Ex-Canadian Envoy Slams US Call on Russia for Chem Weapons Inspections as Absurd
Sputnik – 14.08.2018
WASHINGTON – US demands for Russia to accept new inspections for chemicals weapons as a condition for not imposing sanctions are absurd since an international authority has confirmed Moscow scrapped all of them, former Canadian diplomat Patrick Armstrong told Sputnik.
On Monday, the Russian Foreign Ministry in a statement said that US Skripal-related sanctions unveiled last week calling for inspections undermines the authority of the Organization for the Prohibition of Chemical Weapons (OPCW), which confirmed that Russia had destroyed all such weapons.
“The official [US] justifications for this latest set of sanctions prove that they are not the real reasons because they are too ridiculous to be taken seriously by any thinking person,” Armstrong said. “The OPCW certified… that Russia had eliminated its chemical weapons stocks. Who is supposed to certify that it still has?”
The narrative claiming that Russia carried out the fatal poisoning of defector Sergei Skripal in the United Kingdom town of Salisbury had collapsed into incoherence, Armstrong pointed out.
Now that Washington was punishing countries and businesses that did not go along with its sanctions, the sanctions would hurt US allies and probably, as with the earlier sanctions and counter-sanctions, hurt them more than Russia, Armstrong predicted.
“The upshot? The Moscow-Beijing alliance will be strengthened and Moscow’s determination to reduce its exposure redoubled,” he argued.
On Wednesday, the US State Department rolled out two rounds of anti-Russia sanctions over the Skripal affair. The first set targeting security-related exports will be implemented August 22 and the second round three months later unless Russia agrees to chemical weapons inspections.
The US government and its allies have blamed Russia for the March 4 chemical attack on double agent Sergei Skripal in Salisbury, England. Russian authorities have strongly refuted the allegations as groundless, citing lack of evidence and London’s refusal to cooperate in a probe.
Is This The Most Important Geopolitical Deal Of 2018?
By Olgu Okumus | Oilprice.com | August 13, 2018
The two-decade-long dispute on the statute of the Caspian Sea, the world largest water reserve, came to an end last Sunday when five littoral states (Russia, Iran, Turkmenistan, Kazakhstan and Azerbaijan) agreed to give it a special legal status – it is now neither a sea, nor a lake. Before the final agreement became public, the BBC wrote that all littoral states will have the freedom of access beyond their territorial waters, but natural resources will be divided up. Russia, for its part, has guaranteed a military presence in the entire basin and won’t accept any NATO forces in the Caspian.
Russian energy companies can explore the Caspian’s 50 billion barrels of oil and its 8.4 trillion cubic meters of natural gas reserves, Turkmenistan can finally start considering linking its gas to the Turkish-Azeri joint project TANAP through a trans-Caspian pipeline, while Iran has gained increased energy supplies for its largest cities in the north of the country (Tehran, Tabriz, and Mashhad) – however, Iran has also put itself under the shadow of Russian ships. This controversy makes one wonder to what degree U.S. sanctions made Iran vulnerable enough to accept what it has always avoided – and how much these U.S. sanctions actually served NATO’s interests.
If the seabed, rich in oil and gas, is divided this means more wealth and energy for the region. From 1970 until the dissolution of the Soviet Union (USSR) in 1991, the Caspian Sea was divided into subsectors for Azerbaijan, Russia, Kazakhstan and Turkmenistan – all constituent republics of the USSR. The division was implemented on the basis of the internationally-accepted median line.
After the dissolution of the Soviet Union, the new order required new regulations. The question was over whether the Caspian was a sea or a lake? If it was treated as a sea, then it would have to be covered by international maritime law, namely the United Nations Law of the Sea. But if it is defined as a lake, then it could be divided equally between all five countries. The so-called “lake or sea” dispute revolved over the sovereignty of states, but also touched on some key global issues – exploiting oil and gas reserves in the Caspian Basin, freedom of access, the right to build beyond territorial waters, access to fishing and (last but not least) managing maritime pollution.
The IEA concluded in World Energy Outlook (WEO) 2017 that offshore energy has a promising future. More than a quarter of today’s oil and gas supply is produced offshore, and integrated offshore thinking will extend this beyond traditional sources onwards to renewables and more. Caspian offshore hydrocarbon reserves are around 50 billion barrels of oil equivalent (equivalent to one third of Iraq’s total oil reserves) and 8.4 trillion cubic meters of gas (almost equivalent to the U.S.’ entire proven gas reserves). As if these quantities were not themselves enough to rebalance Eurasian energy demand equations, the agreement will also allow Turkmenistan to build the Trans-Caspian pipeline, connecting Turkmenistan’s resources to the Azeri-Turkish joint project TANAP, and onwards to Europe – this could easily become a counter-balance factor to the growing LNG business in Europe.
Even though we still don’t have firm and total details on the agreement, Iran seems to have gained much less than its neighbors, as it has shortest border on the Caspian. From an energy perspective, Iran would be a natural market for the Caspian basin’s oil and gas, as Iran’s major cities (Tehran, Tabriz, and Mashhad) are closer to the Caspian than they are to Iran’s major oil and gas fields. Purchasing energy from the Caspian would also allow Iran to export more of its own oil and gas, making the country a transit route from the Caspian basin to world markets. For instance, for Turkmenistan (who would like to sell gas to Pakistan) Iran provides a convenient geography. Iran could earn fees for swap arrangements or for providing a transit route and justify its trade with Turkey and Turkmenistan as the swap deal is allowed under the Iran-Libya Sanctions Act (ILSA, or the D’Amato Act).
If the surface water will be in common usage, all littoral states will have access beyond their territorial waters. In practical terms, this represents an increasingly engaged Russian presence in the Basin. It also reduces any room for a NATO presence, as it seems to be understood that only the five littoral states will have a right to military presence in the Caspian. Considering the fact that Russia has already used its warships in the Caspian to launch missile attacks on targets within Syria, this increased Russian presence could potentially turn into a security threat for Iran.
Many questions can now be asked on what Tehran might have received in the swap but one piece of evidence for what might have pushed Iran into agreement in its vulnerable position in the face of increased U.S. sanctions. Given that the result of those sanctions seems to be Iran agreeing to a Caspian deal that allows Russia to place warships on its borders, remove NATO from the Caspian basin equation, and increase non-Western based energy supplies (themselves either directly or indirectly within Russia’s sphere of geopolitical influence) it makes one wonder whose interests those sanctions actually served?
The US’ Rebuff Of Russia’s Cooperation Request In Syria Shows Its Cynicism
By Andrew KORYBKO – Oriental Review – 13/08/2018
The head of the Russian Armed Forces General Staff Valery Gerasimov asked his closest American counterpart Joseph Dunford to assist his country in jointly stabilizing Syria.
Reuters reported that the proposal to cooperate on the repatriation of refugees and reconstruction projects in the Arab Republic was met with an “icy reception” by US decision makers, though this could have been expected considering that Washington had previously said that any assistance that it might provide to the government-controlled areas of Syria would be tied to the implementation of UNSC 2254’s constitutional reform and new elections. Furthermore, President Assad declared in late June that his government wouldn’t accept reconstruction funds from the same countries that contributed to destroying his own, though if the leaked details of Gerasimov’s message to Dunford are to be believed, then Russia’s assessment is that Damascus “lacks the equipment, fuel, other material, and funding needed to rebuild the country in order to accept refugee returns”, hence the reason for reaching out to the US.
While there were high hopes that Presidents Putin and Trump might have reached an understanding on Syria during last month’s Helsinki Summit, it appears as though expectations might be dashed after this latest setback. The US veritably has an interest in focusing its reconstruction efforts and post-war development projects on the Kurdish-controlled proxy state in the northeastern agriculturally and energy-rich corner of the country that it’s already deployed roughly two thousand troops to, so there’s a certain logic to rebuffing the latest Russian offer. Even though the Kurds and Damascus have reportedly entered into talks with one another, this is unlikely to lead to the dissolution of the US’ protectorate and will probably find a way to “formalize” it through mutually acceptable “compromises” that figure into the ongoing constitutional reform process.
Although the leaking of Gerasimov’s proposal to Dunford was probably done by Trump’s “deep state” enemies in a desperate attempt to undermine what they may have feared was the President’s “secret deal” with Putin, it inadvertently harms the US’ soft power standing because it confirms that America doesn’t really care about the welfare of the Syrian people or the return of refugees from the region and beyond in spite of its repeated statements to the contrary over the years. Making humanitarian and developmental assistance conditional on political factors is Machiavellian to the core but unsurprising to those who have a solid understanding of the cynicism behind American strategic planning. It’s also proof that the US is indirectly weaponizing refugees and developmental assistance in order to advance its objectives, something that its supporters have always denied but which is now beyond debate.
Caspian Sea Convention Bans Military Presence of Non-Littoral States in Region
RT | August 12, 2018
Vladimir Putin attended the Caspian Sea summit in Kazakhstan which he said has “milestone” significance. There five littoral powers finally made a breakthrough on trade, security and environment following 20 years of talks.
This year’s meeting has been “an extraordinary, milestone event,” Russian President Vladimir Putin told his counterparts in Kazakhstan’s port city of Aktau, where the summit took place. Leaders of the Caspian Five came there to seal a convention on the legal status of the sea washing shores of Azerbaijan, Iran, Kazakhstan, Russia and Turkmenistan.
“It is crucial that the convention governs … maritime shipping and fishing, sets out military cooperation among [Caspian] nations and enshrines our states’ exclusive rights and responsibilities over the sea’s future,” Putin said. He added the landmark accord also limits military presence in the Caspian Sea to the five littoral countries.
From now on, no country from outside the region will be allowed to deploy troops or establish military bases on the Caspian shores. The five states themselves will also decide on how to deal with issues currently affecting the Caspian Sea region, such drugs and terrorism.
“Hotspots, including Middle East and Afghanistan, aren’t far away from the Caspian Sea,” the President stated. “Therefore, the very interests of our peoples require our close cooperation.”
The summit may give boost to digitalization of commerce, mutual trade and logistics, Putin suggested. “Transportation is one of key factors of sustainable growth and cooperation of our countries,” he argued. Additionally, the five states will establish the Caspian Economic Forum “to develop ties between our countries’ businesses,” Putin told.
The Caspian Sea is home to some 48 billion barrels of oil and 292 trillion cubic feet of natural gas in proven offshore reserves. A range of important pipelines are going through the Caspian Sea, connecting Central Asia and Caucasus with the Mediterranean.
Russia, China nearing alliance conditions
By M K Bhadrakumar | Indian Punchline | August 10, 2018
The Chinese Communist Party Politburo member Yang Jiechi is visiting Moscow on August 14-17 at the invitation of the secretary of the Russian national security council, Nikolai Patrushev to participate in the 14th round of Russian-Chinese consultations on strategic stability. The forthcoming event in Moscow will be closely watched since the two countries are fast nearing a situation of confronting a common ‘enemy’. This is a new experience for both since the halcyon days of the Sino-Soviet alliance in the 1950s.
The mainstream opinion has been that the Sino-Russian comprehensive partnership and cooperation is more the stuff of geopolitical signaling than a strategic alliance. The Western opinion has also been notably skeptical whether such partnership between Russia and China will be sustainable over time due to the growing asymmetry in the two countries’ comprehensive national power. Both premises may be getting outdated by the sheer force of developments.
Curiously, another body of opinion is steadily forming lately whether Russia and China could be actually on the verge of reaching alliance conditions in the rapidly changing global situation characterized by growing tensions in their respective relations with the United States. An essay in the Financial Times this week titled ‘China and Russia’s dangerous liaison’ authored by the daily’s Asia editor (who used to be the Beijing bureau chief previously), Jamil Anderlini, forcefully makes this point.
The writer argues that it is an intelligence blunder of historic proportions that the West is making by “dismissing the anti-western, anti-US alliance that is now forming between Moscow and Beijing.” Anderlini writes:
- This idea that Russia and China can never really be friends is just as wrong and dangerous as the cold war dogma that portrayed global communism as an unshakeable monolith… Their tightening embrace is as much about antipathy towards the US and the US-dominated global order as their rapidly growing common interests… Thanks to its continued rise and obvious ambition to supplant the US, China is a far bigger long-term challenge for America than Russia. No less a figure than Henry Kissinger – the architect of that reconciliation with China in 1972 – has reportedly counselled Donald Trump to pursue a “reverse Nixon-China strategy” by seeking to befriend Moscow and isolate Beijing.
However, the chances of a “reverse Nixon-China strategy” by the US are virtually zero. Even if President Trump is inclined in that direction, the ‘Deep State’ simply won’t allow him a free hand. It is after much effort that NATO has cast Russia in an ‘enemy’ image and anchored a whole new purposive agenda on that platform. Unshackling it can lead to the unraveling of the western alliance system itself. The New York Times today reported that the Washington establishment connived with the US’ NATO allies to present a fait accompli at the recent summit meeting of the alliance in Brussels.
In fact, the Trump administration has just announced plans to create a new Space Force as the sixth branch of its military to prepare for “the next battlefield” to counter Russia and China, which are “aggressively” working to develop anti-satellite capabilities. Announcing this at the Pentagon on August 9, US Vice-President Mike Pence said,
- China and Russia have been conducting highly sophisticated on-orbit activities that could enable them to maneuver their satellites into close proximity of ours, posing unprecedented new dangers to our space systems… We must have American dominance in space, and so we will.
President Trump promptly tweeted, “Space Force all the way!” And this comes soon after the announcement by Washington that it would impose extensive new sanctions against Moscow by August 22, including bans on a wide range of exports, by the end of the month as punishment for the alleged nerve agent attack on former Russian agent Sergei Skripal and his daughter Yulia in Britain in March. The State Department has further threatened another wave of sanctions in 3 months’ time, including a lowering of the diplomatic relations with Russia. Without doubt, within a month of the Helsinki summit, US-Russia relations are in free fall once again.
Moscow has strongly reacted. PM Dmitry Medvedev warned on Friday that tightening up of economic sanctions against Russia may be treated as a declaration of economic war, to which Russia will respond with all economic, political and other means possible.
Similarly, China and the US are embroiled in an escalating trade war. On Wednesday, Beijing unveiled a list of US$16 billion worth of American goods it plans to hit with tariffs. This is response to Washington’s announcement the previous day that it would impose 25 per cent tariffs on an equivalent value of Chinese exports. An editorial in the government-owned China Daily on Thursday flagged that “the possibility that the two countries are heading for a prolonged trade conflict has to be faced.”
Clearly, a closer coordination between Russia and China in a concerted strategy to push back at the US will be a key topic at the consultations in Moscow next week. The point is, the quasi-alliance between Russia and China cannot be belittled as ‘geopolitical signaling’ anymore. Just short of a formal military alliance, the two countries are intensifying their cooperation and coordination. In an unusual gesture, Moscow announced well in advance that President Vladimir Putin will be receiving Yang, signaling the high importance that the Kremlin attaches to the strategic consultations with China.
The bottom line is, despite the attempts by American analysts to create dissension in the Sino-Russian relations – by propagating that China poses demographic threat to the Russian Far East; that China is conspiring to militarily seize the Siberian Lebensraum; that China is overshadowing Russia in the Central Asian region, etc. –the attraction of China is only increasing in Moscow’s strategic calculus, thanks to China’s formidable economic firepower (with its nominal GDP set to overtake the Eurozone’s by the end of this year) and China’s rapidly developing technological sophistication.
Of course, Moscow realizes that no significant improvement in the Russian-American relations can be expected either so long as Trump remains in power. To be sure, new directions of Russia-China cooperation will be identified at the talks in Moscow. Read a commentary, here, by a leading Chinese pundit who envisions the Northern Sea Route (which is a key template of Moscow’s Arctic strategies) as an “important component” of China’s Belt and Road initiative, and could be considered as “part of an ambitious strategy to change China’s land and sea connections to Europe and the world.”
New US Anti-Russia Sanctions Made to Head Off Senate-Proposed Sanctions – Expert
Sputnik – August 11, 2018
Russian Prime Minister Dmitry Medvedev said that the new sanctions the US plans to introduce might be treated as a declaration of economic war. Radio Sputnik discussed this in detail with independent political analyst Gilbert Doctorow.
Sputnik: What is your take on the statement made by the Russian prime minister? Can the sanctions lead to economic warfare between Moscow and Washington?
Gilbert Doctorow: There’s been a low-grade economic warfare going on for several years ever since the initial introduction of sanctions going back at least two years. The question is what is new here and we really don’t know. The markets reacted severely; the ruble fell drastically. Certain Russian shares like Aeroflot or Sberbank were beaten down five percent and more in the first reactions to the announcement of the United States. But the fact is that the real harm to the Russian economy is coming from the first sanctions. And for the greater sanctions scheduled three months after the introduction, after Russia has proven it is unable to take responsibility for the Skripal poisoning and face the consequences; we may assume that Russia will not admit to having taken part in something that it didn’t participate in. Both the initial sanctions and those that would come in place three months later have not been specified, so to speak about the severity of this particular action by the [US] administration is premature. Nonetheless, I do adhere to one interpretation of what is happening that makes some sense to me: namely, these new sanctions, with respect to the Skripal case, were introduced by the Trump administration to head off what had been described as draconian and genuinely nuclear button sanctions that members of the US Senate have intended to impose on Russia, from a bill introduced by (…) and those sanctions, which genuinely take you to very limits of economic warfare at the level of hostility that very often is jumping off point to armed conflicts, those sanctions would be prevented or sidelined by the more modest sanctions that are announced by the administration. This is the interpretation that I pass on; I think it makes a lot of sense. The level of US-Russian trade has never been very high and that is one of the reasons why it has always been a cheap and easy thing for the American Congress to do – to impose sanctions or otherwise limit Russia’s commercial and foreign policy possibilities in the world by unilateral US action. That always has been very cheap for the United States because the whole volume of bilateral trade has been minimal. The commercial interests of the US and Russia have never been matched in a way that Russia’s interests are matched with the EU and, more recently, with China. If these new sanctions fell on Russia absent any other trade developments or other foreign policy initiatives by the United States’ third parties then one could get very excited about it, but considering that Donald Trump has begun a very bitter trade war with China, with which it has at least $500 billion in trade, possibly to be held ransom to new tariffs up to 25 percent, these sanctions that the United States is considering imposing on Russia such as suspending Aeroflot flights, which only would put Aeroflot in the same status with Delta, since at the moment Aeroflot is the only surviving supervisor of direct air links, or somehow affecting the situation with Sberbank. When you consider the dollar value of these sanctions, they are incredibly small compared to what the United States is doing with China and is threatening to do with the EU in the tariff war. Therefore, you have to put the Russian situation in this broad context of US economic aggression against the rest of the world.
Sputnik: What’s your take on the situation generally?Gilbert Doctorow: It will very much depend on the November mid-term elections in the United States. What we are seeing now from the point of Mr. Trump’s enemies in the Senate, both enemies within his own party and enemies, most obviously, in the Democratic Party, is a scrambling for positions that these respective politicians will place before the electorate for the November elections. If Donald Trump loses control of both Houses of Congress then he will be impeached. If he loses control of one House then we will see a continuing fight between the executive and the legislative over policy towards Russia. Russia is really a political football in the US for the partisans who are playing out their antagonisms and reaching out the electorate to take or to retain control of Congress. The thing to watch is what happens in November. The Russian economy has been preparing for this type of activity for some time and I think that the Russian economy is quite resilient or will find its footing very quickly when the particulars are announced. The Russians have held back, they have been very restrained. I think the thing to look at is at what moment will Russia pull the plug on its delivery of rocket engines to the United States. That is, perhaps, the single most important countermeasure that Russia has to respond to draconian sanctions from the US. If in the current round of Russian countermeasures we don’t see any mention of these rocket engines then you can assume that whatever Mr. Medvedev is saying publically, the Russian government is not taking as a serious threat the America administration’s posturing.
US State Dept sanctions against Russia aimed at ‘undercutting’ Trump, analysts say
RT | August 9, 2018
The US State Department decision to blame Russia for the poisoning of Sergei Skripal without any evidence amounts to “flicking matches in a gasoline-filled room,” former US diplomat Jim Jatras told RT.
The announcement of sanctions on Wednesday came despite the fact that the US is entirely aware that Russia was not responsible for the poisoning of Sergei Skripal in Salisbury, UK in March, he said.
“This is a political demand… this is designed to undercut the overtures from the Trump administration for President Trump directly and also Senator Rand Paul – now in Moscow – to warm relations with Russia.”
Former Pentagon official Michael Maloof echoed that sentiment, telling RT that “you have Donald Trump’s foreign policy and you now have the Trump administration’s foreign policy.” He added that the sanctions are being orchestrated by the deep state to “make the president look bad and basically to corner him.”
Both spoke to RT about Moscow’s impossible position when it comes to its non-existent role in the Skripal poisoning. “How do they prove a negative?” Maloof asked.
Meanwhile, Jatras warned that the current situation is “getting more serious than the people behind this.”
“We are getting very close to the line of the kind of breaking of dialogue, the breaking of relations that occurs between two countries only when they’re on the edge of war. I don’t think the people here really understand the kind of gasoline-filled room that they’re flicking matches into,” he said, specifically mentioning the second round of sanctions, which could downgrade diplomatic relations and cut off Aeroflot flights to the US.
The former US diplomat also noted Washington’s hypocrisy in its demands. “Is Russia going to submit to on-site inspections by the United States?” he asked, while pointing out that the US itself hasn’t destroyed its chemical stocks under the Chemical Weapons Convention. “This is a completely topsy-turvy world when it comes to these accusations.”
However, there’s probably more to the sanctions than meets the eye, according to Earl Rasmussen, executive vice-president of the Eurasia Center, who told RT that it needs to be looked at “from a much greater geopolitical situation,” noting the situation in the Middle East, from Syria to Iraq.
“Obviously, Russia’s had a significant hand in putting down Al-Qaeda and ISIS (Islamic State), and blocking a lot of things that the US establishment had there,” he said.
As for the Kremlin’s role in the baseless accusations, Rasmussen said he has “huge respect” for the Russian Foreign Ministry and President Putin for their handling of the situation. “They’re probably the most grown-up foreign diplomats out there and the most professional as well,” he said.
Sanctioning Russia for false link to UK poisonings ‘unacceptable & unlawful’ – Kremlin
RT | August 9, 2018
Dmitry Peskov, the press secretary of Russian President Vladimir Putin, says the use of a Russian link to recent UK poisoning incidents to justify fresh US sanctions against the Kremlin is a violation of international law.
“In general, of course it’s necessary to say that we consider it categorically unacceptable that the new restrictions, that we continue to consider unlawful, are associated with the Salisbury case,” Peskov said in his Thursday interview with reporters.
“The association with these events is unacceptable for us. And we are convinced that such restrictions, together with the ones that the American side has imposed preemptively, are totally unlawful and contradict international law.”
“Russia does not have, and it has never had, anything to do with chemical weapons’ use, this is out of question. Moreover, we cannot confidently discuss what was used in Great Britain and how it was used because we have no information whatsoever. We have received no answers to our proposal to the British side to hold joint investigation into this incident that causes serious concern on our part,” the Kremlin official added.
Peskov told reporters that he considered any speculation about the effect of sanctions on the Russian financial system unwarranted, because this financial system was very stable. He noted that this stability had been proven in previous standoffs and that the Russian authorities had taken deliberate measures to make the country’s finances capable of withstanding the unpredictable behavior of “partners across the ocean.”
He stressed that it was difficult to reconcile the latest unfriendly actions by the US with the atmosphere established during the recent summit between US President Donald Trump and Putin in Helsinki.
When reporters asked Peskov about a possible Russian response to new US measures, he insisted it was too early to discuss the issue because the official US statement and quotes in the media from certain high-ranking sources did not make clear Washington’s official position.
Earlier, the US State Department announced the plans to impose new sanctions on Russia over its alleged role in the poisoning of double agent Sergei Skripal and his daughter Yulia in the UK in March. The first package of sanctions is scheduled to come into effect on or around August 22 and will reportedly include a ban on exports of sensitive national security goods to Russia.
The second round of sanctions, which includes downgrading diplomatic relations, banning the Russian airline Aeroflot from flying to the US and cutting off nearly all exports and imports, will reportedly be imposed three months after the first one, unless Russian authorities provide “reliable assurances” that they won’t use chemical weapons in the future and agree to “on-site inspections” by independent monitors.
Earlier today senior Russian lawmakers called the planned restrictions unfounded and likened Washington’s behavior to actions of a police investigator who attempts to extract evidence from an innocent suspect using torture and threats.
Read more:
The knife in Iran’s back: Trump opens door to chaos
By Vijay Prashad | Asia Times | August 9, 2018
On Tuesday night, Iranian President Hassan Rouhani went on television to talk about the reinstatement of sanctions by the United States against his country. He prepared the country for more privations as a result of the sanctions. Responding to US President Donald Trump’s offer of a meeting, Rouhani said pointedly, “If you stab someone with a knife and then say you want to talk, the first thing you have to do is to remove the knife.”
It is clear to everyone outside the US government that Iran has honored its side of the 2015 nuclear deal that it made with the governments of the five permanent members of the United Nations Security Council (the US, the UK, France, China and Russia) as well as the European Union. In fact, quite starkly, EU foreign-policy chief Federica Mogherini said, “We are encouraging small and medium enterprises in particular to increase business with and in Iran as part of something that for us is a security priority.”
In other words, Mogherini is asking companies to resist Trump’s policy direction. What she is saying, and what Rouhani said, is that it is the United States that has violated the nuclear deal, and so no one needs to honor the US sanctions that have been reinstated.
Mogherini pointed to “small and medium enterprises” because these would not be the kind of multinational corporations with interests in the United States. But it is more than small and medium-sized enterprises that are going to challenge the US sanctions. China, Russia and Turkey have already indicated that they will not buckle under US pressure.
China
“China’s lawful rights should be protected,” said the Chinese government. China has no incentive to follow the new US position.
First, China imports about US$15 billion worth of oil from Iran each year and expects to increase its purchases next year. State energy companies such as China National Petroleum Corporation (CNPC) and Sinopec have invested billions of dollars in Iran.
CNPC and Sinopec also have shares in Iran’s major oil and gas fields – CNPC has a 30% stake in the South Pars gas field and has investments in the North Azadegan oilfield, while Sinopec has invested $2 billion in the Yadavan oilfield.
China’s Export-Import Bank, meanwhile, has financed many large projects in Iran, including the electrification of the Tehran-Mashhad railway. Other Chinese investment projects include the Tehran metro and the Tehran-Isfahan train. These projects are worth tens of billions of dollars.
Second, China is in the midst of a nasty trade war with the United States. In late August, Trump’s government slapped 25% tariffs on $16 billion worth of Chinese imports into the United States. China responded with its own tariffs, with its Commerce Ministry saying that the US was “once again putting domestic law over international law,” which is a “very unreasonable practice.”
The “once again” is important. China is seized by the unfairness of the reinstatement of sanctions on Iran, not only for its own economic reasons but also because it sees this as a violation of international agreements and a threat to Iranian sovereignty – two principles that China takes very seriously.
Sinopec, knee-deep in Iran’s oil sector, has now said that it would delay buying US oil for September. Iran has now been drawn into the US “trade war” (on which, read more here).
The Chinese have been quite strong in their position. The Global Times, a Chinese government paper, wrote in an editorial, “China is prepared for protracted war. In the future, the US economy will depend more on the Chinese market than the other way around.” This fortitude is going to spill over into China’s defense of Iran’s economy.
Russia
Russia and Iran do not share the kind of economic linkages that Iran has with China. After the 2015 sanctions deal, Iran did not turn to Russian oil and gas companies for investment. It went to France’s Total – which signed a $5 billion deal. Russia and Iran did sign various massive energy deals ($20 billion in 2014), but these did not seem to go anywhere.
Russia’s Gazprom and Lukoil have toyed with entry to Iran. In May, Lukoil directly said that it would be hesitant to enter Iran because of the proposed US reinstatement of sanctions. Lukoil’s hesitancy came alongside that of European companies such as Peugeot, Siemens and even Total, which decided to hold off on expansion or cut ties with Iran. Daimler has now officially halted any work in Iran.
It was a surprise this year when the Iranian Dana Energy company signed a deal with the Russian Zarubezhneft company to develop the Aban and West Paydar oilfields. The contract is for $740 million, which in the oil and gas business is significant but not eye-opening.
In July, senior Iranian politician Ali Akbar Velayati met with Russian President Vladimir Putin in Moscow. He left the meeting saying, “Russia is ready to invest $50 billion Iran’s oil and gas sectors.” Velayati specifically mentioned Rosneft and Gazprom as potential investors – “up to $10 billion,” he said.
When Putin was in Tehran last November, Russian companies signed preliminary deals worth $30 billion. Whether these deals will go forward is not clear. But after Trump’s reinstatement of sanctions, Russia’s Foreign Ministry said it would “take appropriate measures on a national level to protect trade and economic cooperation with Iran.” In other words, it would see that trade ties were not broken.
Turkey
Both Iran and Turkey face great economic challenges. Neither can afford to break ties. Turkish Foreign Minister Mevlut Cavusoglu has said that his government will only honor international agreements, and that the US reinstatement of sanctions is not part of an international framework. Turkey, therefore, will continue to trade with Iran.
Iranian oil and gas are crucial for Turkey, whose refineries are calibrated to Iran’s oil and would not be able to adjust easily and cheaply to imports from Saudi Arabia. Almost half of Turkey’s oil comes from Iran.
Turkish-US relations are at a low. Conflict over the detention of an American pastor, Andrew Brunson, has led to the US sanctioning two Turkish cabinet ministers, Justice Minister Abdulhamit Gul and Minister of Interior Suleyman Soylu. Gul is a leader of the ruling Justice and Development Party (AKP), while Soylu came to the party at the personal invitation of President Recep Tayyip Erdoğan. These are not men to be intimidated by US pressure.
A US mission led by Marshall Billingslea, assistant secretary of the US Treasury, went to Turkey to persuade the government to join the US sanctions. Meanwhile, the US has begun to put pressure on Turkey’s Halkbank, one of whose senior officials was found guilty of violation of the US sanctions on Iran by a court in the United States this year. This kind of pressure is not sitting well with the Turkish government.
Inside Iran
Pressure is mounting inside Iran. Protests have begun across the country, a reflection of the distress felt by the population as the country’s currency, the rial, slides and as fears of inflation mount.
Last week, the Iranian government fired the head of the central bank, Valiollah Seif, and replaced him with Abdolnasser Hemati. It reversed the foreign-exchange rules, including the failed attempt to fix the value of the rial that was put in place in April.
Hemati had been the head of Iran’s state insurance firm and before that of Sina Bank and Bank Melli. He is highly trusted by the government, which had already appointed him as ambassador to China before hastily rescinding that offer and moving him to the central bank. Whether Hemati will be able to balance the stress inside the Iranian economy is yet to be seen. Faith in the currency will need to be strengthened.
As part of that, Iran’s government has cracked down harshly against financial fraud, particularly scandals over foreign exchange. The man who signed the 2015 nuclear deal, Deputy Foreign Minister Abbas Araghchi, had to watch as his nephew Ahmad Araghchi, the central bank’s vice-governor in charge of foreign exchange, was arrested along with five other people as part of an inquiry over fraud. The message: No one, not even the Araghchi family, is immune from the long arm of the law.
Trump’s belligerence, the refusal of key countries to abide by Trump’s sanctions (including the European Union, but mainly Russia and China), as well as the internal pressure in Iran could very likely create the conditions for a military clash in the waters around Iran. This is a very dangerous situation. Sober minds need to push against the reinstatement of these sanctions – which the Iranians see as economic warfare – as well as escalation into military war.
This article was produced by Globetrotter, a project of the Independent Media Institute.
Color Revolution in the Caucasus rattles Russian leaders
Armenia’s new Prime Minister has targeted Moscow’s confidantes in a corruption crackdown and angered the Kremlin by making overtures to NATO
By M.K. Bhadrakumar | Asia Times | August 8, 2018
No two “color revolutions” have been the same, although the anatomy may bear similarity. This explains why Russia continues to face a problem in calibrating its response to emerging revolutionary tides in its backyard.
Russia fumbled in Georgia (2003) and Ukraine (2004 and 2014), but digested the ‘color revolutions’ in Kyrgyzstan in 2005 and 2010. Of course, circumstances were different: Kyrgyzstan is a landlocked country.
The Moscow elite’s eternal dilemma has been that, when the defining moment came, the West invariably injected geopolitics into color revolutions in the post-Soviet space in a concerted strategy to encircle Russia with an arc of hostile states.
In this complex backdrop of historical uncertainty, Russia is unsure whether it made an error of judgment apropos the “Velvet Revolution” in Armenia, which shot a 42-year-old former journalist and previously uninspiring opposition politician, Nikol Pashinyan, to power. After a meteoric three-week rise he became prime minister in May.
The Velvet Revolution bore traits of a color revolution – although traces of outside interference were indistinguishable. Even as Pashinyan rode the revolutionary wave, Moscow chose not to cast aspersions on his stated agenda, that cleaning up the Augean stables in his country was his sole objective and his mission had no foreign-policy overtones.
Moscow’s approach probably ended up helping him climb the ladders of power, with the entrenched ruling party in Armenia meekly stepping aside to make way for him as the new prime minister.
Pashinyan pledges loyalty
Moscow appeared to accept at face value Pashinyan’s pledges of fealty. President Vladimir Putin was the first foreign leader to congratulate Pashinyan on May 8 when the ruling party elected him as the new head of government in a parliamentary vote.
Putin said: “I hope that your performance as the head of government will contribute to efforts to further strengthen friendly, allied relations between our countries, partnership within the Commonwealth of Independent States, the Eurasian Economic Union and the Collective Security Treaty Organization.”
Pashinyan nicely played along. Indeed, his first face-to-face with Putin in Sochi, only six days later on the sidelines of the summit meeting of the Eurasian Economic Union (EEU), had an effusive tone.
Pashinyan thanked Putin for what he called Moscow’s “balanced position” during the color revolution and reassured the Kremlin of the immutability of the Armenian-Russian “strategic alliance”.
In the presence of reporters, he told Putin that “the strategic alliance relations between Armenia and Russia” required “no discussion” and “there is a consensus on this issue in Armenia. I think that nobody in our country has or will cast doubt on the strategic importance of Armenian-Russian relations.”
Russia maintains a military base in Armenia.
Putin wished him success and said he hoped that bilateral ties “will develop just as steadily as they have up to now.” Putin added that Russia “views Armenia as our closest partner and ally in the region” on both economic and security issues.”
Moscow confidantes targeted
One week into the Velvet Revolution, it all seemed as if the Russian-Armenian alliance couldn’t be in better shape. But then, the sky began getting overcast and a stillness began descending in the air.
On May 10, Pashinyan began what appeared as a shake-up of the administration. It quickly snowballed into a veritable purge aimed at systemic change. He also launched a crackdown on public corruption, which has since made him a cult figure.
In a matter of three months his administration caught up with the two ex-presidents, Robert Kocharyan and Serzh Sargsyan, and the influential mayor of Yerevan Taron Margaryan, who were all Moscow’s confidantes in Yerevan.
Then, on July 27, Pashinyan struck hard by implicating the incumbent Secretary-General of the Collective Security Treaty Organization (CSTO) Yuri Khachaturov on charges dating back to his past assignment as Chief of the General Staff of Armenia under Sargsyan. The general is presently based in Moscow as the head of the Russia-led alliance.
That was when Moscow sat up.
On July 31, Foreign Minister Sergei Lavrov said Moscow was “concerned” that Armenia’s new leadership was making politically motivated moves against former leaders. Lavrov said: “The events of the last few days… contradict the recent declarations of the new Armenian leadership that it was not planning to pursue its predecessors on political grounds.”
Lavrov added: “Moscow, as an ally of Yerevan, has always had an interest in the stability of the Armenian state, and therefore what is happening there must be of concern to us.”
He disclosed that Moscow had repeatedly raised its concerns with Yerevan and expected a “constructive” response. These remarks amount to a rebuke.
NATO outreach spurs Russian warning
Meanwhile, what probably rung alarm bells in Moscow was that Pashinyan also began making overtures to the North Atlantic Treaty Organization (NATO). On the sidelines of the alliance’s summit on July 12 in Brussels, to which he was invited, Pashinyan said: “It would be very useful if NATO will send a strong message to Azerbaijan that any attempt to solve the Nagorno-Karabakh conflict using force will meet a strong reaction from the international community.”
In effect, he invited the Western alliance to get involved in the Southern Caucasus, which Russia traditionally regards as its sphere of influence.
While in Brussels, Pashinyan met the leaders of Germany, France, Canada among others, apart from a having a brief conversation with US President Donald Trump. Importantly, he began stressing the centrality of NATO as a forum for Armenia’s interactions with Georgia.
On August 2, the influential Moscow daily Kommersant wrote that Pashinyan’s moves had “driven a wedge into Moscow’s relations with Yerevan and may set the two countries at loggerheads even more”. The daily noted, citing Russian security officials, that the charges laid against CSTO Secretary General Khachaturov caused “outrage” in Moscow, because it “deals a blow to the image of the Russian-led military and political bloc”. It hinted at Western interference.
Equally, Moscow has taken exception to Armenia’s participation in the NATO exercises currently underway in Georgia. (Armenia is a member of the CSTO.)
In a hard-hitting statement on Friday, Russian Foreign Ministry spokesperson Maria Zakharova said the NATO exercise in Georgia aimed to “project power pressure, chiefly over South Ossetia, Abkhazia and Russia” and can only result in an “escalation of tensions.” Zakharova regretted that “Georgia’s neighboring countries are involved in these drills on various pretexts.”
On Monday, Russian Prime Minister Dmitry Medvedev said Georgia’s accession to NATO may trigger “a terrible conflict” and lead to catastrophic consequences. He closely echoed Putin’s stern warning last month: “We will respond proportionally to aggressive moves that pose a direct threat to Russia. Our [NATO] counterparts who bet on rising tensions, are trying to bring, say, Ukraine and Georgia into the alliance’s military orbit but they should think about the possible consequences of such an irresponsible policy.”
Clearly, Moscow’s preference would have been that Pashinyan pragmatically keeps Armenia in Russia’s orbit – and NATO out of the Caucasus. But the Velvet Revolution has mutated and Moscow’s dismal experience is that in such defining moments, environmental pressures cause changes to the genetic structure of color revolutions, resulting in variant DNA forms.



