INTL 6/22 EU/NATO/CIS/CSTO-SCO/BRIC|Burka v.Pres. Sarkozy/The Ural Summits: BRIC and SCO

6/7 EU/NATO/CIS/CSTO-SCO|EU elections/UK political situation/Russia et al
Housecarl

UK lawmakers criticise US missile shield plan
Marthanoir

U.S. Dollar Too Unstable to be Reliable: Russian Minister
doctor_fungcool

The six-nation Shanghai Cooperation Organization: USA asked to attend but excluded
SarahLynn

The American Empire Is Bankrupt (Multi-page thread 1 2)
Sleeping Cobra

Brazil, Russia, India and China call for MULTIPOLAR, FAIRER World Order
Heliobas Disciple

which country really rules the world?
NC Susan

Reuters: Iranian president Ahmadinejad arrives in Russia for summit
Spirit Of Truth

What Do these First Six Months Mean?- Hanson
Martin

6/21 Op-Ed Washington Times| Confront China's duplicity
Housecarl
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Well that'll heat up the summer in Paris...
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http://www.timesonline.co.uk/tol/news/world/europe/article6557252.ece


From Times Online
June 22, 2009
Burka makes women prisoners, says President Sarkozy
Charles Bremner, in Paris

President Sarkozy threw his weight behind attempts to bar French Muslim women from covering their faces in public, calling their full-body dress a “debasement of women”.

Mr Sarkozy made his attack on a small but growing number of fundamentalist women in a “state of the nation” speech that was the first by a French President to both houses of Parliament since 1873.

Talking in the ornate chamber of the Château de Versailles, Mr Sarkozy also rejected calls to raise taxes and promised to accelerate his project to remake France, despite the deep recession.

His strong words on the niqab and the burka were part of a confident personal performance review that was decried by the Opposition as a self-aggrandising stunt.

“In our country, we cannot accept that women be prisoners behind a screen, cut off from all social life, deprived of all identity,” Mr Sarkozy said to applause in the Parliament’s ceremonial Versailles home.

“The burka is not a religious sign. It is a sign of subservience, a sign of debasement,” he added. “It will not be welcome on the territory of the French Republic.”

Mr Sarkozy was adding his voice to a strong consensus that has emerged this month against women in France’s five million-strong Muslim community who wear the full or nearly-full cover of their bodies and faces. The latest French controversy over Muslim dress, which follows the 2004 ban on head-cover in state schools, began this month when some 60 MPs from both sides of the house demanded action against the burka and the niqab.

“A debate has to take place and all views must be expressed,” said Mr Sarkozy. “What better place than parliament for this? I tell you, we must not be ashamed of our values, we must not be afraid of defending them.”

Many on the Left disapprove of what is seen as a small rise in women adopting fundamentalist dress — they are said to number several thousand. But the are unhappy with what they see as Mr Sarkozy’s enthusiasm for action that would further stigmatise a big immigrant population that is excluded from much of mainstream life.

Muslim leaders reacted cautiously to Mr Sarkozy’s words on the niqab and burka. Dalil Boubakeur, rector of the Great Mosque of Paris, called the President’s remarks “in keeping with the republican spirit of secularism”. Moderate Muslims also saw full face-covering as a symbol of submission, said Mr Boubakeur.

Mohammed Moussaoui, head of the national Muslim Council, said that he appreciated Mr Sarkozy’s assurances in his speech that “in the Republic, the Muslim religion should be as respected as other religions”. Both men noted that Mr Sarkozy had not specifically called for a ban but had supported a full debate on handling the question.

Measures against face-cover are supported by two of the three women Muslims in the Cabinet but other Ministers are questioning the wisdom of legislation that could be impossible to enforce.

It would also risk further criticism of France abroad. This month, President Obama attacked the French headscarf rule in a speech in Cairo, saying that the United States did not believe that the Government should dictate people’s dress.

Boosted by victory for his party in the European Parliament elections, Mr Sarkozy devoted his speech to promising to continue the reforms that he began implementing after his election in May 2007. He is to stage his first medium-sized Cabinet reshuffle on Wednesday to open a second phase of his five-year administration. Among those departing are Rachida Dati, the Justice Minister, and Michael Barnier, the Farm Minister.

The joint parliamentary session at Versailles was attacked by all the opposition parties as an act of self-promotion by a President with monarchical pretensions. The speech was made possible by a change in the constitution that Mr Sarkozy introduced last year.

Since the late 19th century French presidents had been barred from appearing in parliament under rules intended to reinforce the separation of powers. The Socialist Party boycotted the debate after his speech and MPs from small Green and Communist parties boycotted a session that they depicted as an attempt by Mr Sarkozy to play Louix XIV, the Sun King who based the Royal court at Versailles.

Jean-Marie Le Pen, leader of the far-right National Front, used the image in a scathing put-down of Mr Sarkozy after his appearance. “The bling-bling is sounding hollow,” said Mr Le Pen. “In the middle of the disaster that our country is experiencing, the king is naked, even at Versailles.”

DRESS CODE

— In France a law was passed in 2004 banning pupils from wearing "conspicuous" religious symbols at state schools, a move widely interpreted as aimed at the Muslim headscarf

— In Turkey where 99 per cent of the population is Muslim, all forms of Muslim headscarf have been banned in universities for decades under the secular government. In June 2008 the country's Consitutional Court overruled government attempts to lift the ban, prompting protests

— In Britain guidelines say that the full Islamic veil should not be worn in courts, but the final decision is up to judges. Schools may forge their own dress codes and in 2006, courts upheld the suspension of Aishah Azmi, a Muslim teaching assistant who refused to remove her veil in class

— German states have the option of choosing to ban teachers and other government employees from wearing Muslim headscarves; four have done so

—The Italian parliament in July 2005 approved anti-terrorist laws that make hiding one's features from the public — including through wearing the burla — an offence

— Tunisia, a Muslim country, has banned Islamic headscarves in public places since 1981. In 2006 authorities began a campaign against the headscarves and began strictly enforcing the ban

— The Dutch Government said in 2007 that it was drawing up legislation to ban burkas, but it was defeated in elections in November and the new centrist coalition said it had no plans to implement a ban

Source: Times database

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http://www.timesonline.co.uk/tol/news/world/europe/article6552030.ece

June 22, 2009
Russian regional leader Yunus Bek Yevkurov injured in attack
Times Online

The president of the troubled North Caucasus region of Ingushetia was critically wounded when his convoy was hit by an explosion Monday, Russian officials said.

It was unclear whether Yunus Bek Yevkurov's car convoy was hit by a car bomb or a landmine or whether he was the target of the explosion.

At least three other people were wounded in the attack, and there were reports that three of Mr Yevkurov's bodyguards were killed.

Yevkurov is the third top official to be wounded or killed in Ingushetia in the past three weeks and the fourth in the North Caucasus this month.

The explosion occurred around 8:30am (0430 GMT) as Mr Yevkurov travelled in a convoy outside the Ingush regional centre Nazran, according to Ingush Interior Ministry spokeswoman Madin Khadziyeva.

He was hospitalized in unknown condition. Federal Emergency Situations Ministry officials said he was in critical condition.

Ingushetia is home to hundreds of refugees from the wars in Chechnya, to the south, and is one Russia's poorest regions. Like other North Caucasus regions, it has seen an alarming spike in violence in recent years.

Much of the violence is linked to the two separatist wars that ravaged Chechnya over the past 15 years, but persistent poverty, corruption, feuding ethnic groups and the rise of radical Islam also are blamed.

In October, President Dmitry Medvedev appointed Mr Yevkurov, an ex-paratroop officer, as the regional president replacing former secret police officer Murat Zyazikov, blamed by critics of mishandling the crisis.

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http://www.timesonline.co.uk/tol/news/world/europe/article6537731.ece

From Times Online
June 19, 2009
Ireland agrees to re-run referendum on EU Lisbon Treaty
David Charter, Brussels

EU leaders hope that the Lisbon Treaty will come into force as early as November after Ireland agreed today to re-run the referendum that rejected the controversial document a year ago.

Irish voters will be asked to try again in early October after a series of legal guarantees stating that the treaty will not change Ireland's taxation, abortion laws or military neutrality were agreed by the 27 EU leaders at their summit in Brussels.

If - as polls suggest – they pass the treaty, it will pave the way for a new post of President of the European Council, for which Tony Blair is understood to be a leading candidate. He could be appointed by EU leaders as soon as their next summit in October.

Brian Cowen, the Taoiseach, won assurances that the guarantees would be added to the next EU treaty - likely to be the accession of Croatia in 2010 or 2011 - despite British and Czech fears that this could allow MPs another chance to block the Lisbon Treaty, or open up debate on their country's relationship to the EU.

Lawyers from the British government worked through the night to draft a decision that would meet Mr Cowen's demands without opening a Pandora's Box for eurosceptics.

The EU leaders declared: "The protocol will in no way alter the relationship between the EU and its member states. The protocol will clarify but not change either the content of the application of the Treaty of Lisbon."

However Vaclav Klaus, the eurosceptic Czech President who has likened the EU to Communism, vowed to bring the treaty back to the country's parliament soon if he could for a fresh debate.

Czech MPs passed the treaty earlier this year but it is still awaiting Mr Klaus' signature. He refused to sign to avoid putting extra pressure on Irish voters.

The Lisbon Treaty has been controversial because it was created from the ashes of the failed EU Constitution and contained almost all of the measures it envisaged before being rejected by voters in France and Holland in 2005.

Tony Blair promised a referendum on the EU Constitution but the government refused to call one on Lisbon, arguing that it was a regular treaty and not a constitutional document. The treaty will end the national veto over 50 extra policy areas to "streamline" decision-making by qualified-majority voting.

Mr Cowen, who is expected to announce the firm date for the second referendum on Monday, said: "Together we have agreed a package of legally-binding guarantees that respond positively and decisively to the concerns of the Irish people. Doubts raised about certain issues have been clarified and put to rest once and for all.

"The EU is the means by which we make a meaningful impact on the wider wold in which we exist. The Lisbon Treaty will equip the EU to deal with an unpredictable future. And more than ever we need an effective Europe now."

He added: "I am confident we now have a solid basis to go the Irish people and ask them again for their approval for Ireland to ratify the treaty so Europe can move on."

Jose Manuel Barroso, the European Commission president, said: "I'm especially pleased that we have agreed the Irish guarantees. This gives the Irish people all the guarantees they need. It gives me all confidence we will get a Yes vote at the Irish referendum."

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http://www.reuters.com/article/europeCrisis/idUSLM629266

Georgia conflict "could erupt again" - thinktank
Mon Jun 22, 2009 2:15pm EDT

By Matt Robinson

TBILISI, June 22 (Reuters) - The absence of U.N. and OSCE monitors from Georgia's breakaway Abkhazia and South Ossetia could aggravate tensions and lead to new "full-blown hostilities", a Brussels-based thinktank said on Monday.

The International Crisis Group said Russia's consolidation of its military presence in both regions, and its refusal to endorse the continuation of U.N. and OSCE monitoring in their current form posed a threat to security.

Russia and Georgia fought a five-day war last August, when Russia crushed a Georgian assault on the breakaway pro-Russian region of South Ossetia, which like Abkhazia threw off Tbilisi's rule in the early 1990s.

"... violent incidents and the lack of an effective security regime in and around the conflict zones of South Ossetia and Abkhazia create a dangerous atmosphere in which extensive fighting could erupt again," the ICG said in a policy briefing.

"Russia has not complied with the main points of the truce, and the sides have not engaged in meaningful negotiations to stabilise the situation."

Russia recognised South Ossetia and Abkhazia as independent states after the war, and stationed thousands of troops in both regions despite an EU-brokered ceasefire agreement that called on Russian forces to pull back to their pre-war positions.

DISPLACED

Russia last week vetoed a Western-drafted U.N. Security Council resolution to extend the mandate of some 130 U.N. monitors in Abkhazia, saying the text reaffirmed Georgia's territorial integrity and was therefore unacceptable.

Military monitors of the Organisation for Security and Cooperation in Europe, who operated in South Ossetia up until the war, are to leave Georgia by June 30 after negotiations to extend their mandate broke down.

Russia insisted the OSCE South Ossetia monitors be separated from the mission in Georgia. If both missions leave, the European Union will be alone with 225 monitors patrolling up to the de facto borders with Abkhazia and South Ossetia, but not beyond after separatist authorities denied them access.

The ICG warned that the departure of U.N. monitors from Abkhazia might contribute to a feeling of insecurity among the estimated 40,000 ethnic Georgians and Megrelians in Abkhazia, "and prompt many to flee to the rest of Georgia".

It urged Russia to step up efforts to allow the return of displaced persons, particularly around 25,000 ethnic Georgians from South Ossetia who fled what rights groups said was "ethnic cleansing" by Ossetian militias and are still unable to return.

© Thomson Reuters 2009 All rights reserved
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http://www.eurasianet.org/departments/news/articles/eav062209a.shtml

EU: DEADLY ATTACK IN GEORGIA TARGETED MONITORS
6/22/09

European observers in Georgia argue that a June 21 blast near Abkhazia that killed one man was targeted at European Union Monitoring Mission observers. A driver died and a doctor was injured when a vehicle owned by the medical services company MediClub Georgia hit a landmine in Georgia’s western Talenjikha district, not far from the boundary with the breakaway territory of Abkhazia. The vehicle was accompanying a group of European Union observers on their daily surveillance duties.

The blast follows three explosions earlier this month in Zugdidi, a Georgian city about a 15-minute drive from the Abkhaz border, and an explosion on the nearby East-West railway line. A train driver was injured in one of the Zugdidi blasts, two of which took place at the city’s railway station.

“[P]reliminary findings of this incident indicate that this was a deliberate attack on our patrol,� declared Hansbörg Habel, the head of the EU Monitoring Mission (EUMM) in Georgia. Habel called on Georgian officials to find and prosecute the attackers and urged all sides to apply restraint.

The EUMM now functions as the only international mission authorized to monitor Georgia’s volatile border areas with breakaway Abkhazia and South Ossetia after Russian vetoes led to the cancelation of the mandates of the United Nations observers in Abkhazia and the Organization for Security and Cooperation in Europe observers in South Ossetia.

Posted June 22, 2009 © EurasiaNet
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http://www.etaiwannews.com/etn/news_content.php?id=983450&lang=eng_news

Gunfire, grenades destroy power pylon in Georgia
Associated Press
2009-06-22 06:27 PM

Georgian authorities say gunfire and grenades launched from the separatist Abkhazia province have destroyed an electricity pylon.

The attack occurred near where roadside blasts killed the driver of an ambulance accompanying a European Union vehicle a day earlier.

State power company spokesman Shalva Shamatava said the attack Monday destroyed a pylon, cutting power on a line that carries electricity from Georgia into Russia during the summer.

There were no immediate reports of outages.

Land mine blasts Sunday killed the driver of an ambulance accompanying an EU cease-fire observation patrol in the same area.

Russia routed Georgia in a war last August and bolstered its control over Abkhazia and separatist South Ossetia.

Posted for fair use....
http://www.reuters.com/article/rbssFinancialServicesAndRealEstateNews/idUSLM71070320090622

EU's Kroes says some banks in denial about crisis
Mon Jun 22, 2009 3:34am EDT

LONDON, June 22 (Reuters) - Some of Europe's banks and financial institutions were in denial about the credit crisis that has caused some of the sector's biggest players to go bust, EU Competition Commissioner Neelie Kroes said on Monday.

"Quite a number of them were indeed denying the situation," Kroes told CNBC Europe television. "They were mentioning that it was not them, but it was their neighbours."

"It was worrying because we are talking about big financial institutions, where the CEO was still denying (the situation)."

Kroes, who is in charge of ensuring fair play in markets across the 27 EU member states, said it was vital to make sure banks who had received state aid did not secure an unfair advantage over self-sufficient competitors in the future.

European banks on the brink of collapse have rushed to get rescue aid in the past eight months. Kroes said new guidelines expected this month must ensure state funds were used properly.

"The main aim is the restructuring of banks that got state aid," she said. "State aid is taxpayers money -- so we need to be aware that that taxpayers money is indeed spent in the correct way and that it isn't distorting the market." (Reporting by Kate Kelland. Editing by Mark John and Simon Jessop)

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http://www.reuters.com/article/wtUSInvestingNews/idUSLM32943320090622

UPDATE 3-Sarkozy rejects austerity as crisis response
Mon Jun 22, 2009 1:32pm EDT

* Sarkozy rules out tax hikes that would "delay recovery"

* Announces new borrowing to fund investment

* Ceremonial address aims to relaunch reform momentum

(Adds reaction from opposition, employers, paragraph 11)

By James Mackenzie

PARIS, June 22 (Reuters) - French President Nicolas Sarkozy ruled out tax rises and austerity measures to fight the economic crisis and said he would borrow more to finance investment despite a ballooning budget deficit.

"I will not conduct an austerity policy because it has always failed in the past," he told a joint session of both houses of parliament on Monday.

His speech in the grand setting of the Palace of Versailles had been billed as an occasion to lay out the priorities for the second half of his presidency and to relaunch his reform agenda.

Facing a budget deficit of twice the limit set by European Union borrowing rules, Sarkozy pledged broad investment in fields ranging from education to health and research and said the money would have to be found to pay for it.

"We cannot keep fixing priorities and not provide the financial means necessary to reach them," he said, adding the investment would require "considerable means".

"We cannot satisfy them in the strict context of the annual budget," he said.

The pledge came a day after European Central Bank President Jean-Claude Trichet said there was no room for new debt or spending and after Budget Minister Eric Woerth said the deficit would top 7 percent of gross domestic product in 2009 and 2010.

Sarkozy said the government would take out a new loan either from financial markets or the general public, as the government of former Prime Minister Edouard Balladur did in 1993.

He said a long-awaited cabinet reshuffle would be on Wednesday. One of its first tasks would be to decide priorities and the loan to finance them.

FRENCH MODEL

Sarkozy, who has frequently lambasted "Anglo-Saxon capitalism" said the crisis highlighted the virtues of France's tradition of strong public investment and relatively generous social spending.

The speech was short on detailed announcements and the opposition Socialists, who boycotted the debate afterwards, dismissed it as "useless chatter" but its focus on investment was welcomed by the employers association Medef.

"The crisis has brought the French model back into fashion," Sarkozy said, but promised not to shy away from difficult reform decisions, saying the crisis was a "historic chance" for change.

"What we don't do now, we won't do later," he said.

Details of a pensions overhaul would be agreed after wide-ranging consultations next year, he said, adding "everything has to be put on the table", including the highly sensitive issue of raising the retirement age.

He promised a reform of France's complex web of regional and local authorities, an improvement of the overcrowded prison system and pledged to eliminate waste and improve efficiency.

He also aimed to change the emphasis of the tax system away from work and production and said he wanted to go "as far as possible" with a carbon tax that would help fight pollution.

Sarkozy was the first French president since the 19th century to address parliament. The event was made possible by a constitutional amendment he introduced last year.

He also gave his first public comment on a growing debate about the use of burqas by some Muslim women in France, saying the face-concealing garments had no place in the country as they were a sign of the subjugation of women. [ID:nLM350226] (Additional reporting by Estelle Shirbo; Editing by Janet Lawrence)

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http://www.reuters.com/article/politicsNews/idUSTRE55L4OK20090622

Clinton to skip G8, OSCE meetings in Europe
Mon Jun 22, 2009 1:55pm EDT

WASHINGTON (Reuters) - U.S. Secretary of State Hillary Clinton will not travel to Italy and Greece this week for international meetings because of an injury to her arm, her deputy said on Monday.

Clinton tripped and fell in the State Department's basement on Wednesday and had successful two-hour surgery on Friday to repair her broken right elbow.

Undersecretary of State William Burns and special envoys Richard Holbrooke and George Mitchell will represent the United States at meetings in Trieste, Italy, where the Group of Eight foreign ministers will gather this week, U.S. Deputy Secretary of State Jim Steinberg told reporters.

Steinberg said he would replace Clinton in Corfu, Greece, where Organization for Security and Cooperation in Europe (OSCE) foreign ministers are meeting June 27-28.

"The secretary is doing better. She successfully came through her surgery. She was able to come by and visit with us in the department this morning ... but she does have a road to travel in terms of her recovery and rehabilitation," Steinberg said at a news conference with Georgian Foreign Minister Grigol Vashadze.

Posted for fair use....
http://www.globalresearch.ca/index.php?context=va&aid=14007

The Eurasian Pipeline Calculus

by F. William Engdahl
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Global Research, June 17, 2009


Calculus has two main variants—derivative and integral. The Eurasian energy pipeline geopolitics between Turkey Washington and Moscow today has elements of both. It is highly derivative in that the major actors across Central Asia from China, Russia to Turkey are very much engaged in a derived power game which has less to do with any specific state and more to do with maintaining Superpower hegemony for Washington. Integral as the de facto motion of various pipeline projects now underway or in discussion across Eurasia hold the potential to integrate the economic space of Eurasia in a way that poses a fundamental challenge to Washington’s projection of Full Spectrum Dominance over the greatest land mass on earth.

Since at least the time of the Crimean War of 1853, Turkey has played a strategic role in modern Eurasian and European developments. In the 1850’s Ottoman Turkey became a target of Great Power imperial ambitions as Britain and France sought to take advantage of tensions between Russia and the Ottoman Empire in order to weaken and ultimately take vital parts of that weakened empire.

The Great Powers of that time, the empires of Britain, France, Russia and Austria began plotting the dismemberment of the vast Ottoman Empire. Debt was their preferred instrument. The foreign debt situation in Ottoman Turkey had become so extreme that Sultan Abdul Hamid II was forced by his French and British creditors to put the entire finances of the realm under the control of a banker-run agency in 1881, the Ottoman Public Debt Administration (OPDA), controlled by the two largest creditors—France and Britain. By the late 1880’s a new player on the Continent who was not part of this debt control, the German Reich, engaged the Ottoman Empire economically. That strategically challenged the vital imperial design of the most powerful empire of the day, Britain.

After Britain sank into a Great Depression after 1873, Germany’s industrial colossus emerged as the fastest-developing economic power on earth with the possible exception of then fledgling United States. The political and economic fate of Germany and Ottoman Turkey were linked after 1899 with the decision by German industry, Deutsche Bank to build a railway connecting Berlin to the Ottoman Empire as far away as Baghdad in then-Mesopotamia. It was a land bridge for trade between Ottoman Turkey and Germany independent of British control of the seas.

A few Eurasian geopolitical basics

German industry had begun to look overseas for sources of raw materials as well as potential markets for German goods. In 1894 German Chancellor, von Caprivi, told the Reichstag, “Asia Minor is important to us as a market for German industry, a place for the investment of German capital and a source of supply, capable of considerable expansion, of such essential goods as we now buy from countries of which it may well sooner or later be in our interests to make ourselves independent.” Caprivi was supported by German industry, especially the steel barons, and by the great banks such as Deutsche Bank.

That Berlin-Baghdad Railway linking the fate of Ottoman Turkey to that of Germany was a geopolitically strategic factor in the events which led Britain to the First World War in a failed bid to preserve her global hegemony. Turkey then as today was regarded by powerful Great Powers as a “pivot” state. The danger in being a pivot state is, of course, the question of who has their hands on it, who moves the pivot for their own geopolitical purposes.

In 1904 a British professor of geography, Sir Halford Mackinder, delivered a lecture before the Royal Geographical Society titled The Geographical Pivot of History, which was to shape a history of two world wars and subsequent wars and power relations. Mackinder, the father of geopolitics—the relation of geography and political economy and power—developed the systematic axiom of British imperial power. It was simple as it was fateful:

Who rules East Europe commands the Heartland:

Who rules the Heartland commands the World-Island:

Who rules the World-Island commands the World.

For Mackinder East Europe was Continental Europe from Germany to Poland, France and Austria. The Heartland was the vast Eurasian land power, Russia. The World-Island was Eurasia.

When the United States emerged to displace the British Empire in world affairs after 1945, she also took the lessons of Mackinder geopolitics. The leading postwar foreign policy strategists including Henry Kissinger, were schooled in Mackinders’ ideas. One American disciple of Mackinder, Zbigniew Brzezinski, cited Mackinder’s geopolitical axiom in a 1997 essay in Foreign Affairs magazine where he defined the American strategic priorities in the post-Soviet era:

Eurasia is home to most of the world's politically assertive and dynamic states...The world's most populous aspirants to regional hegemony, China and India, are in Eurasia, as are all the potential political or economic challengers to American primacy. After the United States, the next six largest economies and military spenders are there… Eurasia accounts for 75 percent of the world's population; 60 percent of its GNP, and 75 percent of its energy resources. Collectively, Eurasia's potential power overshadows even America's.

Eurasia is the world's axial super-continent. A power that dominated Eurasia would exercise decisive influence over two of the world's three most economically productive regions, Western Europe and East Asia. A glance at the map also suggests that a country dominant in Eurasia would almost automatically control the Middle East and Africa. With Eurasia now serving as the decisive geopolitical chessboard…the distribution of power on the Eurasian landmass will be of decisive importance to America's global primacy. [1]

That has largely defined US foreign political and military relations with Turkey and the newly emerging former Soviet Republics of Eurasia since the dissolution of the Soviet Union in 1991. Unfortunately for Turkey and the republics of the Eurasian region, those relations have too often been determined by IMF conditionalities and by military alliances and actions more resembling the Cold War than an era of genuine peace and respect for national sovereignty. Until now the post-Soviet East-West relations have largely been based on a negative construct.

The two geopolitical statements—the one from Mackinder in 1919 during the Versailles talks to divide Europe after the First World War, the second by Mr Brzezinski in 1997 at the end of a bitter Cold War—have defined the principle relations of Turkey and the rest of Eurasia to the world for more than a century.

Eurasia’s Opportunity today

What will define the future for the various nations of Eurasia, especially Turkey, two decades since the dissolution of the Soviet Union and Warsaw Pact Cold War structures?

The answer requires some clarity on basic issues. First and most essential is how Turkey and other Eurasian nations define their bilateral and regional relationships. Second, how do they define their relationship with the Atlantic alliance, the system of political, military and economic relations built after 1945 around the dominance of the United States.

What defines the situation today is a growing realization across all Eurasia from Beijing to Moscow, from Alma Ata to Ankara that the pillar of the postwar order, the United States has become an increasingly incalculable partner and force in world economic and political affairs. Some even within the US speak of a terminal decline in American influence over the coming decades, with terms such as ‘imperial overstretch.’ It’s essential to understand the extent and nature of the current economic and financial crisis of the Dollar System if we are to make any serious calculation of the future.

The crisis which broke in August 2007 as a crisis in the sub-prime or high-risk segment of US real estate credit was in fact a first manifestation of a process of debt destruction which is bringing the United States into a new Great Depression, one that will last at least a decade, perhaps several. In its severity it will be far worse than that of the 1930’s. Today the USA is the world’s greatest debtor economy. In 1929 it was the largest creditor. Today the USA public debt is over $11 trillion, growing at the fastest rate in history. The Federal deficit this year is estimated to exceed $1.8 trillion as the Treasury pours money into a bankrupt banking system to try to rescue a collapsing Dollar System. In 1929 US Public Debt was insignificant.

Since Washington abandoned the Bretton Woods Gold Exchange Standard convertibility in August 1971 it has been accepted wisdom in Washington that, as Dick Cheney put it, ‘deficits don’t matter.’ So long as the dollar was world reserve currency and the US was the greatest military power, the world would support the dollar. That era appears to have ended. The trade surplus economies of Asia, above all China are becoming increasingly concerned that the value of their dollar investments in US debt will depreciate as the volume of debt needed continues to soar.

In recent months China has begun exploring alternative investment avenues to replace their dollar investments. Russia and Brazil, seeking to reduce their dependence on the dollar, plan to buy $20billion of SDR bonds from the IMF and diversify foreign-currency reserves. Russia’s central bank said it may cut investments in US Treasuries, currently estimated at $240billion, and China says it may reduce reliance on the dollar and US bonds. China today is America’s largest foreign creditor.

This is no short-term impulse to dump dollars or a pressure tactic by the countries of Eurasia. It’s the beginning of a global tectonic shift away from a sole financial center to many regional or ‘multipolar’ centers over the next decade. As the trillions of dollars of US taxpayer bailouts have demonstrated, try as they might, Humpty Dumpty, the Dollar System can’t be put together again, as it was even three years ago. Wrong economic policies, decisions taken more than four decades ago in Washington and Wall Street, have reached their relative limits. The world is in what Joseph Schumpeter once called ‘creative destruction.’ The consequences for the future of Eurasia are enormous.

With the pillar of the US-centered Dollar System slowly collapsing, the choices for Eurasia begin to define themselves. At this point they can go one of two ways: Continue the status quo and subordinate national economic decisions to support the Dollar System. That means abiding by the rules of IMF and World Bank austerity. It means abiding by the trade rules of the G7-dominated WTO, even on issues such as GMO seeds which go against national health security. It means to subordinate national security interests to NATO, an institution created in the Cold War atmosphere of the Truman Doctrine in 1948. That, despite we are at a time the original purpose for NATO, defense against a Soviet military threat or Warsaw Pact aggression has long since become a relic of past history. Those four institutions are at the heart of the 1944 Bretton Woods Dollar System, as I have described in detail in a recent book.

The main problem for fast-emerging Eurasian nations with continuing this Atlantic status quo, sometimes referred to by Washington as ‘Globalization,’ is that it now means going down with the Dollar Titanic over the longer term.

Emerging Eurasian Economic Space

On the other hand there is second dynamic economic perspective, still raw and unformed, but one containing everything necessary to build a vast zone of economic prosperity, a huge new market.

The catastrophic US military experience in Iraq and also in Pakistan and Afghanistan since 2001 has led to much rethinking across Eurasia.

The fact that the new Obama Administration to date, while making rhetorical gestures of a change, has done little of substance to shift US fundamental economic and military policy, suggests that the real options for maintaining the American Century are few at this point. That is clear from the fact that the key players in Obama economic policy were the same persons responsible for creating the conditions of the financial disaster in the first place. The military policies in the new Administration are represented by the same persons responsible for past military misadventures. They are representing an outmoded paradigm that is in fatal decline.

In this situation of a declining economic influence of the USA the various nations across Eurasia are clearly beginning to look to new regional arrangements which could secure export markets, in fact to build new markets.

A market in the end is a political decision. Markets, contrary to what Milton Friedman taught, do not exist free in nature. They are created. There is no abstract ‘world market.’ Regional or local markets can be and are created peacefully.

In the past several years steps to build new markets have become visible across Eurasia. Notable is the Shanghai Cooperation Organization (SCO). According to Russian and to Chinese economists with whom I have discussed, the SCO is seen as an evolving framework to build a new Eurasian economic space.

It is very initial, but an important framework to economically weave the nations of China, Russia and Central Asia into closer cooperation. From the perspective of geopolitics, the SCO is a natural economic convergence of mutual interests of the republics of Central Asia. SCO founding members include Kazakhstan, China, Kyrgyzstan, Russia, Tajikistan and Uzbekistan. Mongolia, India, Pakistan and Iran are observers. They just concluded an annual meeting in Yekaterinburg, Russia where they discussed deeper economic, security and social cooperation. The background of the present deepening dollar crisis shaped the talks. As well the governments of Brazil and India joined after with Russia and China, to discuss mutual economic interests, including energy cooperation.

The Eurasian energy calculus

The future of any economic cooperation among the states of Eurasia, including Turkey, rests on the resolution of vital energy supply issues. Here Eurasia is fortunate to straddle some of the richest energy regions on our planet, in Russia as well as the Caspian Basin state of Kazakhstan and the contiguous Middle East Gulf region.

Following the ill-conceived decision by the G7 in June 1990 to place the economic reorganization of former economies of the Warsaw Pact including Russia under the mandate of IMF conditionalities, a role for which the IMF had never been intended, Russia today is struggling to regain a stable economic base.

It has a way to go. But Russia brings to the table huge positive resource advantages in terms of its wealth of oil and gas reserves and energy technology no Western country possesses. Given the rapid industrial expansion of China since the beginning of the decade, a natural partnership is emerging linking the economies of Russia, Kazakhstan and China increasingly around energy. The role of pipeline geopolitics in the economic future of Turkey and Eurasia generally is central.

Today the future of competing gas pipelines is at the heart of the Eurasian economic calculus. Here Turkey is in a position to play a central role given its geographic and historical role as a bridge between East and West, North and South—Europe and Eurasia.

One key link through Turkey has been the oil and gas pipeline from Azerbaijan to the port of Ceyhan via Georgia. The Baku-Tbilisi-Ceyhan (BTC) oil pipeline and the Baku-Tbilisi-Erzurum gas pipeline are cited as part of Turkey's foreign policy strategy to become an energy conduit. BTC has also been a high priority US foreign policy goal to weaken Russian influence over Caspian energy corridors. By itself BTC has limited strategic effect on the regional geopolitical balance. Were it to be coupled with a second project, the much-discussed Nabucco project, the impact would definitely be a direct challenge to Russia’s energy role. The EU knows this well, which is why several member states have been less than eager to invest serious sums in Nabucco.

Recent developments in discovery and development of new natural gas reserves in both Azerbaijan and most recently in Turkmenistan in South Yolotan-Osman and Yashlar gas fields, located in the eastern part of the Amudarya River basin, add significant new energy resources to the energy calculus of the emerging Eurasian economic space.

Turkey-Russia cooperation or Turkish-Washington Cooperation?

Turkish-Russian economic ties have greatly expanded over the past decade, with trade volume reaching $32 billion in 2008, making Russia Turkey's number one partner. Gas and oil imports from Russia account for most of the trade volume.

Turkey and Russia are already connected by the twin Blue Stream natural gas pipelines across the bottom of the Black Sea. Moscow and Ankara are talking about increasing deliveries through the network, which in 2008 carried 10 bn cm of Russian gas to Turkey.

More importantly, following a March meeting in Ankara between the Turkish Energy Minister and Gazprom chief Alexei Miller, discussions are underway about a Blue Stream-2 project. It would be a new gas pipeline parallel to Blue Stream, in addition to the construction of a gas transportation system in Turkey by expanding Blue Stream to interlink with the proposed Samsun-Ceyhan line, with a spur line under the Mediterranean to Ashkelon in Israel.

Russia’s Prime Minister Putin has also said he was counting on the support of Israel in the construction of a new oil pipeline via Turkey and Israel. The pipeline would link to the Samsun-Ceyhan oil pipeline, to be constructed across the Red and Mediterranean seas.

For Turkey, which currently imports 90 % of its energy, the projects would provide increased energy security and, in the case of the Samsun-Ceyhan-Ashkelon pipeline, generate significant transit revenues.

Discussions are also underway on possible extending Turkey's gas lines across its Thracian territory to supply neighbouring Balkan nations Bulgaria, Serbia, Croatia and Hungary. In such an event, Moscow would have gained a prime goal of lessening its dependency on the Ukrainian pipeline network for transit.

Russia also won a tender for the construction of Turkey's first nuclear plant recently, though final resolution is unclear at this time. Russia’s market also plays a major role for Turkish overseas investments and exports. Russia is one of the main customers for Turkish construction firms and a major destination for Turkish exports. Similarly, millions of Russian tourists bring significant revenues to Turkey every year. Importantly, Turkey and Russia may start to use the Turkish lira and the Russian ruble in foreign trade, which could increase Turkish exports to Russia.

In recent months both Turkey and Russia have taken steps to deepen economic and political cooperation. Cooperation between Russia and Turkey is seen by both now as essential to regional peace and stability.

In talk of revived ‘Great Games’ in Eurasia during the 1990’s it seemed Turkey was becoming once more Russia’s geopolitical rival as in the 19th Century. Turkey’s quasi-alliance with Ukraine, Azerbaijan, and Georgia led Moscow until recently to view Turkey as a formidable rival. That is changing significantly.

Russian President Dmitry Medvedev recently commended Turkey's actions during the Russian-Georgian war of last summer, and Turkey's subsequent proposal for the establishment of a Caucasus Stability and Cooperation Platform (CSCP). The Russian President said the Georgia crisis had shown their ability to deal with such problems on their own without the involvement of outside powers.

Russian’s aim is clearly to use its economic resources to counter what it sees as a growing NATO encirclement, made dramatic by the Washington decision to place missile and radar bases in Poland and the Czech Republic, as they see it, aimed at Moscow. To date the Obama Administration has indicated it will continue the Bush ‘missile defense’ policy. Washington also just agreed to place US Patriot missiles in Poland, clearly not aimed at Germany.

If Ankara moves towards closer collaboration with Russia, Georgia's position is precarious and Azerbaijan's natural gas pipeline route to Europe, the Nabucco Pipeline, is blocked. If it cooperates with the United States and manages to reach a stable treaty with Armenia under US auspices, the Russian position in the Caucasus is weakened.

The strategy for Washington to bring Germany into closer cooperation with the US is to weaken German dependence on Russian energy flows. With the recent Obama visit to Ankara, Washington is evidently attempting to win Turkish support for its troubled Nabucco alternative gas pipeline through Turkey from Azerbaijan which would potentially lessen EU dependence on Russian gas.

Turkey is one of the only routes energy from new sources can cross to Europe from the Middle East, Central Asia or the Caucasus. If Turkey decides to cooperate with Russia, Russia retains the initiative. Since it became clear in Moscow that US strategy was to extend NATO to Russia’s front door via Ukraine and Georgia, Russia has moved to use its economic “carrot” its vast natural gas resources, to at the very least neutralize Western Europe, especially Germany, towards Russia.

A Washington Great Game?

However the question of Turkish-EU relations is linked with the issue of Turkish membership into the EU, a move vehemently opposed by France and also less openly so by Germany, and strongly backed by Washington.

Washington is clearly playing what some call ‘a deeper game.’ Obama’s backing for Turkey’s application for EU membership comes with a heavy price. As the US is no member of the EU it was an attempt to try to curry favor with the Erdogan government. Since the April Obama visit, Ankara has begun to discuss an agreement with Armenia including diplomatic relations.

A Turkish accord with Armenia would change the balance of power in the entire region. Since the August 2008 Georgia-Russia conflict the Caucasus, a strategically vital area has been unstable. Russian troops remain in South Ossetia. Russia also has troops in Armenia meaning Russia has Georgia surrounded.

Turkey is the key link in this complex game of geopolitical balance of power between Washington and Moscow. If Turkey decides to collaborate with Russia Georgia’s position becomes insecure and Azerbaijan’s possible pipeline route to Europe is blocked. If Turkey decides to cooperate with Washington and at the same time reaches a stable agreement with Armenia under US nudging, Russia’s entire position in the Caucasus is weakened and an alternative route for natural gas to Europe becomes available, reducing Russian leverage with Western Europe.

This past March a memorandum was signed between the Azerbaijan state oil company SOCAR and Russia's Gazprom for major deliveries of Azerbaijan natural gas to Russia by January 2010.

Azerbaijan is the only state outside Iran that would likely supply gas to the planned EU Nabucco pipeline from Azerbaijan through Turkey to south-eastern Europe. Russia has proposed South Stream as an alternative to the Nabucco project, also in need of Azerbaijan gas, so in effect Russia weakens the chances of realization of Nabucco.

In this Eurasian pipeline and economic diplomacy, clear is that Turkey and the other nations of Eurasia are grappling with new possible economic arrangements which will have profound impact on the future of the world economy. The EU as a body is at present clearly frozen in the dynamic of the old post-1945 Bretton Woods order. Initiative is unlikely to come from Brussels for a dynamic economic growth in Turkey or Eurasia generally. Interestingly, Eurasia is becoming the growth locomotive for the EU. Many Europeans find that a hard pill to swallow. It is however the reality, and a fascinating opportunity for the nations of Eurasia as well as for the economies of the EU. Ultimately, as well, a vibrant growing Eurasian economic space would be in the best long-term interest of the United States in a multi-polar world.

1. Brzezinski, Zbigniew, A Geostrategy for Eurasia, Foreign Affairs, 76:5, September/October 1997.

F. William Engdahl is author of Full Spectrum Dominance: Totalitarian Democracy in the New World Order. He may be reached via his website www.engdahl.oilgeopolitics.net

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U.S.-led "Sea Breeze" Combined Exercise Canceled in Ukraine
Publication: Eurasia Daily Monitor Volume: 6 Issue: 120
June 23, 2009 12:23 PM Age: 1 hrs
Category: Eurasia Daily Monitor, Vlad’s Corner, Home Page, Domestic/Social, Foreign Policy, Military/Security, Ukraine, Featured
By: Vladimir Socor

On June 22 Ukrainian Naval Headquarters confirmed unofficially that the country's political deadlock has doomed the multinational military exercise Sea Breeze-2009. According to the Ukrainian headquarters sources, the U.S. Armed Forces European Command (EUCOM) and the U.S. Sixth Fleet notified Ukraine's defense ministry on June 17 officially that foreign military units had to cancel their participation because the Ukrainian parliament failed to authorize the entry of such units on the national territory for Sea Breeze-2009 (UNIAN, Ukrayinska Pravda, June 22).

This exercise has been held annually since 1997 (except 2006) on Ukraine's Black Sea coast and at sea as well as at the Shirokyi Lan base in Mykolayiv oblast. Sea Breeze is a joint and combined naval, ground, and air exercise, U.S.-led and mainly U.S.-financed, lasting two weeks in July. It normally involves more than 2,000 military personnel from about fifteen NATO members and partner countries by invitation. The exercise is designed to enhance multinational interoperability -particularly with Ukrainian forces- by practicing operational information sharing, maritime interdiction, boarding and seizure of suspect ships, anti-submarine operations, mine countermeasures, diving missions, amphibious landings, urban warfare, improvised-explosive-device detection and disposal, paratroops' landings, air warfare, and peacekeeping elements. Some of the combat training phases include live-fire practice. Naval, air, and ground force elements from the participant countries perform tasks together as part of Sea Breeze, using each other's equipment in some cases.

Sea Breeze-2009 had been envisioned as the largest exercise ever in this series, according to Commander-in-Chief of the Ukrainian Navy Vice-Admiral Ihor Tenyukh. It was planned to include practice of anti-piracy operations as a major new element in this year's Sea Breeze. The Ukrainian navy was looking forward to the anti-piracy phase of the exercise, preparatory to Ukrainian participation in NATO-led missions against Somali pirates (UNIAN, June 22).

Under Ukraine's constitution and legislation, the entry of foreign military units on the national territory requires legislative approval in each case. Traditionally, the government prepares and the president submits annually to the Verkhovna Rada a list of international military exercises to be held in the given year in Ukraine, requesting parliamentary approval in the form of a special law. President Viktor Yushchenko duly submitted the draft law to enable the holding of Sea Breeze-2009 and other exercises on April 24. The Verkhovna Rada, however, stalled and ultimately declined to consider the draft law as late as June 12 (Interfax-Ukraine, June 12, 13). Five days later, with time running out for holding Sea Breeze in July, its cancellation became inevitable.

Sea Breeze was aborted also in 2006 for lack of parliamentary approval. In that year, Yushchenko failed to request parliamentary approval for the holding of Sea Breeze. The president apparently did not want this issue to spoil the political coalition he was negotiating with Party of Regions leader Viktor Yanukovych at that time, nominating Yanukovych as prime minister. Seemingly unsuspecting U.S. troops landed in the Crimea without the necessary parliamentary authorization, sparking vociferous protests by local Russian nationalist and leftist groups (with significant reinforcements from outside the Crimea). These exploited to the hilt the opportunity to pose as defenders of the Ukrainian constitution and laws. U.S. troops were blocked inside hostels by protesters while the U.S. military cargoes were sequestered on arrival by local port authorities. Local police in the Crimea and central authorities in Kyiv were powerless to change the situation. Then U.S. President George W. Bush was also forced to abort his scheduled visit to Ukraine at the same time. Russian television channels propagandized the protests, so as to encourage participation in them.

The center of gravity of Sea Breeze was moved to the Odessa region in 2007 and 2008 to avoid another outbreak of anti-NATO sentiment among Crimean Russians. The protests were manageable in these cases. Although originating in the overall framework of NATO's Partnership for Peace program, Sea Breeze is not a NATO exercise. It is, rather, a joint Ukraine-U.S. exercise, to which other countries are invited to participate. Oblivious to such distinctions, local protesters and their handlers use the opportunity to demonize NATO.

The Verkhovna Rada's failure to approve the entry of troops for this year's exercise reflects a deepening crisis of institutions in Ukraine. The posts of defense minister (and one deputy minister), foreign affairs minister, finance minister, and other government posts are vacant due to infighting among political forces. Ukraine's financial crisis threatens the funding of the country's international military cooperation programs with a near-freeze. Inaction pending yet another round of elections is impairing Ukraine's capacity at this time to advance however incrementally toward ultimate NATO membership.

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The Ural Summits: BRIC and SCO
Publication: Eurasia Daily Monitor Volume: 6 Issue: 119
June 22, 2009 01:08 PM Age: 1 days
Category: Eurasia Daily Monitor, Home Page, Russia, Afghanistan, Middle East, Iran, Foreign Policy, Military/Security, Economics
By: Joseph Ferguson



L to R: Presidents Luiz Inacio Lula da Silva of Brazil, Dmitry Medvedev of Russia, Hu Jintao of China, and Indian Prime Minister Manmohan Singh shake hands during a group picture shoot in Yekaterinburg on June 16, 2009 at the BRIC (Brazil, Russia, India, China) leaders summit.

On June 15-16 Russia managed to hold two major heads-of-state summit meetings in the city of Yekaterinburg. That Yekaterinburg was chosen as the site is perhaps fitting, because it marks the geographical beginning of Russian Asia. These two summits were, for the most part, about Russia's Asia partners. The Sino-Russian relationship, however, was clearly the fulcrum for both summits. These summits provided an ideal opportunity for the Chinese and Russian leaders to advertise their close partnership, and to give the occasional gratuitous poke at Washington. Nevertheless, the inability to articulate a clear vision for either of the summit organizations, confirms that apart from disenchantment with Washington, there is little else that strategically binds the two nations.

The Shanghai Cooperation Organization (SCO) convened its annual two-day summit on June 15. The SCO normally covers regional security issues, and this year was no different. But the leaders of the SCO nations - like last year in Dushanbe - faced challenges over reaching consensus on certain fundamental issues, such as the question of Iranian membership (Iran is an observer nation), and the type of support available for the NATO mission in Afghanistan.

Iranian President Mahmoud Ahmadinejad, fresh from his controversial re-election, arrived on the second day of the SCO summit. Tajikistan has supported Iranian membership, but both Russia and China are opposed. One Russian expert said, "If the decision [to accept Iran] is made, it will indicate a wholly new vector of a confrontation between Russia [and the West]" (Nezavisimaya Gazeta, June 16). Likewise, Pakistan - also an observer - has been pushing for full membership, but Russia and the Central Asian members oppose this, keeping in mind the observer status of India (Moscow Times, June 16).

Afghanistan poses another challenge for the SCO, especially for the security of Central Asia. In March, Moscow began allowing the transit of non-military goods across Russia to U.S. and NATO partners in Afghanistan. But earlier this year, Kyrgyzstan -most likely with Russian collusion- announced that it was forcing the United States from a vital logistical airbase at Manas. At the Yekaterinburg summit, Afghan President Hamid Karzai met with Kyrgyz President Kurmanbek Bakiyev to ask him to reconsider the closure of the base. The Kyrgyz government has remained firm in its intentions, although the indications are that talks are still underway between U.S. and Kyrgyz officials (Nezavisimaya Gazeta, June 15). Furthermore, Uzbek President Islam Karimov outlined a proposal for a new U.N. peacekeeping mission in Afghanistan that would entail consultation among the primary stakeholders in the region: NATO, Russia, and the six nations bordering Afghanistan (China, Iran, Pakistan, Tajikistan, Turkmenistan, and Uzbekistan) (RIA Novosti, June 16).

Meanwhile, for Russia the threat of the SCO becoming a Chinese Trojan horse is ever-present. On the sidelines of the summit Chinese President Hu Jintao met with the leaders of Kyrgyzstan, Pakistan, Tajikistan, and Uzbekistan. The Chinese government has pledged up to $10 billion in loans to the five nations of Central Asia that are struggling through the economic crisis (The Times, June 17). Apart from a $2 billion loan to Kyrgyzstan (which some suggest is a bribe to expel the U.S. base from Manas), Russia has been AWOL to many of the states in the region that are looking for leadership amidst the crisis.

At the conclusion of the SCO summit on the evening of June 16 the four leaders of the BRIC group of nations (Brazil, Russia, India, and China) met to discuss global economic issues. Indian Prime Minister Manmohan Singh, President Luiz Inacio Lula da Silva of Brazil, Hu, and Medevedev took turns criticizing the United States and Western financial institutions for their failed leadership during the economic crisis. The BRIC nations account for close to half the world's population, but just one-fifth of the global economy. BRIC leaders made calls for a revision of voting rights in the IMF and a review of special drawing rights (SDR), but recent demands for the replacement of the dollar as a the premier reserve currency were somewhat tempered (Moscow Times, June 15-16).

The BRIC nations hold a combined $2.8 trillion in their reserves. At the summit Medvedev said, "The existing set of reserve currencies including the U.S. dollar, have failed to perform their functions" (Reuters, June 16). But Finance Minister Alexei Kudrin gave assurances over the preceding weekend that Russia will not reduce the proportion of U.S. government debt in Russian reserves (RBC, June 17). China is particularly wary about criticizing the dollar, as it has the largest amount of dollar-denominated debt in its reserves, and a fall in the value of the dollar negatively affects these holdings. Like the SCO, the BRIC summit, appears to be more of a photo opportunity than a venue to truly discuss and resolve pressing economic matters. The director of the Center for Russia and Eurasia at the Rand Corporation Andrew S. Weiss, commented that, "the dirty secret in Yekaterinburg is that the BRIC countries have little in the way of a common policy agenda" (Foreign Policy, June 15).

Clearly, China and Russia see eye-to-eye on any number of issues. In the first quarter of 2009 China supplanted Germany as Russia's top trading partner. But as one Russian report suggested, they are "partners, not allies" (RIA-Novosti, June 17). Russia's latent fear of the Chinese economic and demographic threat to the Russian Far East was reawakened earlier this year when the state-owned oil firm CNPC extended a loan of $25 billion to two Russian energy companies in return for deliveries of Siberian oil over a twenty-year period.

In a speech earlier this month Medvedev touted the SCO summit as an opportunity to "build an increasingly multi-polar world order," which might supplant the "artificially maintained uni-polar system" (Financial Times, June 15). As much as the leadership of Russia might desire the establishment of a multi-polar system, the trends seem to indicate otherwise. China's growing economic, military, and political strength, combined with the still-preponderant power of the United States suggests that in the not-too-distant future another bipolar system might arise, and Russia could be left on the margins.

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Jun 24, 2009
SUN WUKONG
A cycle up for renewal
By Wu Zhong, China Editor

HONG KONG - The People's Republic of China, founded and ruled by the Chinese Communist Party (CCP), will greet its 60th birthday in October with nationwide celebrations, including a grand military parade at Tiananmen Square in Beijing.

Traditional Chinese chronology uses the lunar calendar in which the years are designated by combinations of the 12 Heavenly Stems (read as letters A-L) and 10 Earthly Branches (read as numbers 1-10). Hence, 60 years would complete a cycle (like a century in the solar calendar), as one of such combinations (such as A1) repeats itself every 60 years. Because of this, the number 60 has special significance. The age 60 marks a person reaching the peak of his wisdom and life, as Confucius said, “At 60 years, my ear was attuned [to listening to different opinions].”

While China now officially adopts the solar calendar, the influence of the traditional prevails. This is why it attaches such great importance to celebrating the 60th anniversary - the October 1 National Day also marks the completion of a cycle of 60 years of communist rule to start a new one.

Under the circumstances, however, the CCP also has to justify its legitimacy for its continual rule for possibly another cycle of 60 years - or even forever, as it wishes.

Late Chairman Mao Zedong led the party to found the republic through "fighting on horse back". And in Chinese tradition, whoever seizes "all under heaven" by "fighting on horse back" somehow automatically gains his legitimacy to rule. Deng Xiaoping's legitimacy to rule came partially from being a veteran revolutionary under Mao to help seize "all under heaven", but mainly from his launch of the reform and open-door policy to boost economic growth and improve people's livelihood.

Now that all revolutionaries are gone, no longer can the party simply cite Mao's revolution as the justification for its legitimacy to rule. Fully aware of this change, Vice President Xi Jinping, who is widely believed to be the man to replace President Hu Jintao as supreme leader in 2012, declared in late 2008 that the party had already turned itself from a "revolutionary party" into a "ruling party" (Red capitalists' unravel the party line, Asia Times Online, October 17, 2008). In that case, justification is certainly needed as to why the party should remain as the sole "ruling party".

In this regard, former party chief and president Jiang Zemin put forward his so-called "three represents" theory, saying the party represented the fundamental interests of the vast majority of Chinese people. President Hu declared that the party ruled the country "for the people".

While the party's highest echelons are beating their brains to justify their legitimacy, given growing public discontent over rampant official corruption and abuses of power, some lesser officials are proving counter-productive in word and deed.

This month, China National Radio was tipped off that a land lot in a township in the Zhengzhou municipality designated for low-cost housing for low-income people was instead used to build 12 luxury villas. The radio station sent reporters to investigate the report. They sought comments from the Zhengzhou Urban Planning Bureau, which oversees land requisition and housing construction in the provincial city of Henan.

"Why does China National Radio want to cover such small business of others?" the reporters were asked when greeted by Lu Jun, vice director of the bureau. After making sure reporters' recorders were switched off and the microphone unplugged, he said, "Who will you speak for, the party or the common people?"

He then asked the journalists to put a lid on the scandal in the name of defending the "authority" of the party (local authorities) against the interests of those falling victim to land abuse.

The reporters detailed the encounter on the official website of China National Radio, on June 17.

"The purpose of the party and government is to serve the people. The fundamental interests of the party and the people are the same. How come in the eyes of vice director Lu Jun, the party and people become two opposite sides?" they asked.

In the first two days, the story received more than 2 million readers and it has been widely circulated in print and other online media.

Almost overnight, Lu became nationally notorious. On websites he is known as the country's "coolest vice director" with the "coolest quotation" of the year. Many bloggers sarcastically said his words should be considered "the most honest words" ever uttered by a Chinese official. As one put it, "These party and government officials really think they are the rulers and we are the ruled. And surely the interests of the rulers cannot be the same as those of the ruled."

Bloggers launched a "human flesh search" (renrou shousuo, a cyber relay to dig up information about a specific person) on Lu. Soon, his picture and resume were posted on the Internet.

Lu, 51, looks quite handsome and his resume is also impressive. He became a People's Liberation Army soldier when he was 16 and joined the party when he was 20. In 1980, he retired from the army and became a police officer with the Zhengzhou Public Security Bureau. Afterwards, he took various posts in the party's Zhengzhou municipal committee and government. He even completed distance graduate study in economics with the Chinese Academy of Social Sciences (CASS) from 1996-98.

Given his rank (an upper middle-ranking official), educational background and rich work experience, it is unlikely that Lu made a slip of the tongue when he spoke, said a commentary on the website of the party's flagship newspaper, the People's Daily. More likely, he spoke his mind when saying he "represents the party", it said, adding that his words severely damaged the party's public image.

Lu is by no means the only official with such thinking. A commentary dispatched by the state-run China News Service asked, "How many officials like Lu are there nowadays?"

A sociology researcher with CASS told Asia Times Online: "When making public speeches, officials like Lu always say they do this and that on behalf of the people. But in reality they work more for their own interests. To curb skyrocketing housing prices, the central government banned the building of luxury villas two years ago. And the launch of low-cost buildings is to meet the need of low-income people. How dare officials in Zhengzhou give the green light for building villas on land for low-cost housing, which violates at least two regulations? Nine times out of 10, there is collusion between officials and the developers. The central government should launch an investigation."

Echoing the growing public outcry, the commentary on the website of the People's Daily demanded that Lu be sacked. "As a vice director and member of the party committee of the [Zhengzhou urban planning] bureau, Lu has no correct views on power, [official] position and interests. One doubts whether he still remembers what he vowed when he joined the party? With such an attitude, how could he be allowed to stay on his post?"

Some journalists then checked with the organization department of the party's Zhengzhou municipal committee, which oversees the appointment of officials in the city. They were told that Lu Jun spoke "on behalf of himself", hence the organization department could do nothing about it. The Zhengzhou Urban Planning Bureau said they were trying to find out what really happened and had "no comment" at this stage.

According to media reports on Tuesday, the Zhengzhou municipal government has suspended Lu as vice director pending an investigation into the incident.

Some commentators say the incident is an example of the rampant malpractice of "officials covering up the wrongdoings of their colleagues" because they share common interests. And in unison, commentaries in the media say officials do not have "freedom of speech" and they must be responsible for every word they say in public.

A sharply-worded commentary on the website of the Xinhua News Agency points out how Lu's words have shaken up the legitimacy of the party's rule:

A leading cadre should be unable to say those words if he is not accustomed to abusing the power in his hand. If power could be abused to the extent of violating the constitution and party charter to split the relationship between the party and common people, then such power would not only lead to corruption but also likely shake the foundation of the party's rule.

This further reminds us that ... if administrative power is not supervised and restricted, if ideological education on party member cadres is not strengthened so that they will better behave themselves, the relationship between the party and the masses will inevitably be jeopardized ... and eventually the very foundation for the party to rule the country.

Given the continued condemnation from the public and media, the scandal centering on Lu is likely to escalate. The question he raised touches on the very sensitive issue of the legitimacy of the party's continued rule at a very sensitive time.

One of Mao's best-known quotations is: "Who are our enemies? Who are our friends? This is a question of first and foremost importance for our revolution."

The question could now be rephrased: "Who gives us the legitimacy to rule? Whose interests should we work for? This is a question of first importance for our continual rule."

Copyright 2009 Asia Times Online (Holdings) Ltd. All rights reserved.

An interesting take on the BRIC/SCO meeting from a couple of days ago...
___________________

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Jun 20, 2009
BRIC plotters stage a farce
By Chan Akya

The inaugural summit of the BRIC group of countries - Brazil, Russia, India and China - took place in Yekaterinburg in Russia, the site being of more historic importance than the outcome of the actual summit suggested.

Copywriters were quick to notice that the summit took place in the same site where the Russian communists murdered the last czar and his family, suggesting a plot from Shakespeare's Julius Caesar: four ambitious nobles conspire to bump off the Roman ruler on the pretext that he had pretensions to monarchy. In much the same way, the CNBC-generation warns us, these four countries plan to murder the world's sole superpower, the United States
, and usher in its stead a multi-polar world.

What actually transpired though was more comedic than serious, topped as the whole show was with a bland statement that hardly touched on any of the real challenges to the world economy, let alone suggest new measures. To be sure, this wasn't for want of intention, but rather the complete absence of internal cohesion that practically ensured a sticky end result to proceedings.

For example, the summit statement with respect to reforming the international financial system pointed the following:

We are committed to advance the reform of international financial institutions, so as to reflect changes in the world economy. The emerging and developing economies must have greater voice and representation in international financial institutions, and their heads and senior leadership should be appointed through an open, transparent and merit-based selection process. We also believe there is a strong need for a stable, predictable and more diversified international monetary system.

Superficially, this statement addresses the concerns of the "Global South", namely that the current financial system architecture appears outdated for the needs of a changing world. Then again, does it? Reading the statement closely reveals the basic gist to be one of an intended reallocation of seats rather than a complete overhaul of the system itself.

Or put in different terms, the BRIC statement merely reads as a polite request that one of their nationals be appointed as head of the International Monetary Fund (IMF) or the World Bank, rather than the usual reservation of such jobs for Europeans and Americans, as is the current status.

For how else does one explain "... must have greater voice and representation in international financial institutions, and their heads and senior leadership should be appointed through an open, transparent and merit-based selection process" or indeed the fact that three of these countries (Brazil, Russia and China) have quickly accumulated some US$70 billion equivalent of the IMF's Special Drawing Rights (SDRs) in recent days?

"Please sir, I want some more," as Oliver Twist pleads in the Dickens novel of the name. Rather than stopping at the demand for their citizens to be made heads of the IMF and the World Bank, the motley crew also stated the following with respect to the need for reform of the United Nations:

We express our strong commitment to multilateral diplomacy with the United Nations playing the central role in dealing with global challenges and threats. In this respect, we reaffirm the need for a comprehensive reform of the UN. ... We reiterate the importance we attach to the status of India and Brazil in international affairs, and understand and support their aspirations to play a greater role in the United Nations.

At this point, your humble author had to stop reading, and go away clutching his stomach while laughing uproariously. Since when did the followers of Mao Zedong and Vladimir Lenin ever acknowledge the need for dialogue over brute power? That is only the case when they have no power or at least have no confidence in such power.

Neither fish nor fowl
The primary reason for the summit descending into a farce is the unfortunate presence of Russia. In some ways, Russia is unique - as a member of both the "established economic power" group of the Group of Eight - supposedly the world's leading industrialized nations - and the "rising power" group of the BRIC, the country can be arguably positioned as a perfect bridge between the recent past and imminent future.

All that talk is misplaced, as Russia is more akin to a country with neither a glorious past nor a promising future. While resource-rich, the Russian state lacks both the demographic impetus and systemic integrity to ensure any sustained profits from these activities. Instead, under the influence of Prime Minister Vladimir Putin, the Russian state appears headed towards another bout of political turmoil; like a creature forever chasing its own tail in circles.

In other ways too Russia differs from its group members in BRIC. Unlike the diligence of the Chinese, the resourcefulness of the Brazilians or the innovation of the Indians, the country is seen as heavily trapped in its own history. A country that cannot quite decide whether it will play well with its neighbors or simply go out to bomb them, in other words. This confusing agenda of the Russians has been encouraged by the feckless Europeans (see Utterly pointless Europe, Asia Times Online, August 19, 2008), and a confused state of affairs that persists in Washington.

Also, unlike those of the other three countries in the grouping, the Russian economy contracted by almost 10% in the beginning of the year. The swift rise in oil prices towards $70 per barrel will do wonders for growth in the second half of the year, but even that could well be cold comfort given the mountains of debt that need to be refinanced by Russian companies and banks in coming months.

The collapse of various neighbors in Eastern Europe presents economic losses for Russian oligarchs and banks, while the strategic situation for the country remains in flux against a resurgent Georgia and the current "people power" revolution in Iran that could see the Russian acolyte president being removed in favor of the more American-friendly reformer.

Given all this, it is unlikely that the Kremlin will have much ammunition, and even less interest, in doing anything for a nascent multilateral body where the benefits, if any of acting together are likely to accrue to other members before itself, and what percolates down will only do so over the very long term.

Internal tensions
Added to the nonsensical position of Russia in this meeting, tensions between India and China have also increased in recent days over the issue of trade tariffs. Specifically, Indian companies have demanded that the new government (the re-elected Congress party led government in Delhi) impose tough anti-dumping sanctions on Chinese-made products. In an article in the Financial Times dated June 14, 2009:

India's small and medium enterprises have warned that they are suffering because of cheap imports from China. They are urging New Delhi to accelerate anti-dumping investigations and impose tougher safety and quality checks on Chinese products. The appeal for greater government protection came amid rising tensions between New Delhi and Beijing over trade, after a high-profile dispute over an Indian ban on Chinese made toys.

India's Federation of Chambers of Commerce and Industry said on Sunday that a survey of 110 small and medium-sized manufacturers found that about two-thirds had suffered a serious erosion of their Indian market share over the past year because of cheaper Chinese products.

In its statement, FICCI said the Chinese imports were between 10 and 70% cheaper than comparable Indian products, a price differential that it said was "huge and difficult to explain". Amit Mitra, the FICCI's secretary-general, said Indian industries were being hurt by "typical Chinese predatory pricing" intended to drive rivals out of business so that Chinese companies could capture the market - and then raise prices to more normal levels.

The bite was felt by companies in a range of sectors, including processed food, light engineering, building materials and heavy engineering, chemicals and textiles, FICCI said. Indian manufacturers face serious competitive disadvantages in comparison with China, including poor infrastructure and rigid labor laws, that perversely discourage companies from growing and instead promote inefficient fragmentation.

The answers to India's plight are in the story above: poor infrastructure, the need for industrial and labor reform and the relative inefficiency of investments into the country.

Still, what is at stake between the two countries often presents its own dynamic of how far away is the point at which these economies can actually rely on each other rather than those in Europe or the United States for growth. It is not inconceivable that at some point Brazil and China could have a spat over the price of steel (a point of tension in the not-too distant past as Brazilian steel was sold cheaper than locally made products in China at the turn of the century) or indeed that Russia and China have another period of tension over energy exports to China from Russia's neighbors.

We can conclude that the first BRIC summit was a much-needed first step in a journey that could well overhaul global economic architecture in decades to come. However, as things stand now, internal dissent within that group, the lack of common interests and any vision towards achieving longer-term sustainable growth implies that future meetings could easily descend into the farce in which the first one ended.

Copyright 2009 Asia Times Online (Holdings) Ltd. All rights reserved.

Posted for fair use....
http://www.nst.com.my/Current_News/NST/Tuesday/Columns/2589079/Article/index_html

JOHN LEE: Gloss cannot hide rot in China's growth story
By JOHN LEE

2009/06/23

WHEN the Nobel Prize-winning economist Kenneth Arrow was asked recently which countries had the best-managed economy recently, he nominated China, Taiwan and South Korea. This viewpoint is consistent with the widely shared belief that China is the latest successful instalment of the "East Asian model" of authoritarian development. That is certainly what Beijing would like to think but looks can be deceiving. The nature, purpose and extent of the role of the state in China's economy and society set it apart from successful East Asian neighbours. In fact, the differences are significant enough to call into question whether China will taste the fruits of successful modernisation enjoyed by such Asian economies as Taiwan.

The key to success in South Korea, Taiwan and Japan was the creation of the conditions conducive to vibrant organisations, competition and private enterprise. Even though it was within a context of state-guided capitalism and mistakes were made, these governments ultimately offered a "helping hand" to lay the foundations for future private enterprise and capitalist activity -- in particular, widespread and open access to economic opportunity, rule of law, property rights, and social and political stability.

Most Western commentators focus on the spectacular success of China's export sector and the emergence of China as the world's factory. But the greater contributor to Chinese growth is actually domestically funded fixed investment, which constituted over 50 per cent of gross domestic product last year and more than 40 per cent of that year's growth.

China is off the charts in this regard. Taiwan, by contrast, with an unparalleled growth rate of eight per cent every year for 50 years, never had capital investment spending of more than 30 per cent of GDP.

But it is not just China's reliance on fixed investment that is striking. Where the capital goes is all-important. China is unusual in that bank loans -- drawn from citizens' deposits funnelled into state-controlled banks -- constitute around 80 per cent of all investment activity in the country.

Even though state-controlled enterprises produce between one-quarter and one-third of all output in the country, they receive more than 75 per cent of the country's capital, and the figure is rising.

China's state sector owns almost two-thirds of all fixed assets in the country. This is the reverse of what occurred in South Korea (as well as Japan and Taiwan), where the private sector received more than three-quarters of all capital during the 1960s and 1970s.

Another case in point is shares listed on the Shanghai stock exchange: only around 50 of the approximately 1,300 companies are genuinely private. Between 1990 and 2003, less than seven per cent of the initial public offerings on the Shanghai and Shenzhen stock exchanges were from private sector companies.

The Chinese state owns about 50 per cent of all the shares of listed companies. When state-controlled entities are included, it is likely to be around 70-80 per cent of all listed shares.

The massive bias towards the state sector would be acceptable if the 120,000 state-controlled enterprises could learn to innovate and adapt. Unfortunately, except for a handful of centrally managed state-controlled enterprises, this is not the case.

To put the situation in perspective: China's overall use of capital is half as efficient as India's. World Bank findings indicate that about one-third of recent investments made by the state-controlled sector generated zero or negative returns. This might increase the chances of the Chinese Communist Party remaining in power, but at enormous cost to the country.

The economic cost of loans that go bad is great. But the social costs, and impact on civil society, are greater.

An economic system that concentrates economic opportunity and wealth in the hands of a few creates an unsound and unstable political economy. As the state dispenses the most valued business, career and professional opportunities, a relatively small group of well-placed and connected insiders benefit, while opportunities to prosper are denied to the vast majority.

Despite impressive GDP growth, about 400 million Chinese people have seen their net incomes stagnate or decline over the past decade. The income of the poorest 10 per cent has been declining by 2.4 per cent every year since the beginning of this century.

Absolute poverty has actually increased since 2000, as has illiteracy.

Not surprisingly, China's Gini coefficient, a measurement of income inequality, rose from around 0.25 in the 1980s to around 0.38 in the 1990s. It is now around 0.5, the highest in Asia. In contrast, the Gini coefficients of South Korea and Taiwan from the 1960s to the 1990s hovered around 0.34 and 0.29 even as the economies of these countries were growing rapidly.

The Chinese Communist Party has cleverly tightened its grip on economic and, therefore, political power. But this has meant that the building of institutions such as "rule of law" and enforceable property rights have been stagnant for almost two decades. Beijing's model of "authoritarian transition" is failing, and its longer-term prospects are poor.

China is not becoming South Korea writ large. A large, stumbling giant like Russia or Brazil might be a more accurate indication of its future.

The writer is foreign policy fellow at the Centre for Independent Studies in Sydney and a visiting scholar at the Hudson Institute in Washington
© Copyright 2009 The New Straits Times Press (M) Berhad. All rights reserved.

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Kremlin Says Kyrgyz Deal No Surprise
25 June 2009

ReutersCAIRO, Egypt -- A Kyrgyz deal with the United States to keep a U.S. air base open was agreed with Russia, a Kremlin official said Thursday.

"We support all steps aimed at stabilizing the situation in Afghanistan," said the official accompanying President Dmitry Medvedev in Egypt.

But Kommersant quoted an unidentified Russian diplomat as saying Moscow felt that it had been tricked by Kyrgyzstan over the base and would make an "adequate response" to the deal.

The United States has agreed to pay $180 million to keep open the Manas air base after haggling with Kyrgyzstan since February, when the country secured pledges of $2 billion from Russia and announced its closure.

Kyrgyzstan's ruling party said Wednesday that it had approved the agreement with the United States to keep the Manas air base open.

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http://www.washingtonpost.com/wp-dyn/content/article/2009/06/24/AR2009062400498.html

Kyrgyzstan agreed U.S. base deal with Russia-source

By Oleg Shchedrov
Reuters
Wednesday, June 24, 2009 11:19 AM

CAIRO (Reuters) - A Kyrgyzstan deal with the United States to keep open a U.S. air base in Central Asia was agreed with Russia, a Kremlin source said on Thursday, but a newspaper report said Moscow had been thrown off balance by the move.

The United States has agreed to pay $180 million to Kyrgyzstan to keep open the last remaining U.S. air base in Central Asia, a key refueling point for U.S. aircraft in NATO operations against Taliban insurgents in Afghanistan.

Washington had been haggling to keep the base open since February, when the former Soviet republic announced its closure after securing pledges of $2 billion in aid and credit from Russia.

When asked about the deal, a Kremlin official accompanying Russian President Dmitry Medvedev in Egypt told Reuters that Kyrgyzstan had agreed its decision with Moscow.

"Kyrgyzstan agreed its decision (on the base) with Russia," the source said. "We support all steps aimed at stabilizing the situation in Afghanistan."

But Russia's Kommersant newspaper quoted an unidentified Russian diplomat as saying that Moscow felt it had been tricked by Kyrgyzstan over the base and that Russia would make an "adequate response" to the deal.

"The news about keeping the base was a very unpleasant surprise for us -- we did not expect such a trick," the diplomat was quoted as saying by Kommersant.

"The real character of the U.S. military presence in Central Asia has not changed, which goes against Russian interests and our agreement with the Kyrgyz leadership," the Russian diplomat was quoted as saying.

Kyrgyzstan's ruling party said on Wednesday it had approved the agreement with the United States to keep the Manas air base open.

"Kyrgyzstan can not step aside from fighting terrorism," said Kabai Karabekov, a member of Ak Zhol party led by President Kurmanbek Bakiyev. Karabekov said the deal would probably be approved by parliament on Thursday.

The surprise decision to close the base -- announced by Bakiyev in Moscow alongside Kremlin chief Medvedev -- provoked speculation that Russia was trying to use the issue as a bargaining chip in U.S. relations.

The Kremlin says it is ready for cooperation with Washington on fighting the Taliban and Afghanistan is likely to be on the agenda when U.S. President Barack Obama visits Moscow in July.

(Additional Reporting by Olga Dzyubenko in Bishkek and Olzhas Auyezov in Almaty; Editing by Richard Balmforth)

(Writing by Guy Faulconbridge; Editing by Charles Dick)
© 2009 Reuters

Posted for fair use....
http://www.wnd.com/index.php?fa=PAGE.view&pageId=101810

FROM JOSEPH FARAH'S G2 BULLETIN
'Catastrophic crisis' facing Russian army
Will force greater reliance on strategic nuclear forces
Posted: June 22, 2009
10:56 pm Eastern

© 2009 WorldNetDaily

Editor's Note: The following report is excerpted from Joseph Farah's G2 Bulletin, the premium online newsletter published by the founder of WND. Subscriptions are $99 a year or, for monthly trials, just $9.95 per month for credit card users, and provide instant access for the complete reports.

Aging weapons, poor maintenance and rank-and-file officers who don't "want to do anything" mean the Russian military is on the verge of a "catastrophic crisis" and if forced into action would be much more likely to use strategic nuclear weapons, according to a report in Joseph Farah's G2 Bulletin.

This is the prognosis of Russian Chief of the General Staff and First Deputy Defense Minister Army-General Nikolai Makarov.

In addition, Makarov said the Russian air force is not procuring sufficient numbers of new modern aircraft and has fewer flight-worthy aircraft with badly trained pilots incapable of conducting actual combat operations.

"They can run bombing missions only in daytime with the sun shining, but they miss their targets anyway," Makarov said.

Makarov is in charge of overseeing the Russian military reform begun under then-president and now Prime Minister Vladimir Putin.

Keep in touch with the most important breaking news stories about critical developments around the globe with Joseph Farah's G2 Bulletin, the premium, online intelligence news source edited and published by the founder of WND.

In an effort to implement some military reform, Makarov has sought to discharge hundreds of thousands of officers. However, the effort also has met with opposition, particularly from a special Duma, or parliamentary, working group headed by Mikhail Babich, who also is deputy chairman of the Duma defense committee.

Babich produced a report that said the planned dismissal of some 323,000 officers had to be postponed and the transformation of army divisions into brigades also must stop. He claimed that such reforms lacked appropriate legislation to proceed and needed the full Duma's approval.

Markarov was highly critical of such comments, claiming the top brass did nothing while in charge. Indeed, the Russian military is considered to be top-heavy in terms of general officers who have posed an expensive financial burden and are in the most senior and well-paid positions.

Even a reduction by 50 percent of the officers by 2012 is considered to be ambitious, even though those who would be cut would be closer to retirement. However, the goal is to increase dramatically the ranks of junior officers and non-commissioned officers, or NCOs.

Another reform sought will be a smaller but more flexible permanent readiness force, which will place greater emphasis on the leadership role from junior officers and NCOs, contrary to Russian military tradition.

There also is a culture of brutality – especially among conscripts, drunkenness, desertion and drug abuse that the military needs to overcome. The Russian military, particularly during the time it was in Afghanistan, has a history of heroin smuggling and black-market alcohol selling, including overall drug abuse and corruption in its ranks.

F. Michael Maloof, a frequent G2B contributor, is a former senior security policy analyst in the Office of the Secretary of Defense.
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Russian Military Weakness Increases Importance of Strategic Nuclear Forces
Publication: Eurasia Daily Monitor Volume: 6 Issue: 112
June 11, 2009 06:41 PM Age: 13 days
Category: Eurasia Daily Monitor, Home Page, Military/Security, Russia
By: Pavel Felgenhauer


Russian Chief of the General Staff and First Deputy Defense Minister Army-General Nikolai Makarov

On June 5 the Russian Chief of the General Staff and First Deputy Defense Minister Army-General Nikolai Makarov gave an important press conference. Makarov began with a two hour statement on military reform, followed by a slide show involving almost 30 slides, dazzling journalists with a deluge of facts and figures. Russia's radical military reform agenda has recently provoked growing criticism. Last month a meeting of top-brass retired generals expressed disappointment over not being consulted or informed about the reform plans. Former Interior Minister Colonel-General (retired) Anatoly Kulikov announced that the reform plans were not well thought out, and are being implemented too rapidly -which threatens Russia's "territorial integrity and sovereignty" (Nezavisimaya Gazeta, May 25).

A working group, formed by the Duma defense committee and headed by its deputy chairman from the ruling United Russia party Mikhail Babich, also produced a damning report. Babich told journalists that the planned dismissal of 323,000 officers and praporshiki (warrant officers) must be postponed, and the transformation of army divisions into brigades must stop. According to Babich, the reforms can only proceed after the appropriate legislation is introduced and approved by parliament (Vedomosti, June 1).

Makarov angrily dismissed such criticism during his press conference, claiming that top brass retirees did nothing while they were in charge, which had plunged the military into a catastrophic crisis. According to Makarov, there is no time left for "experiments." The Russian military must be reformed immediately and radically, before it totally disintegrates. Makarov pointed out, "our military theory is outdated," since the 1980's Western militaries have been transformed to fight the wars of the future, while the Russian armed forces hibernated. Makarov explained that Russia's outdated military is inferior to its Western counterparts in terms of equipment, training and organization.

In Makarov's opinion, the arsenals are full of aging heavy weapons that have not been properly maintained or repaired for many years, and are consequently mostly obsolete. The Air Force, for instance, has fewer flight-worthy aircraft and more badly trained pilots -rather than procuring modern platforms in sufficient numbers. Makarov said that air force pilots compete for the few aircraft remaining, and are incapable of conducting real combat operations: "They can run bombing missions only in daytime with the sun shining, but they miss their targets anyway" (Interfax, June 5).

Makarov expressed considerable contempt for the rank and file officers and praporshiki: "no-one wants to do anything - our officers have become degraded." Makarov believes that "unready officers" must be fired - "we do not need them." Moreover, Makarov asserted that since the military reforms of Field Marshal Dmirty Milutin in the nineteenth century, which created a mobilization force instead of a regular standing army, "nothing has changed in our military for 200 years." A slide produced by Makarov displayed an image of Russia surrounded on all sides by "threats" that included not only the United States and its allies, but also China. Makarov said, "We will not cut the strategic nuclear rocket forces - today they are our only real defense, while we need at least three years to reform" (ITAR-TASS, June 5). Russia plans to reform and modernize under the nuclear umbrella, while its conventional armed forces remain extremely weak.

Makarov acknowledged that rearming the military with modern weapons will take several years, whereas the organizational reforms can be carried out now. By June 1, the first half of the reorganizations of the MoD will be complete. By December 1, the overall organizational reform must be finished: all units that are left in the army will be fully ready for immediate action ("in one hour" - repeated Makarov). Units will be expanded to full wartime personnel levels - with no place left for reservists. According to Makarov, as the reforms are pushed ahead, the remaining reserve component will be comparable in size with the regular military. Most of the reservists, however, will be civilian professionals such as drivers and doctors (Interfax, June 5).

In the recent wars in the Caucasus, the Russian military actively used separate tactical battalion groups, reinforced by artillery and other heavy equipment. It transpired that an army division could at best field no more than three such battalion groups, since it lacked sufficient reinforcements or support to deploy more. Regular battalion commanders in many cases lacked command experience, and coordinated different units within a heavy separate tactical battalion group, consequently colonels or generals had to take over direct command. Makarov has reported that divisions are being disbanded, with new "heavy brigades" formed to replace them -already comprised of several reinforced tactical battalion groups (ITAR-TASS, June 5).

Military reform in Russia has been long overdue and often harshly or sporadically introduced. Hundreds of thousands of officers will now be discharged. Makarov stressed that all will receive due payouts and allowances; while those who are allowed to stay in the military will see their pay increase threefold.

Nonetheless, there is massive discontent and opposition to the radical change from a mass mobilization force built to fight a global war with the U.S., transferring to a smaller and more capable standing army, designed to fight local wars in the Caucasus or other territories on the periphery of Russia. To quell any possible open military discontent, the elite airborne corps has been protected from any further cuts and declared as an example of the new army. A sergeant's academy to prepare NCO's for all the services is being created in Ryazan at the Airborne Academy: "to teach the rest the virtues of the airborne forces," stated Makarov (ITAR-TASS, June 5).

The Chechen campaign veteran accused by human rights organizations of war crimes, Lieutenant-General Vladimir Shamanov has been appointed commander of the airborne forces (EDM, June 2). Under his command, Russian paratroopers are capable of suppressing any discontent, if it emerges. Radical military reform is rapidly advancing -and it appears that it might indeed succeed.

Posted for fair use....
http://www.timesonline.co.uk/tol/news/world/europe/article6571995.ece#cid=OTC-RSS&attr=797093

From The Times
June 25, 2009
Georgia keeps watch as Russia bans observers and sends in troops

Philip Pank in Ergneti
www.timesonline.co.uk

Three shots rang out over the orchard, testament to the tension on Georgia’s new front line.

To the policemen hidden behind concrete blocks barely 50m from the Russian border guards and South Ossetian paramilitaries facing them across no man’s land it was just part of the daily provocation.

“They shoot across the checkpoint every night. They are playing like little boys,” a Georgian officer said. “They drink together and when they are drunk they don’t care about anything, they just shoot.”

After years of tit-for-tat violence in the separatist region of South Ossetia the fighting escalated into a war last August. Thousands of Russian troops and tanks poured through a tunnel in the Caucasus Mountains and ethnic Georgians fled their villages or were killed in the fighting.

The Government in Tbilisi and those driven from their homes fear another escalation as Russia once again flexes its muscle on the world stage. On Monday 8,500 Russian troops, 200 tanks, 450 armoured cars and 250 artillery pieces will return to the Caucasus for a military exercise.

Georgia says that some will join thousands of troops stationed in the country’s two separatist regions since last summer.

The West may not discover the outcome because last week Moscow blocked the continued presence of international observers in Abkhazia. Checkpoints that allow civilians back to their villages in parts of South Ossetia are tightening controls.

Diplomats, who were caught off-guard by the invasion last year, may play down the prospects of another war but those living in the shadow of the front line are sure that it is coming.

“They kicked out these observers because they could not do what they wanted and now we are afraid that something will start again. That is why they kicked out the observers. They are preparing for war,” Givi Tseveteli said.

Mr Tseveteli, who has two children, has every reason to be scared. Georgians were driven from his village of Ergneti, within sight of the South Ossetian capital, by militia who looted and burnt 120 homes in what they described as ethnic cleansing.

His villa is a charred shell and the family’s possessions reduced to ash. Like other villagers, however, he has moved back because the temporary accommodation where the family were staying closed. They now live in a shelter in their garden. “We have no where else to go. We have to stay here,” he said.

Villagers cannot work the fields because of unexploded cluster bombs and mines. They rely on aid to survive. “We are afraid. There is shooting every night,” Mr Tseveteli’s wife, Darejani, said. “We hope and dream that we can stay here in peace.”

Their plight, and that of 20,000 Georgians still living in camps after the war, has heightened a political crisis with daily street protests demanding that the Government go.

Critics say that President Saakashvili fell into a Russian trap when his troops began fighting in South Ossetia, giving Russia the excuse to invade. They say that he is an unpredictable leader who mistook Western support as a guarantee of protection from Russia. Riot police have suppressed protest marches violently, adding to the sense of insecurity.

The Government is wary of Russia’s latest tactics. “Of course we are worried because this scheme is exactly the same as it was last year,” David Bakradze, the parliamentary Speaker and a close ally of the President, told The Times. “Russians are increasing their military presence, Russians are conducting large-scale military exercises, directly threatening Georgia, and they are making all the time statements that Georgians are concentrating forces and Georgians are beginning to start the war and we have to respond.”

The President is far from certain that peace will reign. “Ask me something more simple,” he told The Times when asked if Georgia was safe from another Russian advance. “I do not know what is playing out in Vladimir Putin’s [the Russian Prime Minister’s] head. I think everybody but him wants peace.”

In the absence of military observers inside the breakaway regions, 200 EU monitors remain on the Georgian side of the unrecognised border, guarding against war.

Their political masters are confident that Russia, which is keen to build bridges with the US Administration, will hold back. There is always an element of doubt in their assurances, however — an acknowledgement that the personal power plays between Moscow and Tbilisi can produce a combustible mixture.

“I do not see the level of negative provocations that we saw last summer. But all things are possible. At the end of the day you can never tell,” one Western diplomat said.

Another noted that the Russian troops in South Ossetia were already less than one hour from Tbilisi. It was, he said, like living in London with Russian tanks lined up in Windsor.

So much discord in the world. Thanks for a great thread, Housecarl.

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http://news.ino.com/headlines/?newsid=62620090135

G8 Foreign Ministers Get To Work In Trieste; Statement On Iran Forthcoming
1 hour, 8 minutes ago

(RTTNews) - Trieste was tranquil Friday morning as foreign ministers of the Group of Eight largest industrialized nations prepared to kick off official diplomatic talks on a number of issues, with particular attention paid to the Middle East.

Unlike other G8 and G20 events, there were no protesters on site in Trieste, giving police and organizers an easy go of it. Weather reports called for thunderstorms all week, but with nary a cloud in the sky over Piazza Unita d'Italia, the G8 family photo was moved outside.

The meeting in Trieste, a final prelude to the larger G8 Summit in L'Aquila July 8, lost some of its luster over the past few days as Iran refused an invitation from the host Italians, and US Secretary of State Hillary Clinton backed out
following surgery to repair her broken elbow.

Still, talk in the hallways is dominated by the unrest in Iran, and the G8 is under pressure to craft a statement on the situation.

The US delegation in Trieste is headed by Undersecretary for Political Affairs William Burns, but has made little noise thus far due to the absence of Mrs. Clinton.

On Friday, the G8 officials are expected to draft a letter
condemning the violent post-election crackdowns in Iran, and take up discussion on stabilizing Afghanistan.

Two specific sessions will be given over to the Afghanistan issue: the first, on Friday, will address the topics bound up with frontier management and fighting illicit trafficking; the agenda for the second, on Saturday, features talks on the development of the country's infrastructure, refugee relief and migration management, agriculture and food security.

North Korea will likely be another hot topic, as it has fueled fresh anxieties in the wake of last May's nuclear test, conducted in breach of Security Council Resolution 1718. Recent ballistic missile launches
have been viewed as a provocation that jeopardizes regional stability, and particular attention should be paid to the press conference of the Japanese delegation Friday morning.

The Middle East Quartet (United States, EU, Russia and UN)will also be holding a meeting on the fringe of the G8. Special envoy George Mitchell and others are expected to discuss the Israeli-Palestinian peace process and restate the necessity of arriving at a solution based on the "two peoples, two states" principle.

Russia's Foreign Minister Lavrov shook up the G8 on Thursday ahead of the working dinner, insisting that the recent elections in Iran were "an exercises in democracy," and
that Iran must be engaged in order to facilitate discussion about Tehran's nuclear program.

While other members of the G8 have been highly critical of the Iranian crackdown on protesters following the controversial re-election of Mahmoud Ahmadinejad, word in Trieste is that the Russians have successfully tempered the G8's rebuke of Iran, which is expected in a few hours.

"No one is willing to condemn the election process, because it's an exercise in democracy," Lavrov told the press.

For comments and feedback: contact editorial@rttnews.com

Copyright(c) 2009 RTTNews.com, Inc. All Rights Reserved

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http://www.spacewar.com/reports/Kremlin_chief_sees_possible_deal_in_US_arms_talks_999.html

SUPERPOWERS
Kremlin chief sees possible deal in US arms talks

by Staff Writers
Windhoek (AFP) June 25, 2009

Russian President Dmitry Medvedev on Thursday suggested Moscow and Washington could agree on nuclear disarmament if the US gave up existing plans to set up a missile defence shield in Europe.

"No doors have been closed yet," Medvedev said during a visit to Namibia.

"We are continuing discussions with our American partners on these issues including on the linking of missile defence shield questions and the reduction of strategic offensive weapons," he added.

Russian and US negotiators are currently in talks to renew the START nuclear arms control treaty, which was agreed between Moscow and Washington in the dying days of the Soviet Union in 1991 and runs out this December.

Russian officials say there could be an agreement on reducing nuclear arsenals by the time US President Barack Obama visits Moscow on July 6-8.

But Russia is fiercely opposed to US plans to deploy missile defence capabilities in Poland and the Czech Republic in what Washington insists is a measure to guard against rogue states such as Iran.

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http://www.moscowtimes.ru/article/1010/42/379077.htm

Friday, June 26, 2009
Updated at 26 June 2009 3:56 Moscow Time.
The Moscow Times » Issue 4175 » News

Medvedev Says Russia's Allies Should Aid U.S.
26 June 2009
Reuters

WINDHOEK, Namibia -- Russia wants its Central Asian allies to cooperate with Washington on Afghanistan and is ready to work with the United States on a new nuclear arms cut pact, President Dmitry Medvedev said Thursday.

Afghanistan and a replacement for the expiring 1991 START I pact will be at the center of talks between Medvedev and U.S. President Barack Obama in Moscow next month.

Russia has pledged to let the transit of vital nonlethal goods for U.S.-led forces in Afghanistan through its territory. But in February, it sent a confusing signal by encouraging Kyrgyzstan to shut the U.S. Manas air base. Earlier this week, Kyrgyzstan allowed the United States to continue at Manas. Medvedev said he saw nothing wrong in the decision.

"We are helping them [Americans] ... and Kyrgyzstan is ready to help," Medvedev told reporters in the Namibian capital, Windhoek. "They are welcome."

Medvedev said he had discussed allowing the U.S. military base to remain at Manas with Kyrgyz President Kurmanbek Bakiyev. Bakiyev ordered Manas shut after securing $2 billion in aid from Russia, though Moscow denies any role in his decision.

Medvedev said Russia was happy with the terms of the new deal, under which Washington agreed to pay $180 million for the use of Manas to refuel U.S. aircraft bound for Afghanistan.

"[The deal] envisages that the military base ceases to exist, while new transit activities will be run on a different basis without any immunity for the U.S. military, without much U.S. military personnel," he said.

In Bishkek, Kyrgyz lawmakers unanimously backed the deal Thursday.

Medvedev denied suggestions that Washington and Moscow were at loggerheads over a new nuclear arms deal to replace the Strategic Arms Reduction Treaty, which expires on Dec. 5.

"So far, no one closed doors," Medvedev said. "We continue talking about this with our U.S. partners ahead of the visit by my colleague Barack Obama, including on linking anti-missile defense and limiting strategic weapons."

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Thursday June 25, 2009
Obama must shore up Medvedev vs Putin - opposition
By Claudia Parsons

NEW YORK (Reuters) - U.S. President Barack Obama should focus on shoring up Russian President Dmitry Medvedev's power in relation to his former mentor Vladimir Putin when he visits Moscow in July, opposition leader Boris Nemtsov said on Wednesday.

Nemtsov said Putin, now Russia's prime minister, retained the real power in Russia despite standing down as president last year when he engineered the election of Medvedev.

"Russia is a country of secrets and mysteries," Nemtsov, a former deputy prime minister and staunch opponent of Putin, told the Council on Foreign Relations, a New York-based think tank. "This is the biggest mystery -- who is really the president, who is really the boss."

Russia and the United States are seeking to narrow differences before Obama and Medvedev meet in Moscow on July 6-8. Both countries have stated their desire to "reset" relations, which had deteriorated to near Cold War levels.

The two sides have been holding talks on finding a replacement for the 1991 Strategic Arms Reduction Treaty (START I) before it expires on Dec. 5, which would mark a thaw in relations between the world's two biggest nuclear powers.

Nemtsov said the real problem in relations was not the START treaty, or differences over U.S. plans for an anti-missile shield in Europe, or policy toward Iran and North Korea, but rather a fundamental difference in values.

"The problem is absence of confidence," said Nemtsov, one of the founders of the liberal opposition group Solidarity.

"That's why to ignore problem of human rights and democracy means to fail ... strategically," he said, urging Obama to meet with opposition groups and human rights activists in Moscow.

"If the White House agree with Putin's proposal to talk just with pro-Putin organizations ... it will be a victory of Putin, but not only that -- Putin will be sure that Obama is weak."

Nemtsov said both Medvedev and Obama were "new persons" with an opportunity to make progress, but Medvedev was weak.

"The main problem of Medvedev is how to be the president. That's why if Obama will show that yes, Russia has a president and his name is Medvedev, it will be very, very nice for everybody," Nemtsov said.

"I believe if (Medvedev) will finally take power we have a chance to come back to liberalization, to democratization."

Nemtsov said Putin's popularity depended on an "invisible contract" with the Russian people -- that he would make them rich in return for giving up their political and social rights, but that the current crisis was undermining that contract.

He said the fact that oil-rich Russia's economy was in crisis despite oil prices of around $70 a barrel showed that Putin's "corrupt" policies were ripe for change.

"This is a real opportunity for coming back to rules of law and to Russian constitution," he said. "Of course a lot depends on how the opposition will be energetic... that's why we are responsible for our future, not Obama."

Copyright © 2008 Reuters

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KAZAKHSTAN: GEOPOLITICAL RIVALRY FLARES AT NATO FORUM IN ASTANA
Joanna Lillis 6/25/09

NATO Secretary-General Jaap de Hoop Scheffer used a June 25 security forum in Kazakhstan’s capital Astana to encourage debate on how the Atlantic Alliance can evolve in the age of globalization. He also sought to reassure cautious Central Asian leaders that partnership with NATO was a "two-way street."

The two-day meeting of the Euro-Atlantic Partnership Council opened in Astana on June 24 -- the day after Kyrgyzstan agreed to a new deal with Washington that will allow US troops to remain at an air base outside of Bishkek. [For background see the Eurasia Insight archive]. In his keynote address, de Hoop Scheffer emphasized that NATO’s future effectiveness will depend on its ability to adapt to changing circumstances. It was a message clearly tailored to suit the political, economic and cultural sensitivities of Central Asian states.

"We need to tackle the dark side of globalization without compromising globalization’s benefits. How? By thinking and organizing ourselves differently than we did in the past. By saying goodbye to the outdated security paradigms of yesterday. And, above all, by exploring new approaches of security cooperation -- reaching out beyond geographical, cultural and religious boundaries," de Hoop Scheffer said.

De Hoop Scheffer and his Kazakh hosts were at pains to stress the benefits of cooperation and play down geopolitical rivalry in the region. The secretary-general repeatedly used the word "partnership" while outlining the alliance’s strategic tasks. "Partnership is no longer about eliminating residual mistrust left over from the Cold War," de Hoop Scheffer said. "It has become a unique instrument to tackle common challenges.

The organization’s priorities are now combating terrorism, drug trafficking, organized crime and nuclear proliferation, he insisted. NATO is no longer about "Cold War-style territorial defense" or "playing the role of a global policeman," he added.

Central Asia itself stands to benefit from NATO’s mission in Afghanistan, he pointed out: "Instability in Afghanistan affects Central Asia more than any other region -- from terrorism to drug-trafficking. By the same token, no region has more to gain from stability in Afghanistan than Central Asia."

Kazakhstani officials expressed a desire to explore new forms of partnership. Foreign Minister Marat Tazhin, in a June 25 welcome speech, described the forum as a "perfect venue" for re-conceptualizing NATO’s role in Central Asia.

"Central Asia serves as a kind of testing ground for trends coming from the West and the East," Tazhin said, adding that it was Astana’s desire to "creatively reconsider alternative [security] models and gradually develop our own unique regional architecture."

Astana has declared regional security and the reconstruction of Afghanistan as the central planks of its agenda for its chairmanship of the Organization for Security and Cooperation in 2010. [For background see the Eurasia Insight archive]. During the forum, Tazhin called for improved international coordination for Afghan reconstruction initiatives and urged a greater focus on the "non-military aspects of security."

In 2007-2008 Kazakhstan allocated $3 million to Afghan reconstruction, Deputy Defense Minister Bolat Sembinov was quoted as telling the forum by the Kazakhstan Today news agency. Sembinov also said Kazakhstan was proceeding with plans to send "officers to the staff of the international forces furthering security in Kabul." Astana has long maintained a peacekeeping presence in Iraq, and has expressed its willingness to send a contingent to Afghanistan. Kazakhstan has also provided over-flight rights for resupply missions to Afghanistan, and earlier this year permitted land transit for non-military supplies. [For background see the Eurasia Insight archive].

In line with its policy of forging good relations with all great powers, Astana has also made diplomatic and military shows of support for Russia, which it describes as its key ally. The most recent was in May when Kazakhstan refused to participate in NATO military exercises in Georgia. [For background see the Eurasia Insight archive].

The efforts by NATO representatives to downplay Brussels’ geopolitical rivalry with Russia contrasted sharply with comments made by the Kremlin’s hawkish representative to the Atlantic Alliance, Dmitry Rogozin, who made it clear that a Western security presence in Central Asia was not welcomed by Moscow. Rogozin told journalists during the forum, in remarks quoted by Russian newspaper Izvestiya, that NATO is making a mess of things in Afghanistan. "[The alliance] is too far from this region, understands nothing about what is happening there, and therefore imagines that they are having some success there, but in actual fact they are getting bogged down in the Afghan quagmire more and more deeply," Rogozin was quoted as saying.

Rogozin also called on NATO to recognize the role of international bodies in which Russia plays a key part, including the Shanghai Cooperation Organization and the Collective Security Treaty Organization, in promoting Afghanistan’s stabilization. In addition, he suggested that NATO leaders were dreaming if they believed they would ever be able to establish a major presence in Central Asia, especially in Kazakhstan. De Hoop Scheffer on June 24 described Kazakhstan as "NATO’s most active Partner in the Central Asian region," but Rogozin later described Astana as Moscow’s "wife."

"A faithful wife has her admirers who give her flowers," Rogozin said. "That is NATO -- an admirer of Kazakhstan who gives her flowers. Kazakhstan is nevertheless linked . . . to the nucleus of the former Soviet Union and, as before, to Russia. It is impossible to compare the close, kindred, family relations between Kazakhstan and Russia with relations with other families who come and visit, bringing cakes."

Kazakhstani officials did not publicly react to Rogozin’s remarks. Instead, officials promoted a couple of non-proliferation initiatives, repeating an offer to host a US-backed global nuclear fuel bank aimed at curtailing the spread of nuclear materials, and calling for the signing of a new global Nuclear Non-Proliferation Treaty. A new pact was proposed last week by President Nursultan Nazarbayev -- who did not attend the forum but sent greetings.

The Security Forum opened amid upheaval at Kazakhstan’s Defense Ministry. Daniyal Akhmetov, who since 2007 had served as Kazakhstan’s first civilian defense minister, was dismissed without explanation on June 17. He was replaced late on June 23 by Adilbek Dzhaksybekov, who had been serving as ambassador to Moscow. Dzhaksybekov’s appointment is unlikely to change Kazakhstan’s overall defense policy, which -- like its foreign policy -- seeks to tread a fine line between Moscow and the West, without upsetting either one.


Editor's Note: Joanna Lillis is a freelance writer who specializes in Central Asia.

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MOSCOW CAUTIONS THE G8 AGAINST INVOLVEMENT IN ARMENIA-AZERBAIJAN CONFLICT
6/25/09

In a sign of intensifying geopolitical turf wars in the South Caucasus, Moscow warned the West on June 25 against foreign meddling in the dispute between Armenia and Azerbaijan.

The statement came on the eve of a G8 ministerial summit in Italy, where the world’s largest industrial powers will discuss international issues, including the Nagorno-Karabakh conflict between the two South Caucasus states.

"Russia is against foisting remedies upon the conflict sides from outside," the Russian Ministry of Foreign Affairs declared. "Russia is ready to support the option of conflict resolution that is satisfactory to all the sides involved and, in case a compromise agreement is reached, act as guarantor of the resolution."

The ministry said that the conflict talks’ key mediators -- Russia, the US and France -- are in general agreement about the main approaches for a resolution to the 21-year conflict.

Speculation has run rampant recently that a resolution breakthrough could occur this year, but, as yet, no concrete signs of such a development have emerged.


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