by Richard Gowan | Dec 9, 2008 | Africa, Conflict and security
From the BBC:
Somali pirates say they have thwarted an apparent revolt by the crew of a hijacked Ukrainian cargo ship, according to reports. An unnamed pirate told the AFP news agency that sailors of the MV Faina tried to “harm” two of their captors.
The ship is carrying 33 tanks and other weaponry and was seized by pirates two and half months ago.
“Some crew members on the Ukrainian ship are misbehaving,” the pirate said. “They tried to harm two of our gunmen late Monday. This is unacceptable, they risk serious punitive measures.”
“Somalis know how to live and how to die at the same time, but the Ukrainians’ attempt to take violent action is misguided.”
He claimed that two of the pirates were taken by surprise when a group of crew members attacked them. “Maybe some of the crew are frustrated and we are feeling the same but our boys never opted for violence, this was a provocation,” he told AFP by telephone.
Another report of the incident, by Russian Ren TV, quoted one of the pirates as saying that the crew responsible would be “seriously punished”.
by Daniel Korski | Dec 9, 2008 | Conflict and security, Cooperation and coherence, Europe and Central Asia, Global Dashboard, Influence and networks, North America
Following Barack Obama’s election, the intellectual market has filled up with policy papers about how the U.S and Europe can cooperate on substantive issues like China, Russia, CT, climate change etc. But little time has been devoted to the way in which the EU and the U.S cooperate, that is, the institutions of the trans-Atlantic relationship.
NATO will continue to have an important role in the Euro-Atlantic community, but the North Atlantic Alliance is no longer the place where Americans or Europeans go to talk about big strategic questions. This is true not only for non-military topics such as the global financial crisis or climate change, but also for classic foreign policy problems.
In this paper I — and two other colleagues — have tried to lay out what kind of new institutions could boost U.S-EU cooperation. Recommendations include:
- That the President of the United States be invited once a year to the European Council
- Back-to-back EU and NATO summits
- That the US Secretary of State join the GAERC twice a year
- That American Cabinet officials be invited to European Commission meetings from time to time
- That US/PSC discussions be held alternately in Brussels and Washington.
- “Double-hatting” the EU Head of Delegation in Washington as an EU Special Representative
- Establishing a small European Legislatures Liaison Office in Congress, comprising representatives from the EP and national legislatures, as well as setting up Congress/EP task forces on key issues like Afghanistan/Pakistan and climate change.
- Setting-up a US-EU Conflict Prevention Task Force, with a permanent secretariat housed in Brussels.
- Establishing a NATO/EU School for Conflict, Post-Conflict and Stabilisation to provide training for deploying personnel
New transatlantic institutions cannot in themselves help the EU develop policies or come up with a better way of thinking strategically about foreign policy issues; but at a time of considerable transatlantic policy convergence, the absence of a solid framework for US-EU discussion will see both sides miss out on a valuable opportunity for cooperation on shared challenges.
by Daniel Korski | Dec 8, 2008 | Conflict and security, Cooperation and coherence, South Asia
I recently came across the late Russian journalist Artyom Borovik, who saw and wrote about the Soviet War in Afghanistan. His book Hidden War, has this eerie paragraph:
Anyone who stayed in Afghanistan for a long period of time, or who was sent there on a regular basis, typically went through four phases.
The first stage (which would usually last up to three months) went something like this: “The war is proceeding on a normal course. If only we can add another twenty or thirty thousand men, everything will be fine.”
Several months later the second stage : “Since we’ve already gotten ourselves into this jam, we should get the fighting over with as quickly as possible. Adding another thirty thousand men isn’t going to do it. We need at least another army to shut off all the borders.”
Five or six months later, the third stage: “There is something desperately wrong here. What a mess!”
Then, half a year or so later, the fourth and final stage: “We’d be wise to get the hell out of here – and the sooner the better.
I don’t think this needs much comment, really….
by Jules Evans | Dec 6, 2008 | Conflict and security, Europe and Central Asia
This may have escaped people’s attention (it did mine), but Ukraine and Georgia were told they couldn’t join the NATO club this week, and Georgia was given a bit of a ticking off for its abrupt and dumb escalation of the North Ossetia conflict in August.
The NATO communique said: “we remind all parties that peaceful conflict resolution is a key principle of the Partnership for Peace Framework Document.”
As Liz Fuller writes for Radio Free Europe:
“Translated from diplomat-speak into plain English, that reads “The use of heavy artillery against civilians asleep in their homes in Tskhinvali just hours after Georgian President Mikheil Saakashvili announced a unilateral cease-fire was a crude violation of our basic ground rules, and one we cannot overlook.”
Fuller adds:
“Equally, if not more damaging to Georgia’s NATO aspirations was the spectacular ineptitude of its armed forces, which proved anything but battle-ready. The country’s two crack U.S.-trained brigades were serving as part of the international peacekeeping force in Iraq during the August war. According to a new International Crisis Group report, “the [Georgian] armed forces and military infrastructure sustained heavy damage during the Russian invasion, revealing flaws in planning, supply, coordination, air defense, and combat communications systems which contributed to quick demoralization of the troops,” who abandoned the strategic military base in Senaki without firing a single shot.
by Jules Evans | Dec 5, 2008 | Global system
I’ve covered eastern European markets for about eight years, and all of those eight years, the region has been on a growth trajectory, either because it is converging with the EU, or, in the case of Russia and Kazakhstan, because it has lots of natural resources. It’s been a boom region, with GDP growth averaging above 6% for the last eight years.
In the last two months, the region has been hit by the global financial crisis, and engulfed by it. Now, many analysts say that of all the emerging markets, the CEE (central and eastern Europe) region is the most vulnerable and exposed.
The main reason is that several CEE countries have very high current account deficits, which mean that they rely on FDI to get foreign currency to pay off their FX liabilities. Countries with current account deficits over 5% include Hungary, Ukraine, all the Baltics, Romania, Bulgaria, and Serbia.
The FDI that used to flow to these countries was mainly foreign currency loans – syndicated loans from western banks, or Eurobond borrowing. But the credit markets have completely closed. Now these countries are facing real difficulties in meeting the FX gap, and their currencies are coming under severe pressure.
All these countries have banking sectors that are dominated by western banks. These banks have high levels of foreign currency loan exposure to CEE countries. They want to stop the CEE countries from devaluing, because then their foreign currency loans would be worthless, and some of the foreign banks might even go bust.
However, the CEE countries I mentioned earlier might be forced to devaluate sharply in 2009, because their economies are now grinding into severe recessions, with economies shrinking by up to 4% next year. In the words of one analyst ‘they will have to devalue, otherwise their economic systems might break’.
Another analyst told me, ‘Next year for the CEE region will be like 1998 for the Asian economies. A number of currency collapses and severe recessions.’
The western banks that are heavily involved in the CEE region are desperately trying to prevent an Asia style crisis happening within the EU. Those banks are mainly Austrian (Raiffeisen, Erste Bank, Bank Austria Creditanstalt), but also Italian (Unicredit, which owns Bank Austria) and French (Societe Generale, BNP Paribas).
A senior banker at Unicredit, which is the biggest bank in the CEE region, told me: ‘We have about six months to stop the region from imploding. The EU and ECB need to do more. So far they have felt, it is not in the eurozone, it is not our business. But if there is a crisis in eastern Europe, it will affect western banks, and then it will affect western Europe.’
He also told me there was the real threat of nationalism in eastern Europe, with foreign banks being nationalised for not lending more to CEE economies.
The international financial system is straining, because it depends on international banks, on banks acting as bridges between countries. Now, however, both sides of those bridges are crumbling – western governments are demanding that semi-nationalised banks do more at home; while eastern governments are demanding they support their foreign subsidiaries. It is difficult to obey both.
If the CEE region did collapse, it could put great strain on the local political systems in these countries, and could give rise to isolationist, xenophobic governments, as it did in some CEE countries in the early 1990s. We should remember that the last time there was a major Austrian / CEE banking collapse was in 1931, with the fall of Creditanstalt, which helped give rise to the Nazi Party.
The EU should have the firepower to stop such a crisis from happening – the Baltic and Balkan economies are not that big. The EU or ECB may need to provide major bail-outs or guarantees to the local CEE banking system, in order to help local banks raise credit. Otherwise we are faced with an asymmetric bail-out, where western banking is guaranteed and eastern banking is left to rot.
Another pressing question is what happens in Ukraine, which looks set for a serious devaluation in the new year, and which is now struggling to pay its debts for Russian gas. Much of the EU depends on the gas that comes through Ukraine from Russia, so the EU needs to make sure its supply is protected there.
