What do you think about the situation in the Middle East?

The mainstream media likes to make generalizations about this very diverse region. Most of these are idiotic, simplistic tropes (oil, Islam, terrorists, etc). I don’t think this is productive, so instead I’ll highlight two things that get little traction in the Western mainstream media.

First, water scarcity is the root of many of the region’s problems. The Middle East is the world’s only major region perennially incapable of feeding itself, forcing it to import “virtual water” in the form of food. One of the main causes of the Israeli-Palestinian Conflict is over the unfair distribution of water, which is skewed towards Israel and Israeli settlers in the West Bank. On a bigger scale, water flows are almost as important to the region’s strategic balance as the distribution of oil deposits. Control of the headwaters of the Jordan, Euphrates and Tigris rivers, coupled with the biggest economic base in the region, gives Turkey immense strategic clout. To the contrary, Egypt’s food production deficits make it potentially vulnerable, as seen in the food riots of 2008 when global grain prices spiked. The urban poor who are hardest hit tend to resent their secular authoritarian rulers and support Islamists such as the Muslim Brotherhood. As such, making good with Israel and seeking US protection and subsidies makes perfect sense for the Egyptian political elites: resources can be freed up from military spending towards maintaining domestic stability.

Second, the “Islamic Resurgence” is rather simplistically portrayed as single-minded opposition to the West. The real situation is a lot more complex. The movement takes a variety of guises, from the moderate Islamism of Turkey’s AKP to Al-Qaeda’s franchise-based terrorist cells to the internal clan-based conflicts of Shi’ite Iran’s “Velayat-e faqih” system. It is inaccurate to treat them as a hostile monolith. And many of their grievances do sound genuine to ordinary Muslims. For instance, even Osama bin Laden doesn’t hate the US for its “freedom”, but for its support of Arab elites that he sees as corrupt, anti-democratic and hostile to Islam — e. g., the House of Saud’s acquiescence in stationing US troops in the holy lands of Mecca and Medina to protect the oil exports whose proceeds overwhelmingly benefit influential cliques. But arguing that this interpretation has some validity to it is a sure road to a wrecked career in American mainstream journalism.

Should we wait for radical change in Afghanistan?

No. Even Ronald Reagan and Rambo were pessimistic, back in the 1980’s! Americans don’t want to stay in Afghanistan for much longer, and their finances won’t allow them to anyway. In a few years, the Afghan government will have to sink or swim without US ground forces to support it.

However, I doubt the Taleban will seize central control again. Afghanistan has $1 trillion in untapped mineral reserves, and regional giants China, India, Russia and Iran have no interest in fundamentalists blocking access to them — especially in our world of increasingly scarce, harder-to-get resources.

How real is the possibility of US or Israeli strikes on Iran?

It’s one of those things that everyone talks about all the time, but never happens: until a spark sets of the bonfire, the Big Thing happens, and acquires the tinge of inevitability as viewed in the rear-view mirror of our common history. Kind of like World War One…

I wrote about this in my post The US Strategic Dilemma and Persian Deadlock. The key players are the US, Russia and Iran (the “triangle”) and Israel (the “wildcard”). Each have diverging interests that are hard, if not impossible, to reconcile.

the Strait of Hormuz

Iran wants nuclear weapons to secure its mountain base, acquire the capability to project influence through its proxies (e. g. Hezbollah) with impunity and become the hegemon over the oil riches of the Gulf. Russia wants to keep the US occupied in the Middle East as it rebuilds its Eurasian sphere of influence, but all things considered, it would rather Iran not get the Bomb. The US is firmly against both Iranian hegemony in the Gulf and Russian hegemony in Eurasia: however, the tools at its disposal are insufficient to prevent both (it doesn’t have the hard power to contain Russian influence within its current borders, while a strike against Iran will have severe repercussions — up to and including a blockade of the Strait of Hormuz, through which pass 40% of the world’s oil exports, the commodity underpinning America’s own global hegemony). As such, the US, Russia, and Iran are locked into an uneasy, but potentially sustainable, strategic “triangle”.

However, this “triangle” is broken by the “wildcard”, Israel. While the Israelis couldn’t care less what Russia gets up to, it sees an Iran armed with nuclear weapons as an existential threat: not exclusively in a military sense — Israel has 200 nukes of its own (though Ahmadinejad’s apocalyptic rantings aren’t reassuring) — but in a political and cultural one. If Iran gets the Bomb, a nuclear race will break out in the Middle East. A sense of doubt and uncertainty will seep into Israel. Hezbollah will grow bolder; the possible entrenchment of political Islam in Turkey or Egypt will create a strategic nightmare for Israel. Educated Jews will start leaving the Jewish homeland, undermining the tax base needed for increased military expenditures (e. g. on anti-ballistic missile systems), as well as the Jewish nature of the Israeli state itself. In short, a nuclearized Middle East will make Israel’s foothold in the Levant vulnerable, even untenable.

If Israel feels that the US is wavering in its commitment to prevent the emergence of a nuclear Iran, then it will go it alone — perhaps with the covert agreement of states like Saudi Arabia, which aren’t much interested in seeing a hostile, nuclear-armed Shi’ite state on the other side of the Gulf either. The US will almost certainly be drawn into the fight in the aftermath — e. g. by an Iranian attempt to block the Strait of Hormuz, Iranian missile attacks on US bases in Iraq, or even false flag Israeli attacks on the US.

In my opinion, the dates of likely Israeli action are from early-2011 (when the US acquires its Massive Ordnance Penetrator bomb capable of busting concrete bunkers 60m deep) to end-2012 (the date by which Iran is likely to have developed workable nuclear weapons). Otherwise, the stage is set for the eventual nuclearization of the Middle East.

Should we expect a further strengthening of sanctions against Iran?

President Medvedev said on 23 September, 2009, “sanctions rarely lead to productive results, but in some cases, sanctions are inevitable.” What he means by this Aesopian language is that it is Russia that will be able to decide whether the results of strengthened sanctions are going to be ”productive” (however you define that). Russia’s position is crucial because it is the only country with the spare refining capacity and secure trans-Caspian transport routes to successfully break any gasoline sanctions against Iran.

But even Russia’s participation will not dissuade Iran from working on the Bomb. To the contrary, it can even increase Iranian resolve if it creates the conditions for a ”siege mentality” within the Islamic Republic. Furthermore, sanctions are in the interests of both the US (it would prefer accommodating with Iran to fighting it, if possible) and even Russia (to appease the US in exchange for concessions on other policy fronts). As such, sanctions are a very convenient pretext for delaying military action. But for understandable reasons, Israel is unlikely to be as patient.

What do you think are the real Russian, Indian and Chinese positions on Iran?

Though Russia might have a few more friends than just her Army and Navy, Iran certainly isn’t one of them. It’s just a lever to be used for extracting concessions from the US. At this time, supporting sanctions is good for Russia because the Americans are compromising on many spheres (e. g. on modernization, START, Georgia). However, a time may come when Russia performs volte face, e. g. if the US shows signs of reaching a reconciliation with Iran in order to refocus its energies on containing Russia, or ceases supporting Russia’s modernization drive.

China and India are both interested in cooperating with Iran to develop its hydrocarbons sector and lock in its oil and LNG exports. Both countries espouse non-Western values of ”national sovereignty” and non-interference. Furthermore, India is interested in recruiting Iran as a western counterweight against its rival Pakistan. As a result, neither country has any interest whatsoever in stringently enforcing sanctions against Iran out of pure altruism.

What do you think are the positions of Georgia and Azerbaijan on military action against Iran and its aftermath?

map of Iran's ethnicities

Since Iran is in a ”cold war” with Azerbaijan and supports its prime enemy Armenia, the Azeri elites would probably secretly welcome military action against Iran. Furthermore, there are twice as many Azeris in Iran than in Azerbaijan, and though they enjoy equal rights with Persians, it is Islam — or the system of Guardianship of the Islamic Jury — that really keeps Iran united (with help from the security apparatus). If Iran were to suffer military defeat, the regime may be discredited, and a liberal democratic one may even take its place. In that case, centrifugal tendencies may become predominant — as in the last years of the Soviet Union — and maybe even a Greater Azerbaijan will emerge on both sides of the Caspian Sea in alliance with Turkey to the west. On the other hand, Azerbaijan can’t be too openly enthusiastic about undermining Iran because it borders Russia to the north, which is friendlier with Iran. That is why the Azeris categorically refuse to let Israeli planes fly over its airspace in a strike on Iran.

Georgia’s position is much harder to decipher, as it maintains fairly good relations with everyone except Russia — against which it is irrevocable opposed because of its liberation / occupation (cross out as you wish) of S. Ossetia and Abkhazia. Though in previous years they’d have supported Israel, their current interests aren’t clear, since the Israelis stopped delivering arms to Georgia in exchange for Russia not delivering the S-300 air defense system to Iran. I don’t think a strike against Iran by either Israel or the US will cardinally change Georgia’s situation.

What do you think about the situation in the Russian North Caucasus and the Caucasus region in general?

Russia’s North Caucasus remains bloody and unstable, but secure under Russian control. Kadyrov is the Kremlin’s vassal in Chechnya: should he turn renegade, they’ll find another baron to replace him easily enough.

I doubt there’ll be another Georgia-Russia war. Its clear that the Ossetians and Abkhazians prefer implicit Russian control to explicit Georgian rule, and Saakashvili has no chance of changing this reality by military force. On the other hand, he remains genuinely popular amongst Georgians and secure in his rule. The cold war between Russia and Georgia will continue, but it’s unlikely to turn hot again; not unless Saakashvili is a total loon and tries to replay 08/08/08.

Another war between Armenia and Azerbaijan is also unlikely. Though Azeri military spending, bolstered by its oil wealth, now exceeds the entire Armenian state budget, the latter has had fifteen years to reinforce its positions in Nagorno-Karabakh. (Furthermore, direct Azeri attacks on Armenia proper will probably provoke a Russian military response through the mutual defense provisions of the Collective Security Treaty Organization). Aliyev is a rational, calculating leader and would much rather enjoy Azerbaijan’s oil bounty than run the risk of military defeat and popular uprisings against his regime.

How would you interpret the recent Brazil-Turkey-Iran deal in the context of multipolarity?

It’s an ideological statement: the voices of formerly peripheral countries rejecting the Western consensus on nuclear rights and proposing an alternative project amongst members of the “Rest”. As such, it is a very strong endorsement of the multi-polar ideal. But in real life, the actors playing the key roles are the countries with both interests in the issue and power projection capabilities in the region: Israel, the US, Iran, and Russia. West or Rest, it doesn’t matter: only power and the will to power.

I’d like to thank Marat Kunaev for this interview. I tried to make my answers as thought-provoking as his questions, and though I might have failed in that endevour, I hope the gap is not unbridgeable.

Interviewed by Marat Kunaev.

Back in November 2008, the VTsIOM polling site released some very detailed results about what peoples in the former Soviet Union think about each other. The first graph below asks people which countries they consider to be friends or allies of their country.

And these were the results. Some 74% of Belarussians, 58% of Ukrainians, 49% of Moldovans, 82% of Armenians, and 67-89% of Central Asians named Russia as a friend and ally. In contrast, only 11-17% in Georgia, Azerbaijan and Lithuania like Russia this way, but that is hardly surprising. (The Latvians are rather higher at 26%, presumably because of their large Russian minority, though far higher numbers, almost half of them, orient themselves with the other Baltic states).

The poll below is even more telling. It asks peoples in the former USSR to name which countries or blocs they would like to unite with, the main contenders being Russia, the EU, and “independence”.

Russians are mostly split between those favoring some kind of Slavic or Eurasian bloc (37% – Belarus, 29% – Ukraine, 24% – Kazakhstan), and Russia-as-is (32%); the European Union really isn’t that popular at 15%. This isn’t much different in Ukraine or Belarus. Some 56% of Belarussians and 47 of Ukrainians would like to unite with Russia, while 25% and 22% favor the EU, and 18% and 25% favor independence, respectively. Some 51% of Kazakhs favor Russia and 32% independence.

The Moldovans are equally split between Russia and the EU or independence (which in practical terms would mean the Romanian sphere of influence). The Azeris identify most strongly with Turkey, with 31% expressing a desire to join it, followed by 24% yearning for the EU and 24% for continued independence. Big majorities (65-73%) in the Central Asian nations of Tajikistan, Kyrgyzstan, and Uzbekistan would like to rejoin Russia, which is unsurprising given their relative underdevelopment and the relative success of Russification there. Georgia has always had a strong sense of national identity, including during the Soviet period, so by far the majority there wants independence (38%) or the EU (37%); only 10% wouldn’t mind falling back into Russia’s sphere of influence.

Why is this important? Because to some extent, even in semi-authoritarian systems, national leaders are to some extent beholden to popular sentiment. This is not to say, of course, that this is the only factor – an objective assessment of national interests (which are often synonymous with the interests of the ruling elites) almost always trumps anything else. But it does illustrate that the much ballyhooed “Russian resurgence” across the former USSR rests on firmer foundations than just political pressure or economic takeovers – of at least equal importance is that many of the peoples in its path back to regional hegemony aren’t actually that averse to it*.

PS. Another useful survey of attitudes towards Eurasian regional integration by Gallup: “In all countries except Azerbaijan, the median average wants at least an economic union across Eurasia”.

* The big exception is Georgia. This is where there is both a clash of primary geopolitical interests (the irreconcilability of Georgia westward path and Russia’s desire to anchor itself in the South Caucasus) and of civilizational values (AFAIK, the only social grouping in Georgia with a real pro-Russia tendency are the monarchist “People’s Orthodox Movement“). Coupled with simmering border tensions, it is probably not surprising that this developed into a flashpoint for armed conflict.

Ukraine Returns to the Empire?

The most consequential big event is the electoral victory of Viktor Yanukovych (35%) in the first round of the Ukrainian presidential elections, followed by Yulia Tymoshenko (25%), Serhiy Tihipko (13%), Arseniy Yatsenyuk (7%), and Viktor Yushchenko (5%) – a result that I called 100% accurately. Disillusioned with the incompetence, economic decline, and “anarchic stasis” of five years of Orange rule, polls indicate three times as many Ukrainians now favor a “strong leader” over a “democratic government”, so no wonder that the liberal ideologue Yushenko, though the only major Ukrainian politician who is consistent and sincere in his views, suffered a crushing defeat as the last true representative of the Westernizing “Orange” movement. This marks a threshold in the accelerating “regathering of the Russian lands”*.

Below is an electoral map of the first-round Ukrainian presidential elections. As is always the case, the urban, Russophone / Surzhyk-speaking, Russian Orthodox Church-affiliated south and east voted for the pro-Russian Yanukovych, head of the Party of Regions, while the more bucolic, Ukrainian-speaking, Kyiv Patriarchate-affiliated / Uniate center and west favored Tymoshenko.

[Click on map to enlarge].

This reflects the civilizational fault-line riveting Ukraine in half – commonly assumed to be along the Dnieper River, but more accurately, dividing the country into a pro-Russian south and south-east, the independence-minded Ukrainian center, and the pro-Western south-west.

Back in 2004, there was a clearly defined pro-Russian (Yanukovych) and pro-Western (Yushenko) force. Yushenko prevailed thanks to incompetent vote rigging on the part of the Party of Regions and a Western-supported popular uprising known as the Orange Revolution. The oranges are now regarded as rotten and nothing of the same sort can happen in 2010, since both Presidential contenders are now, for most purposes, beholden to Russia.

Yanukovych supports closer political and economic ties with Russia, would renounce NATO and EU accession plans, and enjoys the support of the Donbass oligarchs (including Ukraine’s richest man and king-maker, Rinat Akhmetov) and the senior managers of the Ukrainian military-industrial complex. There has been talk of a possible political union between United Russia (Russia’s “party of power”) and the Party of Regions, which will lay the institutional foundations for closer union with Russia, Belarus, and Kazakhstan, involving joint membership in Eurasec, a customs union, and even the CSTO. Finally, there have been rumors that Yanukovych will retain Yushenko in some minor political position, as a placebo for the west Ukrainians in order to nip secession movements in the bud and to undercut Tymoshenko’s support in a crucial region.

Tymoshenko is the unprincipled, chameleon-like politico par excellence, repeatedly reinventing herself from hard-hitting gas oligarch / robber baroness, to Lesya Ukrainka-inspired Orange liberal nationalist, to Putin-friendly aspiring Czarina. She has negotiated a well-publicized gas deal with Russia, took part in the sale of the major Ukrainian steelmaker, the Industrial Union of Donbass, to a Kremlin-friendly Russian industrial group, and publicly backed away from NATO membership. In doing this, she has tried to ride the geopolitical and emotional wave of the Russian resurgence, and succeeded in gaining the firm support of the central regions. However, although singularly charismatic in the gray world of Ukrainian politics, she has been unable to significantly penetrate into the Party of Regions electoral base. Coupled with low voter turnout in Ukraine’s western regions, due to their disillusionment with her newly-discovered Russophilia, this means that she will almost certainly lose out to Yanukovych in the second round of elections scheduled for February 7th** (assuming no extralegal interference from the 3000 strongarm Georgian “election observers” who are in Ukraine just for the girls, supposedly).

Geopolitically, this Ukrainian reversal marks declining US influence in the region and the imminent resurgence of Russia as a Eurasian hegemon. This is producing reverberations, with independence-minded countries throughout the region – Belarus, Kazakhstan, Azerbaijan, even Georgia – now accepting their eventual reintegration into Eurasia, or attempting to reach a new accommodation with the new reality of Russian power. Here is Peter Zeihan (Stratfor) on Ukraine’s Election and the Russian Resurgence:

These are all important factors for Moscow, but ultimately they pale before the only rationale that really matters: Ukraine is the only former Russian imperial territory that is both useful and has a natural barrier protecting it…. Without Ukraine, Russia is a desperately defensive power, lacking any natural defenses aside from sheer distance… The (quite realistic) Russian fear is that without Ukraine, the Europeans will pressure Russia along its entire western periphery, the Islamic world will pressure Russia along its entire southern periphery, the Chinese will pressure Russia along its southeastern periphery, and the Americans will pressure Russia wherever opportunity presents itself…

Ukraine by contrast has the Carpathians to its west, a handy little barrier that has deflected invaders of all stripes for millennia. These mountains defend Ukraine against tanks coming from the west as effectively as they protected the Balkans against Mongols attacking from the east. Having the Carpathians as a western border reduces Russia’s massive defensive burden. Most important, if Russia can redirect the resources it would have used for defensive purposes on the Ukrainian frontier — whether those resources be economic, intelligence, industrial, diplomatic or military — then Russia retains at least a modicum of offensive capability. And that modicum of offensive ability is more than enough to overmatch any of Russia’s neighbors (with the exception of China).

Incidentally, this episode brings to mind what the late political scientist Samuel Huntington wrote about the future of the “Orthodox civilization” in his well-known work The Clash of Civilizations and the Remaking of World Order. He predicted that Western attempts to orchestrate an artificial divide between these two members of the same civilization would have only deleterious results, perhaps resulting in a “Great Split” – quoting a Russian general, “Ukraine or rather Eastern Ukraine will come back in five, ten or fifteen years. Western Ukraine can go to hell!” Yet the more stable and likeliest arrangement would be the following:

The third and most likely scenario is that Ukraine will remain united, remain cleft, remain independent, and generally cooperate closely with Russia… Just as the [Franco-German relationship] provides the core of the European Union, the [Russian-Ukrainian relationship] is the core essential to unity in the Orthodox world.

With all major Ukrainian political blocs re-orientating themselves to Russia and the two countries increasing their cooperation in spheres ranging from politics to the military-industrial complex, Huntington’s prediction could be said to have been fulfilled.

PS. The (relative) silence about the total collapse of the Orange party in Ukraine on the part of normally Russophobic outlets has been deafening. Since everyone loves the West and liberal ideologues, how on Earth could this have happened? It’s like a bad dream.

The Eurasian Energy Map Redrawn

Russia, China, Iran redraw energy map by the always-insightful Indian diplomat M K Bhadrakumar.

The inauguration of the Dauletabad-Sarakhs-Khangiran pipeline on Wednesday connecting Iran’s northern Caspian region with Turkmenistan’s vast gas field may go unnoticed amid the Western media cacophony that it is “apocalypse now” for the Islamic regime in Tehran. The event sends strong messages for regional security. Within the space of three weeks, Turkmenistan has committed its entire gas exports to China, Russia and Iran. It has no urgent need of the pipelines that the United States and the European Union have been advancing. Are we hearing the faint notes of a Russia-China-Iran symphony? …

Second, Russia does not seem perturbed by China tapping into Central Asian energy. Europe’s need for Russian energy imports has dropped and Central Asian energy-producing countries are tapping China’s market. From the Russian point of view, China’s imports should not deprive it of energy (for its domestic consumption or exports). Russia has established deep enough presence in the Central Asian and Caspian energy sector to ensure it faces no energy shortage. What matters most to Russia is that its dominant role as Europe’s No 1 energy provider is not eroded. So long as the Central Asian countries have no pressing need for new US-backed trans-Caspian pipelines, Russia is satisfied.

During his recent visit to Ashgabat, Russian President Dmitry Medvedev normalized Russian-Turkmen energy ties. The restoration of ties with Turkmenistan is a major breakthrough for both countries. One, a frozen relationship is being resumed substantially, whereby Turkmenistan will maintain an annual supply of 30bcm to Russia. Two, to quote Medvedev, “For the first time in the history of Russian-Turkmen relations, gas supplies will be carried out based on a price formula that is absolutely in line with European gas market conditions.” Russian commentators say Gazprom will find it unprofitable to buy Turkmen gas and if Moscow has chosen to pay a high price, that is primarily because of its resolve not to leave gas that could be used in alternative pipelines, above all in the US-backed Nabucco project.

[Click on map to enlarge].

Third, contrary to Western propaganda, Ashgabat does not see the Chinese pipeline as a substitute for Gazprom. Russia’s pricing policy ensures that Ashgabat views Gazprom as an irreplaceable customer. The export price of the Turkmen gas to be sold to China is still under negotiation and the agreed price simply cannot match the Russian offer.  Fourth, Russia and Turkmenistan reiterated their commitment to the Caspian Coastal Pipeline (which will run along the Caspian’s east coast toward Russia) with a capacity of 30bcm. Evidently, Russia hopes to cluster additional Central Asian gas from Turkmenistan (and Kazakhstan). Fifth, Moscow and Ashgabat agreed to build jointly an east-west pipeline connecting all Turkmen gas fields to a single network so that the pipelines leading toward Russia, Iran and China can draw from any of the fields.

Indeed, against the backdrop of the intensification of the US push toward Central Asia, Medvedev’s visit to Ashgabat impacted on regional security. At the joint press conference with Medvedev, Berdymukhammedov said the views of Turkmenistan and Russia on the regional processes, particularly in Central Asia and the Caspian region, were generally the same. He underlined that the two countries were of the view that the security of one cannot be achieved at the expense of the other. Medvedev agreed that there was similarity or unanimity between the two countries on issues related to security and confirmed their readiness to work together.

The United States’ pipeline diplomacy in the Caspian, which strove to bypass Russia, elbow out China and isolate Iran, has foundered. Russia is now planning to double its intake of Azerbaijani gas, which further cuts into the Western efforts to engage Baku as a supplier for Nabucco. In tandem with Russia, Iran is also emerging as a consumer of Azerbaijani gas. In December, Azerbaijan inked an agreement to deliver gas to Iran through the 1,400km Kazi-Magomed-Astara pipeline.

The “big picture” is that Russia’s South Stream and North Stream, which will supply gas to northern and southern Europe, have gained irreversible momentum. The stumbling blocks for North Stream have been cleared as Denmark (in October), Finland and Sweden (in November) and Germany (in December) approved the project from the environmental angle. The pipeline’s construction will commence in the spring.The $12-billion pipeline built jointly by Gazprom, Germany’s E.ON Ruhrgas and BASF-Wintershall, and the Dutch gas transportation firm Gasunie bypasses the Soviet-era transit routes via Ukraine, Poland and Belarus and runs from the northwestern Russian port of Vyborg to the German port of Greifswald along a 1,220km route under the Baltic Sea. The first leg of the project with a carrying capacity of 27.5bcm annually will be completed next year and the capacity will double by 2012. North Stream will profoundly affect the geopolitics of Eurasia, trans-Atlantic equations and Russia’s ties with Europe.

To be sure, 2009 proved to be a momentous year for the “energy war”. The Chinese pipeline inaugurated by President Hu Jintao on December 14; the oil terminal near the port city of Nakhodka in Russia’s far east inaugurated by Prime Minister Vladimir Putin on December 27 (which will be served by the mammoth $22-billion oil pipeline from the new fields in eastern Siberia leading to China and the Asia-Pacific markets); and the Iranian pipeline inaugurated by Ahmadinejad on January 6 – the energy map of Eurasia and the Caspian has been virtually redrawn.

And from Pipe dreams come true (bne):

Putin ordered construction to start on Nord Stream at the end of last year after the pipeline got the last environmental permits from Germany. And in January, Gazprom started building the first pumping station at the mouth of the first of two parallel pipes, which is supposed to be operational by 2011 with a capacity of 27.5bn cm/y. Thanks to Nord Stream, 2009 should be the last episode of the Russo-Ukraine “Gas for Cash” soap opera, which usually ends with Europe freezing. [AK: see also What difference would Nord Stream mean to European energy supply?].

South stream, the other pipeline project, will close the circle, but this pipeline has had a harder time getting off the drawing board and is competing with the EU-sponsored Nabucco pipeline, which is supposed to source Caspian region and Middle East gas and send it to Europe without crossing Russian soil. The problem is that there’s probably only enough demand to support one pipeline.

The R of the BRIC’s Remains Solid

Many of the economic predictions I made in Decoupling from the unwinding and Russia Economic Crisis are coming to fruition. See RUSSIA 2010: Slow build over first half to boom in 2011 (bne):

Russia was undoubtedly far more affected by the international crisis that started in September 2008 than anyone had expected – especially the Kremlin. It also stands out as the only one of the BRIC countries (Brazil, Russia, India, China) to show negative growth, leading to calls from the likes of analyst Anders Aslund to remove the “R” from BRIC.

This is rubbish, so Jim O’Neill, the man that coined the term in the first place, told bne at the 2009 International Monetary Fund (IMF) conference. “The only reason that Russia was hurt so badly was unlike the others, it borrowed heavily on the international capital markets and, of course, it is dependent on the price of oil.”

This was one of my major themes. When the Western financial system ground to a standstill in late 2008, the first countries to be cut off were the emerging markets. Having access to deep indigenous credit systems, the likes of Brazil and China were understandable far less affected than Russia, whose corporations had come to rely on Western intermediation of their credit inflows.

And in the longer term, excluding Russia from the BRIC’s makes little sense given its major growth potential (educated workforce, resource windfall, modernization policy, economic gains from global warming).

The Russian economy contracted by a bit less than 9% in 2009, but as the year came to a close it was already starting to recover – six months later than analysts were predicting at the start of the year. However, despite the pain of the crisis, the prospects for 2010 are looking much better than many had dared hope.

One should also note that this “pain” was insubstantial compared to the 1998 crisis, which is what many analysts were (unfavorably) comparing it to. While the percentage of the population barely making ends meet went up from 29% in July 1998 to 40% in December 1998, this figure remained stable at around 10% throughout the recent crisis. The main shift occurred amongst Russia’s “consumer class” (the ones who buy cars, PC’s, etc), whose percentage of the population tumbled by a quarter from 19% to 14%, and perhaps explains the reason for its large drop in GDP for 2009, i.e. the drop in large purchases. The silver lining is that this implies inequality has decreased during the crisis.

bne’s annual survey of investment bank outlooks suggests that growth will return to at least 4% and possibly go as high as 6% by the end of 2010. Inflation will remain low at about 5% while overnight rates at the Central Bank of Russia (CBR) will become real for the first time, finally giving the central bank a second tool to manage the economy and so be able to tackle Russia’s twin perennial headaches of inflation and ruble appreciation more effectively. …

The much discussed problems of the reappearance of a budget deficit will be much milder than appears now, coming in at something under 5% of GDP. This means the Kremlin will drastically reduce its international borrowing and has already cut the amount it needs to raise from $18bn to $10bn, but this could fall to $5bn or even nothing at all if oil prices rise to around $80 per barrel, which most of the banks bne surveyed believe will be the average price for 2010. Indeed the state will be able to raise all the money it needs to plug the deficit at home and pave the way for a return of private issuers to the international capital markets.

I predicted an oil price of around 90$ for 2010 (“oil prices in H1 will remain at 70-90$, and will rise to 90-110$ in H2″), so this is completely realistic considering my stellar record on oil price forecasting.

Finally, the RTS had a spectacular performance, rising over 120% in 2009 from its spring lows to end the year at about 1400. Unlike last year, the investment banks all agree that the index will end 2010 at around 1900-1950 and some say that it will reach and pass its all-time high of 2600 by 2011.

The themes for 2010 include: a turning inwards to growth driven by domestic demand, a push to introduce some real bottom-up economic reforms, a new focus on improving Russia’s productivity, increased inter-regional crediting, a shift towards closer ties with China, consolidation within many sectors and most important a gradual reassessment of Russia’s risk.

Again, much of this will not be new to S/O readers. I’ve already called the consolidation of Russia’s financial system, the shifting emphasis on domestic manufacturing, its decoupling from the insolvent Anglo-Saxon system, the imminent purge of corrupt siloviki, etc…

The collapse of the Russian economy in 2009 was dramatic, but emerging market crises are intrinsically less “sticky” than those in the West, largely because of the shallow penetration of debt in all its forms into the economy. As Liam Halligan, chief economist at Prosperity Capital Management, points out Russia’s fundamentals remain extremely strong and stand out from the rest of emerging Europe. And despite spending $200bn on rescue packages, the Kremlin still have $400bn in the bank, which was increasing again towards the end of the year, and remains the third richest country in the world after China and Japan, against the US and UK, which are 18th and 19th with a bit more than $80bn each. As the story going forward for the next several years will be all about the credit worthiness of countries, Russia finds itself, along with its newest buddy, China, in an enviable position.

Feel free to read the whole article.

Russia’s Populations Grows in 2009

Russia registers its first year of population growth in 2009 since 1994.

Russia has registered the first population increase since the chaotic years which followed the fall of the Soviet Union, bucking a long-term decline that has dampened economic growth projections, officials said on Tuesday. Russia’s population increased by between 15,000 and 25,000 to more than 141.9 million in 2009, the first annual increase since 1995, Health Minister Tatyana Golikova told a meeting in the Kremlin with President Dmitry Medvedev. …

Russia’s dire population forecasts — some of which predict sharp declines over the next few decades — are a key function of economic predictions which see Russia growing much slower over the next 20 years than the other BRIC countries; China, Brazil and India.

a) None of this should be too surprising to my readers, given that back in mid-2008 I predicted:

I will make some concrete, falsifiable demographic predictions (something Russophobes going on about Russia’s impending demographic doom wisely avoid doing).

1. Russia will see positive population growth starting from 2010 at the latest.

I was totally correct, and even better, a year early! (well, just about). Meanwhile, the Russophobe commentariat continues their happy life in la la land.

b) Russia’s approaching demographic doom is a major staple of pessimist and Russophobe assessments of its future prospects in areas like economic modernization and geopolitical power. To the contrary, far from the steep fall produced by most demographic models, a more realistic scenario is for Russia’s population to stagnate or grow very slowly in the next two decades, as a fall in the numbers of women in child-bearing age is balanced out by rising fertility rates and falling mortality rates. See 10 Myths about Russia’s Demography for my detailed exposition of Russia’s demographic prospects.

The Volatile Caucasus

Saakashvili’s megalomania probes new depths, so no wonder the opposition – who are no Russophiles, it should be said – are holding their noses and reaching out to their erstwhile enemy.  Taking a cue from the Party of Regions:

The leader of Georgian opposition party the Movement for a Fair Georgia, former Prime Minister Zurab Nogaideli, said Jan. 26 that his party would like to form a partnership with United Russia, the ruling party in Russia led by Prime Minister Vladimir Putin.

See also this Russian-language report, Танки августа (“Tanks of August”) analyzing the buildup to, chronology, and course of the 2008 South Ossetian War, which is called “The Five Day War” in this publication. This is no pro-Kremlin propaganda, the Russian Army receives acerbic criticism for its performance.

However, most interesting, at least for me, was the chapter “Настоящее и будущее грузино-российского конфликта. Военный аспект” (pp. 85-109), a serious analysis of post-war dynamics in the balance of power between the two countries, is worth checking out. I’ll summarize it here.

a) Though Georgian military spending has fallen somewhat from its 2007-08 high of 8% of GDP, its military potential has continued growing at a fast rate and now exceeds its level in August 2008. Anti-partisan training has been deemphasized in favor of preparation for a hot conventional war against Russia, especially emphasizing the anti-tank and air defense aspects; battle-hardened troops have been returned from Iraq, the reserves system is being reformed, and military contracts concluded in 2007-08 are now bringing in masses of new Soviet and Israeli military equipment from abroad. The authors believe it is not unrealistic that Georgia will make another attempt at a military resolution of the Ossetian issue after 2011.

b) Counter-intuitively, the authors believe that though the revolutionary reforms now being implemented by the Russian Army will enhance its long-term potential, in the short-term there will be a certain loss of effectiveness due to the ouster of experienced officers, a shortfall which will not be immediately made up by the extensive NCO-training program which is only now getting started. The effective number of Motor Rifle and Tank battalions in the Caucasus military region has fallen from 65 in August 2008 to just 40 at end-2009, albeit their quality has been somewhat improved thanks to the rapid acquisition of modernized tanks and helicopters. Furthermore, their forward-positioning in Abkhazian and S. Ossetian bases will give them an advantage missing in 2008.

c) Finally, the authors also note the growing military superiority of Azerbaijan over Armenia. The two countries hold a long grudge over Armenia’s occupation of the ethnically-Armenian enclave of Nagorno-Karabakh. Revenues from the BTC pipeline have enabled Azerbaijan to massively increase its military potential, acquiring a panoply of modernized late-Soviet and Israeli weapons systems. Azerbaijan’s military budget now exceeds the entire Armenian state budget. However, Armenia is allied with Russia through the CSTO, hosts a big Russian base, and receives subsidized weapons systems from Russia, as well as some old Soviet stocks for free. The authors note that due to ethnic majority-Armenian unrest in the southern Georgian province of Samtskhe-Javakheti (which I noted in my post on the possibility of a new Russia-Georgia war), Russia would be wise to increase its military presence in Armenia and accelerate the modernization of the Armenian armed forces in order to be able to exploit Georgia’s soft southern underbelly in a new war***.

Power Projection & Military Modernization

Two more military things. Frustrated with the sorry state of Russian military shipbuilding, the Kremlin is considering the French Mistral, a helicopter carrier & amphibious ship. Such an acquisition will enhance two important Russian capabilities.

First, if deployed in the Barents Sea, it will reinforce its anti-submarine warfare (ASW) capabilities, which are growing in importance with its increasing strategic interests in the Arctic linked to the region’s oil-and-gas deposits and potential trade opportunities as the sea-ice melt accelerates. Second, these vessels would enable Russia to insert crack military forces behind enemy lines much quicker than had previously been possible. In the event of a potential conflict with Georgia or the Baltics, this capability will be incredibly valuable.

EDIT to add PAK-FA news: Second, Russia unveiled the PAK-FA prototype fighter, the first 5th-generation fighter to be produced outside the US. Below are some informative articles on the subject.

• Russia’s Future PAK FA Fighter Makes Maiden Flight (Defense Talk)
• Sukhoi PAK FA (Wikipedia)
• Russia: Unveiling Jet Fighter 5.0 (Stratfor)
• Assessing Russian Fighter Technology (Carlo Kopp)
• Air Combat:Russia’s PAK-FA versus the F-22 and F-35 (Carlo Kopp)

Despite delays and questions over its effectiveness, Russia being the 2nd nation in the world to test a 5th generation fighter after the US does prove that elements of the Russian MIC, especially military aviation, remain robust and capable of innovation. (Besides, one shouldn’t neglect to mention that the American MIC also has its own problems: cost overruns, questions over the JSF’s real utility, etc). As pointed out in earlier posts, Russia’s main challenge is now rooting out corruption and modernizing the MIC’s machine tools and management culture to enable high-volume production of state-of-the-art military equipment such as the PAK-FA, so as to modernize its armed forces by 2020 without returning to a Soviet-style militarized economy.

* To forestall criticism, this is not, of course, an expression of “Great Russian chauvinism”, but a historical reference to the state centralization and ”gathering of the Russian lands” undertaken by Muscovy from the time of Ivan III (1462-1505). This formed the palimpsest for all future restorations of Russia’s empire, including the current one.

** Why Yanukovych will almost certainly win the Ukrainian Presidency – just a matter of beans-counting. In the first round, he got 35%, Tymoshenko got 25%. Yanukovych will net many of the Tihipko voters (13%), while Tymoshenko will get support from some of the Yatsenyuk (7%) and Yushenko (5%) voters. The rest of the electorate will split roughly in half, most likely. But even if Tymoshenko gets very lucky, it is hard to see her closing the awning 10% gap separating her from Yanukovych in the first round.

*** I would also add that though unlikely, it is not impossible that Armenia and Azerbaijan will fight a new war in the near future, as the Azeris despair of their long-term chances of ever reclaiming Nagorno-Karabakh in the face of Turkish-Armenian reconciliation and the hard reality of rising Russian power over the Caucasus. They could yet make a desperate gamble, perhaps in the context of the chaos unleashed by a US-Israeli war with Iran and its proxies. That said, the far likelier possibility is that the realistic-minded President Aliyev will reconcile himself to Russia’s growing power over the Caucasus.

Whispers of war are heard in the Caucasus, as the anniversary of last year’s South Ossetian War approaches. Will the guns of August be fired in anger to mark the occasion? Vote below. This poll will be open throughout August. (Image left: Russian S-300 being unloaded in Abkhazia).

Here are some things we need to keep in mind when analyzing this:

• It was Georgia that attacked South Ossetia last year, mere hours after Saakashvili promised them peace and eternal friendship and candy. The Georgians proceeded to indiscriminately bombard Tskhinvali, a densely populated town full of civilians, with Grad missiles. They also attacked UN-mandated Russian peacekeepers, which constitutes a clear casus belli. Russia’s response was just and proportionate.
• The Western media at the time presented this as a struggle between aggressive Russian tyranny and democratic Georgia, spewing the most propagandistic bilge imaginable (e.g. headlines about Russia attacking poor little Georgia, while showing Georgian Grad rockets being fired at Tskhinvali!). Putin’s well-argued justifications of Russian intervention were censored and manipulated by CNN and Western journalists with enough personal integrity to refrain from unconditionally siding with Saakashvili were blacklisted.
• In reality there is much evidence, including the testimonies of former Georgian cabinet members, to the effect that Saakashvili was planning to retake the “lost territories” months beforehand.
• Since then the media retracted their most sensationalist claims in a bid to reinforce their (questionable) reputations for objectivity. Many media outlets now acknowledge the reality of Georgian aggression and war crimes. Amongst those who looked at the issue in detail, only the most diehard neocons and Russophobes still deny that it was Georgia that was primarily responsible for the war. In their circles, the idea of Russian war guilt is almost an article of faith. Applying Occam’s Razor would suggest they are wrong.
• Nonetheless, the US continues to unconditionally support Saakashvili, even under the Obama administration (whether this is because of American geopolitical interests, or because they really are hoodwinked by Georgian PR, is an exercise I leave to the reader). In doing so they turn a blind eye to Saakashvili’s repression of the opposition. This only serves to further reinforce the Russian conviction that the West cares about democracy only in so far as it advances its geopolitical interests. Far from pressuring the Russians to cease and desist, the West’s hostile rhetoric, encroachment on Russia’s security space and dismissal of Russian protestations will only reinforce Russia’s disillusionment with the West and make it ever more unwilling to consider Western interests.
• This disillusionment is especially prevalent amongst the Russian elites and younger people with Internet access. Thanks to the West, they are coming to the conclusion that no matter what their country does – right or wrong – it will be condemned by the champions of Western chauvinism regardless. The only way to make them the West happy would be to lie down and lick its boots, but few peoples anywhere think this way, let alone in a nation as proud as Russia. Though Georgia struck first, this war marked the most significant Russian retaliation to years of humiliations yet; it sent a message that it would no longer passively resign itself to Western imperialism.
• Look at the detailed Legal Case for Russian Intervention in Georgia by Nicolai Petro which looks at these issues in scholarly depth.
• All this may lead to a growing preference for Realpolitik over “liberal internationalist” solutions to Russia’s geopolitical problems, which will go in tandem with an internal power shift towards the hardliners. They are interested in more than just responding to external aggression against the Russian Federation; they want to redefine Russia itself.
• As I pointed out in my previous post Reconsidering Parshev, the weight of history is forcing Russia back to its future, the desires of its leadership regardless (let alone the desires of Westerners). This past-and-future is a Eurasian empire based on economic autarky, political sovereignty and spiritual sobornost. Amongst many other things, this implies control over the Caucasus.
• Georgia is the linchpin of the Caucasus. Securing a Russian-friendly government there will reinforce Russian control of gas flows from Central Asia to Europe, extend its influence over the Black Sea region and allow it to link up with its ally Armenia, which hosts a Russian military base. Nabucco will turn into a pipedream, at least as long as relations between Iran and the West remain strained.
• As Stratfor points out in Georgia: Left to Russia’s Mercy?, Georgia is not a strong nation. It is riven by divisions that could be exploited, e.g. separatist-minded Adjara and Armenian-populated Samtskhe-Javakheti. Its economy is dependent on agriculture and the government budget relies on pipeline rents. Meanwhile, Saakashvili’s brand of market fundamentalism may have provided a temporary boost from efficiency gains, but the attendant deindustrialization now limits its longer-term prospects.
• “Soft” measures failed to topple Saakashvili in the past year. He retains the approval of perhaps half the population, crushed an attempted military coup (or set it up himself) and now appears to be more secure in his position than he was in months.
• Another important point is that many elements of the Russian military were disappointed at being ordered to stop before overthrowing Saakashvili. They would love to finish the job (and furnish the excuse).
• That said, Saakashvili is hardly a peacenik either. According to Kirill Troitsky’s “War taught them nothing” in Voyenno-Promyshlenny Kurier, the Georgians have been rapidly rearming since 2008. Regaining control over South Ossetia and Abkhazia remains a strategic goal of the Georgian regime.
  
• Russia is upgrading and expanding its forces in South Ossetia and Abkhazia. It is renovating Soviet-era air and naval bases in Abkhazia, deploying its own border guards to the region (which increases the chances of an incident), kicking out foreign observers, and equipping the 131st Motor Rifle Brigade in Abkhazia with the latest T-90 tanks. Below is a photo of a Russian soldier in Abkhazia posing in front of his new kit, first posted to the social networking site Odnoklassniki (the Russian Facebook).
  



• The focus on Abkhazia suggests that any Russian offensive would be focused on the west of the country, bypassing urban quagmires in Tbilisi. This would cut Georgia’s links to the Black Sea and sever the gas pipelines running across its territory. The Armenians may be persuaded to join in the dismembering of Georgia through the “liberation” of their compatriots in Samtskhe-Javakheti, through which Georgia would be cut clean in half. Azerbaijan would be cornered into quiescence. The main uncertainty is how Turkey would respond to such developments; it is not as pro-NATO and pro-West as it was a decade ago.
• Several commentators believe the risks of a new war are high. Stratfor believes Georgia will return into Russia’s fold by the early 2010′s, though it does not believe there will be a Russian military offensive this year. Vaha Gelaev, a former member of the now-disbanded “Vostok” Chechen battalion, is certain there will be war this summer. Pavel Felgenhauer has been raising the prospect of a new war since March in Wartime Approaching in the Caucasus and Risk Increasing of Russian Intervention in Georgia. Now he’s saying there’s an 80% chance of war breaking out this August. The Chechen terrorist site Kavkazcenter claims a 300-strong convoy of Russian tanks, BMPs, BTRs and multiple launch rocket systems are moving towards Georgia. If Russia were to attack Georgia, the optimal time would be August, before the autumn rains set in.
• That said, Felgenhauer is not a reliable military analyst. He predicted the Georgians would humiliate the Russian Army in a war.
  

In conclusion, though innocent of starting last year’s Ossetia War, Russia made significant geopolitical gains and its elites became more disillusioned with the West. Control over South Ossetia and Abkhazia now make an invasion much easier to carry out than in 2009. The troops in the region conducted military exercises in July, they are being equipped with modern armaments and Russia’s naval forces in the region are recently very active. The main question is, are these forces meant to deter Georgia from another military attempt to reintegrate its “lost territories”, or are they to be the spearheads of a pre-meditated Russian aggression?

I think somewhere in between, as is usually the case. Russia still respects its foreign relations enough, if not with the West then with the rest, to pay lip service to international law; however, it won’t hesitate to exploit any serious Georgian provocation. I don’t think Saakashvili is a complete idiot, so barring independent lower-rank Georgian military adventurism (or very skilled Russian feigning of said adventurism), the chances of war breaking out this August must be rather small. Perhaps 10-20%. We’ll see. In any case this August is going to be a tense and potentially very fun time in the Caucasus. And that’s not going to change any time soon, because based on current trends the reassertion of Russian power over the Caucasus is almost inevitable this decade.

Media coverage has been skewed towards Medvedev (who was a key government official – deputy prime minister – as well as election candidate), but this is not surprising in a country where opinion polling typically put his popularity at around 80%, in contrast to Zyuganov’s c.10%, Zhirinovsky’s c.10% and the ‘Liberals” c.1%. (This is also the reason Medvedev refused to participate in TV debates). The elections followed the polls, which heavily suggests that they were free. In fact, the major upset was Zyuganov, who managed to scrape 17.8% (well above what most polls predicted) to the detriment of Medvedev.

Now Russians do get coverage of the latters’ platforms and as such it is not surprising they are rejected – the Communists talk the talk but can’t walk the walk; the Liberal Democrats are too crudely clownish to have genuine popular appeal; and the ultra-low ratings of ‘liberals’ is largely of their own making. After all, the media reflects, as well as manufactures, consent.

Edit: now the Western media resorted to whining about police detaining opposition protestors in Moscow. All I will say on the matter is that the Moscow protest was unsanctioned and as such is illegal, and any self-respecting country would enforce that. In contrast, the St.-Petersburg liberal faction did bother getting official permission to hold a rally, which went off peacefully. Of course, if you do get permission, then you won’t get to see your face in the Western press whining about the injustice of it all – a particularly pertinent point, because it often seems that ‘liberals’ like Kasyanov and Kasparov care more about their Western constituencies than Russians.

An oligarch dies in his Surrey mansion. Although at first he supported the new reforming President with financial and media resources, he later turned against him, accusing him of sliding into authoritarianism. In turn, he was charged with plotting a coup in his native country and has since lived in self-imposed exile in the UK and Israel. He claimed he was the target of an assassination attempt orchestrated by elements of his homeland’s government, and this was even supported by a tape (albeit of uncertain authenticity). Which country?

Not Russia. (But I bet that’s what you were thinking, right?). Georgia. The death I am referring to is that of Badri Patarkatsishvili, who collapsed of a heart attack. The Times covered it extensively and quite fairly. The nuts and and bolts are covered in Badri Patarkatsishvili: exiled oligarch who lived in the shadow of death, Georgian billionaire found dead in Surrey feared plots and Tycoon tells of plot to kill him in London, as well as some rather interesting connections. For instance:

Mr Patarkatsishvili lived in Russia between 1993 and 2001. In the 1990s he was wanted by Russian authorities on charges of theft from the country’s largest car factory, AvtoVAZ, which he ran with Mr Berezovsky.

He was also accused of plotting to arrange the escape from custody in 2001 of Nikolai Glushkov, deputy director of Aeroflot, Russia’s national airline, who had been accused of fraud.

The man charged with breaking out Mr Glushkov was Andrei Lugovoy, who was arrested and jailed after the attempt failed. Mr Lugovoy is wanted by the British Crown Prosecution Service for the murder of Litvinenko, the dissident former Russian spy poisoned in London with radioactive polonium-210 in 2006.

Mr Lugovoy was responsible for protecting Mr Patarkatsishvili and Mr Berezovsky at the time as head of security at the Russian TV channel ORT, which the two men controlled.

Mr Patarkatsishvili remained good friends with Mr Lugovoy, a former KGB officer who is now a member of the Russian parliament. The pair were seen socialising together in Tbilisi, the Georgian capital, shortly before Mr Litvinenko was poisoned.

Mr Litvinenko also had links with the Georgian businessman. Sources in Tbilisi have told The Times that he stayed at Mr Patarkatshvili’s residence in Georgia en route to Turkey when he fled Russia to seek asylum in London in 2000.

Russian prosecutors claim that Mr Litvinenko also visited Mr Patarkatsishvili as well as Mr Berezovsky in London shortly before he was poisoned. They accuse Mr Berezovsky of involvement in the murder of the former Federal Security Service (FSB) agent as part of a plot to damage President Putin’s international image.

Georgia’s former Defence Minister, Irakli Okruashvili, accused Mr Saakashvili of encouraging him to kill Mr Patarkatsishvili in 2005, although he later retracted the claim.

Really makes one wonder who’s for who in these circles. If indeed he was murdered (there are, after all, chemical agents capable of causing heart attacks without detection), who did it and what was the motive? Georgian security officials concerned at his plotting of a new color revolution (they claim he was caught offering 100mn $ to a police chief to support opposition demonstrators; Badri claimed it was a honeytrap)? (For – want Saakashvili to remain in power, cast suspicion on Russia; against – risky, does Georgia even have the means?)? Elements of Russian intelligence services to discredit Georgia (For – despite recent thaws, Saakashvili is still set on NATO accession; against – Badri is damaging enough to Georgia alive, wouldn’t they have made a Georgian connection much more explicit than a random heart attack, risky)? Berezovsky (For – discredit Russia, last person to see Badri alive, a history of people inconvenient to him dying; against – risky, Badri is enemy of Saakashvili who is enemy of Putin, as is Berezovsky)? Some mafia or another (Badri’s own past is far from squeaky clean – many Georgians consider him a mobster)?

But ultimately I suspect this was a genuine heart attack, his feud with Saakashvili not rising above black PR. He had a family history of cardio-vascular disease, didn’t exercise, chain smoked and probably subsisted on a traditional (read: lethal) Russian/east European diet. But ultimately this is a murky case and I doubt anything definitive will ever come out of it.

The same cannot be said of the Western media, which is transparently Russophobic. Far from blaming the ‘authoritarian’ Georgian government (about whom, after all, there is direct evidence in the form of aforementioned tape), some totalitarian publications kicked their smear campaigns into full gear immediately – against Russia! Mixed in with unrelated rants against Russia’s closure of British Council offices and its constitutionally mandated refusal to extradite Lugovoi, the point is implicitly made that the FSB, if not Putin himself, are behind the death of Patarkatsishvili – ‘a sworn enemy of Russian President Vladimir Putin’. No mention of Georgia. Eventually, all memory that Saakashvili and elements of the Georgian security forces are also linked to Patarkatsishvili will be erased. Russia will stand guilty before the world, because who controls the present controls the past, and who controls the past controls the future. Just like in 1984. And so the Annals of Western Hypocrisy go on. Talking about hypocrisy, lunatic Lucas also insisted on having a say in the British tabloid Daily Mail. I’ve replied to it on his blog.

Speaking about assassinations and stuff, it seems the traitorous slime Gordievsky has crawled out from under his rock to whine about how he fears he will be next Alexander Litvinenko.

The other main news is the declaration of independence by Kosovo from Serbia, which has been recognized by the US and the major West European countries. I’ve compiled a map below (dark green = recognize; green = say they’ll recognize; red = states insisting on further negotiations under UN auspices; dark red = don’t recognize). Note: Georgia, Azerbaijan should be dark red – forgot to add them in. Sorry.

Firstly, we are against recognizing Kosovo because it a) violates the principle of national sovereignty – the dominant paradigm of international affairs since the Congress of Vienna, b) sets an unwelcome precedent in which aliens can take a chunk out of a country by outbreeding the original denizens over generations (particularly pertinent to places like the US South-West or Londonistan), c) unfairly punishes a politically modern Serbia for the transgressions of a previous regime and d) rewards the likes of Thaçi and his KLA cronies, the former terrorists and drugpushers who now run Kosovo.

Unfortunately, Serbia has little choice but to acquiesce to this as a fait accompli. However, if I were a Serbian policymaker, I would continue down the road to European integration (after all, no need to cut off the nose to spite the face), but refuse to recognize Kosovo, assert it as eternal Serbian territory in the Constitution and maintain charges of treason against the Kosovar leadership. Similarly, if Serbia joins the EU or even NATO, it will remain a Russian ally and can function as a Trojan horse in these organizations (as Bulgaria is alleged to be). As such, this is the best course for Russia to pursue, at least until it regains its superpower status.

Finally, no, this does not mean that Russia should now recognize de facto independent states like Abkhazia, South Ossetia or the Dniester Republic. Since it has positioned itself firmly on the side of state sovereignty (as opposed to Western ‘liberal interventionism’), appearing to switch sides on particular cases like Abkhazia or South Ossetia will undermine its principled stand (as seen by the international community). Furthermore, this is compounded by the fact that both Georgia and Moldova, quite wisely, have also refused to recognize Kosovo. The same applies to Crimea and the Ukraine.

Lenin once said that the capitalists will sell us the rope by which we’ll hang them. Russophobes kindly give it away for free. The BBC World Service has conducted a poll across 31 countries to assess Putin’s legacy as he steps down from the Presidency – you can read it here.

As for the analysis, Fedia Kriukov’s excellent Russia in the Media blog beat me to it in A Charmed Profession. Might as well quote in extenso:

The first part of the poll, conducted in 31 countries including Russia and the G7, dealt with the influence of President Putin on various aspects of Russian and global affairs. Two of these aspects stand out in particular: They are the quality of life in Russia and democracy and human rights situation in Russia. Why do they stand out? Simply because they are an internal Russian matter, i.e. one has to actually be in Russia in order to form a sufficiently educated and hopefully accurate opinion on the topic. Global affairs are anyone’s fair game, but internal situation in any country needs to be assessed from within. Logical, isn’t it?

So what data are we dealing with here? When it comes to Putin’s influence on the quality of life in Russia, 77% of Russians hold a positive view of it, and 8% — negative. Of the residents of G7 countries, on the other hand, only 39% hold a positive view, while 44% are negative. On to democracy and human rights: 64% of Russians think Putin’s influence was positive, while 12% think it was negative. The residents of G7 countries, once again, beg to differ: only 26% have a positive opinion, while 56% think that Putin strangled the nascent Russian democracy, personally butchered 200 Russian journalists and 500,000 Chechens, and also poisoned the “KGB spy” Litvinenko with polonium had a largely negative influence.

It’s all clear with Russians: if a Russian wants to form an opinion of his quality of life, for starters he can open his fridge and compare its current contents with what was in it in the 90s. Or he can look at his paycheck. Or vacation time. Or the feeling of security. Same with democracy — in Russia, one can simply look out the window, and there they are, Russia’s democracy and human rights, out in full force! But if one lives in a G7 country, how can you look into a Russian’s fridge? How can you look out a Russian’s window? Well, probably a million of G7 countries’ citizens have visited Putin’s Russia by now. Tens of thousands have stayed long enough to form an educated opinion of what it feels like to live in Putin’s Russia. But that is such a drop in the bucket compared to the entire population!

You can figure out what it says about the state of Western journalism by yourself. (If not, continue reading Fedia’s post).

The Economist has also joined the party with this graph of leaders’ approval ratings. Putin, quite literally, stands head and shoulders above the rest. (Note how those who preach to Russia the most about democracy tend to put up less than impressive performances).

But one shouldn’t expect too much from the Economist, who attribute this to ‘beating the nationalist drum’ (I suppose Russians don’t give that much of a damn about 10-15% annual real increases in salaries). Nor from their contributors (I give a few succulent quotations):

Putin’s popularity can be partially attributed to the fact that he has closed down, taken over, and otherwise muzzled the media in Russia and that some of his most vocal critics have been silenced in the most permanent and brutal of ways. The murder of Anna Politkovskaya serves as a warning to any who dare to criticize Putins policies and chills all substantive debate on what is best for the Russian people. – vfisher. Love this – just the right blend of ignorance and self-righteousness, of truthiness. A true Westerner.

In fact Putin’s popularity will last as long as crude oil stay high. In reality most of the Russians live at a very low standard compared to developed countries and even countries like Poland, Greece etc. But combination of oil money ingections though social payouts and massive propaganda makes Russians feel happy. Believe these Russians that can think independently are not fan of Putin and his totalitarian state. – Olexiy, Kiev. A Ukrainian talking to Russians about prosperity. Rolls eyes.

Rather than rqnking leaders by popularity (usually ephemeral, often suspect), why not rank them by policies and performance in dealing with their countries’ problems. Harder work, longer term, but surely much more worthwhile. After all, Hitler was pretty popular in Germany until he lost the war. – Plein d’Espoir. At least they’re very reliable at proving Godwin’s Law.

Have you considered for a moment that most Russians would be afraid to say they didn’t like Putin? I’m sure Hu Jintao also has wonderful approval ratings too. – cdicanio. Brilliant. Now we’re being compared to China.

Sometimes I wonder why they bother. Why don’t they just cut the crap and say it straight – Russians are seduced by Putin’s smile because they don’t share western values.

Finally, other news in brief.

Armenia’s capital Yerevan has seen protests again alleged rigging of the elections, which Western observers said was generally free and fair. Eight people were killed and martial law was imposed. I don’t have any detailed knowledge about the finer nuances of Armenian politics, so I’ll let this pass.

The Economist has released an interesting map showing places where Internet content is blocked. Note how Russia is the freest country in the world, at least by this measure.

Russia’s population down 0.17% in 2007 to 142 mln – another nail in the coffin for the Myth of Russia’s Demographic Meltdown. Not that population decline is in itself disastrous (what matters for prosperity is the dependency ratio, for which Russia’s future projections are no worse than that of the G7); but it seems that population decline itself is nearing an end as birth rates rise and death rates fall. I would like to point out that I was almost completely right when in one of my first articles, Reading Russia Right, I said ‘totaling up the figures would give a rate of population increase in 2007 in Russia of around -0.15%’.

On the military front, the US expresses concern about growing Russian military spending. Let them; I don’t care much. This is a natural response to the underspending in the 1990′s, when the military-industrial complex languished (although they did not stop R&D); even today most military modernization goes towards upgrading older systems (e.g. extending service life for ICBM’s) rather than new purchases. On the topic of military spending, the US is still the world’s top leader by far, spending 712bn $ in 2007; nonetheless, it should be mentioned that official figures understate Russian (and Chinese) military spending due to a) purchasing power parity differences, b) accounting tricks and c) some of it being structural.

In related news, Russia has launched its first nuclear submarine since Soviet times, the Yuri Dolgoruky – two more are currently under construction, and a dozen are planned to be commissioned within the decade. Since the US is steadily building up its ABM capabilities at Fort Greely (Alaska), Vandenburg (California) and now Poland (as is likely), it would make sense for Russia to concentrate more efforts on the submarine part of its nuclear triad (as land-based ICBM’s are more vulnerable to being successfully shot down by ABM) and eventually its bomber force (on the subject of which, Russia is developing a new stealth bomber, possibly a resurrection of the Soviet Ayaks project).

Russia has agreed to write off 91% of Iraq’s 13bn $ Soviet era debt, no doubt in return for Lukoil salvaging its Qurna deal. Russia’s telecoms industry is also acquiring a global presence – AFK Sistema set to become pan-Indian mobile operator, a market with the potential for massive growth in the immediate years ahead.

Not related directly to Russia, but an interesting development – Chavez orders ten army brigades to the Colombian border in response to a Columbian strike against FARC within Ecuadorian national boundaries, which killed Paul Reyes, one of its main leaders. Ecuador and Venezuela also terminated diplomatic relations with Colombia.

Now this is still, for all Chavez’ rhetoric, unlike to escalate to all-out war – after all, Columbia doesn’t want it, while Venezuela must consider the American response, not to mention its own chances. Nonetheless, I’ve looked at the stats for these countries and this is what I found:

Columbia vs Venezuela, Ecuador, FARC

Armed forces: 207,000 (145,000 excluding non-combatant support personnel) vs 87,500 (+recent 100,000 militia) / 59,500 / 11,000 = 158,000. Columbia will have the numerical advantage, at least in properly trained personnel; however, assuming Ecuador joins in, they’ll have to fight on three fronts. Both Columbia and Venezuela have undergone intensive military modernization the last few years.

Tanks: none vs. 86 outdated MBT’s, 154 outdated Venezuelan light tanks and 140 very outdated Ecuadorian light tanks. Personnel carriers on both sides obsolete. While Venezuela leads, its armored advantage is irrelevant. This is because tanks are unsuited for jungle warfare. Granted, Venezuelan wargames demonstrate that their most likely avenue of attack would coincide with conventional armored thrusts into the La Guajira peninsula, which is flat – however, this is negated by RPG’s and the large amount of Colombian fortifications there. At most it will be a diversion.

Air: 30 vs 76 fighters; mostly outdated mishmash with 90 Black Hawks vs. mostly mishmash, but with 14 modern Su-30MK2′s (with 10 more to be comissioned this year) and 10 operational F-16′s, so Venezuela will possess air superiority – its ace. Unless the US decides to get seriously involved.

Naval: 3 destroyers/12 frigates/4 subs vs. 6 frigates/2 subs, 2 frigates/6 corvettes/2 subs. There isn’t sufficient naval strength on either side to effect a blockade – at least for now. (In June 2007 Chavez confirmed he intends to procure five modern Russian Kilo-class 636 subs). Hmmm…if I were Chavez I’d also try to obtain Moskit anti-ship missiles as soon as possible to deter the US from becoming involved, taking a cue from Iran.

Population, GDP: 44mn, 264bn $ vs. 28mn, 263bn $, 14mn, 62bn $.

Venezuela and Columbia have similar levels of socio-economic development, although Venezuela has oil – which pushes its GDP levels up to Colombia’s level, which has a larger population.

Colombia’s army has little heavy equipment, being mostly designed as a counter-guerilla type force; Venezuela’s is more traditional, geared towards winning conventional wars, with extensive recent efforts at military modernization. Venezuela will possess air and probably naval superiority. Assuming no big outside actors become involved – a big if – Venezuela will very probably comprehensively defeat Colombia, especially if Columbia still has to face off FARC and Ecuador on other fronts.

I doubt the US will get overtly involved, at least not unless Colombia begins to lose badly (but not too quickly). Ground invasion, of course, is out of the question – the US does not have the necessary reserves, while projecting air and naval power will take weeks. (Of course, Venezuela can play the oil card, what with today’s very tight supply – cutting out Venezuela would make oil prices sky-rocket).

In conclusion, if the US doesn’t get involved – Venezuela will win. If the US does get involved, Venezuela can still win, but it will have to be quick about it. Otherwise, it will lose its key advantage – air superiority – and will end up with a stalemate at best, albeit with the world in turbulence from 200 $ / barrel oil prices.

Edit: actually found an analytical article on the topic of If Colombia and Venezuela went to war, who’d win? The author is bullish on Colombia; some of the commentators lean more to my way of thinking.