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Paul Merrell

China stakes claim in Central and Southeast Europe | Business New Europe - 0 views

  • A Chinese agreement to finance a high-speed railway from Belgrade to Bucharest was one of around $10bn worth of investments, mainly in the energy and infrastructure sectors, signed during a China-Central and Eastern Europe summit this week. By funding the railway, Beijing hopes to establish a rapid connection from Greece’s Pireaus Port through the Balkans to the EU member states of Central Europe. Several agreements on the €1.5bn railway, which will be financed by soft loans from state-owned China Exim Bank, were signed between China, Hungary and Serbia on December 17. When the line is operational, the travel time between Belgrade and Budapest will be slashed from the current eight hours to just 2.4 hours. Macedonian counterpart Nikola Gruevski was also in attendance as there are plans to extend the line south to Macedonia and Greece in future. Chinese Prime Minister Li Keqiang, who headed a 200-strong delegation to Belgrade, said he expected the line would benefit both China and the countries of Central and Eastern Europe and the EU, according to a Serbian government statement.
  • Chinese shipping giant Cosco Pacific took over the management rights to half of Piraeus port and is now expanding two container terminals under a 35-year concession agreement, with the aim of turning the Greek port into one of Europe’s top five container ports. However, to take full advantage of Cosco’s investment in Piraeus and its potential to become a gateway to the CEE region, investments into transport links across the Balkans are needed. "We will propose construction of a rapid land and maritime route based on the Budapest-Belgrade railroad and the Greek port of Piraeus to improve regional connectivity," Li told journalists in advance of the summit, South China Morning Post reported. Investments into infrastructure to transport raw materials into China and Chinese manufactured goods to foreign markets is nothing new. Closer to home, Beijing is looking to fund a railway across Central Asia to create a direct rail link between its factories and the massive wholesale bazaars of Kyrgyzstan and Uzbekistan. Further afield, in May 2014, China signed an agreement in Kenya to build a new line from Mombasa to Nairobi that will extend to four other East African states in future.
  • While land rail routes across Eurasia to Europe are also being developed, sea shipping remains the cheapest route from the Far East to Europe, and Piraeus is a convenient entry point to the continent. While growth in the region has been patchy since the recent global economic crisis, in the longer-term the EU member states of Central and Eastern Europe and future entrants from the Balkans are expected to converge with longer-established EU members from Western Europe in terms of spending power. Since 2012, when the first China-CEE summit was held in Warsaw, Chinese attention on the region has steadily increased, with a focus on energy and infrastructure. Aside from the access to new markets, there are further commercial benefits for China, as Chinese companies are selected for lucrative construction contracts on projects funded by Chinese state-owned banks. On December 16, the opening day of the summit, Li told the 16 regional leaders to attend that China would launch a $3bn investment fund for the region.
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  • Also on December 16 Albania signed a deal with Exim Bank on funding for the completion of construction works on the Arber motorway that links the capital Tirana with Macedonia. In the energy sector, Serbian and Chinese officials have signed a loan agreement for the second stage of the Kostolac B thermal power project, which includes the construction of a new 350MW plant and the expansion of the adjacent Drmno open-pit coal mine. The value of the project is expected to be $715mn, of which $608mn will come from a 20-year China Exim Bank loan. In neighbouring Bosnia, Eximbank has signed an agreement with the Bosnian Federation government for a €667.8mn credit to fund construction of the 450MW unit 7 at the thermal power plant Tuzla. China's Gezhouba Group is expected to build the unit.
  • The timing of the summit, amid a sharp falling off of Russia’s influence, may also have helped China extend its influence in the region. With some exceptions, notably Serbia, most of the would-be EU member states in Southeast Europe have opted to join EU and US sanctions against Russia over Ukraine. Tit for tat sanctions imposed by Moscow caused trade between Eastern Europe and Russia to drop, a trend that is likely to continue amid the new economic crisis in Russia. Meanwhile, in a further retrenchment from the region, Russian President Vladimir Putin announced on December 1 that Russia will scrap the planned South Stream pipeline that would have supplies numerous states across the region with gas. China, meanwhile, has no political axe to grind in Eastern Europe, but hopes to take advantage of Russia’s weakness to make further inroads commercially. Poland and other countries in the region are, for example, looking to China as a potential market for food products following the Russian embargo. This would add to already booming trade ties. According to Chinese Commerce Minister Gao Hucheng, trade between China and Eastern Europe may top $60bn in 2014 - five times its 2003 level, AFP reported.
Paul Merrell

Europe plunged into energy crisis as Russia cuts off gas supply via Ukraine | Daily Mai... - 0 views

  • Russia cut gas exports to Europe by 60 per cent today, plunging the continent into an energy crisis 'within hours' as a dispute with Ukraine escalated. This morning, gas companies in Ukraine said that Russia had completely cut off their supply.Six countries reported a complete shut-off of Russian gas shipped via Ukraine today, in a sharp escalation of a struggle over energy that threatens Europe as winter sets in.Bulgaria, Greece, Macedonia, Romania, Croatia and Turkey all reported a halt in gas shipments from Russia through Ukraine. Croatia said it was temporarily reducing supplies to industrial customers while Bulgaria said it had enough gas for only 'for a few days' and was in a 'crisis situation'.
  • Russia cut gas exports to Europe by 60 per cent today, plunging the continent into an energy crisis 'within hours' as a dispute with Ukraine escalated. This morning, gas companies in Ukraine said that Russia had completely cut off their supply.Six countries reported a complete shut-off of Russian gas shipped via Ukraine today, in a sharp escalation of a struggle over energy that threatens Europe as winter sets in.Bulgaria, Greece, Macedonia, Romania, Croatia and Turkey all reported a halt in gas shipments from Russia through Ukraine. Croatia said it was temporarily reducing supplies to industrial customers while Bulgaria said it had enough gas for only 'for a few days' and was in a 'crisis situation'.
  • The EU demanded the two sides reopen talks as the row immediately sparked fears of gas supply shortages and rising energy prices in the UK.The UK is suffering one of its coldest nights this century with temperatures plunging to as low as -10C.Though Britain is one of Gazprom's largest importers - relying on the company for some 16 per cent of consumption in 2007, according to The Times, the gas is supplied through a complicated swap scheme that means supplies themselves may not be affected.Prices, on the other hand, rose during trading in London today.
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  • The dispute, coupled with Israel's military operation in Gaza, also pushed oil up to a three-week high of $49.91 in New York yesterday. Russia, whose main export is oil, stands to benefit from a recovery in prices. 'Without prior warning and in clear contradiction with the reassurances given by the highest Russian and Ukrainian authorities to the European Union, gas supplies to some EU member states have been substantially cut,' the EU said in a statement.'The Czech EU Presidency and the European Commission demand that gas supplies be restored immediately to the EU and that the two parties resume negotiations at once with a view to a definitive settlement of their bilateral commercial dispute,' the presidency and the Commission said in a joint statement.They added that the EU would 'intensify the dialogue with both parties so that they can reach an agreement swiftly'.
  • Overnight the Russian Prime Minister Vladimir Putin ordered the state energy giant Gazprom to cut supplies to and through Ukraine by around three-fifths amid accusations its neighbour has been siphoning off and stealing Russian gas. Ukraine says the Russian move has been prompted by payment and price disputes, a row between the two that has become almost annual. The effects of the dispute on the rest of Europe however is stark, said Ukraine's main gas supplier. Around 80 per cent of the gas European Union countries receive from Russia comes through Ukraine. While Germany and France are much more exposed, it is reckoned in some estimates that 15 per cent of Britain's supplies come from Russia through pipelines into the UK's east coast.
  • 'They [the Russians] have reduced deliveries to 92million cubic metres per 24 hours compared to the promised 221million cubic metres without explanation,' said Valentin Zemlyansky of the Ukrainian gas company Naftogaz. 'We do not understand how we will deliver gas to Europe. This means that in a few hours problems with supplies to Europe will begin.'Wholesale gas prices have already risen on the back of the rallying price of oil, up 50 per cent in the last fortnight to more than $48 a barrel on the back of Middle East tension over Israeli incursions into Palestinian-held Gaza.
  • Eastern and central European countries are already reporting supply problems, including the Czech Republic which has the current presidency of the EU. The EU as a whole depends on Russia for 25 per cent of its gas supplies.
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    Ukraine stealing Russian gas and Putin sends a strong message to the EU. My guess is that the EU will tell the U.S. in no uncertain terms to control its puppet. Conceivably, this might be the triggering event for the EU to begin the transition to de-dollarization and warmer relations with Russia. You can bet that Foggy Bottom will be working late into the night on this.   
Paul Merrell

ISIL, Turkey: The Dream of Restoring the Glories of Sublime Ottoman State , by Israa Al... - 0 views

  • The ISIL’s funding father is Erdogan’s personal friend The name of the Saudi businessman Yassin al-Qadi has been linked to organizations classified as terrorist internationally. In particular, the foreign press and the Turkish opposition media describe him as “al-Qaeda’s funding father”. After the events of September 11/2001, al-Qadi- along with other figures- has been included in the world’s list of terrorists, and his name was stereotyped as a terrorist man. This made several countries ban him from entering into their territories, Turkey was one of them. Earlier, the Turkish media documented a photo scandal: Erdogan’s meetings with Yassin al-Qadi as well as long meetings with his son Bilal Recep Tayyip Erdogan. The scandal that was leaked by Turkish security elements came in the context of the case of corruption of which the son of the former Turkish Prime Minister has been accused. Based upon this, a large number of elements of the security corps were arrested being accused of plotting a coup against the government.
  • Nevertheless, the French journalist Thierry Meyssan describes Yassin al-Qadi as a personal friend of both Dick Cheney (former U.S. Vice President) and Recep Tayyip Erdogan. According to him, al-Qadi visited Turkey four times during 2012, and “his plane used to land at the second airport of Istanbul, and was being welcomed by the Prime Minister personally, without going through the smart gate, and after cutting the security cameras’ power supply”. The Turkish Gmehoriet Newspaper intended to publish details about the investigations conducted by the Turkish judiciary on the same case, and mentioned that Recep Tayyip Erdogan introduced Yassine al-Qadi as a Saudi businessman visiting Turkey to invest and denied that he is a terrorist. It quoted him as saying: “I trust Mr. Al-Qadi just as I trust myself. He is an almsgiver”.
  • The Turkish newspaper, after publishing Erdogan’s utterances before the Turkish judiciary, revealed that the Turkish police monitored 12 visits made by the Saudi man to Turkey. Seven out of these visits have been made with the help of Erdogan, the period when he was banned from entering Turkey, because his name was added as one of the world wanted terrorists in the list of the American FBI. The newspaper commented saying: “When the Turkish police was looking for al-Qadi, he was holding meetings with the Prime Minister”. Also, it published a photograph that showed separately the aforesaid man, Erdogan, and the Turkish intelligence chief Hakan Fidan, when they were going to a meeting that gathered them. The newspaper noted that Fidan himself met with al-Qadi 5 times when Al-Qadi has been banned from entering the Turkish territory.
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  • Yet, the interesting thing is the leaked recordings published by the newspaper that disclose that Yassin al-Qadi used to give orders to the Erdogan’s office. He used to call to inform them that he had decided today to meet with Erdogan, and that the latter should not engage in any other obligations. The newspaper reported details about the dates of the meetings between the two men, what implies that the meetings were being attended by Fidan and by the Egyptian businessman Osama Qutob; the son of Muhammad Qutob the brother of the Brotherhood leader Sayyid Qutob who holds the Turkish citizenship and is living with his father in Turkey at present. This also mean that the meetings were taking place sometimes at the home of the Turkish businessman Mustafa Latif Topas in Istanbul, attended by Erdogan’s son and Moaz the son of al-Qadi. The recordings verify that Qutob was in charge of delivering the messages from the insurgents in the battlefield in Syria to Erdogan, what signifies that the meetings of these figures exceeded the issues of investment, and perhaps they exploited the title of a charity practice!
  • Those returning from Turkey refer to the public sympathy in the pro-government Turkish street with the ISIL. Social networking websites publish photos of Islamic libraries in Istanbul selling “T-shirts” and goods with the ISIL logo on them. Perhaps this news is no longer shocking after what the German (ARD) Television has revealed regarding the opening of an office for the ISIL in al-Fateh Street in Istanbul, being ran by Turks. Through it, the process of supporting and supplying the Takfiri organization in Iraq and Syria with funds and fighters takes place.
  • The German channel itself revealed in a video report aired by it that the ISIL has training camps on the Turkish territory: 1- The GAZIANTEP Camp: a training camp for the ISIL fighters According to the report published by the website of “Today’s Zaman”, an English-language newspaper in Turkey, the Governor of the Gaziantep (Erdal Ata) rushed to hold a press conference to deny what has been revealed by the German television. However, he spoke about the arrest of 19 elements that belong to the ISIL in the city, among those who came from European countries before committing them to trial.
  • Additionally, the Lebanese journalist Hassan Hamade, in an earlier interview with Al-Manar, drew attention to the existence of three training camps in Turkey for the fighters of extremist organizations [3]. 2- The ORFA Camp, southeastern Turkey: a camp out of which the gunmen came when they attacked the Kasab city that its residents are predominantly Armenian.
  • 3- The OSMANIYA camp in Adana, southern Turkey: It is directly near the major bases of the U.S. Air Force in the Turkish territory. Yet, what is interesting is that the Osmaniya camp is a stone’s throw away from the gas pipelines points of intersection coming from Iraq and Central Asia that empty the freight in the Turkish port of Ceyhan on the Mediterranean Sea. 4- The KARMAN camp, it is also in Adana but is much closer to Istanbul. Moreover, a document published by the French journalist Thierry Meyssan, earlier, revealed that Turkey facilitated the infiltration of 5,000 fighters, who belong to al-Qaeda, to the Syrian territory after receiving training in Libya.
  • Perhaps the report of the American TV Network clarifies the argument of the Turkish journalist Orhan Kama Genghis: “The strongholds of the ISIL are located close to the Turkish border, and this did not happen coincidentally”. The Turkish journalist Kadri Gursel talks about the fact that the Turkish border territories have turned into an easy pathway facilitating the arrival and departure of the militants, where there are no formal procedures (visas, etc…) that could bother them, referring to the cooperation of the Turkish intelligence agency with the militants. Above and beyond, the Turkish opposition Republican People’s Party MP Muharram Ingee said that the ISIL leader “Mazen Abu Mohammed” received treatment in one of the Turkish government hospitals in the city of Hatay on April 2014, publishing a photo of the terrorist man in the hospital.
  • Reviewing these data provide an early answer to the question of the Saudi writer, Nawaf Qadimi, who is known for his support for the Muslim Brotherhood, where the phenomenon of the ISIL leads us to evoke history. The Seljuks drew the policies to expand their influence and their tools were the advocates of takfir and the recruiting of fighters in the name of religion. Here is Erdogan in actual fact walking in the footsteps of the ancestors and painting policies, and the tools are the texts of takfir for which he is recruiting fighters in the name of religion itself! That is how history is enabling us to understand our present...
Paul Merrell

Out of Gas: Turkey is Losing Its Battle with Russia | Observer - 0 views

  • Turkey has told the Reuters news agency that Russia has stopped work on its nuclear power plants.  In reality, the Turks are exaggerating.  The Russians haven’t really stopped—they have really only slowed down. It is another piece in the intensifying conflict that has enveloped Russia and Turkey over the downing of a Russian AU-24 slow moving bomber by a Turkish F-16 fighter jet. The nuclear deal began in 2013. The Turks promised to pay $20 billion and the Russian nuclear company Rosatom promised to build four 1,200 megawatt nuclear electrical power plants in Turkey. The first plant was scheduled to be opened in 2019, but from the very outset things have not run on schedule.  One reason is that the project confronted international regulatory problems.
  • The Russians have done this before—only with Iran.  They slowed down on the original proposal, Iran took the Russians to the World Court, and sued them. They wanted their nuclear plants.
  • Now, because of their experience with Iran, Russia realizes that stopping entirely would prove costly. Huge disincentives and penalties are built into the contract.  And Turkey has already started shopping around for someone else to finish the nuclear job. Good luck. Here is the crux of the problem and why Turkey can never win in this conflict with Russia. Turkey is almost totally dependent on imported energy. They have been counting on these nuclear plants and should be conducting back-door diplomatic negotiations to resurrect the deal , but they do not appear to be doing that. Tensions between the Turks and Russians do not seem to be dissipating. So much so that Russia has also stopped importing Turkish fruits and vegetables. The reason they give is poor Turkish sanitation and hygiene, but the real reason is because the jet shot down the bomber. This isn’t  just a case of no more Turkish pistachio nuts or dates. Turkish fruits and vegetables account for 20 percentof Russia’s total fruit and vegetable consumption. This is a huge loss for the Turkish economy.  A $4 billion annual loss in fruit and vegetable revenue. Russia has said they will easily make up the loss by importing more from Iran and Israel.
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  • Turkey cannot get that much gas replaced.  They are in public conflict not only with Russia but also with alternative suppliers.  They sided with the Muslim Brotherhood so Egypt will not supply them.  They have been very aggressively critical of Saudi Arabia so they will not supply them.  There is always Israel and Israel could, potentially, help supply Turkey’s natural gas needs—but Turkey, a former ally of the Jewish state, has been openly hostile to Israel. The Russian minister of agriculture has said, “Allah has already decided to punish Turkey’s ruling clique, depriving them of mind and reason.” For their part, Turkey is counting on the help of the EU and the general disdain almost everyone has for Putin and his style of leadership especially in the aftermath of Russia’s land grab on Crimea and their invasion of Ukraine. But Turkey is misreading the situation.  Just because the world criticizes Putin and Russia it does not translate into action.
  • Russia has also cancelled the junkets and all expense included holiday vacation trips that Russians make  every year to Turkey.  The numbers tell the complete story. Last year 3.3 million Russians vacationed in Turkey.  That was 10 percent of all the tourists that visited Turkey. For Russia, however pleasant they were, these vacations are not essential and they will find someplace else to fill their vacation needs.  Turkey, however, will not find 3.3 million other tourists. Russia wants to punish Turkey.  That should be clear.  And Vladimir Putin definitely has the ability to make things difficult for Turkey.  The balance of trade is pretty clear. Russia purchases $30 billion in goods from Turkey per year. All of those services are easily replaced elsewhere. But Turkey relies on Russia for $20 billion of natural gas every year.  If that flow is even slightly altered, even for a single day—Turkey will grind to a halt.  That natural gas engines Turkey’s electric grid. Gas is next. Russia will start pulling it.  They have already cancelled work on the underwater gas pipeline which, together with the nuclear electric plants, would eventually make Turkey more energy independent.
  • This is the case even in the Middle East. Russia marched into Syria, set up a huge air-force base, and established a significant presence.  The West warned the Russians not to put boots on the ground.  Russia went in anyway and their actions were met with only a few tepid condemnations.  When the Turkish F-16 jet shot down the SU-24 Russia bomber, that’s when international voices were raised— and they were raised to urge calm and deescalate tensions, not to blame Russia. Turkey thinks that because there are UN sanctions against Russia there is a way to leverage that power and squeeze Russia.  If the world stood by when Russian military pranced into Ukraine and Crimea how can Turkey expect them to act now? Russia will get away with everything.  And despite pressure that Turkey is trying to apply—the real pressure will be placed by Russia on Turkey.  No one is willing to step forward and help Turkey.  If this continues, Russia will destroy them.
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