March 1 - 31, 2018
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USA
The Trump administration mounted a fresh offensive against India by dragging it to the World Trade Organisation (WTO) for providing what it termed as export subsidies through half-a-dozen schemes, including SEZs and the Merchandise Exports from India Scheme. In its request to hold consultations with India, the first step before legal action, the US has argued that the incentives violate WTO agreements as India is no longer below the economic benchmark of $1,000 per capita gross national income (GNI).
“These export subsidy programmes harm American workers by creating an uneven playing field on which they must compete. USTR will continue to hold our trading partners accountable by vigorously enforcing US rights under our trade agreements and by promoting fair and reciprocal trade through all available tools, including the WTO,” US trade representative Robert Lighthizer said. The US has estimated the quantum of incentives offered by India at $7 billion. While Indian authorities said they would respond to the US request for consultations within the specified 60 days, they argued that like other countries in the past, India should be allowed a transition period of eight years. [
Chief economic adviser and director of the National Economic Council, Gary Cohn, has become the latest high-profile departure from President Donald Trump’s administration. Speaking on his exit, the US President said, “Gary has been my chief economic adviser and did a superb job in driving our agenda, helping to deliver historic tax cuts and reforms and unleashing the American economy once again….He is a rare talent, and I thank him for his dedicated service to the American people."
Trump’s announcement that he would levy tariffs on aluminium and steel imports was believed to be one of the driving factors behind the resignation, according to The New York Times. Cohn is a long-time proponent of free trade and has reportedly claimed the tariff decision could jeopardise economic growth. [
Donald Trump sacked Secretary of State Rex Tillerson and nominated CIA director Mike Pompeo to replace him as the nation’s top diplomat. After months of simmering tension between Trump and Tillerson, the US president made the announcement on Twitter. Trump repeatedly clashed with Tillerson on foreign policy, often undercutting the man he lured away from ExxonMobil to be America’s top diplomat.
“I actually got on well with Rex but it was a different mindset,” Trump told reporters en route to California to inspect prototypes for his border wall. “When you look at the Iran deal: I think it’s terrible, I guess he thought it was OK… with Mike we have a very similar thought process. I think it’s going to go very well.”
Steve Goldstein, the undersecretary of state for public diplomacy and public affairs, was also fired overnight after he contradicted the official account of the secretary of state’s dismissal by President Trump. [
President Donald Trump’s decision to name John Bolton, a hawk the liberal establishment loves to hate, as his new National Security Advisor and Mike Pompeo as Secretary of State could be a major turning point in his administration. Both men have long history of supporting military interventions and low tolerance for long-drawn out diplomacy. Bolton’s tenure in the administration of George W. Bush was marked by an overt enthusiasm for the Iraq War and bureaucratic gamesmanship to crush opponents.
Bolton replaced H.R. McMaster, who was unable to develop a rapport with Trump and was increasingly isolated on policy issues. Pompeo, the CIA Director and an aggressive critic of Iran, took over from Rex Tillerson, whose public disagreements with Trump on foreign policy issues had rendered him largely ineffective as America’s top diplomat.
Trump and Pompeo have a close relationship — Pompeo often personally delivers the daily intelligence briefing to the president. When foreign diplomats interact with Pompeo, they know he is speaking for the US President. While announcing the changes, Trump said, “We’re getting very close to having the cabinet and other things I want.” The sentiment was a reflection of the widely reported differences between the president and his national security team over the past year.
The new additions will tilt the balance in the circle of top foreign policy advisors towards more hawkish positions, leaving Defence Secretary Jim Mattis as the lone voice arguing for diplomatic rather than military solutions. With Gary Cohn, the Chief Economic Advisor, already gone, defenders of the liberal international order in the White House are few and far between. [
U.S. President Donald J. Trump has accepted an invitation by the North Korean leader to meet within the next two months (VOA), South Korea's national security advisor said in an announcement outside the White House. The South Korean envoy, Chung Eui-yong, said that Kim has told Seoul he is "committed" to denuclearization, will refrain from further weapons tests, and accepts U.S.-South Korea military drills (Korea Times). Beijing welcomed the move toward direct dialogue between Washington and Pyongyang, calling it a "positive message." On Twitter, Trump called the announcement "great progress."
However, "Past denuclearisation efforts have foundered on a combination of failures to secure verification and North Korean subterfuge, but have never gone so far in giving the Kim family the prestige or treating North Korea with the strategic weight that it has sought for decades," writes CFR's Scott A. Snyder.
"In a head-snapping display of incoherence, Trump has agreed to meet Kim, giving the worst human-rights abuser on the planet what he most wants: international legitimacy," CFR's Max Boot writes for the Washington Post. "The Kim dynasty in Pyongyang also has a history of coming to the bargaining table dangling the prospect of concessions, only to walk away after extracting economic concessions," Jiyeun Lee and Hooyeon Kim write for Bloomberg. [
US President Trump fired the first shots in what could become a global trade war with the imposition of 25 per cent tariffs on imports of steel and 10 per cent tariffs on aluminium. The action, taken under the national security provisions of US trade law (Section 232), risks provoking tit-for-tat retaliation by trading partners who, unlike Canada, Mexico and Australia, aren't able to negotiate exemption from its impact, and corrosion of the WTO rules-based trading system. The White House announcement throws the international trade rulebook out the window. If the Trump administration's imposition of these tariffs on a flimsy national security pretext does not outright flout the rules of the WTO, then it at least flouts its widely shared norms.
The response from the European Commission was to 'do the same stupid things to respond to stupid things' — promising retaliatory tariffs on a range of US exports into Europe, from Harley-Davidson motor bikes to bourbon whiskey. The tariff imposts also launched a process in which trading partners like Australia successfully begged exemption on various grounds both sound and spurious, all of which are nonetheless in clear violation of the understanding that trade will be conducted under internationally agreed rules, not ad hoc bilateral deals.
That's the beginning of the rot; it may be a short-term tactical victory for countries like Australia, but it is certainly not effective strategic play. [
Sen. Jeff Flake, one of President Trump’s most prominent Senate critics, told The Washington Post in an interview that he would support impeachment proceedings against Trump if the president ends special counsel Robert S. Mueller III’s investigation into Russian interference in the 2016 presidential election “without cause.”
“We’re begging him: ‘Don’t go down this road. Don’t create a constitutional crisis. Don’t force the Congress to take the only remedy that Congress can take,’ ” said Flake (R-Ariz.). “To remind the president of that is the best way to keep him from going down that road. To fire Mueller without cause, I don’t know if there is any other remedy left to the legislative branch.” [
FM Lavrov led the Russian delegation to the high-level conference on Afghanistan in Tashkent (March 26-27), which included participation of Afghan President Ghani and Ministerial or senior official representations from major European countries, all Central Asian countries, China, India, Iran, Japan, Pakistan, Qatar, Saudi Arabia, Turkey, United Arab Emirates, United States, EU and UN. USA was represented by Under Secretary of State Thomas Shannon.
The declaration voiced “strong backing” for the Afghan government’s offer of direct talks with the Taliban, “without any preconditions”, and calls upon the Taliban to accept this offer. It supports direct peace talks between the Afghan government and “reconcilable elements of the Taliban”, adding that an inclusive peace agreement should include renunciation of violence by the Taliban and severance of ties with Al-Qaeda, ISIS/Daesh and other Transnational Terrorist Networks (TTNs). The declaration stipulates that all security assistance should be provided only through the Afghan Government and expressed strong opposition to “financial support, material assistance or arms to the Taliban and ISIS/Daesh”. The declaration, therefore, managed to square the circle by supporting the “unconditional” offer of direct talks with the Taliban and also incorporating the conditions that the Taliban should renounce terrorism and accept the Afghan constitution, thus enabling the diverse participation (including India) to sign on. [
President Trump has congratulated Russian President Vladimir Putin for winning re-election at the weekend, provoking a strong rebuke from Senator John McCain. White House press secretary Sarah Sanders said accusations that Russia used a nerve agent to poison a former Russian spy in the UK did not come up during the two presidents' conversation. The diplomatic crisis between Britain and Russia over that attack has raised the prospect of cyber warfare between the two nuclear-armed countries. Research fellow Brendan Thomas-Noone spoke to The Telegraph about how a cyber-war with Russia could play out. [
RUSSIA
The Russian Presidential elections of March 18 returned the predictable result of an overwhelming victory for President Putin. The Russian Election Commission said he received over 76% of all votes cast, with a voter turnout of over 67%. This works out to a neat figure of just over 50% of all eligible voters.
In his victory address to the nation, President Putin declared that economic and social issues would be his top priority: economic growth, job-creation, increasing real incomes, infrastructure development, education, healthcare, environment and housing. The recent emergence of the Russian economy from recession to modest growth and the increase in oil prices create some favourable conditions for this agenda, though the continued standoff with the West (and its potential exacerbation) may create difficult headwinds. The critical question really is whether a fourth-term head of state (or fifth-term, if his de facto role in 2008-12 is considered) will have the drive to push through this difficult agenda against external political and economic odds. [
On March 5 afternoon, former Russian military officer Sergey Skripal was discovered unconscious with his daughter on a bench at a shopping center in Salisbury, England, after they were exposed to an unknown substance. Police are investigating the incident and trying to determine what harm has come to the two individuals, but several first responders were assessed for poisoning afterwards and one remains in the hospital. Moscow says it’s prepared to help in the investigation, denying any role in this “tragic situation,” but journalists are already drawing parallels to the death of Alexander Litvinenko, who succumbed to radiation poisoning in 2006, after moving to London and writing two books about corruption in Russia’s federal law enforcement. US established up to 20 military bases in Syria's Kurdistan - Russian Security Council.
According to Russian media and official sources, the US has established as many as 20 military bases in the part of Kurdistan that lies within Syria. “The return of peace and stability to Syria is hampered by continued external interference in the Syrian crisis. For example, in the territory controlled by the people’s self-defense units of Kurdistan, some 20 US military bases have been created,” the official said. US interference in the Syria conflict has provoked Turkey into launching a military operation targeting Kurdish militias in the northern Syrian region of Afrin. The provocation took the form of “boosting” the Kurds with advanced weaponry, according to Venediktov.
Kurdish militias control some regions in northern Syria, including Afrin, which has been the subject of the Turkish military cross-border operation since January 20. Ankara believes the targeted Kurdish People’s Protection Units (YPG) are linked to the Kurdistan Workers’ Party (PKK), which is deemed a terrorist organization in Turkey. [
The overall value of pending Chinese investment projects in the Russian Far East exceeds $30 billion, Chinese Ambassador to Russia Li Hui said at a board meeting of the Ministry for Far East Development in Vladivostok. "The interaction has been most active in the oil and gas industry, agriculture, and finance," the press service of the Primorye territory's administration quoted the ambassador as saying. Currently, 85% of foreign investment in the Russian Far East comes from China. About 20 Chinese companies are working in the rapid development territories and at the Free Sport of Vladivostok.
"We believe that China's imports will approach $20 trillion, and $2 trillion will be attracted as foreign investment within the next 15 years. We intend to invest those funds in foreign markets, which implies an increase in joint projects with Russia and other countries," Li said. [
Russia is going to present a special report on foreign meddling in its domestic affairs on March 24-28 at the 138th meeting of the Assembly of the Inter-Parliamentary Union (IPU) in Geneva, Head of the Federation Council’s Interim Commission for the Protection of State Sovereignty and the Prevention of Interference in the Internal Affairs of Russia Andrei Klimov told Izvestia. Experts interviewed by the newspaper highlighted the recent expansion of the Russian delegation's activities in the IPU.
According to the newspaper, lawmakers have drawn up a report on Western countries interfering in Russia's internal affairs. The dossier will also touch on the recent presidential elections in Russia held on March 18. [
Russia’s top diplomat Sergey Lavrov held talks with his Vietnamese counterpart Pham Binh Minh in Hanoi. Heads of foreign ministries of the two countries discussed pressing issues of the bilateral agenda and global topics of mutual interest at the talks, Russia’s Foreign Ministry said earlier. "Efforts to deepen cooperation between Russia and Vietnam in trade, investment, scientific, technological and humanitarian fields is supposed to be the key area of focus," the ministry said. Russia’s Foreign Minister also met Vietnamese President Tran Dai Quang in Hanoi.
The two countries will mark a 25th anniversary of signing the agreement on basic friendly relations next year. During this time, Moscow and Hanoi have managed to establish "very close ties," based on "long-lasting traditions of friendship and mutual support," Russia’s foreign ministry said. "A regular political dialogue on the top and high level is one of the key factors of a gradual bolstering of ties," the ministry said, adding that Russia and Vietnam "have a rich positive experience of mutually beneficial cooperation and a weighty potential for further progress." [
Moscow feels that the countries of Europe and the United States do not want to discuss the problem of flight safety in the area over the Baltic Sea, Russian Foreign Ministry deputy spokesman Artyom Kozhin said. "The increasing activity of flights of NATO countries, as well as of Sweden and Finland, near our borders in the Baltic Sea area continue to cause concern," he said at a briefing on Friday, "we state that NATO is not ready to proceed in the measures on military-civil cooperation that were earlier approved by experts." "One gets the impression that the countries of Europe and the U.S. do not need real transparency in specific confidence-building measures over the Baltics and their waters," Kozhin continued, "two-thirds of flights conducted by Finland and Sweden in September-November 2017 took place without switched-on transponders [...] These actions provoke the possibility of dangerous incidents that have far-reaching consequences."
"Russia, for its part, has done a lot to reduce tensions in the region. Moscow is ready to discuss with NATO countries the safety of flights over the Baltics. "As for Russia, we confirm our readiness to discuss ways to reduce the tension in the Baltic region, both on a bilateral basis with all interested parties and in the format of consultations in the NATO-Russia Council." Russia, unfortunately, "does not see any reciprocal steps from the NATO countries," Kozhin concluded. [
Rosatom State Corporation for the first time will allow foreigners - Chinese investors to extract Russian uranium, the East Russia bulletin said. The Russian-Chinese Investment Fund for Regional Development (IFRR) signed an agreement on joint uranium mining in the Trans-Baikal region with the structures of Rosatom - Atomredmetzoloto (ARMZ) and Priargunsky Mining and Chemical Association (PGHO).
To implement the project on the construction of the Mine 6 in Krasnokamensk, which is part of the PGGO, it is planned to create a joint venture or a management company within half a year, 49% will receive IFRR. The agreement assumes that, as the first tranche, the fund will invest in the joint company's capital of about 2,5 billion roubles, which will be used to build the ground infrastructure facilities of the mine and its reopening. In the future, the Fund plans to invest in 6 Mine about 13,5 billion roubles. As for the total cost of the project, it is 18,5 billion roubles. At the same time, the fund acts as a management company, and the actual investor in the project will be the China National Nuclear Corporation (CNNC), which is one of the fund's investors. [
