December 16, 2011

European Union, Eurasian Union

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Lorna Thomas - 12/14/2011

1."FIVE DAYS TO SAVE THE EURO" AND AN EU TREATY CHANGE - GERMANY'S ROLE IN EUROPE GROWS INCREASINGLY DOMINANT

On December 9, 1991 final negotiations took place on The Treaty of Maastricht on European Union.

The Treaty was signed by the European Economic Community on 7 February 1992, entered into force on 1 November, 1993 during the Delors Commission, creating the European Union which in turn lead to the creation of the single currency, the Euro.

Twenty years later, during what was described as "five days to save the Euro", on Monday 5 December, 2011 German Chancellor Angela Merkel and French President met to agree on a plan they could present to the EU summit in Brussels 8-9 December, 2011.

Addressing a press conference on 5 December, 2011 after meeting with President Sarkozy, Chancellor Merkel said: "Under the current Lisbon treaty, it is set out that a deficit procedure can only begin when a qualified majority supports it. We want to change this, and for this we need a change to the treaty."

Stating they were open to changing the Treaty for all 27 members, Chancellor Merkel said "if someone can't do this, then we will say the Euro is so important to us that we will pursue treaty change for the 17 members."

French President, Nicolas Sarkozy said: "We prefer to have 27 signatories so that nobody feels excluded from a French-German initiative, but we're ready to go ahead with 17 members or with any state that wants to join us."

Preferring a deal that included the 27 members, British Prime Minister David Cameron went to Brussels to negotiate concessions from the proposed new regulations to protect the British financial services sector, describing them as "modest, reasonable and relevant."

On the 20th anniversary of final negotiations for the Maastricht treaty, negotiations for a changed EU treaty took place in Brussels with Prime Minister David Cameron the only one of the 27 leaders to decide at the Summit not to accept the proposed treaty changes.

Addressing a press conference on 9 December, 2011, Mr Cameron said:

"I said before coming to Brussels that if I couldn't get adequate safeguards for Britain in a new European treaty, then I wouldn't agree to it. What is on offer isn't in Britain's interests, so I didn't agree to it.... (T)he decisions taken here tonight all flow from one thing: the fact that there is a single currency in Europe - the euro. Britain is out of it, and will remain out of it. Other countries are in it and are having to make radical changes, including giving up sovereignty, to try and make it work."

"PM Reaction following EU talks in Brussels", 9 December 2011,

The Official site of the Prime Minister's office,

http://www.number10.gov.uk/news/pm-reaction-following-eu-talks-in-brussels/

While the Summit may have focused on forging closer supra-national governance, post-Summit analysis identified the treaty as not helping address the current crisis in the Eurozone, with the euro dropping to a 11 month low against the dollar several days later.

"The treaty does nothing to address the current crisis, however. Many analysts and investors have been counting on the agreement to persuade the European Central Bank to step in and protect heavily indebted countries such as Italy and Spain by buying up their bonds, but there is no sign yet that the bank has any plans to do so.

European equity markets fell heavily Monday, following the now well-worn pattern in which stocks make major gains after leaders announce a new solution to the debt crisis, and then dive the next trading day as investors begin to pick apart the details."

"Britain's David Cameron defends opt-out from new EU treaty," Los Angeles Times, Henry Chu, December 13, 2011

http://www.latimes.com/news/nationworld/world/la-fg-euro-cameron-20111213,0,1921346.story

While polls showed many of the public supported Mr Cameron's decision, as did members of his own Conservative party, his strongly pro-Europe coalition partner Liberal Democrat Deputy Prime Minister Nick Clegg was "bitterly disappointed" at the outcome of the summit - he had initially appeared to publically back Mr Cameron's decision. Mr Clegg said the danger existed that the UK would be isolated and marginalized in Europe. He was not present when Mr Cameron addressed Parliament on Monday 12 December, 2011, saying in an interview that his presence would have been a "distraction".

Francois Hollande of the Socialist Party, challenging Mr Sarkozy in presidential elections in 2012, said the accord lacked efficiency with respect to the financial markets and he would renegotiate if elected.

In an interview with Le Monde newspaper following the summit Mr Sarkozy said that "henceforth there are clearly two Europes - one seeking greater solidarity and regulation, and the other attached to the exclusive logic of the single market."

"You have to understand this is the birth of a different Europe - the Europe of the euro zone, in which the watchwords will be the convergence of economies, budget rules and fiscal policy...."

See:

"Cameron, Speaking to Parliament, Defends Actions at Europe Summit", New York Times International Herald, Sarah Lyall and Alan Cowell, 13 December, 2011, http://mobile.nytimes.com/article?a=878940&f=19

The idea of a two speed Europe is nothing new. In June 2006 Jean-Claude Juncker, currently chairman of the Eurogroup stated:

"In 20 years the EU will have between 27 and 33 members. At some point this group will realise it can't agree on a joint future in all areas. Then, a core group will emerge that is not completely identical with the Eurozone group, but almost. This core group will be surrounded by the normal members. They won't be deeply involved in the key EU issues of taxes, domestic policy and foreign policy. I don't want this core Europe, but one day it will emerge of its own accord as the only way out of a collective crisis that makes in impossible to agree on common goals."

Eurotopics: http://www.eurotopics.net/en/home/autorenindex/autor_juncker_jean_claude/

Original article in full:

"Ich moechte Kerneuropa nicht, aber es wird kommen,"Die Welt, Hannelore Crolly and Christoph B. Schiltz, 15 June 2006

http://www.welt.de/print-welt/article223153/Ich_moechte_Kerneuropa_nicht_aber_es_wird_kommen.html

During the 2006 interview Mr Juncker stated it was conceivable that the EU would continue without the British should they reject the constitution and that only those countries that were ready for a deepening of political union be included. (In the interview Mr Juncker also spoke about establishing a European army.)

Mr. Juncker once told Belgian newspaper Le Soir that he supported public debate on the EU Reform Treaty - except in Britain. He said:

"Britain is different. Of course there will be transfers of sovereignty. But would I be intelligent to draw the attention of public opinion to this fact?"

'Don't tell British about the EU treaty', Telegraph, Bruno Waterfield, Brendan Carlin, 3 July, 2007

http://www.telegraph.co.uk/news/worldnews/1556400/Dont-tell-British-about-the-EU-treaty.html

In 2009 Mr Juncker was a favourite of Mr Sarkozy for the post of EU president.

On 1 December, 2011 French President Nicholas Sarkozy called for a "refounding and rethinking the organization of Europe."

President Sarkozy advocates closer relations between church and state, and it is not unlikely an emphasis be placed on closer relations between church and state with a call for a "return to Europe's Christian roots", previously called for by both Pope John II and Pope Benedict XVI. Note that over the past years there has been growing unity between the Catholic and Russian Orthodox churches. A close relationship exists between state and church in Russia.

See: "Will Europe's "capacity to act" and a "return to its Christian roots" present a danger to religious freedom?", Global Politician, Lorna Thomas - 17 November, 2009

http://globalpolitician.com/26045-european-union

During the recent crisis in the Eurozone, Germany's increasing dominance in Europe has been frequently commented on - and even sought.

Given Germany's invasion of Poland 72 years ago, one of the most startling appeals in the run-up to the summit - greeted with outrage by Poland's main opposition, the Law and Justice party as "treason" - was issued by Poland's Foreign Minister Radoslaw Sikorski in Berlin on 28 November, 2011.

"The biggest threat to the security and prosperity of Poland would be the collapse of the eurozone.

"And I demand of Germany that, for your own sake and for ours, you help it survive and prosper. You know full well that nobody else can do it.

"I will probably be the first Polish foreign minister in history to say so, but here it is: I fear German power less than I am beginning to fear German inactivity."

"You have become Europe's indispensable nation."

"A breakup of the eurozone - a possibility now being openly talked about - "would be a crisis of apocalyptic proportions beyond our financial system", he added."

"Poland urges Germany to do more to solve euro crisis", BBC News, 29 November 2011

http://www.bbc.co.uk/news/world-europe-15936206

On 1 December, 2011 according to STRATFOR President Sarkozy and German Chancellor Angela Merkel "invited Poland and Sweden to be part of a voluntary EU treaty that would seek deeper financial integration and oversight among its members, the German newspaper Bild-Zeitung reported, citing an unnamed source."

"STRATFOR: Poland's choice: A stronger Germany", Published in Warsaw Business Journal with permission of STRATFOR, 2 December, 2011

http://www.wbj.pl/article-57149-stratfor-polands-choice-a-stronger-germany.html?typ=wbj

Ambrose Evans-Pritchard wrote:

"Brussels has warned Europe will ''disintegrate'' unless leaders grasp the nettle. It is a scare tactic. There is no linkage between a euro break-up and the end of the EU."

"Merkel's big-stick approach not the answer to Europe's woes", Ambrose Evans-Pritchard, Sydney Morning Herald, 6 December, 2011

http://www.smh.com.au/business/merkels-bigstick-approach-not-the-answer-to-europes-woes-20111205-1ofbw.html

Ironically, it was Mr Sikorski who in April 2006, as Poland's Defence Minister, compared the Nord stream natural gas pipeline project running from Russia to Germany under the Baltic Sea to the infamous 1939 Nazi-Soviet Molotov-Ribbentrop Pact in which foreign ministers of the Soviet Union and Nazi Germany signed a non-aggression pact that included dividing Poland between Germany and Russia. (In a ceremony that included Chancellor Merkel and President Medvedev, the Nord stream pipeline was officially opened in Germany on 8 November, 2011.)

Russia Today reported that Russian Foreign Minister Sergey Lavrov and Mr Sikorski signed an agreement in Moscow on 14 December regulating local frontier crossings for residents of Russia's Kaliningrad Region and adjoining territories of Poland which Russia anticipates "will precede a visa-free regime between Russia and the EU."

See:

"Visa-free travek gets a lift from Russia-Poland agreement,"

Russia Today, 14 December, 2011

http://rt.com/politics/russia-poland-moscow-visa-free-travel-katyn-767/

The Warsaw Business Journal reported that on 13 December, 2011 the 30th anniversary of imposition of martial law in Poland, Jaroslaw Kaczynski, former Polish prime minister and current leader of the opposition Law and Justice party (PiS) led thousands of people in a march through Warsaw showing their displeasure against the government's support for deeper integration with Europe.

"In a speech to those assembled Mr Kaczynski said that "It is hard to imagine a situation more dangerous, than when representatives of democratic countries are beginning to pay homage to other countries."

"This is a shame, an abuse and a violation of the constitution. For that reason we cannot agree," he added.

Referring specifically to Mr Tusk's support for the new EU measures, Mr Kaczynski said: "This undermines our status as a sovereign state, our position, our dignity . We can't agree to this. We can't, we can't and we won't.""

"Polish opposition holds march against gov't 'treachery'", Warsaw Business Journal, 14 December 2011

http://www.wbj.pl/article-57322-polish-opposition-holds-march-against-govt-treachery.html?typ=wbj

While Mr Sikorski fears "The biggest threat to the security and prosperity of Poland would be the collapse of the eurozone" calling on Germany to exert more leadership, others are concerned are concerned about the consequences of staying in an increasingly political union. Given the trends, Russia's role along with Germany will, for a time, become dominant in Europe and the world.

On 14 December, 2011, Russia Today featured Nigel Farage, UKIP's MEP saying that there is a risk that Europe could return to extremism and even facism.

Before the summit in a BBC interview he said "democracy is being stripped" from countries like Greece and Italy where austerity packages are being introduced that "will drive them into depression, mass unemployment and probably very serious civil disorder."

He said that UKIP does "not want to be a member of a political union but we do want to have free trade, friendship and co-operation" adding that "countries like Norway and Switzerland have exactly the same terms of trade with Europe without being members of the Union, indeed there are countries all over the world that have free trade with the EU."

See video:

"UKIP leader Nigel Farage voices eurozone concerns", BBC, 3 December, 2011

http://www.bbc.co.uk/news/business-16017106

Addressing the European Parliament following the European council summit, he said "Britain is going to make the great escape. We're going to get out of this union. We'll be the first European country to get our freedom back."

In an interview with Russia Today Mr Farage said, "French President Sarkozy ruled out any compromise and insisted on the financial transaction tax."

"That would have meant a new tax, 80 per cent of which would have been paid by the UK. If Cameron had signed up to that and gone back to the House of Commons, it would have literally brought down the British government," Farage told RT.

The myth that the UK can be in Europe but not run by Europe has died after the Friday vote over the fiscal deal, he claimed.

"We now find ourselves in a position where we are outvoted by 26 to 1. We are in a hopeless minority and yet we still have 75 per cent of our laws that run the United Kingdom made in these institutions," said the politician. "Cameron's not wishing to do this has now opened up the real debate in the UK about our European future."

"Nigel Farage: Bully-boys in Brussels building Europrison," Russia Today, 14 December, 2011

In an interview with Sky TV Conservative MP Julian Lewis said he thought David Cameron's decision to veto the Treaty change was "about preserving what sovereignty remains to the United Kingdom."

He said that on the continent a number of countries "seem content to merge their financial systems thus creating an economic government which inevitably will lead to some sort of European government. That is a danger to the peace and stability of Europe in the long run and although, thank goodness we are out of it, I am filled with fear and dread of what's going to happen to the people who are foolish enough to be inside it."

(On 5 December, 2011 Standard & Poor, who downgraded the US top AAA rating in August, warned 15 of the 17 eurozone countries including Germany, France and four others, that it might downgrade them depending on the outcome of the EU summit on Friday. While some stated the threat of a downgrade increased the pressure already on the summit, Bloomberg reported that European Central Bank Governing Council member Ewald Nowotny said it highlighted that "rating agencies increasingly are assuming a political role." Following the summit, Moody's said that it will review the ratings of EU countries in early 2012.)

Decisions made as a consequence of "scare tactics", but losing sight of the bigger picture of inevitable loss of freedoms, both sovereign and personal, could lead to greater suffering beyond any felt in the economic sphere.

The European Union is moving towards supranational governance, and while strong leadership may seem the solution in times of trouble, it may be best for all to recall the lessons of history with regards to dictatorial leadership which in the end did not benefit even those it initially claimed to serve.

2.THE POTENTIAL EXISTS TO CREATE A SUPER UNION BETWEEN MEMBERS OF THE EUROPEAN UNION AND THE EURASIAN UNION, WITH GERMAN AND RUSSIAN LEADERSHIP?

On 1 January, 2012 the Common Economic Space will be officially launched. Russia, Belarus and Khazakstan are founding members of the CES, intended to lead to the Eurasian Union, which has goals both of a single currency and political union. (CIS, the Commonwealth of Independent States was founded on 8 December, 1991 by Russia, Belarus and Ukraine, to replace the crumbling U.S.S.R.)

Russian leadership considers itself part of Europe. Vladimir Putin has stated that "accession to the Eurasian Union will also help countries integrate into Europe sooner and from a stronger position."

Unlike the European Union, political union will be instituted in the Eurasian Union from the outset.

In November 2011, Boris Makarenko, chairman of the board of the Center of Political Technologies told Russia Today:

"The structure of the (Eurasian Union) is very different from the EU as Russia is an absolute leader, while in the EU even Germany is strong but not completely overshadowing other members," he said. "So it will be easier to overcome problems through Russia's leading role."

"One small step for Russia, one giant leap for Eurasian Union,"

Russia Today, 18 November, 2011
http://rt.com/politics/russia-kazakhstan-belarus-eurasian-union-647/

The potential exists for creating a super-union between members of the European Union and the Eurasian Union, placing Russia in a leading role in Europe, economically, politically and militarily. (Religion could also be used to unite. However, the possibility exists that with potential future strong, even dictatorial political leadership, a cult of personality could come into being.)

In the Russia Today interview, Boris Makarenko spoke of the possibility of a super-union between the EU and the Eurasian Union:

"First all member-states of the new union must join the WTO, then they must bring their technical regulations in line with the EU and only then could such a "super-union" be negotiated. But it is possible in principle."

Russia stands on the verge of joining the WTO. Georgia blocked Russia's accession bid to the WTO following the 2008 Russia-Georgia conflict. The final obstacle was removed when they signed an agreement on 9 November, 2011 and the accession package was adopted by a Working Party on 10 November, 2011 who send their accession recommendation to the 15 - 17 December 2011 Ministerial Conference. If approved, as expected, Russia will become a WTO Member.

President Medvedev will visit Brussels on December 14-15. Voice of Russia reported that Deputy Economic Development Minister Andrei Slepnev told reporters that at the 28th EU-Russia summit on December 15, Russia and the EU will discuss a new partnership agreement.

While the Organisation for Economic Co-operation and Development warned in an annual report that the business environment in Russia leaves a lot to be desired with questions concerning governance, lack of transparency, corruption, and rule of law, Jim O'Neill, the economist who coined the acronym BRIC for emerging markets Brazil, Russia, India, China, now Chairman of Goldman Sachs Asset Management has published "The Growth Map: Economic Opportunity in the BRICs and Beyond" expressing the view that Russia has every chance of becoming Europe's largest economy and entering the EU.

"Jim O'Neill: BRICs' rapid growth tips the global balance,"

http://www.telegraph.co.uk/finance/finacialcrisis/8902824/Jim-ONeill-BRICs-rapid-growth-tips-the-global-balance.html

Read more:

"Russia's GDP will equal Germany's - expert,"

The Voice of Russia, Mamonov Roman, 1 December, 2011

http://english.ruvr.ru/2011/12/01/61306245.html

If Russia, or the emerging markets are seen as having potential for growth, and investment is moved away from the US, this will further negatively affect the US economy.

Russia has also been seen by some as using the financial crisis as an opportunity to gain leverage in Europe.

STRATFOR states:

"Moscow's plan is to make Russia look economically stable"; to buy European assets while they are cheap - "the Kremlin is focused mainly on banks, oil terminals, utilities providers, retailers, and large oil and natural gas firms, followed by strategic assets like ports and airports"; to invite European countries into Russia "the idea is for European firms in transportation, telecommunication, energy and possibly even the military-industrial sector to work in Russia's active and expanding market" and "to offer financial backing for Europe's evolving bailout mechanisms".

"In Europe's Crisis, Russia Sees Opportunity," STRATFOR, 2 November, 2011

Full article for download at:

http://www.stratfor.com/memberships/204143/analysis/20111101-europes-crisis-russia-sees-opportunity

On 25 November, 2011, shortly after the signing of the 18th November, 2011 Declaration by Russia, Belarus and Kazakstan that will lead to the official launch of the CES on 1 January, 2011, the Wall Street Journal stated that:

"Russian Prime Minister Vladimir Putin announced a $14 billion rescue plan for Belarus on Friday, tightening Russia's embrace over its isolated, authoritarian neighbor in return for a major stake in its economy.

Under the plan, Russia wins complete control over Belarus's gas pipeline network, a major export route for Russian natural gas to Europe. Moscow appears to keep financial leverage over Belarus in the years to come by retaining the right to raise the price of gas, a lifeline for industry of the former Soviet republic."

"Russia Tightens Its Grip in Belarus", The Wall Street Journal, Alan Cullison, 26 November 2011

http://online.wsj.com/article/SB10001424052970203764804577060312640356138.html?mod=googlenews_wsj

A New York Times article stated:

"The loans and discounts represent an economic lifeline to Belarus's president, Aleksandr G. Lukashenko, helping his government to subsidize basic food items and imported goods to offset inflation and tamp down social unrest. In exchange, Belarus sold full control of its natural gas pipeline to Europe to Gazprom, the Russian energy giant.

The agreement, like so many Russia has struck with its neighbors, hinged on energy pricing policies, long a tool of choice in Moscow's foreign policy with other former Soviet states."

"Gas Deal With Belarus Gives Control of Pipeline to Russia", New York Times, Andrew E. Kramer, November 25, 2011

http://www.nytimes.com/2011/11/26/world/europe/in-deal-with-belarus-russia-gets-control-of-yamal-europe-pipeline.html?_r=1

3. JANUARY 1, 2012 - LAUNCH OF THE COMMON ECONOMIC SPACE LEADING TO THE EURASIAN UNION

According to Prime Minister Putin, the proposed Eurasian Union is open to include "accession by other states that share the goals and principles of the Union and are ready to implement them" and is "a means of helping countries integrate into Europe sooner".

On 18 November 2011, Dmitry Medvedev, Nursultan Nazarbayev and Alexander Lukashenko, Presidents of Russia, Kazakhstan and Belarus, members of the Customs Union met in Moscow and agreed on creating a Common Economic Space.

The completion date is not yet fixed, but in mentioning 2015 as a possible date Mr Medevev said during his speech "if the conditions are right we will move quicker where possible." (Following a working dinner on the 18th Mr Lukashenko reportedly named the end of 2013 as a possibility.)
At the news conference after the meeting, President Medvedev said:

"We agreed today for the first time on establishing a supranational body, neutral with respect to all three countries, to which we will delegate increasing powers. This is a decision of major significance."

"The three presidents signed the Declaration on Eurasian Economic Integration, the Treaty on the Eurasian Economic Commission, and the Resolution on the Eurasian Economic Commission Regulations.

The Declaration of the Presidents of Belarus, Kazakhstan and the Russian Federation announces the transition to the next stage of integration: the Common Economic Space (CES).

The Declaration states that the CES is based on the principles of compliance with universal norms of international law and that in their practical cooperation the CES states are governed by the rules and regulations of the World Trade Organisation and confirm the importance of all three states' accession to the WTO.

The Declaration states the following main directions of further integration: ensuring the effective functioning of the common market for goods, services, capital and labour; the formation of a coherent industrial, transport, energy and agricultural policy; further harmonisation of national legislations; strengthening cooperation in the monetary sphere and in area of economic security.

Further integration also involves the improvement and growth of supranational institutions, the development of cooperation in the sphere of foreign policy on issues of mutual interest.

The Declaration states that the CES, at any stage of its formation and operation, will be open for accession by other states that share the goals and principles of the Union and are ready to implement them."

"Meeting of the Presidents of Russia, Belarus, and Kazakhstan",Official website of the President of Russia, The Kremlin, Moscow, 18 November 2011

http://eng.kremlin.ru/transcripts/3090

Prime Minister Vladimir Putin wrote an article published in Investia on 4 October, 2011 denying the Eurasian Union would be a revival of the Soviet Union, saying:

"...these times call for close integration based on new values and a new political and economic foundation. We suggest a powerful supranational association capable of becoming one of the poles in the modern world and serving as an efficient bridge between Europe and the dynamic Asia-Pacific region. This project also implies transitioning to closer coordination in economic and currency policies in the Customs Union and CES and establishing a full-fledged economic union."

Article published in the newspaper Izvestia: "A new integration project for Eurasia: The future in the making", Government of the Russian Federation, 4 October, 2011

http://premier.gov.ru/eng/events/news/16622/

Mr Putin wrote "the Eurasian Union is an open project. We welcome other partners to it, particularly CIS member states. Soon the Customs Union, and later the Eurasian Union, will join the dialogue with the EU. As a result, apart from bringing direct economic benefits, accession to the Eurasian Union will also help countries integrate into Europe sooner and from a stronger position."

4. PROPOSAL TO "SHUT OUT THE DOLLAR"

Russian President Dmitry Medvedev has long called for a "multi-polar world" with reduction of the "uni-polar" role of the US in terms of global finances and security.

(See Russia and Europe want a multi-polar world, Global Politician, Lorna Thomas, 12/9/2008) http://www.globalpolitician.com/25307-russia-europe-united-states-foreign-policy

In July 2008 President Medvedev called on the G8 leaders to develop "a new international financial system".

An article in The New American Magazine states that Russian Minister of Industry and Trade, Viktor Khristenko "In describing the efforts the architects of the Eurasian Union to correct the mistakes of the EU blueprint", "revealed the truth behind the construction to be a "localized globalization processes."

"That is to say, it is much easier to unite once sovereign, self-governing nations into blocs of interdependent, regional satraps of a greater, all-powerful, global government than to establish the world union in one fell swoop."

"Eurasian Union One Step Closer to Reality", The New American Magazine, Joe Wolverton, II, 22 November 2011

http://thenewamerican.com/world-mainmenu-26/europe-mainmenu-35/9882-eurasian-union-one-step-closer-to-reality

If the dollar loses status as reserve currency it would have serious repercussions for the U.S. Following the 18 November 2011 meeting during a press conference President of Kazakhstan, Nursultan Nazarbayev said:

"The three countries should use the Kazakh tenge, the Russian rouble and the Belarusian rouble in mutual trade in order to shut out the dollar.

"Any integration project begins above all with creating a common free trade zone, then a customs union, then a common economic space, and finally, an economic union with the eventual possibility of a common currency. This is the classic road that we are taking. We have established a free trade zone and a customs union, and we are now creating our common economic space. Most important of all is to give this economic space the full power and capacity it requires to get everything developing effectively, macroeconomic indicators and everything else, and then we can start putting the union in place.

Perhaps this is running ahead somewhat, but we discussed too, today, the possibility of moving over to conducting settlements in our own currencies when it comes to big trade deals, using the Kazakhstani tenge, the Russian ruble, and the Belarusian ruble between ourselves instead of the dollar. We buy dollars in order to settle accounts with Russia when we could do this using the tenge or the ruble.

In other words, we are only at the start of all the possible exchanges we can conduct. Indeed, I envisage in the future establishing a common defence space (we have the CSTO working on this), a common technological space, common electricity networks (as we used to have), and a common resolution of food supply issues. We have been blessed with no shortage of energy supplies, at any rate.

"Meeting of the Presidents of Russia, Belarus, and Kazakhstan", Official website of the President of Russia, The Kremlin, Moscow, 18 November 2011

http://eng.kremlin.ru/transcripts/3090

(Mr Nazarbayev reportedly has given Tony Blair, former British Prime Minister, a consultancy job:

"Officials said that during their meeting yesterday Mr Blair and 71-year-old Nazarbayev 'discussed working out a large-scale programme to modernise the economy of Kazakhstan, as well as a wide range of international issues, in particular, the situation in the European Union and the Middle East'."

"Pictured for the first time: Tony Blair and the Kazakhstani tyrant who's given him an ?8m consultancy job," Daily Mail, Will Stewart, 23 November 2011

http://www.dailymail.co.uk/news/article-2065434/Together-Blair-tyrant-whos-given-8m-job-Pictured-time-Tony-Kazakhstani-ruler-consultancy-deal.html#ixzz1ep6lm97h)

5. COMMON DEFENCE BETWEEN RUSSIA AND BELARUS

At the press conference after the 18th November, 2011 meeting between the three Customs Union presidents, Aleksandr Lukashenko referred to the coordination of domestic and foreign policy issues between Belarus and Russia including a common defence space.

"Today, within the framework of [the Allied State of] Belarus and Russia, we are coordinating not only domestic policy, but foreign policy issues as well. Recently, a joint council of our foreign ministries had a meeting in Moscow which produced good results. Incidentally, joint councils are set by all ministries and agencies.

We also have a common defence space and have well advanced in that respect. We have a common air defence system which is managed from one command centre...."

"Meeting of the Presidents of Russia, Belarus, and Kazakhstan", Official website of the President of Russia, The Kremlin, Moscow, 18 November 2011

http://eng.kremlin.ru/transcripts/3090

Days later, on 23 November, 2011, President Medvedev threatened that Russia may deploy missiles in Belarus and on its own borders if talks with Washington regarding European missile defence failed.

See:

"Russia says may deploy missiles in Belarus": Ifax, 24 November, 2011

http://missiledefense.wordpress.com/2011/11/23/medvedev-threatens-to-target-u-s-missile-shield-in-europe-if-no-deal-is-reached/#more-7964

In a statement on 23 November, 2011 which was likened to Cold War rhetoric, President Medvedev said:

"If our partners show an honest and responsible attitude towards taking into account Russia's legitimate security interests, I am sure we can come to an agreement. But if we are asked to 'cooperate' or in fact act against our own interests it will be difficult to establish common ground. In such a case we would be forced to take a different response. We will decide our actions in accordance with the actual developments in events at each stage of the missile defence programme's implementation.

First, I am instructing the Defence Ministry to immediately put the missile attack early warning radar station in Kaliningrad on combat alert.

Second, protective cover of Russia's strategic nuclear weapons will be reinforced as a priority measure under the programme to develop our air and space defences.

Third, the new strategic ballistic missiles commissioned by the Strategic Missile Forces and the Navy will be equipped with advanced missile defence penetration systems and new highly-effective warheads.

Fourth, I have instructed the Armed Forces to draw up measures for disabling missile defence system data and guidance systems if need be. These measures will be adequate, effective, and low-cost.

Fifth, if the above measures prove insufficient, the Russian Federation will deploy modern offensive weapon systems in the west and south of the country, ensuring our ability to take out any part of the US missile defence system in Europe. One step in this process will be to deploy Iskander missiles in Kaliningrad Region.

Other measures to counter the European missile defence system will be drawn up and implemented as necessary.

Furthermore,

If the situation continues to develop not to Russia's favour, we reserve the right to discontinue further disarmament and arms control measures."

Besides, given the intrinsic link between strategic offensive and defensive arms, conditions for our withdrawal from the New START Treaty could also arise, and this option is enshrined in the treaty.

But let me stress the point that we are not closing the door on continued dialogue with the USA and NATO on missile defence and on practical cooperation in this area. We are ready for that.

However, this can be achieved only through establishing a clear legal base for cooperation that would guarantee that our legitimate interests and concerns are taken into account. We are open to a dialogue and we hope for a reasonable and constructive approach from our Western partners."

"Statement in connection with the situation concerning the NATO countries' missile defence system in Europe," President Dmitry Medvedev, President of Russia website, 23 November, 2011, http://eng.kremlin.ru/news/3115

NATO chief Anders Rasmussen wrote on his Twitter account:

"The suggestion that deployment of missiles in the areas neighbouring the alliance is an appropriate response ... is very disappointing.

"Nato's missile defence system [is] designed to defend against threats from outside Europe. Not designed to alter balance of deterrence."

See also:

"Russia in Europe missile threat", BBC, 23 November, 2011

http://www.bbc.co.uk/news/world-europe-15857431

Following his statement on 23 November, 2011, on 29 November 2011 President Medvedev ordered a new incoming missile early warning system equipped with the new Voronezh-DM radar system to be turned on in response to US plans for a missile shield in Europe.

President Medvedev stated:

"In any case, the standard statements that the new system of the adaptive and phased transition to a European missile defence system is not directed against Russia can no longer satisfy us. These statements are made orally and unfortunately do not guarantee the protection of our interests. If other steps are made, naturally we will be ready to listen to them. However, it is not enough to issue oral statements. So when they tell us that the system is not directed against us, I would like to reply as follows: 'Friends, the early warning radar station that was put on combat duty today is not directed against you either; on the contrary, it can work for you and towards achieving the aims we have set for ourselves'.

With regard to further actions, it is entirely up to those who make the relevant decisions today. If our signal is not heard, then, as I said on November 23, we will deploy other defence means, including the adoption of tough countermeasures and deployment of the main attack force.

The station has been put on combat duty, which means that it has begun to work as a finished facility, although a number of parameters are still to be built up over time.

Therefore, I instruct the Defence Ministry, first, to carry out all the tasks required to achieve that. Second, I expect that the servicemen on duty at the station will be our highly trained Space Forces, our new combat arm. We should create good conditions for their service."

"Meeting with the leadership of the Armed Forces," President of Russia website, 29 November, 2011, Kaliningrad Region

http://eng.kremlin.ru/news/3141

It should be noted that while President Medvedev proposed a common defence system in 2008, President Putin had first promoted the idea of a joint missile defence system in Europe to both U.S. and European leaders in 2000. At the time, analysts warned such as system would be contrary to U.S. interests.

Russia is increasing its spending on weapons. In 2011 Prime Minister Putin announced plans to spend 22 trillion rubles ($730 billion) for weapons through to 2020.

See:

"Russia to Spend $730 Billion on New WeaponsAnya Ardayeva"

http://www.voanews.com/english/news/europe/Russia-to-Spend-730-Billion-on-New-Weapons-125074984.html

6. RUSSIA, SYRIA AND ISRAEL

Russia is establishing a presence in the Mediterranean.

In November 2009 President Dmitry Medvedev said Russia would increase its naval presence in the world's oceans, of significance is Russia's presence in the Mediterranean. The Russian naval base at the Syrian port of Tartus was renovated and scheduled to be ready for use in 2012.

On 13 December, 2011, the aircraft carrier Admiral Kuznetsov was monitored by HMS York 30 miles off the coast of Fife, Scotland as it made its way to Tartus.

"Russia Sends Show Of Support To Syria", Sky News, Sam Kiley, December 13, 2011.

http://news.sky.com/home/world-news/article/16129689.

Tartus is important strategically Russia. It gives Russia a permanent naval presence in the Mediterranean. In 2007 the prospect of Russian ships in Syria was a reason of concern for Israel.

"The major Israeli newspaper Yediot Ahronot reported yesterday that Israeli intelligence holds that the presence of Russian ships in Syria is a direct threat to Israel's security. In particular, the bases in Tartus and Latakia will turn into centers of electronic surveillance that will be able to monitor not only Israel, but the entire Middle East. There is also concern in Israel that Russia will share that information with its Muslim partners, especially Syria and possibly Iran. In addition, Russia will certainly create a major air defense system to defend its bases that will be able to defend much of Syria from attack as well."

"Russian Fleet Worries Israel/Even though it is nowhere near it,"

Kommersant, lga Berezintseva, Konstantin Lantratov, 7 August, 2007

http://www.kommersant.com/p793357/overseas_military_bases_navy/

(Note that with regard to the situation between Syria and Israel, a draft resolution dated 21 November, 2011 was voted on during the sixty-sixth session of the UN General Assembly Plenary meeting 69 vote 6, Agenda item 36 regarding "The situation in the Middle East" which amongst other points stated that it:

"4. Determines once more that the continued occupation of the Syrian Golan and its de facto annexation constitute a stumbling block in the way of achieving a just, comprehensive and lasting peace in the region;" and

"6.Demands once more that Israel withdraw from all the occupied Syrian Golan to the line of 4 June 1967 in implementation of the relevant Security Council resolutions;"

119 countries voted "yes" to the resolution including Russia, Belarus Kazakhstan, China, Brazil, India; 7 voted "no" including Israel, the US and Canada. 53 countries abstained, including the UK.

Draft resolution and voting record at:

http://www.eyeontheun.org/assets/attachments/documents/9902_GA_Draft_Resolution_The_Syrian_Golan.pdf

http://www.eyeontheun.org/assets/attachments/documents/9896_Voting_record_on_GA_Draft_Resolution_L.20_The_Syrian_Golan.pdf))

On 23 November, 2011 Arutz Sheva reported that Russian warships had reached waters off Syria carrying technical advisors who could help Syria set up S-300 missiles.

"The S-300 system is regarded as one of the most potent anti-aircraft missile systems available. The system's radar is able to simultaneously track up to 100 targets while engaging up to 12. Deployment time for the S-300 is five minutes, and they have a very long life span, with no maintenance needed."

"Report: Russia Sent Syria Super-Advanced S-300 Missiles," David Lev,Arutz Sheva,23 November, 2011

http://www.israelnationalnews.com/News/News.aspx/150059

In November 2011, DEBKAfile reported that there was a build-up of US and Russian naval aircraft carriers in Syrian waters.

"In the face of this escalating big power standoff and the high possibility of the Syrian ruler deciding to lash out against his country's neighbors, the Israeli, Jordanian and Turkey armies have declared a high state of war preparedness."

"US carrier strike force enters Syrian waters. "Russian carrier en route,"

DEBKAfile Special Report November 26, 2011

http://www.debka.com/article/21521/

On 29 November 2011 it was reported:

"Next week, the aircraft carrier Admiral Kuznetsov is to start steaming from the Arctic toward Tartus. The Kuznetsov, which carries at least 10 late model Sukhoi and Mig fighter jets, is to be joined by two other Russian Navy vessels."

"Syria: Russia Clings to Legacy of Soviet Ties in Arab World", Voice of America, Russia Watch, James Brooke, 29 November, 2011

http://blogs.voanews.com/russia-watch/2011/11/29/syria-russia-clings-to-legacy-of-soviet-ties-in-arab-world/

See also:

"Russian Warships to Syrian waters," (DP-News - agencies), 19 November, 2011

http://www.dp-news.com/en/detail.aspx?articleid=103632

"Raising The Stakes: Russian Military Support For Syria - Analysis",

James M. Dorsey, 12 December, 2011

http://www.eurasiareview.com/12122011-raising-the-stakes-russian-military-support-for-syria-analysis-2/

During the 9 month Syrian uprising Russia (and China) vetoed a UN Security Council resolution proposed by the US and several European nations condemning president Bashar al-Assad's crackdown. (The UN Human Rights Commissioner Navi Pillay said on 13 December, 2011 that 5000 have been killed, a figure disputed by Syria.)

On 13 December, 2011 Russian Foreign Minister, Sergei Lavrov, criticising the West for taking an "immoral" stance on Syria by only pressuring President Bashar Assad's government while turning a blind eye to violence by opposition groups, said pressure was being exerted on Damascus to receive observers including from Russia:

"We are urging the parties to achieve an agreement on starting a dialogue on the Arab League initiative. We are trying to exert pressure on Damascus so that it agrees to receive observers from Arab states and other countries, including the BRICS member countries. If they are all sincere when they say that the Libyan scenario will not be repeated in Syria and want to resolve the Syrian issue through an internal dialogue, we can all get together and put pressure on the government and all the opposition groups so that they put an end to all violence regardless of its origin."

"Russia hopes for peace in Syria", Voice of Russia, Lada Koratun, 13 December, 2011

english.ruvr.ru/2011/12/13/62164299.html"

CONCLUSION

2011 has seen the growing role of both Germany and Russia in Europe and on the world's stage and unless trends change they will continue to play an increasingly dominant role in both Europe and the world. Unity will be sought in the sphere of economy, politics, security and religion.

At the year of 2011, described as a turbulent year in many respects, while some may share the belief that the breakup of the eurozone would cause a "crisis of apocalyptic proportions", there are those who see that with strong governance in Europe leading to a loss of sovereignty, a powerful union with global influence could emerge but also has the potential for dictatorship which could indeed usher in a time of suffering.

The lessons of the Old Testament show that when ancient Israel put their trust in alliances with the nations around them, including the Assyrians and Babylonians (Eze 23, Hos 8,9), and forgot and forsook God and His Laws and followed the customs of those nations, also worshipping their gods, thereby provoking God to jealousy and anger, God removed His blessings and also allowed them to be punished by those nations. In the 400th anniversary of the translation of the King James Bible, we should consider that the lessons contained within the history of ancient Israel, given in the Bible, are also applicable to today's modern nations and that as nations if we do not learn the lessons of history we will repeat them. Should our trust be in man and in human devised systems, or in God Who as the Creator of heaven and earth and everything in them, is ultimately the One who provides for nations and for individuals?

Lorna Thomas is a freelance author.

http://www.globalpolitician.com/27228-geopolitics-germany-russia

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