Monday, October 29, 2018

Issue 24



Angela Merkel, Vladimir Putin, Recep Erdogan and Emmanuel Macron
October 27th, Istanbul
©President of Russia Website

The previously unannounced and relatively short-notice meeting in Istanbul between Recep Erdogan, Angela Merkel, Emmanuel Macron and Vladimir Putin was formally called to discuss the further developments in Syria, especially the situation in the Idlib area. It has appeared however that such issues as Ukraine, arms control and even the recent brutal murder of Saudi journalist Jamal Khashoggi were on the agenda as well. Remarkably such important players as the US and Iran were not invited. There are reasons to assume that Europe is trying to find its own way and stand in the turbulent world of Trumpovian impulsiveness and unpredictability. All four participants in the summit agreed that Syria should maintain its territorial integrity and that the current conflict should be resolved through a political solution. They disagreed, however, on the role of Bashar al-Assad in the future of Syria. Merkel, Macron and Erdogan continued to define the Syrian leadership as the "Assad's regime" while Putin insisted that Syria is led by a legitimate government. On Idlib specifically, Macron and Merkel were more fully briefed on the recent Russia-Turkey agreement and, if only by their presence, gave it their blessing.

The Istanbul meeting could be interpreted as a diplomatic success for Putin because it recognized and legitimized Russia's role in Syria, as well as the validity of its efforts to avoid a humanitarian crisis in the Idlib region.

Angela Merkel also informed other summit participants that she decided to step down as leader of Germany's ruling Christian-Democratic Party. She will though remain a Federal Chancellor till the end of her mandate in 2021.

Recep Erdogan can also consider himself a winner after that summit. He reminded his guests that Turkey has accepted 3,5 million refugees from Syria. He requested more financial aid from those countries where the refugees truly wanted to settle. With a sarcastic smile President Erdogan looked at Angela Merkel and stated that if Turkey will not get financial assistance from the EU he will have no choice but to let the refugees go into Europe. Macron who, in the absence of Theresa May due to Brexit and the just announced departure of Merkel, truly feels as the sole remaining leader of Europe, essentially agreed with Erdogan.

A French observer concluded that the Istanbul summit confirmed that Europe is looking for more balanced relations with Russia, less dependence on the US and a bigger role in the international decision-making process.



The US President's National Security Adviser John Bolton's October visit to Moscow was unusual in the sense that Bolton alone conducted negotiations with the Minister of Defense, the Minister of Foreign Affairs, the Russian National Security Chiefs and Vladimir Putin himself. As Sergei Lavrov, Russia's Foreign minister noted with a touch of sarcasm, "John personified everyone who matters in Washington".

Vladimir Putin receiving John Bolton at the Kremlin
October 23rd
©President of Russia Website

The main reason for the visit was the Trump Administration's announcement that the US will be pulling out of the INF Treaty. (The Intermediate-Range Nuclear Forces Treaty is a 1987 arms control agreement between the United States and the Soviet Union that was signed by Presidents Reagan and Gorbachev).

According to that treaty the US scrapped 800 missiles and the then USSR 1,800. Step by step both sides began to build those missiles again. For years Washington accused Russia of violating the treaty. The Obama administration decided, however, to maintain the treaty. The reasoning then was that the outright annulment would be the worst of two evils. Since Bolton, a well-known opponent of any arms reduction deals with Russia, joined the Administration, the situation changed radically. Moscow relented and admitted that the treaty is imperfect, but emphatically denied violating it. Bolton insisted during the negotiations that any future solutions to the problem of Intermediate-Range Nuclear missiles should also include China that has the largest arsenal of such weapons. China meanwhile refuses even to discuss the issue according to the statement from the Chinese Foreign ministry. 

Some experts with more nuanced views on the issue believe that though the recent developments indicate that there is an evident sliding towards a Cold War stance, it is still too early to talk about a doomsday scenario. Putin and Trump will meet in Paris on November 11 and most likely some new deal will be arranged. 

John Bolton used his Moscow trip to talk about the whole spectrum of US-Russia relations. In his meeting with Russia's Defense Minister Sergei Shoigu, it was discussed how to avoid direct engagement between two nuclear superpowers in conflict zones around the world, particularly in Syria. The coordination of anti-terrorist efforts was also discussed with Nikolai Patrushev, Head of Russia’s Security Council.

Putin-Bolton discussions
October 23rd
©President of Russia Website

President Putin and John Bolton met for almost two hours which in itself a sign that the talks were detailed and wide-ranging.

At a press conference after the meetings Bolton mentioned that the US will put brakes on the next set of sanctions against Russia.



On October 22nd President Putin adopted a decree that paves the way for Russia to impose sanctions on Ukrainian individuals and legal entities, in response to “unfriendly acts on the part of Ukraine”. This follows on Ukraine’s own decision to end its friendship treaty with Russia as well as other specific actions by Ukraine against Russian interests in Ukraine.

The specific details of the measure still have to be worked out, but its significance is probably more in what it reveals about the current thinking in the Kremlin. Despite everything that is wrong in the current relationship between Ukraine and Russia, Russia remains Ukraine’s most important commercial partner, as an individual country. The official trade balance is in Russia’s favour. The new measure may eventually affect Russia’s own access to the Ukrainian market should Ukraine respond in kind. Clearly, Moscow has concluded that, politically it had to respond to Ukraine and that, economically, the risk of losing a share of the Ukrainian market is manageable and that losing Ukrainian suppliers is even more manageable. At the beginning of the current conflict, Russia was dependent on Ukraine for some military supplies, that is no longer the case. As for the transit of Russian gas through Ukrainian territory, despite Ukrainian legal victories against Russia’s  Gazprom or in fact because of them, Russia has little to lose from the current arrangement and would welcome any development that reinforces the case for NordStream II, the undersea pipeline that will strengthen the process of bypassing Ukrainian territory.



On October25th, Oleg Sentsov received the European Parliament’s Sakharov Prize. Sentsov is a Ukrainian film director, sentenced to 20 years in prison for “plotting terrorist acts” against the Russian “de facto” rule in Crimea. Amnesty International has described the court process as “an unfair trial before a military court”.

Oleg Sentsov, 2015

Announcing this year’s laureate, Parliament President AntonioTajani said: "Through his courage and determination, by putting his life in danger, the film maker Oleg Sentsov has become a symbol of the struggle for the release of political prisoners held in Russia and around the world.

"By awarding him the Sakharov Prize, the European Parliament is expressing its solidarity with him and his cause. We ask that he be released immediately. His struggle reminds us that it is our duty to defend human rights everywhere in the world and in all circumstances."

Moscow’s official response was that the decision to award the prize to Sentsov was “absolutely politicised”.



The Constantinople Patriarchate’s decision to award the tomos of autocephaly to the Orthodox Church of Ukraine continues to create heated discussions. A well-known Ukrainian journalist was even quoted as saying that this could eventually lead to the dismemberment of Ukraine. Thus far, there may have been a few scuffles among various factions in proximity of religious buildings, but nothing too serious. The full implementation of the Constantinople decision may however bring more trouble.

President Poroshenko receiving Constantinople exarchs
October 16th, Kyiv
©President of Ukraine Website

To the supporters of the Moscow patriarchate, the Constantinople decision to lift the anathema against the two leaders of the hitherto un-recognized Kyiv based churches is even more unacceptable as they argue that by doing this the Patriarch of Constantinople has himself incurred anathema. In the process, the Constantinople Patriarchate, whose followers include Ukrainian Churches in North American, is also establishing a more active presence in the territory of Ukraine. It is, however, clear that the other patriarchates of the Orthodox Church are not supportive of Constantinople and that the ensuing open conflict between the Patriarchates of Moscow and Constantinople will create major rift in the Orthodox world for the foreseeable future.

Whereas the political objective of the pursuit of the creation of an autocephalous Ukrainian church was to create greater spiritual distance between Ukrainian believers and the Patriarchate of Moscow, it looks as though there is still a strong bond between the people of Ukraine and Russia, at least in one direction. The latest opinion polls conducted by reputable polling agencies, the Kiev International Institute of Sociology and the Levada Centre in Moscow, are in fact somewhat surprising.
48% percent of Ukrainians hold a positive attitude toward Russia, according to survey results published in early October, up from 37% percent last year.

By contrast, only 32% of Ukrainian respondents said they hold negative views of Russia, down from 46% last year.

Meanwhile, only one-third of Russian respondents expressed positive attitudes towards Ukraine this year, the independent Levada Center reported, and a majority of Russians said they viewed Ukraine negatively (55%).



Uzbekistan, Central Asia’s most populous country, has been mainly known for its cotton production and tourism opportunities. Yet, the country is rich in gold, silver, copper, oil, natural gas, tungsten and uranium. Some international companies, including Canadian ones are already present in Uzbekistan. Very soon however the country is planning to change its economic strategy from a heavy reliance on natural resources towards modern industrialization, development of an IT sector and related services. The administration of President Shavkat Mirziyoyev, who replaced the long-serving dictator Islam Karimov in 2016, introduced a more liberal investment climate, free exchange of currency and tax free areas of development. The country wants to build several nuclear power stations and related industries. During President Putin’s recent state visit to the country, the two presidents launched the construction of a Russian-supplied nuclear power plant by initiating the process through which the location of the plant will be decided. France may still be hoping to participate in Uzbekistan’s nuclear programme. President Mirziyoyev was in France in early October. Tashkent is also looking to resurrect its airplane manufacturing base that existed when Uzbekistan was a Soviet republic. 

Presidents Putin and Mirziyoyev
October 19th, Tashkent
©President of Russia Website

In addition to the greater activation of the relationship with Russia, that was signalled by Putin’s visit, Uzbekistan is simultaneously developing its relationship with neighbouring Kazakhstan. Until recently, the two countries were perceived more as competitors for the regional leadership in Central Asia. Indications are that a strong cooperation atmosphere has already set in under the new Uzbek leadership. There are even rumours that Uzbekistan may consider acceding to the Eurasian Economic Union. This could relatively quickly lead to a major increase in trade flows within the Union as well as provide a significant boost to economic growth both in Uzbekistan and Kazakhstan.

As an illustration of the new political atmosphere, the Presidents of Russia, Kazakhstan and Uzbekistan had an informal meeting in a small town in Kazakhstan, less than 25 kilometers from

Presidents Putin, Nazarbayev and Mirziyoyev
October 20th, Saryagash, Kazakhstan
©President of Kazakhstan Press Service

Uzbekistan has the advantage of offering a skilled and educated labor force for new industrial and technological projects. It has a solid scientific base with a network of universities, technical colleges and various institutes. The development program for the next decade is ambitious and challenging. According to the Asian Development Bank Uzbekistan has a good potential to become the next Asian tiger.



Elvira Nabiullina

Elvira Nabiullina was born on October 29, 1963 in the city of Ufa, in Russia’s Ural region. She is a Tatar, which is Russia’s largest ethnic minority.

In 1986 Elvira Nabiullina graduated from the prestigious Moscow State  University with a Master’s  degree in Economics. She is broadly regarded as unusually brilliant as well as a hard worker.

In the 1990’s, Nabiullina worked in various private sector jobs, including as the Chairwoman of a successful Promtorgbank. She then took the position of Vice President at the newly-created Center for Strategic Research, an economics-related think tank formed to advise Vladimir Putin, who was at that time running in his first campaign in a Russian presidential election. The Center developed what is known as Strategy 2010, a set of reforms designed to fix the damage of the crises of the preceding decades in order to bring back Russia to more stable development.

Early in the 2000's Nabiullina began to rise to prominence when she worked with Herman Gref, a noted liberal leaning reformer, head of the Ministry of Economic Development and Trade. Nabiullina served as First Deputy Minister at the Ministry from 2000 to 2003. Her work greatly contributed to seriously curbing Russian inflation.

From 2003 to 2007 Nabiullina was in charge of Center for Strategic Research and was instrumental in helping Russia for a highly prestigious presidency of the G8 (2006).  A year later Nabiullina was selected by Yale University as one of 18 “emerging leaders” to participate in its World Fellows program.

The same year  Herman Gref stepped down as Minister to head Sberbank, Russia’s largest private bank. Nabiullina replaced him as Minister of Economic Development and Trade.

Elvira Nabiullina is known for her ideological neutrality. She also was not afraid to clash with such influential men as Alexei Kudrin and Dmitry Medvedev.

To combat rapid inflation, Nabiullina boosted Central Bank interest rates to 17%, drawing in deposits both domestically and internationally and directing these funds to refinance foreign currency loans. The market also helped correct itself, with Russian suppliers, for instance, replacing imports of American beef with Brazilian beef, where the exchange rate was more favorable. In addition, higher prices and government programs encouraged investment in Russia’s food industry, bringing down prices by localizing production.

In 2013 she was appointed as the Chairwoman of the Bank of Russia. In that capacity she managed to bring down inflation to 4%.

Nabiulina is known for her outspoken style and cold-blooded professionalism, but also with taking controversial decisions.

In 2014 Forbes magazine named her one of the most influential women in the world and noted that she was instrumental in keeping the ruble exchange afloat during the difficult aftermath of the Ukrainian crisis and keeping Russian economy relatively steady without a slide into major recession.  In 2017 British magazine The Banker picked Nabiulina as "Central Banker of the Year in Europe". In 2018 she gave a memorable and highly instructive lecture to the IMF gathering in Washington DC.



In connection with the Skripal affair, BGN wrote in March 2018:   “in Russia, the Intelligence services, rich oligarchs, criminal world and some echelons of power often intersect in unusual ways. It is not unlikely that this brazen assassination attempt came from within those murky structures and could have been designed as an act of vengeance or an act of sabotage, or even an act of insubordination.”

In an October 25th story that did not attract a lot of attention a BBC investigative journalist wrote “Far from living quietly in retirement, Skripal had been travelling extensively across Europe and to the United States providing information to Western security services about Russian intelligence, including its alleged links with the mafia”.

The BBC story does not draw the conclusion that Skripal was directly targeted by the Russian mafia, but it raises a number of interesting questions about mafia interest in targeting him.

For more details, please see:


Armenian Prime Minister Nikol Pashinyan, who only recently came to power as the result of a popular but peaceful revolution, announced his resignation on October 16th. that he was resigning from his post in order for parliament to be dissolved and an early election held. This move was done in order to obtain a clear majority in the next parliamentary elections and to have a legitimate mandate to implement a cardinal reform of the political and administrative structures of the country.  Pashinyan currently enjoys a high popularity rating, unlike the traditional parties currently holding a majority in Parliament.


Georgians will choose a new president in a runoff second round after a very close, inconclusive first-round vote. The first round election was labelled by international observers as competitive, but clouded by "an unlevel playing field" (without specifying in whose favour, but implying the ruling party)and private-media bias.

French-born former Foreign Minister Salome Zurabishvili, who has the backing of the ruling Georgian Dream party, will face opposition candidate Grigol Vashadze in the second round to be held by December 2nd.

Should the opposition candidate win in a second round, the possibility of bringing back former president Mikhail Saakashvili as a political star could become a reality.


This Central Asian country is experiencing an acute shortage of basic food products. The situation is driving people from provinces to the capital city of Ashkhabad where they can still find some products. The authorities are, however, trying to prevent people from taking large quantities of food from the capital by setting up police roadblocks. According to local sources, police officers also demand bribes. The overall situation in the country is worrisome. 


The Moldovan Constitutional Court has suspended the powers of the country's Russia-friendly president amid a standoff over ministerial appointments with his opponents in the pro-Western government.

The court ruled that President Igor Dodon’s powers should be suspended because he failed to approve the candidates put forward by Prime Minister Pavel Filip’s for Minister of health care, social protection, and family, and for Minister of agriculture, regional development, and environmental protection.

As well, the country was visited by the President of Turkey Recep Erdogan who openly expressed his support for president Dodon's political stance and promised to provide Moldova economic assistance and investments.


Macedonia's parliament has taken a critical step toward renaming the country North Macedonia, a move that would end a decades-long dispute with Greece and pave the way for Skopje to join NATO and the European Union.

With not a vote to spare, a bare two-thirds majority of 80 of the Macedonian parliament's 120 members voted for the name change after a tense week of debate, back-room negotiations, and delays that pushed the vote into the late hours of October 19th.

Amendments will now be drafted to incorporate the new name into Macedonia's constitution, after which another parliamentary vote will be required to enshrine the changes, most likely in January.


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.

Gilles Breton also currently serves as Chairman of the National of the Canada-Eurasia-Russia Business Association. The views expressed in this newsletter exclusively reflect the opinion of the authors.