International Affairs A Russian Journal of World Politics, Diplomacy and International Relations
Editor-in-Chief: Armen Oganesyan
Executive Secretary: Evgenia Pyadysheva
Editorial Advisory Board:
Minister of Foreign Affairs of Russia
First Deputy Minister of Foreign Affairs of Russia
Deputy Minister of Foreign Affairs of Russia
Deputy Minister of Foreign Affairs of Russia
Permanent Representative of Russia to the UN
Permanent Representative of Russia to the European Union
Director General of Ministry of Foreign Affairs of Russia
Chairman of the Foreign Affairs Committee, Federation Council
Head of the Federal Agency for Press and Mass Communications
Doctor of Science (History)
Special Representative of the Russian President for Cooperation with African Countries
Rector, Moscow State Institute of International Relations
President, Russian International Affairs Council
Vice President, Chamber of Commerce and Industry
Ambassador Extraordinary and Plenipotentiary to the Vatican
Ambassador Extraordinary and Plenipotentiary to the PRC
Ambassador Extraordinary and Plenipotentiary to the United Kingdom
Chairman of the Board, Interstate Oil Company Soyuzneftegaz
Doctor of Science (Political Science)
Chairman of the Foreign Affairs Committee, State Duma
Doctor of Science (Political Science)
Ambassador Extraordinary and Plenipotentiary to the Slovak Republic
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Volume 66, No. 2 (2020)
To browse contents on our digital database, click here
Sergey Lavrov Turns 70
To Provide Strategic Stability and Form a Just World Order
A Diplomat Is Above All a Patriot
RUSSIA AND OTHER NATIONS
Russia and Indonesia: 70 Years of Fruitful Cooperation
Russia and Vietnam: Decades-Long Friendship
Vietnamese-Russian Comprehensive Strategic Partnership: Continuing Traditions, Confidently Looking Into the Future
Pham Binh Minh
Principal Vectors of Russian Diplomacy in the Post-Soviet Space
Emmanuel Macron's European Project and Russia
The WTO: Contours of Change
Preserving Independence and Power: Iran's Top Priority
COMMENTARY AND ESSAYS
The "Rules-Based Liberal Order" and International Law
The Political and Legal Landscape of the Alaska Phenomenon
The "Bulwark of Europe": Ideology and Program Goals of Ukrainian Nationalism
Allegations of a German Invasion Plan in the Russian Press in 1906: The Russian Foreign Ministry's Response
INTERNATIONAL CONFERENCE Contemporary Integration Processes in the Post-Soviet Space
A. Oganesyan, S. Lavrov, S. Aksyonov, G. Muradov, O. Stepanov, A. Stoppe, O. Lebedeva, A. Bobrov, V. Deinego, Yu. Shevtsov, Ye. Khalevinskaya, Yu. Sayamov, N. Kabanov, Eliseo Bertolasi, A. Bobrov, Arif Asahoğlu, V. Semyonov, R. Ishchenko, I. Tatarinov, D. Trofimov, A. Gurba, M. Rossiyskiy, V. Simindey, R. Denisov, O. Semyonova, Zauresh Saktaganova, V. Nikanorov, I. Khalevinsky, I. Tarasova
Milestones in the Life of Fyodor Martens, Outstanding International Law Scholar and Diplomat
I. Demianenko, V. Ivanenko
Lev Mendelevich as a Diplomat, Historian and Journalist (Based on His Personal Archive)
HISTORY AND MEMOIRS
The Posolsky Prikaz and the Establishment of the Patriarchate in Rus
The Lost Lesson: How Bessarabia Joined Russia
Enforced Alliance: Soviet-Baltic Relationships and the International Crisis, 1939-1940
A. Dyukov, V. Simindey
International Information Security: Theory and Practice
Author: Sergey Ryabkov
'NO POSITIVE CHANGES IN WASHINGTON'S POLICY TOWARD RUSSIA'
Deputy Foreign Minister of the Russian Federation
Mr. Ryabkov was interviewed by International Affairs’ Editor-in-Chief Armen Oganesyan.
Source: International Affairs, Vol. 65, No. 6, pp. 1-15
Keywords: UN General Assembly, Russia, Iran, arms control.
Question: Sergey Alekseyevich, 10 members of the Russian delegation to the UN General Assembly have not been issued visas. Is that a continuation of the visa war? What action will Russia take in this connection?
Answer: It is important to note that two members of the Russian delegation – namely, K.I. Kosachev, chairman of the Federation Council’s international affairs committee, and L.E. Slutsky, chairman of the State Duma’s international affairs committee – were denied visas. The others who were not issued visas were delegation experts and persons accompanying our minister. Of course, these US actions have highlighted an acute problem. The US ignores not only international law per se but also its obligations as the host of the UN headquarters that signed a relevant agreement in 1947. I can’t recall a single instance when Washington took a stance ignoring self-evident things to such an extent. That is a new US anti-record in terms of the country’s positioning in the international arena.
In the future, the US can be expected to deliberately impede the normal political process and UN activity, especially with the participation of countries that are considered to be Washington’s geopolitical opponents since the stance taken by those countries does not suit the US side. This raises the question: What reaction do our US counterparts expect from countries whose representatives are treated this way? Do they really think that their actions will force us to reevaluate our approaches and adjust them to the US’s demands? I believe the effect is opposite to the one intended, and in this case the US is acting against its own interests.
It is also a fact that of late, a frivolous approach toward handling specific situations, ideas and proposals has been spreading at the UN. Thus, last year, a resolution of the First Committee of the UN General Assembly in support of the Treaty on the Elimination of Intermediate-Range and Shorter-Range Missiles (INF) was rejected by the US, its allies and so-called sympathizers just because the resolution was sponsored by Russia. Nobody even tried to grasp the meaning of the document. The fact that it was sponsored by Russia was enough for our opponents to defy the obvious logic of action in favor of consolidating the cornerstone of international security.
As for countermeasures, we proposed that meetings, for instance, of the First Committee of the UN General Assembly and the UN Disarmament Commission be held not in New York, not on US territory. After all, events on any scale and with any composition have been held in so-called international capitals in Europe for decades. They have infrastructure, equipment and staff. There are efficient transport services there.
We will see how other members of the international community respond to that proposal. Russia is not the only country encountering defiant manifestations of US arrogance, which is indecent and shameful. Other countries have experienced similar problems. Earlier this year, there was a highly disturbing indication of what the US could do with respect to the UN. That is a demonstration of total disregard for the organization that is based in New York, on US soil. An idea has come up to relocate the UN headquarters. That is nothing new. In the course of time, this idea has been promoted not only by Russia.
As far as the visa war is concerned, it is ongoing, and it was unleashed by the US Barring Russian representatives from attending a Fort Ross Dialogue conference is the most outrageous recent case. There have been recurring problems with long-term assignments to Russian embassies and general consulates in the US The same applies to short-term business trips. In such cases, we respond in a symmetrical manner. However, we encourage the Americans to come to terms, not act according to the “eye for an eye” principle. So far, that has not worked. It seems that those who formulate and implement US policy toward Russia are focused on acting from a position of strength. It has long been very well known to everyone that this approach is doomed to failure.
Q: Did the UN respond to that in any way?
A: There is the UN Committee on Relations with the Host Country. All kinds of difficult situations, often highly controversial ones, are discussed within its framework. Naturally, we will continue to raise the issue before that body. When in New York, S.V. Lavrov has repeatedly addressed this issue, including from the General Assembly rostrum. I believe everyone heard everything. In my opinion, the response from the UN Secretariat could have been more cogent.
Q: What impression did Donald Trump’s statement at the UN General Assembly make on you?
A: It is a signal that under the present circumstances, national sovereignty and national interests are more important than, for instance, specific benefits from globalization in its classic definition. Trump’s speech contained sharp denunciations against countries pursuing an independent foreign policy course. Several topics, including climate-related issues, were ignored. I believe there is a certain context related to the upcoming US elections that Donald Trump’s remarks should be put into for conclusions to be drawn.
Q: Some experts hastened to say that Trump was targeting Biden but hit himself. However, Trump may have calculated everything. The failure of Special Counsel Robert Mueller’s investigation must have made him more confident in his standoff with the Democrats ahead of the election campaign. Still, how serious is the threat of impeachment for Trump?
A: Mueller’s investigation did not produce the effect that certain circles counted on – not only in Washington but also in some other capitals. We always knew that that would in fact be the case since it was absolutely impossible to dig up anything to substantiate the totally idiotic and wild allegations of collusion with Russia and Russia’s meddling in the US’s domestic processes. Objectively, that was simply untenable. Then an idea came up to try to identify other “vulnerabilities” in the current administration. In my opinion, what we are seeing now reflects the unhealthy atmosphere that has evolved in Washington today, when foreign policy “hot potatoes” are being ping-ponged back and forth across the table from the Republican Party to the Democratic Party for domestic political objectives. We are just watching that peculiar phenomenon from afar. We regard what is going on as a reflection of the current difficult stage of the domestic political discourse in the US.
Q: In your opinion, will the “Russian card” be played in the US presidential campaign?
A: I believe that is almost inevitable. Some say there are no grounds for pursuing the issue that has been played dozens of times in US domestic politics and does nothing to boost anybody’s ratings. Nevertheless, I think that the generally negative, “feverish” approach toward what is happening in present-day Russian politics, as well as in Russia’s foreign policy, has to a very large extent become an inalienable part of US political thinking, permeating the fabric of what is going on in present-day Washington.
Author: G. Ivashentsov
CAN NORTH KOREA'S NUCLEAR MISSILE CRISIS BE RESOLVED?
Gleb Ivashentsov, Ambassador Extraordinary and Plenipotentiary; firstname.lastname@example.org
Source: International Affairs, Vol. 65, No. 6, pp. 37-47
Keywords: Korean Peninsula, South Korea, North Korea, nuclear program, Asia-Pacific region.
Gleb Ivashentsov, Ambassador Extraordinary and Plenipotentiary; email@example.com
Tension around the Korean Peninsula is one of the main threats to international security. North Korea’s acquisition of nuclear and missile weapon systems has become a new serious factor in global strategic stability. Previously, during the cold war era, the only tool of control over strategic weapons was the relationship between Moscow and Washington. At present, the international situation has radically changed. New nuclear powers – India, Pakistan, Israel, and North Korea – regardless of whether or not the original five members of the Nuclear Nonproliferation Treaty (NPT) acknowledge them as such, are not under the control of either Washington or Moscow or Beijing, acting at their own discretion, as they see fit.
The current polycentrism of nuclear proliferation is based on regional rivalry. India has created its nuclear arsenal as a counterweight to China; Pakistan, as a counterweight to India; and Israel, as a shield against Arab states. None of these states, however, are seeking global supremacy and so their nuclear status is taken by the world community more or less in stride.
The North Korea case is different. The regional motive (i.e., years-long confrontation between the two Korean states – North Korea and South Korea) has also played a certain role in the evolution of Pyongyang’s nuclear missile program. However, its program has one peculiarity. Unlike the Indian-Pakistani or Arab-Israeli confrontation, the U.S. has been involved in the inter-Korean confrontation as a party to the 1953 Mutual Defense Treaty with South Korea. So originally, Pyongyang’s nuclear missile program was not aimed against its southern neighbor but was designed as a protective shield against a potential U.S. strike in a possible inter-Korean war.
At first, Pyongyang’s nuclear project did not cause much concern in the U.S. However, when North Korea acquired intercontinental ballistic missiles in the mid-2010s, it became the third country in the world (after China and Russia) that could deliver a strike against the U.S.’s continental territory, which drastically changed the situation. If the U.S. had previously become involved in a new armed conflict on the Korean soil it would only have sustained personnel losses among its military contingents deployed in South Korea. At present, however, that kind of action as part of its military alliance with Seoul would lead to the destruction of major U.S. cities.
That caused Washington to push toward North Korea’s “denuclearization” – in contrast to the U.S.’s rather lenient view of nuclear preparations by India and Pakistan, not to mention Israel.
Pyongyang’s nuclear missile program is dangerous, but not only for Washington. North Korea’s nuclear status substantially undermines the entire current nuclear nonproliferation system. For instance, Iran, in keeping with the 2015 Joint Comprehensive Plan of Action, or JCPOA, agreed to limit its nuclear program in exchange for the lifting of sanctions and its reintegration into the global economy. However, if the JCPOA, from which the U.S. has already withdrawn, finally collapses, then nothing – not even possible U.S. and Israeli military strikes – will stop Iran from emerging as a nuclear power.
North Korea’s nuclear missile program is also affecting the positions of its neighbors in the region. Few people remember that Seoul, not Pyongyang, was the first to launch a nuclear military project on the Korean Peninsula in 1970. That program could easily be reactivated. Japan and Taiwan also have all the essential elements to develop their own nuclear weapons. It cannot be ruled out that if the U.S. pulls out of the bilateral “nuclear umbrella” agreement with one of its allies in Asia that would trigger a chain reaction where the acquisition of nuclear weapons by one state would lead its neighbors to launch similar programs. The likelihood of such weapons falling into the hands of terrorist organizations, such as ISIS [Islamic State of Iraq and Sham], also increases.
The problem is also that the line between defensive and offensive policy is getting blurred. Right now, North Korea has no plans to attack anybody; it needs nuclear weapons purely for protection. However, is there a guarantee that in the future, Pyongyang will not want to use force against Seoul on the assumption that nuclear missiles will protect it against U.S. intervention on the side of the South?
Another question is how safely North Korea’s nuclear arsenals are stored, and there is also concern that computer malfunction or some other incident could cause a potential armed conflict involving the use of weapons of mass destruction.
The nuclear problem on the Korean Peninsula has a direct bearing on Russia. It is not only that Pyongyang is disrupting the nonproliferation regime. North Korea’s nuclear and missile test facilities are located a couple hundred kilometers from the Russian border. That does not suit us. We need neither nuclear nor missile tests near our borders. Nor do we need any saber-rattling from anywhere.
That is why in 2003, Russia, together with China, North Korea, the Republic of Korea, the U.S. and Japan, joined the six-party talks on the nuclear problem on the Korean Peninsula. The Sept. 19, 2005 Joint Statement of the Six Party Talks provided a constructive foundation for progress not only toward securing a nuclear-free status of the Korean Peninsula but also toward normalizing the situation in the region as a whole. Its implementation would ensure political and economic decisions that could make Northeast Asia a region of peace, security and cooperation.
What exactly did that document say? It said that the DPRK (Democratic People’s Republic of Korea) committed to abandoning all nuclear weapons and existing nuclear programs and returning at an early date to the treaty on the nonproliferation of nuclear weapons (NPT) and to IAEA safeguards. The United States affirmed that it has no nuclear weapons on the Korean Peninsula and has no intention to attack or invade the DPRK with nuclear or conventional weapons. The DPRK and the United States undertook to respect each other’s sovereignty, exist peacefully together and take steps to normalize their relations subject to their respective bilateral policies. The six parties committed to joint efforts for lasting peace and stability in northeast Asia. The parties agreed to work out a compromise formula that would open the way to the DPRK for peaceful uses of nuclear energy, including the provision of a light-water reactor. The six parties agreed to take coordinated steps to implement the aforementioned consensus step by step, in line with the principle of “commitment for commitment, action for action.” The implementation of those agreements could have averted many dangerous processes that have developed on the Korean Peninsula in the last decade and a half. However, the agreements ended up in limbo. Not all parties to the talks, primarily the U.S., were willing to implement them.
At present, U.S. President Donald Trump has assumed the role of a leading campaigner against North Korea’s nuclear program. In 2017, speaking at the UN General Assembly, he threatened to totally destroy the DPRK if it did not abandon its nuclear missile weapons. However, the reluctance of U.S. allies to become involved in the U.S.’s new reckless adventures in Korea, as evidenced by the January 2018 Vancouver meeting of foreign ministers of countries whose troops fought in the 1950-1953 Korean War on the side of the South as part of the so-called UN forces in Korea, made him change tactics. The result: two North Korean-U.S. summits and an hour-long meeting between Trump and Kim Jong-un on the demarcation line between the DPRK and the ROC in Panmunjom.
Both sides committed to efforts to achieve stability and peace on the Korean Peninsula. However, their statements were not backed up by any concrete actions.
The reasons for that are understandable. The “complete, verifiable and irreversible” nuclear disarmament that the U.S. has been talking about for many years now is an absolutely unrealistic and politically impossible demand. Pyongyang’s nuclear missile program is its security shield and it will not abandon its shield just like that. The nuclear problem on the Korean Peninsula is unique in that this is not about ensuring a certain balance of nuclear missile capabilities of the two opposing sides that would limit the threat of a conflict, as was the case with the USSR and the U.S. in the past. The goal is to persuade the state that has developed nuclear weapons as its only security shield against a strike by the nuclear superpower to abandon that shield in exchange for international guarantees of the inviolability of its borders and its independence. The North Korean leadership knows how the West rewarded Libyan leader Muammar Qaddafi for voluntarily abandoning the country’s nuclear program and does not want to experience the same scenario.
The U.S. has tried to exert pressure on North Korea through sanctions. However, it turned out that sanctions against Pyongyang are not working – for several reasons. The first reason is China. Just as Russia and the U.S., China is unhappy about the erosion of the nonproliferation regime, and if it implemented tough economic sanctions, it could effectively stifle North Korea: After all, China currently accounts for up to 90% of North Korea’s total trade.
However, there are additional factors in China’s policy on the Korean Peninsula, many of which, from Beijing’s perspective, are far more important than the threat of nuclear proliferation.
China views the lineup of forces in Northeast Asia primarily through the prism of its confrontation with the U.S. Washington’s efforts to reformat U.S.-Japanese-South Korea military partnership are perceived in Beijing as the surrounding of China. Under these circumstances, keeping the DPRK afloat is strategically important for China. China does not need a domestic political crisis in North Korea that would lead to mass disturbances, the flow of refugees and the uncontrolled export of nuclear technology and components of other weapons of mass destruction. Furthermore, China does not view the DPRK’s nuclear program as a direct threat to itself. Beijing sees North Korea’s nuclear weapons primarily as a problem for the U.S. and its allies. This is why, on the one hand, China is implementing technical sanctions in good faith and cutting short the North Koreans’ attempts to gain access to materials and components for its nuclear missile program, and on the other, it continues to trade with the DPRK, including by means of bypassing the sanctions.
The problem is too serious to be handled in a gung-ho way, to be resolved in one fell swoop. But that is exactly what the U.S. establishment, including Trump as the most zealous advocate of its interests, is insisting on. And since resolving it in one fell swoop, i.e., ensuring the DPRK’s immediate and complete nuclear disarmament, is impossible by definition, Trump is using dialogue with Kim Jong-un not so much to resolve the problem as for the purpose of self-promotion, trying to convince the American voters that he has surpassed all of his predecessors in countering North Korea’s nuclear preparations.
Thus, during his first summit with the North Korean leader in June 2018 in Singapore, Trump sought primarily to boost his own ratings, as well as the ratings of his Republican Party ahead of the November 2018 congressional elections in the U.S., telling the Americans, spooked by North Korea’s nuclear missile program, that former U.S. president Barack Obama could do nothing about that threat, but he, Trump, even though he hated it, met and came to terms with the “rocket man” from Pyongyang. And he achieved his goal: Nobody asked what the deal was, exactly, and as a matter of fact, it was a non-deal. What was important about Singapore for the American voter was the TV picture: President Trump “came, saw and conquered,” and that image worked at the time.
Trump needed the Hanoi summit with an eye to the U.S. presidential campaign in which he hopes to get reelected to a new term. So, just as on other pressing foreign policy issues, he had to present to the American public a concrete, tangible result on North Korea’s nuclear missile problem.
They say that unlike Singapore, in Hanoi, some deal could have been made. According to some reports, at that time, the North Koreans offered to close the Yongbyon nuclear research center in exchange for the complete lifting of economic sanctions, but Trump – under pressure from hawks in his entourage, above all his odious national security adviser John Bolton – refused that offer.
The main argument of the U.S. opponents of the Pyongyang-proposed deal was that by signing a deal with the DPRK, which does not provide for North Korea’s complete denuclearization, the U.S. would essentially recognize the DPRK as a de facto nuclear state. Washington also believes that agreeing to lift the UN sanctions on Pyongyang would be a mistake with irreversible consequences. China and Russia, which in 2016 and 2017 completely supported the U.S. stance on the DPRK at the UN, would under the present circumstances undoubtedly vote for the lifting of sanctions, but would they vote to restore them if such a problem arises in the future?
Now, after shaking hands with Kim Jong-un in Panmunjom and after dismissing Bolton, it seems that Trump would like to sign some document with Pyongyang, similar to what the North Koreans proposed in Hanoi, which could be presented to the electorate as an “agreement on North Korea’s denuclearization.” But naturally, such an “agreement” would not resolve the main problem. Pyongyang would retain not only the existing nuclear warheads and delivery systems but also the capability to produce a certain amount of uranium warheads and missiles. Granted, that agreement would make sense as the first step toward establishing a nuclear arms control regime on the Korean Peninsula.
However, is Kim Jong-un willing to make any deals with Trump in the current situation, where the latter is not on the best of terms with the U.S. Congress and has far from clear electoral prospects? It is in Kim’s interests to wait a little before making any deals to ensure himself against a situation where Trump’s successor abandons all obligations, just as Trump is now pulling out of the treaties signed by his predecessors, such as the ABM Treaty, the INF Treaty and the nuclear deal with Iran.
Pyongyang needs security guarantees, and it seems to be willing to discuss a system of multilateral guarantees. Not surprisingly, after four summits with Chinese leader Xi Jinping, three with [South Korean President] Moon Jae-in and two and half with Trump (counting the handshake in Panmunjom), in April, Kim Jong-un went to Vladivostok for a meeting with Vladimir Putin and then began to talk about a summit with Japanese Prime Minister Shinzo Abe. Essentially, the idea is to restore in some form or other the six-party format to discuss current problems and develop a system of guarantees.
Progress on the DPRK’s nuclear missile program is possible only via a step-by-step approach, including, first, limitation, then reduction and ultimately complete elimination of those weapons. Naturally, since the DPRK’s nuclear status is enshrined in the country’s Constitution the issue of abandoning the nuclear program right now is out of the question to Pyongyang. But what about starting with a deal between the U.S. and the DPRK, with the participation of other Group of Six members, on Yongbyon nuclear research center in exchange for the lifting of economic sanctions?
Or how about holding separate talks on the DPRK’s nuclear program and its missile program? For example, Kim Jong-un declares a moratorium on missile launches and nuclear tests, which is actually already in force (after all, there have been no tests since November 2017); stops the ICBM development program; freezes the production of nuclear materials; opens its nuclear facilities to international inspection and provides guarantees of nonproliferation of nuclear and missile technology. For their part, Washington, Seoul and Tokyo, in response to that, officially recognize the DPRK, establish diplomatic relations with it, exchange embassies, limit military activity near its borders, reduce and eventually lift sanctions, and provide financial assistance.
However, will the US political establishment accept that? So far, it does not seem to have realized that unless a substantive and equal dialogue is conducted with the North Koreans, based on mutual respect, in the future, the US will have to learn to live with nuclear Pyongyang, just as it once had to learn to live with nuclear Moscow and nuclear Beijing.
The ongoing wide-ranging and in-depth discussion of North Korea’s nuclear crisis overshadows, as it were, another crisis – i.e., an inter-Korean one, where one Korean nation has for almost three quarters of a century been divided into two separate states. The DPRK’s nuclear missile program was adopted to avert a potential U.S. strike in case of an inter-Korean war. Removing the threat of such a war would also eliminate the threat of a U.S. strike against the DPRK, which Pyongyang invokes to justify its nuclear missile projects. So inter-Korean normalization could give a new impetus to the efforts to resolve the nuclear problem.
The main takeaway from two years of inter-Korean and North Korea-US summits is that both Washington and Seoul have accepted the existence of the DPRK and adopted a policy of peaceful coexistence in relation to it. At the same time, they have no plans to recognize North Korea’s status as a sovereign state or recognize the legitimacy and constitutionality of its leadership.
Incidentally, Pyongyang does not recognize the constitutionality of the Republic of Korea. From the North Korean government’s perspective, South Korea is a territory occupied by the U.S. with a puppet regime that has no illegitimacy. At the same time, Pyongyang has already played host to the heads of that “regime” – Kim Dae-jung in 2000, Roh Moo-hyun in 2007 and Moon Jae-in three times in 2018. However, neither Kim Jong Il nor Kim Jong-un has ever been to Seoul despite official invitations from South Korea.
The fact is that under South Korea’s national security law, North Korea is not a country but an antistate organization: should any one of the Kims have gone to the south, in keeping with the letter of that law, he would have been subject to immediate arrest as a war criminal. They say in his time, liberal Kim Dae-jung planned to ignore that odious law to visit the DPRK after the 2000 Pyongyang Summit that brought him a Nobel Peace Prize, but that was opposed by conservative forces in the National Assembly, the Armed Forces and the state apparatus of the Republic of Korea. Moon Jae-in’s current political situation is for various reasons more complicated than Kim Dae-jung’s. So, it seems unlikely that Kim Jong-un will get to see Seoul any time soon despite all the good words that the ROC president addressed to him at inter-Korean summits.
It cannot be said that during the inter-Korean summits of 2018, no efforts were made to reduce tensions between the DPRK and the ROC. There are two aspects here. First, at the Pyongyang Summit, the two countries’ defense ministers signed the Agreement on the Implementation of the Panmunjom Declaration in the Military Domain. That is a fundamentally new, and most importantly, practical step toward reducing military tensions. Confidence-building measures in the military domain are being implemented and new channels of communication are opening as the sides are resolved to do all they can to prevent any clashes or conflicts with the use of military force. That is all the more important since the ROC has not signed the 1953 Korean Armistice Agreement.
Second, the North and the South have agreed to pursue a joint bid to host the summer Olympics in 2032. In other words, the ROC has acknowledged that it does not expect (as it did previously) the DPRK regime to collapse and that the North and the South will exist separately at least in 15 years from now.
However, it is noteworthy that the Committee for the Five Northern Korean Provinces under the ROC Ministry of Security and Public Administration is still around. According to the ROC authorities, it is a legitimate administration for the territories that are “under the DPRK’s temporary control.” The committee is comprised of five governors of provinces with their staffs and several dozen heads of administrative subdivisions. In addition, the heads of all of North Korea’s rural towns, counties and urban areas are in reserve.
To normalize inter-Korean relations, it is extremely important to shift the relations between the DPRK and the ROC to a bilateral format. Issues of war and peace between the two Korean states should be dealt with by those states themselves.
The situation where the DPRK is officially in a state of war not with the Republic of Korea but with the UN as a party to the Korean War looks totally bizarre. The 1953 Korean Armistice Agreement was signed, on one side, by representatives by the Korean People’s Army (KPA) and the Chinese People’s Volunteer Army, and on the other, by the so-called United Nations Command in South Korea, comprised of military contingents of 16 countries under U.S. command, i.e., actually on behalf of the UN.
However, that agreement brought about only a cessation of hostilities, not of a state of war, so de jure the UN is still at war with the DPRK, which looks strange, to say the least, since the DPRK has been a full-fledged UN member since 1991.
The time has come to adopt a UN Security Council declaration stating that the Korean War is history and that the UN Security Council closes that page of history, and therefore there is no need for the United Nations Command in Korea. As for the U.S. military presence in South Korea, it should be regulated exclusively by interstate agreements between the Republic of Korea and the U.S.
In the context of the 2018 inter-Korean summits, the issue of replacing the 1953 Korean Armistice Agreement with a peace treaty has repeatedly arisen. At the same time, there are different views on what states should be parties to that treaty.
There are several things to bear in mind in this context. The 1953 Armistice Agreement was not an interstate document. It was signed by the commanders of the armed forces that participated in the Korean War: DPRK head of government Kim Il Sung, the commander of the Chinese People’s Volunteer Army and the commander in chief of the UN forces, a U.S. Army general. The South Korean representative, following the orders of then-president Syngman Rhee, refused to sign the agreement. Thus, neither the Republic of Korea nor the U.S. or China was involved in the armistice agreement in their state capacity. Nor did the U.S. and China participate in the Korean War as states. US troops fought as part of the international contingent that was sent to Korea in keeping with a UN Security Council resolution and Chinese troops fought as volunteers.
Taking that into account, a peace treaty on the Korean Peninsula should be a treaty between two sovereign states – the DPRK and the Republic of Korea – possibly, with guarantees from the five permanent members of the UN Security Council (Russia, China, the U.S., the UK, and France).
It is hardly possible to achieve full trust between the opposing sides on the Korean Peninsula in the foreseeable future, but a certain measure of confidence regarding each other’s actions is quite a realistic and necessary goal.
The North Korean nuclear dossier is one of the few international political issues on which there is a near consensus among the main players. At the same time, in addition to the general reluctance to see North Korea as a nuclear power, each state that is in some way or other involved in the problem has its own specific goals and interests, which are often in conflict with each other and impede coordination of actions.
Nevertheless, the situation around North Korea’s nuclear program is not an impasse that cannot be resolved. Right now, the task is to ensure that the consensus of all parties concerned – the U.S., Russia, China, South Korea, and Japan – on the military aspect of North Korea’s nuclear program lead to active concerted efforts on a practical level.
Progress on the nuclear problem on the Korean Peninsula is crucial to the future of not only Northeast Asia but also the entire Asia-Pacific region, as well as global processes.
Author: Nina Michchenko
Northern Ireland After Brexit: Deliberations and Forecasts
Author: Nina Mishchenko, Third Secretary, Embassy of the Russian Federation in the United Kingdom of Great Britain and the Northern Ireland
Source: International Affairs, Vol. 65, No. 6, pp. 150-155
Key words: Ireland, Brexit, EU Customs Union, no-deal Brexit, Sinn Féin.
The border between Northern Ireland and the Republic of Ireland is the key issue at the talks on Brexit. An absence of Ireland s only land border is its most amazing feature. The winding and twisting border of nearly 499 km long is not marked by pillars or barriers; there is no barbed wire or checkpoints. After the 2016 referendum on the withdrawal of Great Britain from the EU, the border issue moved to the fore in the relations between the UK and Ireland.
When the UK leaves the European Union, the counties on both sides of the twisting border will become the frontier of the EU which will increase, at least theoretically, the possibility of political and economic crises and deeper conflicts in both countries.
It should be said that the Good Friday Agreement signed in 1998 (the agreement on political settlement of the conflict in Northern Ireland that envisaged autonomous bodies of power) created the “transparent border between Northern Ireland and the Republic of Ireland as one of the agreement s key elements.
In the referendum of 2016, nearly 56% of the population of Northern Ireland voted “remain yet there was no agreement in its government: Sinn Féin, in the past the political wing of the Irish Republican Army (IRA), wanted to remain while the Democratic Unionist Party (DUP), its coalition partner that represented the interests of the Protestants, spent nearly half a million pounds to support the “Brexiteers.”
In Ireland, the border is a highly sensitive political, security and diplomatic issue. This explains why the politicians of the United Kingdom and the European Union assert, at least verbally, that regardless of Brexit variants there should not be any attempt to set up customs control at the border to say nothing about additional infrastructure.
The fairly contradictory principle of last resort, the so-called backstop, is the main bone of contention between London and Brussels. What is it all about? It is a measure needed to preserve the status quo, viz. the functioning border on the Emerald Isle. According to it, Great Britain will be guided by the rules of the EU Customs Union (EUCU) and that certain rules of the Common Market will be applied in Northern Ireland until the sides reach an agreement on the mechanism of ensuring a seamless border. This plan will be enacted if the UK and the EU fail to agree on the final variant of their trade agreement by the end of the transitory period or if it does not guarantee border transparency. Brussels insists that any Brexit deal should contain a backstop plan. The question is: When will it be needed?
As members of the Common Market and the Customs Union, the two states (Ireland and the United Kingdom) exchange goods and services with insignificant limitations: their products are not subjected to checks by customs or to mandatory standardization.
Brexit might change this algorithm: two parts of the Emerald Isle will find themselves in different customs and legal realities, which means that customs checks will become inevitable. As could be expected, both want to avoid the unwelcome scenario by signing a comprehensive trade agreement. However, Britain s negotiates withdrawal both from the Common Market and EUCU, which means that the “Irish problem makes this deal an extremely different task.
Many Brexiteers support a technological solution of the border issue yet neither London nor Brussels has any ideas of how this know-how should be realized.
Indeed, what should be done if a consensus on the trade deal or technological solution is not enough? According to the currently accepted project, the backstop will be realized: Northern Ireland will continue living according to the rules of the EU Common Market. This means that the goods brought to Northern Ireland from all other parts of the UK should be checked according to the rules and norms established in the European Union.
The agreement envisages a temporary single customs territory so that the UK will remain tied to the EU Customs Union indefinitely long, unless and until the sides arrive at a mutually acceptable solution. Why are there so many disagreements?
In November 2018, then Prime Minister Theresa May announced that her Cabinet endorsed the deal the United Kingdom and the EU had agreed upon with the “infamous Irish backstop as its inevitable part. This statement stirred up a lot of indignation in Parliament. Some of the ministers from the same Conservative party resigned from the Cabinet to demonstrate that they disagreed with the prime minister. They feared that the backstop might be used against their country; that it might make it a hostage or even a vassal (a more apt term) of the EUCU. In this case, the UK will be deprived of the right to sign trade agreements with third countries.
Some MPs deemed it necessary to specify that the backstop would be allowed or acceptable either within strict temporary limits or if the UK acquired the right of unilateral withdrawal.
In March 2019, the EU and the United Kingdom tried to discuss certain legal aspects of the backstop to arrive at a common interpretation of the concept and specify the project s main provisions. The document explained how the UK would resolve “official disagreements with the EU in the legal field if Brussels tried to tie the Kingdom to the backstop conditions forever.
The document specified that the EU was resolved together with Great Britain to look for a technological solution of the border issue; this point was actively supported by the Brexiteers. It was expected that these conditions would help Theresa May pass the Brexit agreement through Parliament, but it did not happen. Geoffrey Cox, Attorney General in the May Cabinet, issued a verdict that “the legal risks for Great Britain are still high. He added that if trade agreement between the EU and Great Britain proved impossible because of “irreconcilable contradictions the government would have no “internationally recognized legal instruments to push the backstop plan aside unilaterally, that is, without Brussels approval.
In his first speech to Parliament in his new capacity, Prime Minister Boris Johnson said: “No country that values its independence and indeed its self-respect could agree to a Treaty which signed away our economic independence and self-government as this backstop does. He declared that this plan should be removed from the project of the future agreement as “undemocratic and “sowing discord. Today, he is steering the country toward a “no-deal Brexit that, in his opinion, looks preferable to the backstop plan.
The government of Ireland, in its turn, insists that a no-deal Brexit will damage the Irish economy. Early in 2018, the first fundamental study of this side of the Brexit revealed fact that its realization would slow down Ireland s economic growth by 7% in the next ten years as opposed to what could happen under Brexit.
In June, Irish Finance Minister Paschal Donohoe said that a "disorderly Brexit" could cost 55,000 Irish jobs within two years and a further 30,000 over the longer term. His summer economic statement pointed out that a no-deal Brexit would “seriously undermine bilateral trade ties between Ireland and Great Britain. He did not forecast a recession but suggested that growth would be close to zero in 2020 if there were no deal.
It should be taken into account that the United Kingdom and the Republic of Ireland are big trade partners. A hard Brexit will destroy trade ties with import tariffs and other measures that regulate trade. A sober look at the state of affairs, however, reveals that the UK is not Ireland s biggest export market and has not been for years. The US is actually the largest external market with 27% of all goods exported in 2017. But the UK is number two – in 2017, 12% of Ireland s exports worth 16.5bn were sold to the UK.
The exported goods belong to various sectors of economy: Ireland supplies the British market with about one-fifth of its food and agricultural exports. Red meat producers are particularly vulnerable – about 50% of Ireland s beef exports are sold to the UK.
These food exports would face tariffs and increased competition in the UK market in the event of no-deal Brexit. In this case, these groups of Irish products will be confronted with tariffs and increased competition of third countries.
Exports don't tell the whole story of the UK s importance to Irish trade. Every year, around 18bn euros of Irish goods pass through the UK on the way to other EU markets. This route, via the UK road and ports network, is known as the “land bridge. It is particularly important for high-value or time-sensitive goods because it offers significantly faster transit time than alternative sea routes
The “land bridge from Dublin to Calais takes approximately 20 hours, while ferry services from Ireland to the continental EU can take twice as long. Ireland will be seeking priority for its lorries as they arrive in the EU, but it is difficult to see how they would avoid delays on the English side. A new plan for ferry services between Ireland and the EU has been developed, but it is still not the best option for time-sensitive goods.
The Irish government has been preparing for a no-deal Brexit for a long time. It has been running roadshows for businesses, often led by cabinet ministers, since September 2018. Grants of up to 5,000 have been made available for businesses to pay for professional advice and a 300m Brexit loan scheme has been created.
There is also the prospect of substantial EU support for Ireland to mitigate no-deal impacts: the Irish government has set up a 100m fund to help beef farmers who will experience difficulties as a result of Brexit. No-deal Brexit legislation was passed in February, creating continuity in areas such as pensions and benefits, cross-border rail services and the all-island single electricity market. An additional 400 customs officers were due to be trained and in place by the end of March, with a further 200 in place by the end of this year.
The Irish government, however, has not been clear about a very important point. In its recent so-called extreme plan, the government has warned that no-deal would mean that cross-border trade with Northern Ireland could not be as frictionless as it is today. It concedes that new checks will be “necessary to preserve Ireland s full participation in the Single Market and Customs Union. But it does not elaborate on where and how such checks would take place.
Many other serious problems might surface in Northern Ireland in case of a no-deal Brexit: social-economic tension will be inevitable while an appearance of a border will cause a lot of instability in the region.
Political confrontation will increase: some politicians will insist that Northern Ireland should be excluded from Brexit, others that it should be unified with the Republic of Ireland. The Sinn Féin leaders are talking about a referendum on unification of Ireland if a deal is not achieved.
Use of weapons in the region is another risk: we all know that, to a great extent, Irish nationalists are not aggressive because of an absence of a border. If it appears, the IRA might become more radical.
Author: Alexander Borisov
How Business Became a Hostage to Geopolitics
Source: International Affairs, Vol. 65, No. 4 (2019), pp. 83-94
Key words: geopolitics, globalization, war of sanctions.
The Russian Foreign Ministry increasingly sees the current state of international relations as a dangerous no-rules game. One comes to this conclusion when one sees the established world order falling apart and international treaties that have done such a good job to so many countries, guaranteeing global security and stability for many decades, being called into question or just ignored. General Charles de Gaulle’s quip that “treaties are like roses and young girls” because “they last while they last” isn’t very comforting. One is tempted to comment that, after all, stability is better than instability. But it is the global business community that today’s transition from the old world order to a new one is hitting particularly hard – it has involuntarily become a hostage to geopolitical games.
Geopolitics vs. Globalization
Today's world is a place where political interests closely intertwine with business interests. International relations have come to amount to competition among countries in which pragmatism pushes ideological considerations into the background. This trend has been particularly obvious after the collapse of the Soviet Union and the onset of the liberal world order. In public discourse, especially in Europe, some politicians traditionally pledge loyalty to “democratic values,” just as the fathers of the church pledged loyalty to Christian dogma in the early Middle Ages.
However, in the epicenter of liberalism, the United States, the democratic values theme has unnoticeably gone down the drain, especially after the well-known business mogul moved into the White House, although it still is a reserve weapon for the opposition. Needless to say, none of the ascending nations, not even China with its construction of “socialism with Chinese characteristics,” sees ideology as dogma. Ideology doesn’t prevent any of those countries from pursuing pragmatic policies while taking the world’s changing geopolitical map into account.
The world has moved into an era when governments throw aside all isms and put their entire power and influence at the service of their country’s business community. This has triggered intense geopolitical rivalries among great powers with consequences that have come unexpected to champions of liberalism and has plunged globalization into a protracted crisis.
After nearly a quarter of a century of “happy globalization,” the world business community has become drawn into a web of geopolitical tensions and uncertainties that is sometimes described as the Second Cold War. This is an effect of the global financial crisis, and to a greater extent, a consequence of the refusal of the West to accept the re-emergence of Russia as a world power and the rise of China. Who will claim today that “politics is a concentrated expression of economics” when time and again there come foreign policy decisions that run against business interests and push the world toward a new economic recession?
What was said at this year’s 49th annual meeting in Davos of the World Economic Forum makes clear that only the most incurable optimists would risk claiming that the fourth (digital) industrial revolution is ushering in a new phase of globalization as the world order built by the United States and its complaisant allies after World War II is falling to pieces. “The mood here is subdued, cautious and apprehensive,” U.S. analyst Fareed Zakaria, author of the book The Post-American World, said in describing the atmosphere at the 2019 World Economic Forum. “The great expansion of globalization is over.”1
Transnational business circles normally don’t need political upheavals, least of all those that undermine markets, break supply chains that have taken decades to build, and lead to tariff barriers, sanctions, and even full-scale trade wars. It is no accident that European capitalism, after reaching maturity back in the 19th century, proclaimed the free trade, open doors, and equal opportunity principles, which paved the way to economic expansion and the conquest of new markets. This doesn’t mean that armed force wasn’t used when agreements proved impossible to reach. “Trade follows the flag” was advice given to descendants by Cecil Rhodes, one of the founders of the British empire, an adventurist, racist and colonizer. Students have recently demanded that the Oxford University administration remove his statue in Oxford.
It is the question of questions how it came about that globalization, extolled by the West as a key to solving global problems, primarily backwardness, poverty and inequality, fell victim to geopolitics, which seemed to have sunk into oblivion and was ousted by revived supremacy struggles among great powers. The answer is that globalization was thought up as a hierarchical project, as the removal of national borders for transnational, mainly American corporations, as, in a sense, an embodiment of the “end of history” – the final triumph of American universalism, an evasive phrase for the onset of the “American age.”
For political simpletons, globalization was portrayed as a blessing for everyone. However, the United States planned to use globalization as a means of advancing its own interests, and least of all did it want a change to the hierarchical world order based on the outcome of the Cold War, and least of all did it want to relinquish its status as the world’s only superpower.
Yet, at the same time, by eliminating ideological antagonisms and putting an end to many of the international conflicts caused by them, globalization has brought about a more favorable environment for economic competition, removing many of the artificial barriers erected during the Cold War. Businesspeople across the world feel nostalgic about those days as a “golden age” when markets expanded tremendously after former socialist countries had gone over to free enterprise and China was reforming quickly. There emerged truly global markets, which many believed offered equal access and equal competition. New power centers emerged that were quickly asserting themselves instead of taking prepared for them rungs in the U.S.-created hierarchical system. Surely the ways of competition, just as any spontaneous forces, are unpredictable and inscrutable.
Consequently, what the United States got wasn’t what it had expected – it was caught in a trap it had laid. It had assumed that the developed part of the world, the “golden billion,” would retain its role as the financial, economic, and technological center, naturally under American organizational supremacy and control, and pass over “yesterday’s” functions – manufacturing and other – to the rest via an integration and interdependence system that would perpetuate global political and economic inequality. But this is not what has happened.
This quickly came home to the United States, which knows how high a profit needs to be to justify a specific investment, while Europe was still laboring under liberal illusions. The American model of global domination, which seemed immutable after the Cold War, was unexpectedly in danger.
The British, linked to Washington by a “special relationship,” were also anxious. Once again, they launched a policy that reflected their self-centered insular mentality. Britain saw the incipient European Union crisis and European disintegration as symptoms of growing nationalism and protectionism and as a harbinger of an upcoming replacement of world political leaders. The British reacted by pre-emptive action that reflected typical British shrewdness and pragmatism – they hadn’t won two world wars to accept Germany as the new European economic hegemon. This pre-emptive action took the form of the Brexit vote, which altered the course of European politics and meant that the British elite wanted freedom in the turbulent times of global uncertainties, though it’s not yet clear what effect this hazardous (and possibly disastrous) move will have on the British economy and financial system, and maybe on British statehood as well – Brexit proved impossible to launch on the initially scheduled date and had to be put off by several months.
The election of scandalous billionaire Donald Trump as president of the United States came out of the blue for the entire world. In a sense, it meant that Washington was ditching a strategy that had ceased to work and was launching a new strategy. Actually, Trump’s electoral victory was not as accidental as it might have seemed. On the other hand, it’s unclear whether the U.S. military-industrial complex, hit by a post-Cold War production decline in the 1990s and the subsequent “peace dividend” period, was instrumental in bringing about this change of strategy. The defense industry, the military, the intelligence community, and the media played a significant role in the United States’ swing from globalization to protectionism and in its stronger defense of American interests under the “America First” slogan.
Government and Business
The collapse of a world order has always involved painful processes in international relations, changes of leaders and parliaments, and the agonizing birth of new rules of international behavior. And it is business that has always had the worst time. For companies that didn’t directly participate in hazardous governmental projects and managed to avoid bankruptcy, those have been times of serious losses and difficult adaptation to new realities.
In the past, such periods have usually involved economic antagonisms that developed into trade wars and military conflicts some of which evolved into world wars. It’s only rather simple-minded people who believe claims by some fashionable authors that World War I was an accidental result of activities by some political “sleepwalkers” and not a clash of the economic interests of European great powers, primarily Britain and Germany, and business elites that were behind those interests.2
Economic interests were to an even greater extent behind World War II as the motivations of those who unleashed it, the Axis powers, mainly Nazi Germany and militarist Japan. Those countries were primarily fighting for strategic resources, such as oil, commodities and labor markets, and living space. The Treaty of Versailles, which put a formal end to World War I, violated the interests of the worst enemy of the Anglo-Saxons, German companies, and it was mainly this and not any anti-Bolshevik ideology that propelled the National Socialists led by Adolf Hitler into power. And it was chiefly the interests of big German companies that the Nazis were serving in their bloody attempts to redivide the world.
Remarkably, as soon as German forces occupied a European country, tycoon Gustav Krupp von Bohlen und Halbach, a lavish funder of the Nazis, would fly to that country on board his private Messerschmitt to look for assets to include in his empire. It became a state policy to plunder occupied countries, specifically to take hold of Jewish capital. For example, Alfred Rosenberg, the chief Nazi ideologist, who was sentenced to death at Nuremberg and executed, said in his diary that the Mendelssohn & Co bank, “which had existed since 1795, was handed over to Deutsche Bank in the course of Aryanization.”3
The Ost plan, which was adopted by the Nazis after they launched their invasion of the Soviet Union, involved robbing Slav peoples on a vast scale. In European Russia, the Nazis planned to leave a maximum of 30 million people, according to minutes of a meeting at Hitler’s headquarters on July 16, 1941. “As regards German requirements in the East, feeding the German people is undoubtedly our main concern…. But we do not see it as our duty to provide Russians with food from those regions. The Russian people are in for difficult years. It will be decided later to what extend industrial facilities will be preserved there. Crimea must be liberated from all aliens and populated by Germans…. By and large, the point is to intelligently divide a huge pie so that we can, first, possess it, second, manage it, and, third, exploit it.”4 Such was the role of a criminal state that had put itself at the service of big companies. Present-day demands by Berlin that Russia return property obtained from the defeated Third Reich as reparations with the consent of the Allies seem strange, to say the least.
After decades of ideological confrontation, the world has clearly entered a new era, a period of redistribution of roles among principal power centers, primarily the United States, China, Russia, and the EU. Apparently, the nuclear arsenals of key global powers remain the only brake on their increasingly intense rivalries and mainly limit them to economic competition.
It is surprising that there aren’t too many detailed, fact-based, insightful studies that shed light on roles played by intricate relationships between big companies and governments in foreign policy decision-making with all the hidden objectives and behind-the-scenes movements. It’s much too important a subject to be neglected. One profound study is the article “Business and Foreign Policy” by Jeffrey Garten, a former U.S. undersecretary of commerce for international trade, that was published in influential American magazine Foreign Affairs and explains a symbiosis between the United States’ government and business community.
“Throughout most of American history, commercial interests have played a central role in foreign policy, and vice versa,” Garten says. “During the next few decades, the interaction between them will become more intense, more important, more difficult to manage…”5
Calvin Coolidge, who was U.S. president in the 1920s and was the hero of Ronald Reagan, another former American president and another big friend of American corporations, is the author of the popular aphorism, “The chief business of the American people is business,” which reflects the essence of U.S. foreign policy. The State Department terms this “commercial diplomacy,” a policy to advance the interests of American companies in the world come hell or high water, no matter what political cost of it is and what obstacles may emerge. U.S. foreign policy owes its tough, uncompromising nature to American corporate culture, which was built from scratch and evolved through brutal competition unlike what happened in Europe with its soft movement from feudalism to capitalism, not to mention the 1990s privatization of government property by nomenklatura in Russia.
“For most of the country's history, foreign policy has reflected an obsession with open markets for American firms,” Garten says further on. The United States looked for markets to export “autos and airplanes,” and for “access to raw materials like oil or copper.” Business expansion outside the United States has often been seen as part of a national mission. As never before, the health of the American economy depends on foreign markets, Garten says. The domestic market has ceased to guarantee adequate growth, employment, revenues, and accumulation, he argues. “If the global experiment in democratic capitalism goes awry, the international landscape will be ominous for the United States,” Garten says. Garten, who, besides having been a politician in the 1990s, is a businessman as well as an academic today, makes another interesting point – he criticizes economic sanctions, especially if they are unilateral and argues that they harm American companies and help rivals of the United States. American businesses have always preferred stability to uncertainty, he says.6 In other words, “money loves silence,” as the adage goes, and business loves stability. In the words of the unforgettable and outstanding Russian aphorist Viktor Chernomyrdin, stability is better than instability.
How has it come about that the United States threw aside the advantages of stability, abandoned caution and circumspection that are inherent features of business, and embarked on the dubious and dangerous enterprise of seeking to safeguard its dominant positions in the world, challenging increasingly powerful rivals such as China and Russia, and even the EU? What is behind this: a paranoid fear of losing former power? Refusal to adapt to a new reality after being used to be the hegemon? Or justifiable fear that the onslaught of rivals would deprive the Americans of privileges in world markets, or even throw America back to its pre-World War II status with a scale of influence limited to the western hemisphere?
Judging by heated polemics within the U.S. government that spill into public space, the American elite is generally united, extremely militant and believes that it will be able to reverse history. This belief has got stronger after Trump was elected president and is based on the power of the American economy, the United States’ financial and technological superiority bolstered by its military might, and the experience and clout of American transnational corporations. On the surface, this looks like a dangerous gamble with unpredictable consequences for the Americans and the rest of the world.
The War of Sanctions
Today’s world political scene is marked by intertwining geopolitics and geo-economics that underlie bitter global antagonisms. Any dispute or conflict, no matter which region is its site, is, at the end of the day, a struggle for resources, especially energy, a clash of the interests of large corporations and governments backing them. Recent developments in Iraq, Libya, Syria, Venezuela, and other hot spots are good examples. After many years of relative stability, those countries were rocked by bitter domestic conflicts with the United States and its main NATO allies interfering in them. These conflicts inflicted heavy losses on rivaling transnational corporations regardless of their jurisdiction. One would have expected Western countries to realize by now that one can never be sure of consequences of any interference in someone else’s affairs no matter what noble pretext is used for it. One can’t help thinking of the European quip of the days of Napoleon III that the French “are always surprised at the outcome of what they have done.”
Many experts believe that, after a relative lull, a new global conflict is looming and that business interests are neglected in this situation. This highlights the issue of interference in internal affairs. American-Chinese antagonisms and the simultaneous American-Russian confrontation are at the epicenter of this brewing conflict. The American-built world order based on the results of World War II, which, it seemed, became definitively triumphant after the Cold War and the collapse of the Soviet Union, has sunk deep into crisis because of the Americans’ own conduct, and this crisis has spread to what is the “holy of holies” for the United States, trans-Atlantic relations. One has the impression the Americans are deliberately trying to split up the world in order to reassemble it in their own way.
Trump’s America with its neo-conservative logic prefers bilateral relations with each ally to the old multilateral approach that France and Germany still call for. Trump bases his behavior on the tough business logic of everyone taking care of themselves, although this runs against the United States’ post-World War II strategy of unifying the Western world under its leadership and setting up political and military alliances, primarily NATO, although the latter’s future looks uncertain, to say the least, now that Trump has accused its European members of parasitism.
Focusing on military operations to “liberalize” and “democratize” the world, the United States has been finding it harder to win economic competition both with its allies and partners and with its principal adversaries. American companies, primarily transnational military-industrial, energy and telecommunications corporations that behave as masters and lawgivers throughout the world and therefore are geopolitical actors, felt threatened in this competition. The entire world is the scene of these rivalries, all its key regions – Europe, the Indo-Pacific, the Middle East, Africa, Latin America. One can detect geopolitics behind any of these clashes of interests – one just has to scrape the surface.
The international business community is confused. Until very recently, companies had the decisive say in the policies of their governments but today they have been pushed into secondary roles in U.S.-directed dangerous geopolitical games and therefore are forced to accept hazardous rules dictated to them. The United States makes fairly sober-minded near-term assessments of its economic power and the extent of its control of the global financial system and, in view of nuclear-age realities, uses economic sanctions as its chief means of political pressure in dealing both with its adversaries and with its partners.
The United States included sanctions in its political and diplomatic arsenal when it was launching a policy of expansion and, when applying them, sometimes supplemented them with the use of threat of armed force. When the Cold War came to an end, unilateral economic sanctions that didn’t have the approval of the UN Security Council, although very damaging to American and European companies, became one of Washington’s chief means of political pressure on Russia, China, and even some allies of the United States. According to calculations by American economists Gary Clyde Hufbauer, Jeffrey Schott, Kimberly Ann Elliott, and Barbara Oegg, in the 1990s, the United States used various forms of sanctions against 35 countries compared with 20 countries that it had sanctioned in the preceding decade. The United States obtained UN Security Council approval for its sanctions against Iraq in 1990-1991, the former Yugoslavia in 1991, and Rwanda in 1994 in order to give them legitimacy. However, if coordinated international pressure proved unachievable or failed to make the target country change its behavior, the United States unhesitatingly employed more aggressive unilateral measures, the four economists said.7
The declared reason for the current large-scale sanctions against Russia was the reinclusion of Crimea in Russia. However, it was long before that when the West began to consider the use of sanctions as a long-term strategy to achieve a “change of regime” in Russia and force the country to abandon an independent foreign policy if it contradicted Western interests. The hasty introduction of sanctions – first personal and then sectoral – meant that the administration of President Barack Obama had adopted them as a reserve instrument before the conflict in Ukraine, no later than in 2012, the year the “Magnitsky Act” was put into force. This reflected deep disappointment with the results of the “reset” of Russian-American relations – no new edition of Gorbachev’s perestroika came about while Vladimir Putin won a new presidential term in 2012. And it can never be a problem to find a pretext for sanctions, as the downing of Malaysia Airlines Flight 17 or the Skripal poisoning case make clear.
The anti-Russian sanctions, which are based on American legislation but run against the UN Charter and international law, have become a permanent factor in international relations, raising major obstacles to trade and investment. They have mainly hit the EU countries, which have thoughtlessly joined the sanctions out of trans-Atlantic solidarity and refused to recognize the right of Crimea’s population to self-determination, which it exercised after ultranationalists took power in Kiev.
Russia’s main trading and business partners in the EU such as Germany or Italy sustained heavy losses. The Russian Foreign Ministry estimates that the sanctions have cost Europe a total of about 100 billion euros. Import substitution measures and exploration of non-EU options whereby Russia reacted to the sanctions irreversibly deprived many European companies of markets in Russia. Being barred from Russia’s agricultural market was the greatest loss for them. Russia meanwhile achieved a breakthrough in grain production. Exports of wheat began to bring Russia higher revenues than its weapons exports and made it one of the world’s main grain exporters. The United States involuntarily created a long-term rival for itself in the world agricultural market.
Only a naïve politician may expect a great power to change its behavior under that external economic pressure rather than looking for an antidote. Several years after the West launched its war of sanctions against Russia, some Western analysts and politicians admit this. An article by David Cohen and Zoe Weinberg headlined “Sanctions Can’t Spark Regime Change” is a good example. “In the last several decades, financial and economic sanctions have become a key tool of U.S. foreign policy. The Trump administration has made particularly heavy use of this tool, especially in its efforts to induce regime change in Venezuela and Iran,” Cohen and Weinberg say. However, they indicate, “the more the United States uses sanctions to pursue policies that lack international support, the more other countries … will seek alternatives to the dollar and the U.S. financial system. If they find such alternatives, it will be a blow not only to U.S. sanctions policy but to the United States’ position in the global financial system.”8
That is true, but the current sanctions are a mechanism with an inertia that’s hard to stop. The United States is unlikely to abandon them in the foreseeable future, even though by sticking to them it will be harming itself and others. That is a reality one can’t avoid. It’s more likely that the EU’s united front will be breached, but even that can only happen if Trump’s policies continue to undermine trans-Atlantic solidarity, which has already become looser due to his efforts. It’s too early to expect European countries to shake off their dependence on the United States, although they have become more independent in decision-making on issues such as the Iran nuclear deal, Middle East policies, European energy security, or relations with China, and put more value on their own interests. Whether this independence trend gains momentum largely depends on how much pressure European companies will put on their governments, on whether European governments will prioritize market advantages, and on how influential Europe’s pro-American circles will be.
1 Zakaria, Fareed. “Davos is a microcosm of the world – and the outlook is grim,” The Washington Post. January 24, 2019.
2 Clark, Christopher. The Sleepwalkers: How Europe Went to War in 1914. New York, 2013.
3 Politichesky dnevnik Alfreda Rozenberga, 1933-1944. Moscow, 2015, pp. 264, 277-278, 314.
4 Piker, Genri; Khaffner, Sebastian. Plan “Ost.” Kak pravilno podelit Rossiyu. Moscow, 2011, pp. 198-200.
5 Garten, Jeffrey E. “Business and Foreign Policy.” Foreign Affairs. May/June 1997.
7 Hufbauer, Gary Clyde; Schott, Jeffrey J.; Elliott, Kimberly Ann; and Oegg, Barbara. Economic Sanctions Reconsidered. 3rd Edition. Peterson Institute for International Economics. June 2009, pp. 87-88.
8 Cohen, David S. and Weinberg, Zoe A.Y. “Sanctions Can’t Spark Regime Change: The Trouble with Trump’s Approach to Venezuela and Iran.” Foreign Affairs. April 29, 2019.
Author: Boris Dolgov
Author: A. Borisov
Big Business in a Multipolar World
Author: Alexander Borisov, Professor, Department of International Relations and
Foreign Policy of Russia, Moscow State Institute (University) of International
Relations, Ministry of Foreign Affairs of the Russian Federation, Doctor of
Sciences (History); firstname.lastname@example.org
Source: International Affairs, Vol. 66, No. 1, pp. 31-46
Key words: U.S.-China, Huawei, geopolitics, Nord Stream 2, Northeast Passage.
THE 20TH CENTURY went down in history as a century of ideologies and sharp confrontation of states belonging to different systems, the Soviet Union and the United States in the first place. The 21st century has already demonstrated a mounting geopolitical confrontation of great powers that drew international business interests into their whirlpool. It turned out that the main actors of world politics cannot agree on new principles of economic cooperation, free competition and respect for the spheres of interests - they have chosen the road of mounting worldwide tension.
America and China
THE AXIS of geopolitical and geoeconomic confrontation is gradually shifting toward the relations between the United States and China. With Donald Trump in the White House, Washington no longer cherishes the illusion that it would transform China into a "manageable partner" in the system of global American interests. The U.S. has obviously missed the moment when strong state and private corporations, especially in the high-tech branches, rose from the soil of Communist China and its one-party system. Today, they determine the pace and trends of scientific and technical progress and have challenged the seemingly unattainable leadership of the United States.
This has been clearly demonstrated by RAND Corporation, America's biggest analytical center, which in March 2019 published its latest report with a telltale title "Russia Is a Rogue, Not a Peer; China Is a Peer, Not a Rogue." It has offered the American elite some far from comforting assessments and forecasts and instructed it how to place accents and identify priorities in the unfolding global confrontation.
In 2016, China became the top goods export destination for 13 economies, constituting 9.2% of the global economy, and the top source of goods imports for 49 economies, constituting 53.9% of the global economy. In contrast, in 2000, the United States was the top goods export destination for 33 economies and the top source of goods imports for 28 economies. By 2016, the United States remained the top goods export destination for 30 economies but served as the top source of goods imports for 20 economies. "China is thus displacing the United States as both the leading goods exporter and the leading goods importer in a growing number of markets," write the authors .
Corporate America is worried or even is openly hostile to the Made in China 2025 plan that has defined ten promising innovation trends and the Chinese leaders' ambitious plan to double the country's GDP by 2049, its 100th anniversary. If realized, it will make China the main economic partner for nearly 70 countries with 66% of the world's population and 43% GDP of Planet Earth. China's increased economic pressure on the world market earned its leader Xi Jinping the title of "president-expansionist" and "red emperor." In 2017, during his visit to Beijing, President Trump in his typically American condescending manner called Xi Jinping "the King of China" which the latter never appreciated.
In fact, seen from the American shores, China's manners in doing business bring to mind the history of America's foreign economic expansion pursued a century ago with well-known results for other even congenial countries: Great Britain, for example, moved away to give space to the United States. Unwilling to follow the same road, Washington is bracing itself for a long struggle against the new claimant for world leadership: unlike its "elder sister" (that lost its colonial empire after its Pyrrhic Victory in World War II that Churchill called "unnecessary"), it has no recent history of disasters and remains the most powerful world military and economic power. There is an opinion that while geopolitically the world is growing increasingly multipolar, it so far remains unipolar geoeconomically: Washington has prevailed over its opponents through some successful arm-twisting.
The international scandal around Huawei, China's biggest telecommunication corporation that has set up a 5G network to insert into the World Wide Web, was the latest and most typical example of deep-cutting contradictions between the two economic giants. Washington reacted nervously to what it interpreted as China's intention to push its main rival on the high-tech market to the side.
Washington did not hesitate to use "foul" methods of competitive struggle, as well as the might of American diplomacy and special services; it put pressure on its closest allies and partners from among NATO and EU members and, under a false pretext that China was using high technologies for espionage, even on the so-called Five Eyes (FVEY) Anglophone intelligence alliance.
The highly tense relations between Russia and the United States are explained, to a great extent, by clashes on the fuel market and the fact that the sides are so far not ready to arrive at a mutually acceptable global modus operandi.
Arrest in Vancouver (Canada) of the financial director of the company, daughter of its founder who was former military, crowned this "game without rules": the company was accused of violating the regime of American sanctions imposed on Iran. Since the arrest that bared the ties between geopolitics and commercial interests was made by Canadians, they also became a part of the scandal.
By that time, Beijing had rejected the behests of Deng Xiaoping "Do not push forward" and "Cross the river by feeling the stones" which had remained gospel truth far too long. China's response was harsh: as if by chance, several Canadians found themselves behind bars. One of them was recently a high-placed diplomat, another, a drug dealer, was sentenced to death after repeated court hearings. The U.S. has met its match, so to speak. The story has not ended yet Europe, including the UK, refused to follow the United States and ban the Huawei technologies on its territory.
Trump turned to protectionism and tariff wars with China in order to cut down the huge American trade deficit with China ($419 billion in 2018) caused not by China's malice but by fair competition.
Back in 1876, at one of the world's first international exhibitions (the first of that kind organized on American soil in Philadelphia), now known as Expo, America presented a wonder of industry - the latest electric motor, Britain demonstrated an upgraded steam engine, Germany boasted of a giant lathe for gunsmithing while China exhibited 12 silver spoons from the treasury of Qing Dynasty. This caused no surprise: a backward nation, its members perishing by thousands at railway construction sites in the United States.
Today, the picture is different: the United States that lacks the courage to accept the natural course of history explains China's breakthrough, of which Huawei is one of the examples, by branding it "the den of the technologic thieves"; Washington insists that American firms working in China are forced to share their secrets within JVs, that Chinese businesses and Chinese economy are flourishing under the patronage of the state, on state subsidies and within the system of state economic management. America can barely conceal its demands that China should revise its methods of economic management in favor of the Western liberal model. So far, Americans have been avoiding bigger troubles because Chinese demonstrate restraint and still want to arrive at a consensus. This will finally catch up with the United States - the laws of fair competition have not been annulled.
With the largest amount of America's sovereign bonds, China has enough means of retaliation. Today, with over $1 trillion-worth sovereign debt, the United States can print money to pursue its costly external and military policy. In the trade war the U.S. unfolded early in 2018, China retaliates with precisely targeted measures that affect those of the American states that brought Trump to power and with trade tariffs of billions of dollars.
China can devalue its currency to stimulate exports, something that Washington fears more than anything else. This means "a war is a war:" Beijing will not back off in the trade wars started by Washington. The Chinese, however, are ready to mutually acceptable reasonable compromises, but they will continue fighting for the world's markets. Beijing has stated that there are no reasons to expect that China will be crawling to America in response to its threats.
Chinese Conquer the World
VERY MUCH in line with the laws of geopolitics, the center of this struggle is gradually shifting from the backward peripheries to the Old World, its Western center. Washington was moderately worried while Chinese were pushing into Africa, Asia (including Central Asia) and the Middle East; they remained more or less indifferent when Chinese reached Latin America, Washington's backyard. Americans were waiting for what they thought would happen sooner or later: either Chinese drive will fizzle out or they will be repulsed at least by some of the targeted countries.
American diplomacy invented a counterargument: The recipients of Chinese investments would, sooner or later, find themselves in "debt bondage" and deprived of their sovereignty. This comes from the superpower that never respected and does not respect the sovereignty and independence of others. Expansions differ - one's own is justified while others should be rebuffed.
It seems that its militarized consciousness does not allow Washington to fully understand the crawling nature of China's global economic expansion and its inevitable and long-term effects for Washington and its interests. It should be said that China has a huge experience of trade that goes back into centuries, that was not damaged by the Communist regime even during the grimmest periods of the "cultural revolution" and that was retrieved by the ruling party when in 1978 it embraced the policy of "reforms and openness."
Having become another "workshop of the world" (in the 19th century, this title belonged to Great Britain), China used its colossal export potentials to accumulate big dollar reserves. This money should be invested abroad. The local purchasing capacity is still too low while the doubts about sustainability of American currency are too high. The country with the population of nearly 1.5 billion especially needs external markets, raw materials and hydropower resources.
These objective and deeply rooted requirements prompted the idea of transcontinental infrastructural logistic (transportation) projects covering Eurasia and the neighboring seas and involving tens of states. Announced in 2013 when a new cycle of power headed by Xi Jinping began, the project today known as One Belt One Road does not exclude a possible connection with the Eurasian Economic Union (EAEU), of which Beijing informed the world in May 2015.
The Anglo-Saxon fans of Halford John Mackinder, father of geopolitics, and his ideas of the "geographical pivot of history" and the Eurasian Heartland as the core of world order that he had offered in his well-known article published in 1904  and that, in its time, had caused quite a stir comparable to the noise raised by Francis Fukuyama's "end of history" nearly one hundred years later, became immediately aware that the seemingly inoffensive or even peaceful Chinese project was, in fact, charged with a great threat to the America-centrist world.
From the very beginning, American geopolitics relied on its fundamental doctrines of "exceptionalism" and "predestination" that ignored even a possibility that another hegemon might appear on the other side of the world, in Eurasia; whoever it might be is unimportant - either the Kaiser or fascist Germany, the Communist Soviet Union, post-Soviet Russia or China on the rise. American historians can tell you that driven by these ideas the United States was involved in two world wars on the side of the victors; it won the Cold War against the Soviet Union and its East European allies. In his book The Revenge of Geography: What the Map Tells Us About Coming Conflicts and the Battle Against Fate, American scholar Robert Kaplan has written: "Making sure that one power in the Eastern Hemisphere does not become unduly dominant, so as to threaten the United States in the Western Hemisphere" is one of the major tasks .
Judging by the commentaries offered at different levels, from the media to analytical reports and official statements, China's global initiative took Washington by surprise. This speaks volumes about Washington's devotion to the old and outdated dogmas and its inability to think in a new and very different way. Confusion in Washington was deepened by the confusion of sorts in the camp of America's closest allies tempted by the Chinese initiative that promised considerable investments for Europe starved for funding due to a fairly long recession. Xi Jinping's European tour in March 2019 (when he visited Italy, France and Monaco) was an impressive breakthrough.
Italy proved to be the weakest link in the G-7. Its populist coalition government knocked together out of left- and right-radical forces ostentatiously challenged Brussels's financial and budget discipline and was insisting, as much as it could, on their country's national interests. The Chinese leader concluded his visit to Rome with signing a memorandum of mutual understanding in support of the One Belt One Road program and 29 business contracts on the total sum of €2.8 billion invested in several big infrastructural projects (the ports of Genoa and Trieste, transportation arteries, bridges, etc.). Together with earlier acquired 51% of shares of the port of Piraeus (Greece) and the possibility to use the port in Valencia (Spain), Italian ports are expected to become facilities of Chinese export maritime and land shipping routes within the One Belt One Road program.
Italian self-confidence stirred a lot of jealousy in the main EU "shareholders," France and Germany in the first place, and unconcealed irritation on the other side of the ocean. Americans treated everything as a
mine under the building of "trans-Atlantic solidarity" that shattered its influence in Europe. The European grandees were more worried, whether with good or no reason at all, by the fact that the European unity was gradually undermined and that China was acquiring strategic European assets even though before that China had already invested a lot of money into European economy, Germany in the first place.
To demonstrate the European Union's cohesion, President of France Emmanuel Macron unexpectedly changed the format of Xi's official visit to Paris. The Chinese side was stunned to learn that Chancellor of Germany Angela Merkel and Head of the European Commission Jean-Claude Junker were also invited. The European side called on the Chinese guest to maintain "balanced interests" and to take the interests of partners into account: the hosts were obviously worried by China's drive. On the eve of the visit, the European Commission, tuned to Washington's sentiments, issued a document "EU-China: A Strategic Outlook" in which it called China "an economic competitor in the pursuit of technological leadership, and a systemic rival promoting alternative models of governance" .
Germany occupied the toughest position which is probably explained by the export nature of German economy (over 50% GDP) that already caused clashes with the Chinese Drang. Germans deemed it necessary to warn other countries not to be "naive" when dealing with China's invitation to take part in widening the 5G network. It means is obviously more than playing into the hands of Americans.
It looks as if Europe is being torn apart between the desire not to sell cheaply and to preserve the united front of the European Union and the West as a whole. The high-flown deliberations of President Macron about the importance of preserving the interest of Europe and his "touching" concerns about the interests of the French businesses is the best example of European ambivalence. After the catastrophes of Boeing 737 MAX in Indonesia and Ethiopia that echoed all over the world, China demonstratively met Paris halfway and refused to buy Boeings. Instead, it bought 300 Airbus liners to the total sum of €30 billion. The French business community appreciated this as a great success of their president, a diligent graduate student from the Rothschild financial empire.
"100,000 Tons of Democracy"
ENERGY and hydrocarbons form the sphere in which the ties between transnational business and geopolitics are especially clear: oil and gas resources and transportation routes, diversification of supplies and energy security figure prominently in the interests of all great powers and are responsible for their disagreements. They determine the fates of small states and, in the final count, the war and peace issues. Despite certain individual agreements, the world as we know it today, is still far removed from a broad consensus on these issues. Today, it is plunged in the never-ending struggle of "all against all."
More than that: today, unlike the 1990s when business interests were more or less coordinated on the international scale on the basis of cooperation between the biggest energy corporations, both state and private, we are watching the rising tension in interstate relations along the East-West line. The situation on the world energy market is gradually developing into a source of great troubles and new geopolitical risks.
It seems that this is the main reason of excessive politicization of the oil and gas business that has become an instrument of geopolitical rivalry of the great powers in which the United States calls the tune. One cannot but wonder whether international cooperation or confrontation is better suited to the financial interests of business.
Starting with the "kerosene trust" of the Rockefellers, Americans were the trailblazers of the oil business even though early in the 20th century the Baku area produced more oil than Pennsylvania. The clock of the oil era started ticking on the eve of World War I, when First Lord of the Admiralty Winston Churchill ordered to transfer the Royal Navy from coal to oil. For decades, the oil business was dominated by the notorious "Seven Sisters" (a group of the biggest, mainly American oil companies) that left their predatory imprint on the business and tied it to diplomatic and military support of their governments.
For many years, American domination in oil production and oil business ensured to a great extent American leadership in international affairs as a whole. The closed nature of Soviet economy and the minimal presence of the Soviet Union on external markets throughout the longer part of its history, as well as the fact that for a long time after decolonization the developing countries could not shake off their dependent status, made it much easier for the Americans to retain their privileged position on the market of hydrocarbons.
This explains America's hostile response to the Soviet Union's first attempt in the 1970s to break the blockade and bring its hydrocarbons to the European market (the Druzhba oil pipeline and the "gas for pipes" deal). These were the first moves of the future "Great Game" on the world geopolitical chessboard.
As the biggest naval power, America built its energy strategy on control over the main maritime communications and manipulations with the raw material producers in the interests of American corporations and geopolitical interests of the United States as a superpower. "The U.S. ambassador to Russia, Jon Huntsman said about the aircraft carriers: 'Each of the carriers operating in the Mediterranean at this time represent 100,000 tons of international diplomacy'." They were used to block sea straits and other "bottlenecks," punish the displeased and the disagreeing, scare the disloyal regimes, etc.
"Aircraft carrier diplomacy" replaced "gunboat diplomacy." After World War II, when James Forrestal, the first head of the Pentagon, was defending the Navy budget in Congress, frightened liberal Senator Claude Pepper still very much devoted to prewar pacifism asked the bellicose minister, "Are you planning to send our ships elsewhere?" only to hear a mocking answer, quite in tune with the beginning Cold War, "No, not everywhere, only where there is sea" .
Its domination on the market of energy sources gave the United States not only an access to the world's biggest oil and gas fields (today, with the new extraction technologies the United States uses on its own territory, this is no longer important) but also allowed it to manipulate with prices to undermine the rivals' economic positions. A legend is still alive that in the 1980s, Saudi Arabia under American pressure brought down the oil market to deprive the Soviet Union of currency proceeds thus accelerating its disintegration.
Today, the general strategic situation in the world has changed a lot contrary to the interests of the United States. Its geopolitical interests no longer fully harmonize with those of the oil-producing countries, even of the most loyal of them. American anti-Russian sanctions cost American corporations tens of billions of dollars. ExxonMobil, for example, had to cancel the deal with Rosneft on the Arctic shelf. American business had lost a lot due to the trade ban with Iran, another big oil and gas producer, both before the Joint Comprehensive Plan of Action (JCPOA) was signed in July 2015 and later, when in May 2018, under President Trump, the United States was the only one among the six signatories that withdrew from it.
The fact that all other countries, including India, China and some of the American allies, continue trading with Iran by insisting on all sorts of exceptions from the regime of sanctions is very offensive to the U.S. The European Union went even further: in disregard of Washington, it created a special clearing mechanism with Iran outside the dollar zone. The U.S. Secretary of State Michael Pompeo admitted that Iran lost $10 billion because of sanctions. He, however, said nothing about the losses of American businesses. It should be said that European companies find the American market attractive to the extent that they reject tempting deals with Teheran because of possible American sanctions.
China's geographically vulnerable situation that forces it to get oil and gas from the Middle East via the Strait of Malacca accelerated the construction of pipelines from Siberia which guarantees diversification of hydrocarbon supplies and their safety. These pipelines are inaccessible for the American Navy in case of extraordinary situations. The majority of experts are convinced that George W. Bush's invasion of Iraq in 2003 and the later efforts of the United States to keep it within its orbit are explained by the geopolitical struggle for resources rather than by the desire to bring democracy to the people of Iraq.
In the course of time, it is becoming clearer that the civil war in Syria that began in 2011 was nothing more than a cynical attempt to use its territory under the guise of popular protests of the Arab Spring type and violate its sovereignty in order to build a network of pipelines from the oil-and gas-rich Gulf monarchies to Europe to change the balance of power and undermine Russia's interests.
Prosperous Libya, the territory of which contains over one-third of African oil reserves and which obeyed Washington without a murmur - under its charismatic leader Muammar Qaddafi, it voluntarily folded up its nuclear power program, - fell victim to a military intervention of some of the NATO countries (France, Britain and the United States). At the best of times, Libya accounted for 11% of oil imports (about 1.5 million barrels a day) of by European countries (France, Italy, Germany, and Spain) and served a reliable barrier against migration flows from the inner areas of Africa to Europe.
After regime change realized by the West with the use of force and physical liquidation of the proud leader of the Jamahiriya, the state fell apart and plunged into internecine wars and terror. International corporations, Russian corporations among them, sustained great losses. It seems that in spring 2019 the country entered another stage of the civil war making return to normalcy even more illusory. In an interview to The Atlantic, President Obama, with the benefit of hindsight, admitted that invasion of Libya had been the greatest political mistake of his presidency: "Mess is the president's diplomatic term; privately, he calls Libya a 'shit show'," that cost the American ambassador his life at the hands of terrorists .
The highly tense relations between Russia and the United States are explained, to a great extent, by clashes on the fuel market of fuels and the fact that the sides are so far not ready to arrive at a mutually acceptable global modus operandi. In oil-rich Venezuela (with 20% of world resources against 2% in the United States), these relations have come dangerously close to the red line; some experts even started reminiscing about the Caribbean Crisis. This happened because Washington refused to accept the government of Maduro who succeeded President Hugo Chavez as head of the left populist Bolivarian regime supported by Russia, China and certain other countries.
The United States decided that time has come to revise certain parts of the well-known Monroe Doctrine of 1823 that warned the Europeans against interference in what was going on in the Western Hemisphere and in its first article promised, in the name of the United States, "not to interfere in the internal concerns of any of its [Europe's. - Ed.] powers." In the course of time, this self-imposed obligation was pushed aside which is best illustrated by what is going on in Ukraine, filled with American military, according to Sergey Lavrov. The statement that the "American continents... would not to be considered as subjects for future colonization by any European power" is repeated persistently and threateningly.
A more or less similar "business politics" are pursued on the European gas market mainly in relation to the Nord Stream-2, the second gas pipeline that will bring Russian gas to Germany. It has been said many times that Russia and Germany treat it as a purely commercial project; at the same time, Americans and certain East European supporters look at commerce as part of great geopolitics. The United States wouldn't mind capturing the lucrative European market for its liquefied gas even though its cost is higher by an order than the Russian gas and it is mostly sold on the Asian markets. In the final analysis, Washington, having caused a lot of problems for the sides involved in the project, retreated; the breach between the interests of the Atlantic partners became wider while Germany, the key EU country, rose to a new level of independence.
THE MARKET of armaments has developed into an arena of fierce rivalry for the simple reason that in terms of profit it is one of the most lucrative or even the most. Dominated for a long time by monopolies that imposed their prices, the market remained outside the sphere of normal price formation. During the Cold War, two ideological antagonists - the United States and the Soviet Union - divided this market among their clients; in post-Soviet time and during Russia's temporal absence from the market, Americans controlled more than a half of arms sales in the world.
For Washington, trade in armaments is a commercial and a geopolitical enterprise, an important part of its strategy of world domination. Its military superiority allows it to keep other states in check and, from time to time, remind those who try to object or even protest who is the boss. This explains the very sharp response of the United States to and its intolerance of the efforts of its rivals (especially Russia) to elbow it out from its first place on the arms market. This is mainly related to high-tech aviation, air defense and anti-missile systems. The experience of America's latest wars from Vietnam to Afghanistan, Iraq and Syria demonstrated that it had successfully used them against weaker enemies.
Today, Russian air defense systems S-400 Triumf, NATO's nightmare, according to Stern , are in the center of struggle on the arms market. Washington knows only too well that these latest defense systems have outstripped the outdated American Patriot systems of 1981 and deprived the Pentagon of its impunity if it uses its air force against the "guilty" countries.
The ministry of armed forces of China and its leaders responsible for the use of new weapon systems were the first objects of American sanctions imposed on them for buying Russian anti-missile systems and Sukhoi Su-15 fighters. As could be expected, Washington failed to wreck the deal. After successful testing, Russia-produced S-400s were put on combat duty. India, which buys up to 30% of the total sales of the military-industrial complex of Russia, was identified as the next target of American intimidation. This, however, did not happen. In the eyes of the United States, "the largest democracy in the world" looks as the strongest counterweight to China, therefore, after a lot of deliberations, it was decided to remove New Delhi from the Countering America's Adversaries Through Sanctions Act.
Washington was shocked by the decision of the Turkish government to buy four squadrons of Russian air defense systems S-400 Triumf for $2.5 billion (half of the sum to be paid by installments). For the first time in the 70-year long history of NATO, one of its members violated the unwritten law and bought weapons from the country officially identified as America's adversary.
The events in Syria that entered the period of political settlement after the fierce civil war became an important watershed in the history of the Middle East. Russia has greatly consolidated its positions in the region lost after the Soviet Union's disintegration. The Arab media started talking about Russia's return to this part of the world and about America's "weakened" positions. Geopolitical shifts were followed by new chances to invigorate business relations with the Arab countries that anyway want to move away from their one-sided dependence on the United States on the arms market and widen the group of arms suppliers. Early in 2019. thirteen countries, including Egypt, one of the biggest customers of the military-industrial complex of Russia, as well as Saudi Arabia, Qatar, the UAE, Bahrain and other countries close to Washington, said that they wanted to buy Russia's air defense systems and other weapons.
Stealing a March
THREE DECADES of international business activity in the new post-Soviet market environment taught Russia's foreign policy how to bring together geopolitical and commercial principles. Russia has partially restored the foreign economic positions lost after the Soviet Union's disintegration by switching from ideological to pragmatic rails. Market reforms, new types of property and the principles of private-state partnership allowed it to succeed where Eastern Europe failed. Russia preserved and, having entered the new century, strengthened its strategic economic branches; it left the Soviet system of state monopoly behind to move to the so-called "natural monopolies" orientated at external markets where they can compete as equal with Western transnational corporations. On the one hand, this provided Russia's economy with new opportunities, on the other, created big foreign policy problems.
Indeed, faced with the challenge of Russian businesses, its most competitive and most developed branches, on the world markets, the West showed no enthusiasm. More than that, with Vladimir Putin as President of the Russian Federation, the country stabilized and the most ambitious of the Russian oligarchs "tamed," Russia promptly demonstrated that it was a strong rival of Western companies because of the specifics of its economy orientated at winning external markets. In 2005, the Kremlin declared that Russia had become an "energy superpower"; later, Western propaganda started talking about the oil and gas sector of Russia as its "geopolitical weapon."
The West did not like Russia's balanced diplomacy, efficiency of Russia's support of national businesses which brought good results, in short, everything that is called strategic proactive approach. This was true of the far and near abroad. Gas pipelines that bypassed Ukraine took into account its domestic instability and its persistent and obviously long-term anti-Russian policy. The new ports on the Baltic no longer allow the Baltic NATO members to use transit as an instrument of blackmail, to say nothing of their financial losses.
Russia was actively involved in setting up a "gas OPEC"; it plays the leading role on the natural gas market. Novatek started gas extraction on Yamal with the use of latest technologies, allowing Russia to move to the liquefied gas market, before that the weak point of Russia's oil and gas branch. The Russia-controlled Northeast Passage has offered new opportunities.
During the last thirty years, not everything was going on smoothly and successfully. Moscow had to pay for its economic naivete and political shortsightedness of the 1990s; its inability to foresee the repercussions of the inevitable "asset recovery," that is, overcoming the unfavorable results of the Cold War and restoration of its national identity as a great power with a glorious history. As soon as President Putin began stabilizing the situation in Russia and pursuing the foreign policy in its interests, the West started accusing Russia of violating the "rules of the game," of undermining the foundations of the world order and ignoring the experience of Germany and Japan that, having lost World War II, learned its lessons and succumbed to the system of vassal dependence established by the United States.
Russia's financial and economic interdependence with and its integration in the external world dominated by the United States would allow the West to expect that sanctions would change the vector of Russia's foreign policy or even destabilize the country to bring it to regime change in line with the "color revolutions" pattern. The mechanism of sanctions was elaborated by the collective West; it was intended to maximally damage Russia's economy, doom it to international isolation or "geopolitical loneliness," of which Vladislav Surkov wrote in his article "The Loneliness of the Half-Breed" .
The United States, the main inspirer of sanctions, based them on Russia's poorly diversified economy that depended on the developed countries in the high-tech sphere. This was especially obvious since the sanctions were introduced during the world economic crisis of 2008 ("the first global") and low oil prices.
The peak of the sanctions has been left behind, especially in view of the changing sentiments in the EU countries. Russia's ability to "take the punch" and to respond in kind took the West by surprise (Russia's agricultural counter-sanctions proved to be painful for the EU); Russia managed to substitute imports in some of the most important branches with local products and find the rest of needed technologies and money in the east.
Russia's response was restrained. Business does not tolerate wounded pride in foreign policies or vengefulness even though in some cases profit cannot be the measuring rod of national interests. In his time, great Mahatma Gandhi said on a different occasion: "An eye for an eye will only make the whole world blind."
To a certain extent, the fact that Washington cannot resolve the important global and regional problems without Russia is the latter's asymmetrical answer to the American sanctions. The world is interconnected: if a state acts deliberately and consciously against the interests of other countries, it can hardly expect to be met halfway when it needs this.
The time of Russian idealism has passed; the logic of geopolitical confrontation and business rivalry, where is no place for the only hegemon, has its own laws. That's how a new polycentric world is being formed.
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Author: Sergey Ryabkov
A FRANK CONVERSATION ABOUT WAR AND PEACE
Interview with Deputy Foreign Minister Sergey Ryabkov
Source: International Affairs, Vol. 65, No. 2, 2019, pp. 6-28
Q: Sergey Alekseyevich, we are seeing the deterioration of
Russian-U.S. relations in all conceivable areas. Without a doubt, it is
the U.S. that has brought about this situation. What is the outlook?
A: I wouldn't be telling the truth if I said that we believe these prospects are bright. There are few reasons for optimism. Rather, from all indications, the period of uncertainty will drag on. If we worked within a different system of foreign policy coordinates, we could say that we are involved in crisis management or damage control, but this is not our lexicon. Still, despite the current trends in our relations, we are seeking a foundation, a fulcrum, based on which we could gradually begin to move upward. So far, this has not panned out.
It has to be acknowledged that for a number of reasons, domestic political struggles are continuing in the U.S. Russia has become a tool in these struggles - a tool for settling domestic political scores. As a result, it has proved impossible to stabilize our relations. However, there are other reasons as well, including the current U.S. administration's trend toward unilateral actions, steps that do not take into account the legitimate interests of other parties, in this case Russia. For instance, what is going on in arms control clearly shows that this attitude is part of the Trump administration's style. We understand this and are in dialogue with the U.S., which we have no intention to scale down. I still hope that by the end of this year we will be able to identify several areas where the process will continue in a constructive way, even if there is not a significant improvement.
Q: Perhaps the most acute and sensitive issue in our present-day relations is the U.S.'s withdrawal from the Treaty on the Elimination of Intermediate - and Shorter-Range Missiles (INF). We have done a lot to prevent this from happening. Russian Foreign Minister Sergey Lavrov has described the U.S.'s actions as the dismantlement of strategic stability in the world. What is Russia's position on this issue?
A: Indeed, it is a very sensitive issue. The 60-day deadline that the U.S. unilaterally set for Russia to destroy a missile that allegedly violates the treaty has expired. It goes without saying that the arrogant nature, tone and essence of this demand were unacceptable for us - primarily because Russia has not committed any violations...
Author: Yevgeny Zinkov
The Political and Legal Landscape of the Alaska Phenomenon
Author: Yevgeny Zinkov, Professor, Department of Social, Humanitarian and Natural Sciences, North Caucasus Branch of the Russian State University of Justice, Doctor of Science (Philosophy); email@example.com
Source: International Affairs, Vol. 66, No. 2, pp. 60-64
Key words: Alaska, Russia, U.S., Novgorod Republic, Russian-American company.
THE PROBLEM of the acquisition and sale of Alaska, and to whom it belongs, excites the minds of researchers to this day. There are suppositions that once the first Russians had traversed Siberia, they settled in Alaska during the second half of the 16th century.1
The next period, in which Alaska gets mentioned by Russian people, dates to 1648, in connection with the names of the Cossack Semyon Dezhnev and his associate Fedot Popov, who circumvented the Asian continent, then passed from the Arctic Ocean to the Pacific Ocean basin.2 Later on, an official expedition was organized; its commander, Vitus Bering, announced in 1728 his discovery that Asia and America did not have a land bridge between them.3
The first legal documentation of Alaska's coastline took place on August 21, 1732, when the crew of the St. Gabriel, under the leadership of surveyor Mikhail Gvozdev and navigator Ivan Fyodorov (or K. Moshkov, according to other sources), recorded its contours without going ashore. From this date began the jurisdictional affiliation of Alaska with the Russian Empire. However, the territory for a long time continued to be developed on the basis of civil law. The bureaucrats of the Russian Empire did not duly administer the land in Alaska. This situation contributed to the consolidation of legal relations within civil society on the territory along the lines of the Novgorod Republic.
By 1799, the situation in Russian America began to radically change following the formation of a complete monopoly by G.I. Shelikhov's companies. The decree by Tsar Paul I granted Shelikhov's widow and
children an official monopoly on fur and other industries throughout the entire space from the Aleutian Islands to California. This decree was the basis for setting up the Russian-American Company, which became the first authorized body of governance there. It was assigned its own flag and allowed to maintain its own Ground Forces and Navy. The company had the right to claim new lands.
In 1802, Tsar Alexander I acquired 20 shares of the Russian-American Company. His example was followed by the imperial family, statesmen and aristocrats, as well as wealthy merchants and industrialists. In 1816, the company started issuing its own financial currency in the form of sealskin banknotes in denominations of 1, 2, 5, 10 and 20 rubles; and in 1826, coins appeared in denominations of 10, 25 and 50 kopecks. The economic success of the Russian-American company was apparent.
The question arises: Was Alaska actually sold, or was it simply transferred to the operational management of the U.S. by a fictitious contract?
Representatives of the Russian-American Company actively expanded the territory of Russian America. Its population grew arithmetically due to the adoption of Russian citizenship by the local population in America. This process was facilitated by the Russian Orthodox Church: In 1741, the Church of the Assumption of the Virgin Mary had been consecrated there.
In turn, the United States of America began to express concern that if no action was taken, the North American continent could become completely Russian in the next half-century. Under the Monroe Doctrine (that the American continent belongs only to the United States), Russians began to be pushed out of California.
Tsar Alexander I answered the U.S.'s actions with a decree prohibiting foreign ships from approaching within 100 Italian miles of Russian shores or settlements in America, drawing the boundary of Russia's American possessions at the 51st parallel.
All of this served as a pretext for delimiting borders, and on April 17, 1824, in St. Petersburg, the Convention on the Definition of Borders of Russian Possessions in North America was signed. The U.S. administration did not stop there. It eventually insisted on several other agreements and treaties that entailed the further withdrawal of the Russian Empire from the Pacific Ocean waters along the coast of North America.
There is also a theory that the U.S. perpetrated a political "hoax." The American political elite staunchly supported the myth that Alaska wished to cede from the mainland and sought to bring to life a new Novgorod Republic, with ambitions to claim territory from the Far East and Siberia to the Ural Mountains. Perhaps this was a further argument for Russia in favor of the sale of Alaska.
Grand Duke Konstantin Nikolayevich Romanov again returned to the question of the sale of Russia's possessions in North American in March 1857, under the sway of false arguments about a Novgorod Republic and the developing events of that time between the North and the South within the United States of America. He presented a letter to Tsar Alexander II, outlining his views on the issue.
After looking over the letter, Alexander II agreed to consider the proposal further and appointed a special committee for that purpose. Admiral Baron Ferdinand Petrovich Wrangel and Prince Alexander Mikhailovich Gorchakov were appointed as experts on the matter. Both representatives of the special commission spoke out mildly against the sale of Russia's North American possessions for ethical reasons. Given the situation, Tsar Alexander II decided not to push things any further but to determine what the U.S. itself thought of the matter.
To do this, he used the art of secret diplomacy, entrusting baron Eduard Andreyevich Stoeckl to conduct negotiations. The appointed negotiator turned out to be an extremely interested party in the planned transaction. Taking the initiative from the start in the secret negotiations, he presented the purchase/sale of Alaska as a definitively resolved issue on the part of the Russian Empire and very staunchly pursued it. What prompted Baron Stoeckl here remains unclear and deserves further research. But there is no doubt that what he did was the scam of the century, fueled by certain political circles within the U.S.
The territory for sale legally belonged to the Russian-American Joint-Stock Company, which had the status of an independent public and private entity - or, as they say now, a public-private partnership. It should not have been sold without notifying or receiving approval from the Russian-American Company, nor from its shareholders, since such actions were against the law. From a juridical perspective, all these acts were illicit, and the transaction itself would therefore not be legally binding. Nevertheless, it took place.
A full array of opinions surrounded it, with varying angles of speculation as to the integrity of the deal, with some calling it collusion.
However, all of this played a secondary role while the real goal, from our point of view, was to oppose the revival of a Novgorod Republic and its political order.
It is also an interesting fact that the amount of the 1867 transaction between the Russian Empire and the United States of America was $7.2 million. This was the exact amount of the bill that Russia had presented to the U.S. (and was never paid) for the fleet provided by Russia during the American Revolutionary War.
The question arises: Was Alaska actually sold, or was it simply transferred to the operational management of the U.S. by a fictitious contract to avoid political upheaval?
Thus, the problem before us indicates that this issue should be reviewed by the International Court of Arbitration, at least with respect to the fact that there are disagreements regarding the exchange of funds by the parties to the transaction. After all, no one has ever seen a receipt documenting the monetary transfer. Based on the ruling on this dispute, other procedural actions may be taken. To follow this further, a few matters need to be better understood: Was this a financial and political scam in which the Tsar is improperly blamed for trusting his agents (who cleverly took advantage of the situation), or was it a bad-faith real estate deal on the part of the United States of America? Or perhaps it was a conspiracy among third parties pursuing their own interests in the deal?
One contemporary researcher of this issue, Yury Bulatov, stated the following: "I am sure, beyond doubt, that there is a mystery behind the voluntary cession of Alaska. After all, there must have been some reason for the Americans to insist from the very outset that the entire archive of the Russian-American Company should be transferred under their purview. The treaty of March 30, 1867 specifically noted: '(A)ny government archives or documents relative to the territory and dominion aforesaid, which may be now existing there, will be left in the possession of [an] agent of the United States.' Apparently, the U.S. administration at that time was already trying to protect itself and reliably hide from prying eyes the secrets of the deal under which the Russian ceded its territorial possessions on the North American continent."4
1 See: Predystoriya Russkoy Ameriki (zarozhdeniye interesa v Rossii k severo-zapadnomy beregu Ameriki) // Istoria Russkoy Ameriki (1732-1867) v 3-kh tomakh. Ed. Academician N.N. Bolkhovitinov. Moscow: Mezhdunarodniye otnosheniya, 1997. Vol. 1.
2 See: Dokumenty ob otkrytiyakh russkikh zemleprokhodtsev i polyarnykh morekhodov v
XVII veke na Severo-Vostoke Azii; http://drevlit.ru/docs/world/XVII/1600-1620/Otk_russ_mor_sev_cost_azii/pred.php
3 See: Osobennosti perekhoda k aktivnomy poisku blizhayshikh beregov Ameriki // Istoria Russkoy Ameriki...
4 Bulatov Yu.A. " 'Tarn, gde podnyat' russkiy flag, on uzhe opuskat'sya ne dolzhen'": Kto i zachem prodal Russkuyu Ameriku." Mezhdunarodnaya zhizn, 2015, No. 4, p. 127.