insight and coverage! Thank you.

    Winston Smith,
    London GB

    ReplyDelete