Saturday, June 27, 2009

Russia and the WTO

Russia has pursued a policy of creating an alternate universe, politically and economically, in a strangely confrontational manner. The recent withdrawal from WTO talks, coupled with the veto of the OSCE mission in the Caucuses confirms that it has no fundamental intention of cooperating with any organization or country that it considers a threat to its goal of reasserting its hold on what used to be termed its "near abroad".

This may be a mistake of huge proportions in the long term. It faces competition from China in Central Asia and in Europe, Putin's aggressive stance has been only successful in the short-term. The EU is now painfully aware that it's dependence on Russian energy is a serious problem since Russia is very willing to use it as a weapon to achieve its foreign policy goals. But, Nabucco will now go forward, China has just concluded a huge deal for gas with Turkmenistan and although Norway's recent discovery of a potentially huge reserve of natural gas will not come on-line for years, the short-term gains achieved so far by Moscow will be remembered in the long-term.

The recognition by Russia of Abkhazia and South Ossetia as independent states, accompanied by Lavrov's assertion that the world needs to accept "new realities", has focused the attention of the Baltic States and Poland (perhaps even Belarus) that Russian foreign policy as applied to its neighbors is not benign.

Withdrawal from WTO negotiations seems particularly gratuitous since membership has been a goal of Russia since the collapse of the Soviet Union. To tell the world that Moscow is the center of a new, multi-polar world in which the Russian Federation can do anything it wants within its sphere of influence will backfire. It's economy is not strong and would benefit by WTO membership, which might force it to broaden its economy beyond energy. It is surrounded by political and economic competitors who do belong to the WTO and are not inclined to accept Russian leadership.

Russian positioning is not earning it any friends, much less partners. Putin - and he is fooling no one - is in charge. Medvedev is a messenger. The message to Russia's neighbors is to tow the line or suffer the consequences - mostly economic, but with the threat of military intervention. Coupled with the death of anything that could remotely be defined as "democratic" makes the region, ultimately, less stable.

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Shocked, shocked...

Some things just don't need a comment:

From Reuters:

If it were in a position to do so, Al Qaeda would use Pakistan's nuclear weapons in its fight against the United States, a top leader of the group said in remarks aired Sunday.

Otherwise known as a BGO (blinding grasp of the obvious)


Life is a glass of Champagne with Cherries. It...Image by Te55 via Flickr

A couple of friends have emailed me and asked why I have not posted anything recently about Ukraine.

OK. Elections are scheduled for January 18. Nobody cares.

There is nothing else.


Court in Izmir, Turkey - Monty Python Movie Moment

IzmirImage via Wikipedia

Before the story, I want to explain that I took a short break from posting because of my irritation with a major donor. Consultants should unionize so that they are at least compensated for the results stemming from the sometimes incapable and inneffective bureaucracy of donors who keep them hanging around and expect them to jump at a moments notice. If anyone is interested in stopping donors from jerking around consultants, let me know.

OK. That's my gripe. Now, for a Monty Python moment.

A court in Izmir (ancient Smyrna), the second largest port in Turkey, was the victim of the common "drunk judge" syndrom, a world-wide problem during June. OK, maybe not world-wide. And maybe not June. Fine...I made up the whole world-wide June problem. So you don't have to follow this link, the story was reported in Hurriyet Daily News as follows:

İZMİR- Six lawyers in the Aegean town of İzmir have filed a complaint against a judge, arguing that he was drunk at a court session Monday evening and mistakenly ordered the arrest of all six defendants and the victim.

The lawyers filed a complaint, with two other lawyers noted as witnesses, both at the local bar association and the judicial board, accusing the judge of conducting a trial while intoxicated. The Justice Ministry is also investigating the matter, it said. After the complaint was lodged, the said judge went on holiday, reported Doğan news agency. According to reports, several individuals detained Monday were taken to court with their lawyers.

A few too many

One female lawyer, who did not want to be named, said: "On Monday, my client was among the six people detained and sent to court for his arrest. Just before we appeared in court, I heard someone laughing and telling another that the judge had taken a few too many and could not walk straight. I did not want to believe it but once we were in the courtroom, it became apparent that they were right." She said the judge asked questions to the accused totally unrelated to the case and recorded in court minutes statements that the accused had not made. "He then started to ask the female lawyers where he knew them from. He asked questions like, ’Which university did you graduate from?’ Then he would start giggling. Just when we were counting the minutes until the session was over, he ordered the arrest of both the accused and the victim," she said. The lawyer then explained that it had taken them three days to overturn the arrest of the victim.

There are no reports on where the judge took his vacation or what disciplinary proceedings were brought.

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Wednesday, June 24, 2009

Italy's Leader

Am I alone in thinking that PleasureofConquest PM Berlusconi is just plain strange?

Russian Reaction to Manas

Well, that didn't take long.

According to a report in Kommersant today Russia characterized the new lease agreement with the US for use of the Manas airbase a “dirty trick” and the Russians intend to make a “corresponding response”. The new agreement allows the base to be used as a “transit center” for nonmilitary supplies. Moscow, not being entirely stupid, said through their Ministry of Foreign Affairs that calling the base a transit center is just “a cosmetic alteration”, adding that “The real nature of the U.S. military presence in Central Asia has not changed, which goes against the interests of Russia and our agreements with the Kyrgyz government.”

Given the nature of the the Kyrgyz leadership and its parliament, why Moscow would have believed them in the first place is a mystery. I expect the "corresponding response" will be a significant reduction in the funds promised by Russia to the Kyrgyz Republic for throwing out the US.

It should be pointed out, I suppose, that base priviliges had also been cancelled for 10 other NATO countries supporting the Afghan war. Have they been allowed back in?

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Tuesday, June 23, 2009


BishkekImage via Wikipedia

Stays open, according to a report on the BBC.

The government of the Kyrgyz Republic is arguably the most corrupt in Central Asia - although the Tajiks give them a run for the money. The details of the new deal for using Manas airbase have not been released; but, I would bet the ranch that the lease payments will be considerably increased. That would make up for President Bakiyev's losses during the current world-wide recession. His son would, of course, get half the rent with which to play. The government will be happy. Moscow will have a different reaction.

UPDATE: The new rent is $60 million. Three times the original amount. Your welcome, Mr Bakiyev - don't forget your Swiss banker.

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Monday, June 22, 2009

Coming Apart in the North Caucuses?

Leaders of the Mountainous Republic of the Nor...Image by Thomas Roche via Flickr

The BBC reports that human rights activists and opposition politicians are now calling the unrest in Ingushetia as a civil war. The President of the republic has been seriously wounded in a bomb blast that killed his bodyguard.

Medvedev and Putin may have a messy problem on their hands after calling the uprisings in neighboring Chechnya over. Russian security forces have responded in the usual manner - heavy-handed and repressive.

Historically, it took the Russian Empire about 150 years to subdue the northern Caucuses. They never really won...

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Aid to the Roma

MITROVICA, SERBIA - DECEMBER 12:  A Roma refug...Image by Getty Images via Daylife

Al Jazeera published an article by Phoebe Greenwood, working for Save the Children charity, on the plight of the Roma in Montenegro. The article was published as a special report commemorating Refugee Day on June 20. (The photo is of a Roma refugee in Cesmin Lug, Kosovo, December 2007)

The description of the camp is focuses on the plight of Roma refugees from Kosovo, and not about the life of the Roma population within their respective countries in general. For example, in FYR Macedonia, the Roma community within Skopje, the capital, is similarly poor, but not quite to the extent described in Ms Greenwood's report. Many Roma families in Skopje pull their young children out of school, not because they are abused or attacked (although that is certainly the case at times), but because the way of life requires that the children help support the family on the street by peddling goods or begging. There is no desire, at least in Skopje, to join Macedonian society. Indeed, if one tours the Roma compound in Skopje, the poverty is overwhelming - except when one comes upon the local ruler's home which is quite large and expensive.

The result of the resistance to integration leads to frustration among some in the development community. During my time in Skopje, I watched as a UN team enthusiastically began working with the Roma community only to find that their efforts were not similarly enthusiastically embraced unless the local leader approved. Such approval was clearly based on "what do I get out of this?". In private, the team was critical of the Roma community leadership's failure to respond positively and constructively. They wanted to leave.

I am also not surprised at the low attendence and high drop-out rate in school. That was the pattern in Skopje. Unfortunately, I am also skeptical of the sincerity of some of the statements made by some the Roma in Podgorica. I am also curious as to the ownership of the large homes in the background of the photo featured in the article.

The truth of the matter is that the answer to question of "why is no one helping us", is that no one in the Balkans (or in Russia, Ukraine - anywhere) wants to help. Organizatons like Save the Children should be given more resources to assist communities such as this, but no one should expect local governments to help at all. Save the Children and similar charities cannot build infrastructure, houses or change the political climate to the extent required. But they can help to prevent the spread of disease, push for new regulations and enforce existing laws protecting the rights of children.

The Roma have been the target of discrimination in every country in which I have worked. Their way of life does not easily permit absorption into local society. However, the treatment of the Roma - abetted by the policies of local governments as documented in this article - needs to be changed. Telling them to "return where they came from", in this case Kosovo, would solve the problem for officials in Podgorica, but not for the refugees. They cannot stay, but they are probably equally unwelcome in Kosovo. Attitudes will need to change on both sides - and attitudenal changes require generations.

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Saturday, June 20, 2009

It Has Begun...

Cold War ClockImage by ckaiserca via Flickr

BBC reports that the crack-down on demonstrations in Iran has begun. Regimes don't last long, historically, when they rely on a combination of repression, one party rule, experience cratering economies and international opprobrium. Despite the seemingly endless Cold War, keep in mind that the experiment with fake socialism - Leninism and Stalinism - lasted only 70 years. That may seem like a lot, but it is hardly any time at all from a historical perspective. This is something the old, grey religious "leaders" of the Islamic Republic should study. Sooner or later, they will, like other dictators, vanish. They could be replaced by a stronger dictatorship led by a successor to Ahmadinejad. But they will have only a shadow of their former power. He is likely to take them on.

Ahmadinejad types however, as he is very capable of proving, make serious mistakes as well and although Iran is entitled to build nuclear plants for generating electricity (a fact frequently ignored)what will happen if they decide to build nuclear weapons and delivery systems is something else entirely. If they do, then they should bear in mind that ever since 1945, nuclear weapons have never dissuaded an opponent from launching a war. The side with the weapons has never seen fit to use them no matter how dire the situation seemed. Ask Israel. And if Iran was to use one, well...

No more posts on Iran until it's over or a revolution begins.

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Friday, June 19, 2009

The Friday Prayer

Ayatollah Khamenei has proven uncompromising. This is likely because the maneuvering taking place under the radar of attempted media coverage, particularly by Rafsanjani, is a threat to him more than Ahmadinejad.

The speech does not offer any hope to those who are challenging the election. The threat that the demonstrators "face the consequences" should be taken seriously, but Khamenei needs the acquiescence of Mousavi and the other candidates to call off the demonstrators since they are part of the establishment. An attack on the demonstrators without a statement from Mousavi that they should all go home would have consequences for the regime that could open the way for full destabilization. This weekend will be critical.

A couple of things are certain, however. Iran clearly has had the pretense of its brand of democracy stripped away. There is no freedom of speech. Newspapers cannot publish opposition materials, electronic media of all forms is jammed and the leadership is more than a little paranoid. All this must be kept in mind for future negotiations with the government about any issue.

What is strange among all countries of this type (Khazakstan, Azerbaijan, Russia, China and Venezuela) is that open elections would very likely return to power those who are currently in power. Medvedev and Putin are so popular that a real open campaign would be decided in a landslide in their favor. The same is true for Khazakstan, and probably true, though less so, for Azerbaijan. They need the pretence because they want to hold on to power more than anything else.

I remain more or less convinced that nothing will change in Iran, or if it does, outsiders will only see the shadows, like the shadow puppets of Indonesia, and nothing will be clear. Dealing with Iran in the future will be more difficult once the current situation settles down. But that is no reason not to continue with opening the door to negotiations. There is no other choice.

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Thursday, June 18, 2009

BRIC (bat)

So far, the media is treating the recent BRIC meeting in Moscow as a big event of rising powers - Brazil, Russia, India and China - joining together in a powerful new bloc.

It isn't.

The first communiqué consisted of the usual pablum of urging a greater role for developing nations in international institutions. Wow. Just Wow.

BRIC has been characterized as a potential balance against the US. How is that going to work exactly? Russia, I can understand wanting to regain its role vis a vis the US. China? They have no interest in irritating the US and neither does Brazil. India does not exactly trust China and Brazil is on the other side of the planet from everyone else.

On the BBC, an emphasis was placed on Russia's foreign currency reserves as a symbol of the potential of BRIC. Uh...well...with a budget deficit of 11 percent of GDP in April, a decline of 16.2 percent in revenues between April and May and a total deficit of $100 billion, its reserve fund is accounted for. Its Ministry of Finance recently announced that it would jump into the international bond market forexternal funding of its deficit. How's that working out so far?

BRIC will fade into the world of annual economic coordination meetings accomplishing little, if anything.

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Asian Development Bank

I have not read the details in the report, but the ADB is publishing guidelines to describe the ideal employee and state clearly what kind of people it needs.

Is this a good idea? Will it become a "fill in the blank need not apply"? It could be a very useful guideline, but could just as easily backfire by turning away people who might contribute valuable and new ideas to development. I need to see it.

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What Next for Iran?

TEHRAN, IRAN - JUNE 16: People attend a state...Image by Getty Images via Daylife

As the Guardian Council begins its review of 646 electoral complaints, Mousavi supporters are gathering while arrests are accelerating, including former government officials and journalists. The current government is losing its credibility in a hurry. Even Medvedev avoided a scheduled meeting with Ahmadinejad, reducing it to a handshake.

President Ahmadinejad is not short of enemies. Powerful enemies. One of those enemies is also a one of the defeated candidates for president, Mohsen Rezaie, who happens to be a former Islamic Revolutionary Guard Corps commander. With no chance of winning anyway, his opposition strips away an important element of strength of Ahmadinejad.

Rezaie is also secretary of the Expediency Council. The Council handles disputes and liaison between the office of president and parliament (Majlis). It also oversees all three branches of government and directs strategic policy planning for Iran. At the head of the Council sits Ali Akbar Hashemi Rafsanjani, one of the most powerful clerics in the Islamic Republic for over 20 years. He, unlike, Khamenei, has not uttered a single word since the election and is not a big fan of Ahmadinejad. The pressure on Khamenei is huge to take a stand against Ahmadinejad - perhaps even to the extent of his own removal.

The last question is whether the government will roll out the tanks. It is already clear that these demonstrations have shaken the Islamic Republic and if not a game changer, have redrawn its social and political structure. If Ahmadinejad and his supporters decide on a Tiananmin moment, Iran's putative attempt at a leadership role in the region will be flushed, hardliners in Israel will be strengthened and its economy will begin to circle the drain.

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Wednesday, June 17, 2009

Iranian Football and Change

Ali Khamenei, Supreme Leader of IranImage via Wikipedia

As it says in the sidebar, we change our minds if facts change. Although I still think that Ahmadinejad will remain as president of Iran, the demonstrations appear to have taken on a new dimension and have a life of their own.

The fact that the Iranian football team - or at least six of its players - are wearing green armbands (the color of Mousavi's campaign and also the color of Islam) seemingly in support of Mousavi, has raised the stakes for the Iranian clerics supporting Ahmadinejad, particularly Supreme Leader Ayatollah Ali Khamenei. The game was televised and it is assumed widely viewed in Iran. The clerics, and Khamenei certainly, appear to have very badly miscalculated the reaction to the election.

The demonstrations appear also to be gathering in intensity and it may be too late for the government to crack down violently. Although they have the ability to do so, mass violence or turning loose the security apparatus will permanently damage their previous, well guarded reputation for dealing in an evenhanded way with past opposition figures.

Internationally, Iran has had its credibility damaged, likely to the delight of the Saudi government especially. Their house is not in order and that will affect how they can deal with or pressure neighbors.

President Obama's handling has been exactly correct. Senator Lugar (R. Ind) concurs. Supporting the opposition is exactly what the supporters of Ahmadinejad and the clerics would love. They could then portray the opposition as tools of America.

Speaking of "tools", we then are treated a profoundly stupid resolution being introduced by Mike Pence (R. Ind)that plays right into the hands of the conservative clerics, Ahmadinejad and the Republican Guard:

"Today I'm introducing a resolution that ... express its concern regarding the reported irregularities of the presidential election of 12 June, 2009. It will condemn the violence against demonstrators by pro-government militia in Tehran in the wake of the elections. It will affirm our belief in the universality of individual rights and the importance of democratic and fair elections. And lastly, and most importantly, it will express the support of the American people for all Iranian citizens who struggle for freedom, civil liberties and the protection of the rule of law."


So, the situation has changed a little. The expanding demonstrations, calls for a new election and an inability to use force to end the stand-off may not be game changers yet - but the longer the opposition is in the streets, the less maneuvering room is available for Ali Khamenei.

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Victor Chernomyrdin Goes Home

The article in the Jamestown Foundation Blog regarding Victor Chernomyrdin's recall to Moscow from his long-held post of ambassador to Ukraine contains interesting background on his previous career which I never completely knew, particularly about the report to then V.P. Al Gore by the CIA. It is surprising that Gore dismissed the report given what was known about the state of business ethics in Russia at the time (and now, actually). I met Chernomyrdin at a reception at the US ambassador's home together with Al Gore when the Gore-Chernomyrdin Commission was active. At the time I knew little about him and my connection with the Russian Federation was over a short time later as my job changed. What I do remember is that he was really, really short - or maybe that V.P. Gore was so tall. Whatever.

My next involvement with Chernomyrdin came at a small meeting in Kyiv among European ambassadors and Ukrainian officials discussing WTO and other economic issues in 2002.

At that meeting what struck me most was his amazingly dismissive and condescending attitude toward fairly important Ukrainian officials and Ukraine in general. This was pre-Orange Revolution of course, and he pointedly suggested that Ukraine simply allow Russia to lead the way and not try to attempt WTO or EU membership on its own. Of course, in 2008 WTO accession was granted to Ukraine. Russia is still not a member.

Victor Chernomyrdin's replacement will, I assume, be more diplomatic in his remarks and overall attitude.

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Tuesday, June 16, 2009

Iran Recount

The BBC reported ten minutes ago that a recount has been ordered by the Guardian Council in Iran is interesting, but I am not prepared to change my opinion that nothing will change and Ahmadinejad will still be president after the recount.

Demonstrations and similarities to 1979 notwithstanding, there is no credible evidence reported so far that the clerics are going to allow the reversal of the election results.

Of course, Ahmadinejad's victory makes him powerful and if one is a believer in conspiracy theories it could be argued that the Guardian Council, hardly a liberal entity, is more concerned about Ahmadinejad than Mir-Hoseyn Mousavi - himself not a liberal. Ahmadinejad is not enthusiastically supported by the clerics who may now view him as a threat since it is likely that he will engineer a political cleansing under the guise of an anti-corruption program. That cleansing could include lots of clerics. Will the Guardian Council order a new election?

I don't believe in conspiracy theories. But, Western interpretation of Iranian politics have been largely wrong since 1979. The BBC and others may be the victim of smoke and mirrors.

Monday, June 15, 2009

Iran and the Clerics

Again, I am not even close to being an expert on Iranian politics or its socio-political structure. However, what little I do know, I cannot agree with this.

First, I almost always - perhaps more than 99% of the time - agree with Josh Marshall. So when I read his post above, I was really surprised. The clerics in Iran depend absolutely on confrontation with the United States so long as that confrontation does not turn deadly. Since it is very unlikely that the Obama administration would accept any type of military strike against Iran unless Iran attacked US interests or allies first (also very unlikely), then the clerics have an interest in maintaining the current government in power. They cannot afford an opening with the West, much less the US, which would set in motion the gradual erosion of their power. The fact that Obama is not Bush is a great problem for them. They are not used to dealing with rational grown-ups from the US.

Frankly, it costs them nothing and may diffuse a great deal to order an investigation of the election results and process. Time will cool the street and also permit some back room maneuvering to prevent Ahmadinejad from taking his victory too far.

I am inclined to believe that the initial protests against what is now clearly a fixed election worried the clerics enough to accede to the demands for the investigation. Additionally, keep in mind that Mirhossein Mousavi is part of the ruling elite. He is not an outsider by any means, is not the "reformer" the US and EU are looking for - he would just change the tone. Maybe part of the problem is that he is not even Persian - he is an Azeri, although I really have no idea if that figures into the Iranian equation. Nevertheless, it is entirely reasonable that the investigation would be launched based on his request alone - not to mention the other candidates who joined in the request.

So, I can't agree with Josh Marshall. As much as the elimination of clerical rule would be welcome, that is highly unlikely. It would be like asking Israel to cease being a Jewish State or the hope that the ever-shrinking shrill group of right wing Christians in the US would disavow their positions.

The review will, by and large, be the end of it. How the clerics keep a hold on Ahmadinejad is entirely another matter.

The Netanyahu Speech

Given the reaction from the EU and President Obama, Netanyahu squirmed out of a difficult corner in which he had to concede something following the demands put on him recently. The concession was his abandonment - nuance aside - of his and his supporter's opposition to the two-state solution. When President Obama referred to this as a "good first step", I disagree with Josh Marshall where he feels that this is "doubly naive":

Most reactions in the US press are treating this as a major move by Netanyahu, endorsing the idea of a Palestinian state. But that seems doubly naive a) since that's been the premise of US policy for almost 20 years as well as a goal accepted by several Israeli governments and b) because Netanyahu's conditions amounted to deal breakers.

Yes, it has been the premise of US foreign policy for 20 years and yes again - Netanyahu's conditions are deal breakers. However, the position taken by the Netanyahu government is a major change for him. To that extent, the acceptance of a two-state solution is a good first step. I have serious doubts that the two state solution would work, but this is the policy that is being pushed, and pushed hard.

I think it is important to remember that President Obama has changed the game vis a vis Israel with his demand for an end to settlements - something Netanyahu has yet to address adequately. Netanyahu is in a terrible political position at home if he wants to retain power. He cannot ignore the US without blowing apart his coalition. If President Obama keeps the pressure on Netanyahu obtaining a stream of concessions (like dismantling of ad-hoc settlements illegal under Israeli law and by force if necessary)then there is a chance that a Netanyahu government will reach a deal with the Palestinians where a Labor government simply could not. This is a "Nixon goes to China" scenario and probably the only one that has a chance of working.

The Palestinian reaction was predictable and they have many points in their favor. The conditionalities put forward in the speach are clearly unacceptable. They strip away rights that define a "state". The Netanyahu government needs to walk those conditions back. Having said that, the Palestinians need to accept reality: 1) recognize Israel and 2) accept a compromise on repatriation. This is really not too much to ask. Without either, no deal and no peace.

Coming to a War Near You...

Completely - almost - off topic, but has anyone seen this? "Terminator" anyone?

Sunday, June 14, 2009

Iran Election

Although I have a number of Iranian friends from my time in Central Asia and Ukraine, they are mostly "liberal" in the sense that they are opposed to the clerical rule in Iran. Indeed, they call themselves Persian. So, I have no great knowledge of the socio-political structure of the country as a whole. However, reading the reports on the election and the aftermath, particularly the arrest of over 100 opposition leaders yesterday, one can't help but conclude that the margin of victory was fraudulent, if not the election itself.

One point that appears to repeat itself is that the rural vote put Ahmadinejad over the top. The huge margin seems to make this improbable as it would require a major shift in the urban vote as well.

Juan Cole has the best analysis at this time about the election results. As the weeks pass more information will appear. In the meantime, it seems that Israel will likely take this as an opportunity to push its aggressive stance against Iran - although attacking Iran is off the table as it would require US consent. I suspect as well that US policy will remain unchanged since Ahmadinejad has been president for the past four years and will be there for the next four. That's the fact on the ground that is not going to change, so US and EU policy should remain in place.

Whether the damaged credibility of the Iranian government if the belief that the election was stolen weakens its ability to deal with the outside world, including Pakistan and Saudi Arabia, not to mention the EU and the US, will be interesting to watch. President Ahmadinejad may need to dial down his rhetoric - which would be welcome in and of itself.

Saturday, June 13, 2009

Belarus and Russia

I'm not quite sure what to make of this (Russian only version of Belarus Today) but it seems as if President Lukashenko is a little miffed at the Kremlin.

In the article, he rejects an apparent attempt by Moscow to try and intimidate it by withholding about $500 million Belarus had been promised over the fact that his government has not recognized as independent countries the breakaway regions of Georgia (Abkhazia and South Ossetia). He then goes on to imply that an attempt to interfere with the independence of Belarus would result in another Chechnya.

President Lukashenko has always been somewhat strange, but this sudden burst of nationalistic fervor directed at Russia deserves watching.

Russia, Gas and Europe

Germany and Russia have been meeting through their respective FM's supplementing previous meetings between Chancellor Merkel, Prime Minister Putin and President Medvedev, regarding Nord Stream - Russia's well-planned pipeline designed to avoid all transit countries and tie the EU, and particularly Germany, to Russia through energy dependence.

According to Kommersant (Russian only) the military in Germany doesn't like the idea much since the pipeline runs too close to a naval excersize area. This should be interesting as Chancellor Merkel maneuvers for the next election and her FM, a supporter of Nord Stream but not of the same party and a likely opponent to the Chancellor, may not be quite so supportive during his Moscow meetings.

This has provoked Gazprom into threatening to sell gas elsewhere - such as the US. Maybe, just maybe, the Germans will look twice at their eastern policy during the next election. If Gazprom feels strong enough to threaten the largest European economy, perhaps Chancellor Merkel and her supporters should think harder about the cost of closer ties with a resurgent Russia.

Georgia, AES and Energy Development Programs

The BBC has an interesting TV program called Storyville which covers unusual or rare reports on issues that otherwise are not covered in great detail. Today I happened to tune in to the report on electricity supply in Georgia.

In 1999 the American firm AES won the tender to purchase the electrical distribution system in Georgia. This is not the same as buying the generation capacity which is owned separately and AES needs to pay for the power supplied to it. Thus, the payments by users, billed by AES, is critical to a viable and profitable operation. There is the rub. It is demonstrably not profitable and therefore not sustainable.

Development agencies such as USAID and EU programs have always emphasised the privatization of electrical distribution systems despite the fact that there has been no evidence that privatization, even through open bidding by seemingly knowledgeable private sector companies, would result in sustainable commercial companies. Tbilisi residents never had the money to pay the bills - especially the pensioners. With incomes around $30 - $50 per month the objective was to avoid the metering system (provided free, thank you very much) which could take as much as 50% of that income. AES would cut the power for non-payers, leaving many without light or television. AES, of course, needed to pay for the electricity it received, but considering the black hole of corruption in Georgia, the money it paid to those in charge of supply would disappear into the pockets of the energy ministry or other highly placed officials.

This is only one example. Armenia attempted the same with its distribution system - it did not work. The private sector built generation and distribution system in southern Tajikistan in Khorog fulfills the definition of bankrupt. In Khorog, the director of the facility was physically threatened when power was cut to homes. (Since I dealt with the firm which was owned by my employer at the time, it will go nameless).

There is the persistent idea that privatization of energy production, distribution or both in poverty rich nations like Armenia, Georgia and Tajikistan, is the optimum solution. It has not worked and cutting off power to the poor is not an option. A different way forward for energy reform in poor countries needs to be developed. The backlash by ordinary people in Georgia against the US (AES is based in the US)because they live in darkness and can't afford the cost, does not benefit US foreign policy goals. Conversion of formally state run companies providing "free" public services, such as electricity, into for-profit firms needs a re-assessment.

Denying essential services to those who cannot afford to pay is not an option.

Posting Gap and Israeli Sanctions Against US

I've been tied up with professional stuff and meandering about trying to get to Tanzania. Not there yet. Besides, nothing has happened in the past week...except this.

The most interesting part in this little missive was the proposal to interfere in US Congressional elections by donating to opponents of President Obama, which would likely backfire (aside from being borderline illegal unlike the continuation of settlement construction, which is totally illegal).

Friday, June 5, 2009

Reacting to Cairo in Tulsa

Despite the enormous temptation to do so, I rarely comment on what's reported in the American media - particularly when it include remarks made by the pitiful remains of what was once a national party and is now one of tired, old, racist white men from the South. However...and this will be quick...Senator Inhofe, arguably the dumbest person in the Senate in an unremarkably stupid speech...doesn't know "whose side he's on" when referring to his President. The fact that the speech was well received by everyone except extremists seems to be lost on the good Senator. But then, maybe not...

Anyway, the citizens of Oklahoma have elected this guy more than once, and they are not even embarrassed. Says something about Oklahoma. How many people have passports there, by the way. But then they need not visit a foreign country unless they accidentally wander north.

Thursday, June 4, 2009

China and Tiananmen

On the 20th anniversary of Tiananmen Square, we should remember that despite the glossy glitter, tall buildings and strong economy, China is a dictatorship without a free press, permission to dissent or freedom of movement. Money and prosperity can hide the ugliness, but it does not go away. Just look at Russia.

President Obama in Cairo

Just watched President Obama's address in Cairo. Impressive, particularly in its outreach attempt displaying a deep understanding of Muslim history and its cultural and scientific contributions while during the same period in time Europe was backward, illiterate, intolerant, dirty and fighting baronial wars over scraps of land and peasants. The distinction, of course, between the grand age of Islam, with it broad tolerance, promotion of education and philosophy, massive strides in science, and its current status was obvious.

This may be a game changing speech. It was direct and tough to all - including the Israeli's. He put both the Arabs and Israeli's at the same level. Comparing the status of Palestinians to American slavery was brilliant.

The warning to Iran was also clear.

Great speech. Nice for the US to finally have a literate, intelligent leader - better than anyone in Europe.

Third Time a Charm in Moldova?

Yesterday, the Moldovan parliament failed to appoint a president for the second time. By one vote. The immediate result of these failures to approve acting Prime Minister Zinaida Greceanii of the Communist Party as president will be a new election 45 days after the compulsory dissolution of parliament.

The last election was immediately followed by opposition protests that quickly turned violent despite OSCE monitors' reports that the election was free and fair. Although the outgoing president Voronin has accused Romania of supporting and funding the opposition and the protests, no proof has been profered.

Russia is keenly interested in the outcome of the power struggle in Moldova as it has a firm hold on what is essentially a criminal regime in the breakaway region of Transdniestria. Transdniester is on the left bank of the Dniester. It proclaimed its status as a republic in September 1990 and declared its independence in August 1991, at the same time as Moldova. It is supported by the present Russian government much as Russia supports South Ossetia and Abkhazia - although unlike the latter two regions, Russia has never recognized the independence of Transdniestria. That may be next.

Russian foreign policy in Europe is to prevent any further rollback of its influence and to extend that influence where possible. If Romania succeeds in pulling Moldova out of Russia's sphere of influence, then Transdniestria becomes untenable; but it is unlikely that it will ever rejoin Moldova and will continue as transit center for illegal arms, human trafficking and drugs.

Despite vast sums of money spent by the EU, World Bank, the Swiss and USAID, Moldova remains outside Europe. As the Czech Ambassador Pyotr Kupr said recently, he is doing his best to bring Moldova closer to Europe. He has been only modestly successful. "People are interested in foreigners when it comes to making a profit. They do not think like Europeans. There is no civil society, no independent mass media... There is only so much one can do on the micro level."

The fact that there is has been little to no success in developing civil society or an independent media in Moldova after so many years and so much money expended by international organizations is evidence that the development community is either doing something terribly wrong or the Moldovan people don't care. Or both. So why are the aid agencies continuing with the very same programs they have funded over the past 15 years?

A new election may end the control of the only democratically elected Communist government in Europe and begin to turn wheels of change. How much capital will Romania and Russia be willing to expend to either fulfill this result or oppose it?

Cuba in OAS?

Steve Clemons reports that Cuba is about to rejoin the OAS with US backing. About time.

Ukraine Politics

OK. Ukrainian politics should be the new gordian knot of political analysis. President Yushchenko is now down to 1.9% popularity. Party of the Regions is in the lead and Yulia's gang is in its usual position of #2. The Rada will actually consider Yushchenko's proposals for amending the Constitution, after initially delaying any thought on the subject - except no one is quite sure what those amendments really mean. Yulia is in Poland celebrating the collapse of communism and Putin has turned the screws a little more by saying gas transit to Europe could end in July.

It's more entertaining watching Gordon Brown's struggles in Parliament and the disintegration of the government. So, until someone figures out what is going on here in Ukraine, that's what I intend to do.

Tuesday, June 2, 2009

Ukraine Politics - What Next?

The unfolding story of the potential alliance between Yulia Timoshenko’s party BYuT and Victor Yanukovych’s Party of the Regions may be ending this week as Victor Medvedchuk brokers the deal. If anyone recalls, Medvedchuk was the head of the Presidential Administration under former President Kuchma (who is appearing in the news as well). He is also Chairman of the Social Democratic Party – which supported Yanukovych in 2004 and is ideologically opposed to the West and personally hates Yuschenko. His involvement is barely reported, but in talking to local business executives, they are worried about his role. Whether the two parties will actually form a coalition or simply come to some sort of voting arrangement in the Rada (Parliament), is an open question. For continuous reports go here.

The primary purpose of joining together is to change the Constitution and preventing the direct popular election of the president. Rather, the president would be chosen by the Rada. This would be very convenient for both Tymoshenko and Yanukovych because it would eliminate virtually all other political parties and thus prevent any new faces, such as Arseniy Yatseniuk, the leader of the Front of Changes party, from challenging either. This would install an un-challengeable two party system – and might stabilize the political scene while at the same time enormously pleasing Moscow.

Unlike Russia, with a coalition and change in the constitution it is unlikely that, in the beginning at least, debate and a free press would be suppressed completely. However, given the temperament of both Yulia and Victor, and the fact that people like Medvedchuk are supporting them, makes the future of a Western style democracy in Ukraine highly unlikely.

This alliance may yet be derailed because of several factors. The first is that neither Tymoshenko nor Yanukovych like each other very much. BYuT members of the Rada will also likely all not feel particularly comfortable with such an arrangement. According to a source in Party of the Regions anything less than a coalition is unacceptable because they do not trust all the members of the BYuT to keep promises – a coalition is more or less binding while a unified voting block is not. BYuT are are, after all, the ones who tossed out Kuchma, Medvedchuk and Yanukovych. Working with them in a coalition would strain their patience.

Additionally, there is a rumor that Yuschenko is thinking of resigning. This would force an election in 90 days – precisely what both Tymoshenko and Yanukovych do not want. Finally, the leader of BYuT in the Rada, Ivan Kyrylenko, said that he knew nothing at all about a coalition since he would be the one who would need to sign the agreement – and he has not even seen the draft.

What will happen next is anyone’s guess.

Somalia Pirates

Somalia – or the Puntland part at least – seems to be tiring of pirate glamour, according to the BBC. Two things struck me about the article. The first is that UNICEF actually appears to make a difference by building schools and providing alternative lifestyles to the fading romanticism of piracy. But they are leaving.

The second is the statement by the President of Puntland. He named a price for which his government, and not the one that controls a few square blocks of Mogadishu, could eliminate piracy. It’s a lot less than what the military deployments cost or the ransom payments. So now we know what it will cost to control the pirates – even if paying him is sort of a ransom payment of its own.