Massenbach-Letter: NEWS 24/04/15

Massenbach-Letter. News

· Der Bericht zum Bundeswehr Sturmgewehr G36: Nur eingeschränkt einsatztauglich, aber ohne Alternative (mit Ergänzung)—Anybody who worries about a soldier’s life? (uVM)

· Mapping the US oil boom *Analysis: Turkey pivotal to future of European gas supplies

· Archived Video: Big Data for Defense and National Security* Neue DGAP-Studie zu „Außenpolitik mit Autokratien“ * German military no longer standing at ease as security fears grow*

· South Africa, Brazil and Russia Set to Underperform Other Emerging Markets * New Configuration of the Global Landscape

· Why Russia Will Send More Troops to Central Asia *Valdai Discussion Club Analyzed Prospects of the “Silk Road Economic Belt” Project *Coming to Terms With the American Empire

· KRG’s Barzani accuses PKK of meddling in internal affairs

· The British Decorative and Fine Arts Society Berlin e.V.

Massenbach* Mapping the US oil boom*

US oil production has grown sharply over the past decade, thanks to new extraction techniques and a spike in oil prices, which have made shale investments more commercially viable.

The big question: how much longer will the US shale industry’s surge last?


Analysis: Turkey pivotal to future of European gas supplies*

John Roberts


Presidents Recep Tayyip Erdoğan of Turkey, Ilham Aliyev of Azerbaijan (left) and Giorgi Margvelashvili of Georgia during the groundbreaking ceremony of the Trans Anatolian Natural Gas Pipeline Project (Tanap).

On March 16, the presidents of Turkey, Azerbaijan and Georgia travelled to Kars in Turkey’s mountainous northeast, and then to a remote worksite near the border with Georgia, to launch construction of the 1,850km Trans-Anatolian gas pipeline (Tanap).

It was a big occasion for a big undertaking: a $12bn pipeline that constitutes a quarter of the $48bn chain of projects, called the Southern Gas Corridor (SGC), initially designed to carry some 10bn cubic metres a year of gas from Azerbaijan’s giant Shah Deniz field to Europe — and some 6bn cu m/y to Turkey itself. Eventually, the pipelines will carry twice as much.

The opening was a symbolic occasion, one that highlights Turkey’s pivotal role in diversifying European gas supplies at a time when Russia appears an increasingly unreliable supplier, and when Moscow’s plans for a new “Turkish Stream” gas line across the Black Sea poses a challenge to the companies and governments developing the SGC.

It is gas that matters. Turkey consumes more gas and oil than it produces, but it can buy oil from multiple sources in several ways. Its position at the end pipelines from Azerbaijan and Iraq, together with new connections from the Kurdish region of northern Iraq, have turned its port of Çeyhan into a centre for oil deliveries to European and Mediterranean markets, with some deliveries dispatched as far as the US and south Asia.

Today, both Russia and Azerbaijan want to send their gas to Europe via Turkey, while suppliers as diverse as Turkmenistan, Iran, the Kurdish region of northern Iraq and producers in the eastern Mediterranean have similar ambitions.

Ankara would like as many producers as possible to opt for a Turkish solution to their export problem, to strengthen Turkey’s position as an energy hub. Both Tanap and Turkish Stream are vital for regional energy security.

Turkish Stream, announced by Vladimir Putin, the Russian president, during a visit to Ankara in December is crucial for the delivery of gas in a sustainable manner to Turkey’s biggest city, Istanbul.

The SGC is equally important for Europe, because it will diversify supplies and enable leading producers in both the Caspian and the Middle East to reach EU markets.

In the past 20 years, the companies and governments involved in developing regional oil and gas have been seen as contestants in a “New Great Game”, with the prize being control the hydrocarbon resources of the Caspian Sea.

Şevket Demirbaş, president of Turkey’s Chamber of Geophysical Engineers, disagrees: “In the long term, we will see that they are not rivals to each other. Other pipelines will never be competitors to Tanap. They will be complementary.”

Taner Yıldız, the Turkish energy minister, takes the same line. “If we look at Turkish Stream, it cannot replace Tanap,” he told an energy conference in Ankara the day after the Tanap inauguration.

Both projects can be expected to proceed steadily because their sponsors have already invested.

Russia is in the middle of a $22.5bn programme to develop its own Southern Corridor, which will carry gas to the Russkaya compressor station on the Black Sea. This depends on an onward connection from Russkaya.

Gazprom, the Russian gas company, is committed to some €3.8bn worth of contracts for the delivery and laying of pipe for a Black Sea crossing. Most of the piping has already been delivered for the first two lines of what is intended as a four-line, 63bn cu m/y system from Russkaya to the Turkish coast at Kıyıköy.

One problem is that the pipe is stashed at Varna in Bulgaria, a reflection of Gazprom’s original South Stream plan to deliver gas to the EU via Bulgaria and a 1,400km onshore line to Austria and possibly northern Italy.

Contracts for SGC work already run to more than €10bn, most of it on upstream development on Azerbaijan’s Shah Deniz field — the €22.5bn Shah Deniz Stage Two (SD2 project) — but also on work on expanding the South Caucasus Pipeline from Baku to the Georgian-Turkish border and for the delivery of pipe for Tanap. Moreover, the 16bn cu m/y of gas heading for Turkey and the EU is already fully contracted.

There are, however, problems concerning the impact that Turkish Stream will have on the SGC, not least whether Gazprom might seek to secure space on the Trans-Adriatic Pipeline, the final leg of the SGC from the Turkish-Greek border at Ipsala/Kipoi to Southern Italy, and thus effectively deny its use for prospective additional exports from Azerbaijan or other suppliers coming after the SD2 project.

So, there is still a focus on whether long-term deliveries of gas through Turkey can be used to supply markets in the Balkans as well as in and beyond Italy. Turkey would like to use both Tanap and Turkish Stream, which will also terminate at Ipsala/Kipoi, to become a hub.

But as Volkan Özdemir, the chairman of Turkey’s Institute for Energy Markets and Policies said recently, Turkey will have to negotiate well to create the right conditions to create the kind of hub in which gas producers and consumers wish to trade.

“Opportunity may turn into a great disaster for us,” he says, adding that Turkey might become “an energy corridor instead of an energy hub”.


*Valdai Discussion Club Analyzed Prospects of the “Silk Road Economic Belt” Project*

The Valdai Discussion Club prepared the analytical Report titled “Toward the Great Ocean – 3”. This document evaluates the prospects of Eurasian economic integration in the course of implementation of the “Silk Road Economic Belt” project. A group of experts from the Valdai Club including the representatives of the Higher School of Economics, the Moscow State Institute of International Relations, the Russian Council on Foreign Affairs, as well as the Foundation of the First President of the Republic of Kazakhstan – the Leader of the Nation took part in this work. The Report was presented on April 17 in Astana, at the “Creating Eurasia: “Silk Road Economic Belt” international conference. Over 40 experts from Russia, China, Kazakhstan, Kyrgyzstan, Iran and Turkey took part in the discussion.

Image Gallery: “Creating Eurasia: “Silk Road Economic Belt” international conference.

The Report analyzes the prospects for Russia’s participation in the PRC initiative that aims to establish the “Silk Road Economic Belt” – the network of land and sea routes that will link the western regions of China with the main markets of Central Asia and Europe. China plans to invest 40 billion US dollars in this project. The main cargo flow routes that would be generated in the rapidly developing Western China, are expected to pass through the territories of Kazakhstan and Russia.

The Report dwells on the opportunities for the countries involved in the project, either directly or indirectly. The authors arrived at the conclusion that the “Silk Road Economic Belt” is not only a transit-transport project, but also a comprehensive plan for the economic development of a number of states; it includes the development of infrastructure, industry, trade and services. The project will allow for the establishment of stable environment in the entire center of Eurasia, as well as for bringing out the region’s full potential.

According to the authors, the “Silk Road” project may start the process of generating a Central Eurasian joint development zone – with the level of integration close to that of the European Union.

Andrei Bystritsky, the Chairman of the Board of the Foundation for Development and Support of the Valdai Discussion Club, underlined that the economic integration in Central Eurasia would solve the security problems associated with the possible destabilization of the region under the pressure of internal and external forces. “This is especially relevant for such countries as Uzbekistan and Tajikistan, but, under certain circumstances, Kazakhstan with Kyrgyzstan might also face instability. The interests of Russia and China coincide in this respect. And, in this case, the economic cooperation between the parties can meet important geostrategic challenges”, – said Andrei Bystritsky.

Sultan Akimbekov, the Director of the Institute of World Economics and Politics at the Foundation of the First President of the Republic of Kazakhstan, noted that the “Silk Road Economic Belt” project is able to give new momentum to the development of integration processes that takes place between Russia and Kazakhstan within the framework of the Eurasian Economic Union. “It is important that today the “Silk Road Economic Belt” project undergoes discussion at such a serious expert level. And we are glad this dialogue was started here, in Kazakhstan, for our border will become the “entry point” for the new cargo from the PRC on the way to the Eurasian Economic Union.”

Ziyavudin Magomedov, the Chairman of the Board of Directors of Summa Group, added that the project would open up new opportunities for the implementation of major infrastructure projects along the routes of the “Silk Road Economic Belt”, as well as provide the Trans-Siberian Railway with the additional cargo flow. He believes Russia and Kazakhstan should jointly strive to attract additional cargo flows from Western China, thus competing with the alternative routes that lie more to the south. Mr. Magomedov concluded: “From this point of view, the common customs area within the Eurasian Economic Union framework is our joint and undeniable competitive advantage”.


Policy= res publica

Freudenberg-Pilster* The British Decorative and Fine Arts Society Berlin e.V.

(BRIDFAS Berlin) would gladly welcome you to their April Lecture in the English language

Monday, 27 April 2015

Opera and Design bySimon Rees

Simon Rees, former Dramaturge at Welsh National Opera in Cardiff, talks about the links between opera and design, from the origins of opera in 17th century Italy, through the Baroque and Classical periods and into the Romantic and Modern eras. At every stage during opera’s four centuries of existence, the highest quality of design has been used to bring the stage to life, with artists such as Alfred Roller, David Hockney, Salvador Dali and Sidney Nolan contributing to the art form. Simon Rees will illustrate this lecture with photographs of set and costume designs, the sets and costumes themselves, and some musical examples.

Monday, 27 April 2015, 20:00h, at the Fritz-Haber-Villa in Berlin-Dahlem, Faradayweg 8 – side entrance Hittorfstrasse. (U3 Thielplatz, Bus M11 Hittorfstrasse).

The non-member fee is € 10. The student fee is € 5.

Doors open from 19.30h for sale of wine and soft drinks.

After the lecture we cordially invite you to stay for wine and snacks.


Politics: From Vision to Action

Barandat* German military no longer standing at ease as security fears grow*

A year ago, as chief of staff at the Nato outpost in the Polish port of Szczecin, he was serving in a backwater — the only one of nine command centres in Nato’s rapid deployment network without high-readiness status. “It made us a bit of the poor brother,” he says.

Now, with Europe facing its biggest security challenge since the end of the cold war, the multinational base is on the front line — lying closer to Russia than any other Nato command centre. A high-tech operations room is being built, the base is doubling in size to 400 officers and it is racing to achieve high readiness by mid-2016. “Things have changed dramatically,” says Gen Niemann.

Public opinion in Germany has also changed dramatically. Since the end of the cold war voters have been wary of military engagement, distrusting politicians’ calls for greater German participation in foreign missions such as Afghanistan, often because of ingrained fears over military adventurism born of the country’s Nazi past.

Just before the Ukraine crisis erupted last March, Germans responded sceptically to an appeal from Joachim Gauck, the president, to stop using history as a “shield”.

But the Russian threat to European stability has galvanised backing for a more active military. A recent YouGov poll showed 49 per cent support for increased defence spending, versus 36 per cent against. Christian Mölling of the Berlin-based SWP think-tank says: “We didn’t really understand about sending expeditions to other parts of the world. But this is the old narrative about the defence of our homeland.”

After limiting defence spending for 25 years, Berlin will boost the military budget by 6 per cent over the next five years, starting with a €1.2bn increase next year to €34.2bn.

The money will modernise equipment, boost depleted stores and finance big increases in German contributions to Nato, including the Szczecin base.

However, political will and money alone will not turn Germany’s armed forces into an effective bulwark against possible aggression. Berlin faces organisational, logistical and technical challenges, including a difficult arms procurement programme. “It’s like turning around a battleship,” says Jana Puglierin, of the DGAP think-tank in Berlin.

“The Kremlin’s behaviour has put the importance of the Nato defensive alliance before our eyes. We thought for years we would not need to defend our borders, but now the facts show otherwise,” says Henning Otte, parliamentary defence spokesman for chancellor Angela Merkel’s ruling CDU/CSU bloc.

Ursula von der Leyen, defence minister and seen as a possible successor to Ms Merkel, has put Russia at the centre of her strategy. “The Kremlin’s new policy began long before the crisis in Ukraine and will occupy us for a very, very long time to come,” she said earlier this year, announcing a planned new defence white paper.

She has a difficult starting point. The armed forces have been cut from 500,000 for the then West Germany alone in 1990 to 180,000 now. Conscription has gone. So has a vast battle tank fleet, the mainstay of cold war European defence, with numbers dropping from 2,125 to about 250. With funds tight, the government abandoned trying to keep the military fully equipped and limited levels to 70 per cent.

A parliamentary inquiry last year found much equipment out of action because of spares shortages. Only 24 of 43 Transall planes were operational, 41 of 190 helicopters, 42 of 109 Eurofighter Typhoon aircraft and 280 of 406 Marder armoured cars.

A review by KPMG, the consultancy, identified 140 problems with big weapons orders, including delays, imprecise contracts and confused responsibilities. The consequences in air transport are especially acute: with five years’ delay in delivering the new Airbus A400M, Germany still relies on the 50-year-old Transall transporter.

At 1.3 per cent of its gross domestic product, Germany’s defence budget is modest by Nato standards and falls short of Nato’s 2 per cent target, which is reached only by the US, the UK, Greece and Estonia.

But even with much bigger outlays than planned, preparing the military for its new role would take years. Thomas Wiegold, editor of Augen geradeaus, defence news website, says: “Even raising the budget to €40bn would not change anything overnight. It takes time to restructure and upgrade equipment, not to mention the organisation and co-operation with Nato allies.”

The Nato element is politically vital. Mindful of the Nazi past, Berlin is restrained in projecting its power abroad and does so only with allies. It is also concerned about provoking Russia: at last year’s Nato summit it blocked efforts by eastern European states to have western powers station heavy weapons in former Soviet-bloc countries.

The quid pro quo is a hefty German commitment to a new Nato unit — the Very High Readiness Joint Task Force (VJTF) — for deployment to eastern European crisis spots. Berlin is supplying 1,000 troops to a 5,000-strong brigade (supported by air, sea and special forces), which is later planned to be expanded to 30,000 soldiers.

The Szczecin headquarters would serve as the command centre for VJTF deployments in the Baltic region, including the vulnerable Baltic states.

Gen Niemann, whose service began in the cold war, says Germans are ready for the new challenge. “I have no doubt about it. There is no question of history [stopping us]. This is not Germany post-1945 any more. We have enjoyed the solidarity of our partners during the cold war and now our partners deserve our solidarity.”




März / April


12 to 17 April 2015

Secretary-General Ban Ki-moon, Message for World Water Day 2015

“… To address the many challenges related to water, we must work in a spirit of urgent cooperation, open to new ideas and innovation, and prepared to share the solutions that we all need for a sustainable future. If we do so, we can end poverty, promote global prosperity and well-being, protect the environment and withstand the threat of climate change …”

Papst Franziskus, nach dem Angelus am V. Sonntag der Fastenzeit, 22. März 2015

… Heute wird der von den Vereinten Nationen ausgerufene Weltwassertag begangen. Das Wasser ist das wichtigste Element für das Leben, und von unserer Fähigkeit, es zu bewahren und zu teilen, hängt die Zukunft der Menschheit ab. Daher ermutige ich die internationale Gemeinschaft, darüber zu wachen, dass das Wasser des Planeten angemessen geschützt und niemand vom Gebrauch dieses Gutes ausgeschlossen oder dabei diskriminiert werde, ein Gut, das ein gemeinsames Gut schlechthin ist. Mit dem heiligen Franziskus von Assisi sagen wir: »Gelobt seist du, mein Herr, durch Schwester Wasser, gar nützlich ist es und demütig und kostbar und keusch« (Sonnengesang) …

Info: Die monatlichen Zusammenfassungen der WATERINTAKE-Newsletter sind abgelegt in: >WASSER: Ressource – Risiken – Chancen<:

Der aktuelle >W A T E R I N T A K E< wird jeweils im Massenbach-Letter geposted:

… der letzte > 2/2015 < vom 28.02.2015


Archived Video: Big Data for Defense and National Security*

Below is the archived video link:


Why Russia Will Send More Troops to Central Asia*


Russia is making a concerted effort to increase its military and security presence throughout Central Asia, just not for the reasons it would have you think. Though the Kremlin is concerned with the threat of spillover violence from Islamist militancy in Afghanistan — its purported motive for deploying more troops — it is far more alarmed by what it sees as Chinese and Western encroachment into lands over which it has long held sway. It is this concern that will shape Moscow’s behavior in Central Asia in the years to come.


Central Asia has played an important role in the projection of Russian military power since the Russian Empire’s expansion in the 18th and 19th centuries. During this period, Russia established military outposts as it competed with the British Empire for influence in the region. By the mid-19th century, Russia had brought modern-day Kazakhstan, Uzbekistan, Turkmenistan, Kyrgyzstan and Tajikistan into its empire. In the early 20th century, the countries were incorporated into the Soviet Union.

After the collapse of the Soviet Union, Russia retained a military presence in Central Asia and played a major role in regional conflicts, such as the 1992-1997 Tajik civil war. Today Russia still has military bases in Kyrgyzstan and Tajikistan. Kazakhstan is a member of the Collective Security Treaty Organization, a military bloc dominated by Moscow. And while Uzbekistan and Turkmenistan are not members of the bloc, they do have important security and military ties with Russia through arms purchases.

Concerns of Militancy

Russia’s long-standing influence in Central Asian military affairs frames several of the country’s recent moves. On April 2, the base commander of Russia’s 201st military base in Tajikistan said Russia would increase the number of troops stationed there from 5,900 to 9,000 over the next five years and add more military equipment through 2020. Then on April 3 an unnamed source in the General Staff of the Russian armed forces told Kommersant that Russia was prepared to grant Tajikistan $1.2 billion in military aid over the next few years. Russian military specialists were reportedly dispatched to Turkmenistan’s border with Afghanistan on March 24 as well. Turkmen officials have yet to confirm this, but local media report that Ashgabat requested Russian assistance to protect the Afghan border.

Officially, these developments are tied to growing concern over violence spilling over from Afghanistan into Central Asia. It is a legitimate fear for many Central Asian governments as NATO and the United States draw down their forces in Afghanistan. Regional governments have voiced discomfort with the increased militant presence in northern Afghanistan, including the Taliban and the Islamic State.

Russia has echoed this fear. Russian President Vladimir Putin’s special representative for Afghanistan alleged that Islamic State fighters in the north are training thousands of militants near the Tajikistan and Turkmenistan borders. Collective Security Treaty Organization summits have focused on the issue, and Tajikistan urged the bloc to do more to counter the threat at the April 1-2 Dushanbe summit.

Despite a definite uptick in militant attacks in northern Afghanistan, no concrete evidence has emerged of attacks over the border in Central Asian states. Central Asia’s last major wave of regionwide militancy was 1999-2001, when the Islamic Movement of Uzbekistan conducted attacks in the Fergana Valley in Tajikistan, Kyrgyzstan and Uzbekistan. The U.S. intervention in Afghanistan following 9/11, however, wiped out much of the group. Surviving elements then dispersed throughout the Afghanistan-Pakistan border area.

Since then, Uzbekistan, Tajikistan and Kazakhstan have seen some attacks by Islamist militants. But many were related to political dynamics, not the movement in Afghanistan. A spillover of Afghan militancy is possible, but so far the threat is minimal.

More Pertinent Factors

Because Islamist spillover from northern Afghanistan is still a relatively minor threat, Russia’s push into Central Asia may have other motivations. Moscow is engaged in a tense standoff with the West over Ukraine, just one theater in the competition for influence along the former Soviet periphery. Central Asia is another key region in this contest. The region possesses sizable oil and natural gas resources that are attractive to the European Union as it seeks to diversify energy supplies and end its dependence on Russia. Europe has already pursued Turkmenistan to join the Trans-Caspian pipeline project.

The United States has also been active in Central Asia, particularly from a security standpoint. The United States no longer uses Central Asian military bases that had been logistical centers for operations in Afghanistan, such as the Manas Air Base in Kyrgyzstan or the Karshi-Khanabad Air Base in Uzbekistan. These bases, however, have left a regional legacy. Washington maintains some security operations that include counternarcotics training with Kyrgyzstan and Tajikistan.

The United States has also expressed interest in increasing its commitment. The commander of U.S. Central Command, Gen. Lloyd Austin, said the United States was willing to provide military equipment and technology to support Turkmenistan’s efforts to secure its border with Afghanistan. The United States also announced in January that it would grant over 200 Mine Resistant Ambush Protected vehicles to Uzbekistan previously used in the U.S. Northern Distribution Network in Afghanistan. Such gestures point to a U.S. desire to develop more cooperative security relationships with Central Asian states.

Moscow’s military and security expansion efforts stem partly from its concern about these gestures. But Russia has not limited itself to deploying military personnel. Moscow has expanded the scope and membership of its Eurasian Union to include broader cooperation on issues including border controls. Kazakhstan is already a member, and Kyrgyzstan will soon join. Russia increased the number of exercises held by Collective Security Treaty Organization members. It also called on Uzbekistan and Turkmenistan to cooperate more with the security bloc, though both have been hesitant.

However, Moscow’s ability to solidify its position in Central Asia will be limited. Russia has a weak economy. Already, many Central Asian migrants who once worked in Russia have left, causing a decline in Russian remittances to the region. The West, and particularly the United States, will continue to have influence in the region. China, too, will continue to make economic and energy inroads.

Meanwhile, instability in the region will probably increase. Kazakhstan and Uzbekistan both have potential succession crises in the offing. Moreover, demographic growth and competition over water resources are likely to threaten the region’s security. Russia will see its position in Central Asia tested in the coming years. Islamist militancy is just one concern among many for Moscow and Central Asian governments.


Neue DGAP-Studie zu „Außenpolitik mit Autokratien“

16.04.2015 | 13:00 – 14:30 | DGAP Berlin | Nur für geladene Gäste

Diskussion -Kategorie: Internationale Politik/Beziehungen

Die Russland- und Ukrainekrise führt eindrücklich vor, dass sich Europas demokratische Regierungen schon in ihrer direkten Nachbarschaft mit autokratischen Staaten verständigen müssen. Welche Mittel sind dazu geeignet: Dialog, Wirtschaftsförderung oder Sanktionen? Welchen Umgang pflegen andere Demokratien mit autoritären Staaten? Diese Fragen beantwortet eine neue Studie zu „Außenpolitik mit Autokratien“, herausgegeben von der Deutschen Gesellschaft für Auswärtige Politik (DGAP).

Aus den ländervergleichenden Analysen von 50 renommierten Experten leiten die Herausgeber fünf zentrale Schlussfolgerungen und Empfehlungen ab:

1. Westliche Regierungen sollten sich davor hüten, im Kampf gegen den Terror, etwa gegen Al-Qaida oder den IS, Allianzen mit Autokratien einzugehen. Der Zweck sollte nicht die Mittel heiligen – etwa die Lieferung von Rüstungsgütern an Staaten, die diese Waffen gegen die eigene Bevölkerung einsetzen könnten.

2. Autokratien sind nur vermeintlich stabil. Im Namen von Stabilität und Sicherheit politische und gesellschaftliche Unterdrückung zu tolerieren und dies als „Realpolitik“ zu bezeichnen, ist kurzsichtig: Eine solche Politik provoziert, wie im Nahen und Mittleren Osten immer deutlicher wird, radikale Bewegungen, die Staatszerfall und regionale Instabilität forcieren – und damit unsere Sicherheit bedrohen.

3. Demokratische Staaten sind wandlungsfähiger, globale Herausforderungen wie Terrorismus, Ressourcenknappheit und wirtschaftliche Probleme zu bewältigen. Dieses Selbstbewusstsein sollte der Westen offensiv vertreten – politische Forderungen aber an nationalen Interessen statt an moralischer Kritik festmachen. Auch Machthaber autokratischer Regime verstehen, dass gewinnorientierte Unternehmen nur dann an vertieften Handelsbeziehungen interessiert sind, wenn ihre Investitionen geschützt sind und Rechtssicherheit, also ein gewisses Maß an „Good Governance“, gewährleistet wird.

4. Gleichwohl wäre es ein Denkfehler, demokratische Handlungslogiken grundsätzlich auf Autokratien zu übertragen. Im „System Putin“ etwa tritt wirtschaftliche Vernunft hinter dem Machtanspruch zurück. So können die Sanktionen westlicher Regierungen kontraproduktiv wirken. Dem russischen Machthaber dienen sie als Sündenbock für eigene wirtschaftspolitische Unzulänglichkeiten und helfen, seine Herrschaft durch antiwestlichen Nationalismus neu zu legitimieren.

5. Europäische Politiker sollten darüber nachdenken, die wirtschaftliche Konfrontation zwischen Russland und der EU zu entschärfen, indem sie Moskau die Perspektive eines gemeinsamen Wirtschaftsraums eröffnen. Russland läuft ohnehin Gefahr, die Loyalitäten postsowjetischer Länder nicht mehr lange erkaufen zu können. Mit strategischer Geduld und Vertrauen in ihre Soft Power – die Anziehungskraft ihres gesellschaftlichen und ökonomischen Modells – sollten die EU und USA stärker auf vertrauensbildende Maßnahmen und den Dialog mit Reformkräften in der russischen Gesellschaft setzen.

An der Diskussion nahmen teil Prof. Dr. Eberhard Sandschneider, Prof. Dr. Wolfgang Merkel, Dr. Johannes Gerschewski, Dr. Stefan Meister und Dr. Josef Braml.


Middle East

MENA economic monitor : towards a new social contract (English)


Whereas the global economy is set for a gradual pick up, economic prospects in the Middle East and North Africa (MENA) remain flat. Growth in MENA is expected to slow down in 2015 and range between 3.1 and 3.3 percent according to the World Bank and consensus… See More + Whereas the global economy is set for a gradual pick up, economic prospects in the Middle East and North Africa (MENA) remain flat. Growth in MENA is expected to slow down in 2015 and range between 3.1 and 3.3 percent according to the World Bank and consensus forecasts respectively, and continue on the same path in 2016. The main reasons for the continued, sluggish growth are: prolonged conflict and political instability in Syria, Iraq, Libya and Yemen; low oil prices that are dragging down growth in oil exporters; and the slow pace of reforms that is standing in the way of a resumption of investment. Violent conflicts are devastating people’s lives, infrastructure and national economies, with spillovers to neighboring countries such as Lebanon, Jordan and Tunisia. A longer-term perspective indicates a more homogeneous region and a more hopeful future. Despite their current differences, MENA countries have since independence been following more or less the same development model. From internationally comparable data, all MENA countries were below the regression line connecting "voice and accountability" with per capita income. Some people have described this development model as an "authoritarian bargain" (Yousef, 2004) or a social contract. This common social contract delivered relatively successful results on both economic and social fronts. In the 2000s, economic growth averaged 4-5 percent a year. Poverty rates were low and declining. Almost everyone completed primary school, and enrollment rates in secondary and tertiary education, especially for women, were high and rising. MENA registered the fastest decline in infant mortality rates in the world. Contrary to perceptions, inequality (as measured by conventional indicators such as the Gini coefficient) was lower than comparable countries elsewhere and either constant or declining. The MENA Economic Monitor supplements the World Bank’s bi-annual MENA Quarterly Economic Brief and presents the short term, macroeconomic outlook and economic challenges facing the countries in the Middle East and North Africa region.

complete report:




*I. New Configuration of the Global Landscape* (Valdai)

…. The agenda for building a new multipolar world order is already being developed by BRICS. This year, BRICS is chaired by Russia, and there will be a BRICS summit in Ufa in July. However, the positions are most likely to become crystallized around the SCO, which is likely to expand through inclusion of India and Pakistan, and later Iran. A geopolitical center of economic growth is taking shape in this region, and a new Eurasian group of countries with a growing security component is being actively formed as well….

The unipolar world model is giving way to multipolar one and, accordingly, to a new configuration of the global landscape. By the early 2000s, the United States had achieved the world’s top positions, which seemed unattainable by anyone else. And then it suddenly fizzled out. Dizzy with its earlier successes, the United States launched military operations in Iraq and Afghanistan, but lost both miserably. The weaknesses of the political system became clear. Most importantly, the American economic model lost its appeal during the 2008-2009 crisis.

In an interview with Banks and Business World magazine, Sergei Karaganov, the dean of the HSE Department of Global Economy and International Affairs, said that imperceptibly to many, the third world had suddenly risen in the shadow of ongoing global metamorphosis, offering an alternative model of semi-authoritarian or semi-democratic capitalism that seems very seductive for many countries and peoples. The BRICS countries, particularly China, became a symbol of this new model.

The Western positions in the world collapsed during the period from 2002 to 2012. The West committed a strategic blunder: it missed the rise of other powers and suddenly discovered that these “others,” first, wanted to live independently, and second, wanted to do so their own way. It became clear that the imposed Western democratic model was not something that the majority of countries wanted for themselves.

Karaganov believes that the West is still going strong, but is engaging in rearguard action. One such battle, in Ukraine, is aimed against Russia, and is also used to scare others, such as China, India and Brazil. And everyone realizes this.

Why hasn’t Russia succeeded in building proper relations with the West? First, because of an inability to recognize and acknowledge the fact that Russia and Europe are moving in different socioeconomic, moral and psychological directions, because in many respects, we are living in different eras. Second, because of a reluctance to develop a common long-term development goal. Instead, and this is the third reason, a fight over the Soviet legacy was unleashed, with an attempt to tighten the geopolitical screws on Russia, which led to the events in South Ossetia and now Ukraine. Fourth and final, because of the lack of a serious Russia-West dialogue for nearly a quarter century, which was replaced with lecturing and unsubstantiated assurances regarding the common future.

The agenda for building a new multipolar world order is already being developed by BRICS. This year, BRICS is chaired by Russia, and there will be a BRICS summit in Ufa in July. However, the positions are most likely to become crystallized around the SCO, which is likely to expand through inclusion of India and Pakistan, and later Iran. A geopolitical center of economic growth is taking shape in this region, and a new Eurasian group of countries with a growing security component is being actively formed as well.

According to Karaganov, Russia has been working on its integration with Europe for 25 years now, during which time it never had a strategy of its own. Sanctions are a logical outcome. Now that we got them, let’s at least learn some lessons. The need to fight back is forcing Russia to work, meaning that we need to change our priorities and economic policy. This is a very good opportunity to change the vector and finally start investing in people. We have excellent starting positions and an educated population. What we need to do now is raise the quality of education. If we make targeted investments in promising areas of the manufacturing industry, then, in alliance with China and with general access to the markets of Asia, we are guaranteed to enjoy long-term sustainable economic acceleration.

An economic and transport configuration based on integration of the Chinese Silk Road with the Russian Trans-Siberian and Baikal-Amur railways and the Northern Sea Route is currently being formed. A new economic growth center is emerging in central Eurasia, spurred on by the accelerated growth of western China, Kazakhstan and Iran, and the use of Central Asian labor and natural resources. It is essential for Russian Siberia, with its powerful production, resources and human potential, to play a key, rather than peripheral, role in this global project from the very start. To do so, it is already necessary to think about creating not only latitudinal, but also longitudinal transport arteries, which will ensure Russia’s active and lucrative participation in the new center of economic growth.

Over the past quarter century, Russia has accumulated invaluable experience of surviving in difficult circumstances. Indeed, we have lost some of our territory and assets, but we no longer have to subsidize the socialist camp and the vast majority of former Soviet republics, or maintain a gigantic war machine. We managed to keep our country in one piece, retain control over our natural resources and maintain high defense capabilities. We got rid of ideological blinders and illusions regarding both our opponents and our partners. This new awareness of ourselves and the world around us is the most important result of 2014. The latest opinion polls, conducted at a time when Russia is living under sanctions, high consumer prices and rising levels of uncertainty, only confirmed the willingness of most of the elite and society to fight for our national interests, even if we have to sacrifice some of our well-being.

That’s worth a lot. Never before has Russia been so collected and enjoyed such a strong position in the face of global challenges.

This is an abridged version of the interview, published in Russian on


*II. South Africa, Brazil and Russia Set to Underperform Other Emerging Markets*

Global | Strategy | Country Risk | Thu Apr 09, 2015

BMI View: The growth outlook for the ‚SoBeR‘ economies (South Africa, Brazil and Russia) has darkened due to cyclical, structural and idiosyncratic factors. All three economies are poised for long-term underperformance of emerging market peers.

In November 2014, we outlined our bearish macro views on South Africa, Brazil and Russia, which we termed the ‚SoBeR economies‘. Since then, the outlook has become even bleaker. We are now forecasting recessions for Brazil and Russia in 2015, and we have also lowered our growth forecasts for South Africa. All three countries face severe structural and cyclical challenges. Moreover, as outlined below, idiosyncratic risks have come to the fore in recent months. South Africa is suffering from serious power shortages, Brazil is being shaken by the Petrobras scandal, and Russia’s economy is in meltdown due to lower oil prices and sustained sanctions.

Bottom Of The EM Class
Real GDP Growth In 2015, %

A Confluence Of Cyclical Challenges

High-frequency economic indicators suggest that the SoBeR economies are performing poorly; the risks are weighted to the downside for our growth forecasts. All three economies are highly exposed to the global economic environment and commodity prices, and as such, are unfavourably positioned amid the current global economic cycle. Commodity prices are subdued, China’s economy is slowing down and the Eurozone remains fragile. As outlined below, lower oil prices are particularly painful for Russia. Although South Africa’s economy has received a boost from cheaper oil imports, the uplift has been minimal owing to currency depreciation and weak confidence.

Currency And Hot Money Risks
Exchange Rates / USD, Rebased to Jan 2014 = 100 (LHS) and Portfolio Liabilities To Foreigners As % of GDP (RHS)

Additional cyclical factors weighing on the outlook for the SoBeR economies are US dollar strength and forthcoming interest rate hikes in the US. The Russian rouble, South African rand and Brazilian real have all weakened dramatically in recent months, causing inflation to escalate in Brazil and Russia (inflation in South Africa has softened due to cheaper oil), and external debt servicing costs to increase.

When the US Federal Reserve starts to hike rates, all three economies will be vulnerable to portfolio outflows and associated currency depreciation – although the bulk of the FX move has already taken place. Brazil and South Africa are more exposed than Russia given the levels of foreign participation in the equity and debt markets (see accompanying chart). We hold bearish views on the real and the rand for the remainder of 2015 and through 2016, forecasting 14.1% and 7.1% depreciation, respectively, by end-2016. As regards the rouble, it is on course to appreciate to our near-term RUB50/USD target, but we expect it to subsequently depreciate over the remainder of the year owing to the onset of recession and additional monetary easing (300bps).

Sluggish Momentum For Structural Reform

Structural factors are compounding the negative outlook for the SoBeR economies. All three countries are in need of economic reforms to revitalise growth, for example liberalisation of the labour markets and privatisation of key sectors. Yet, there is little momentum for such reform under existing political structures, meaning that the economies are likely to underperform more dynamic peers such as India.

Of the three economies, Brazil has shown the most promise in terms of reform momentum. Over recent months, there has been a shift toward more orthodox macroeconomic policy: fiscal policy has been tightened, fuel prices have been hiked and interest rates have been raised. However, we believe that broader reform will be hindered by deep divisions within the ruling Partido dos Trabalhadores and considerable legislative fragmentation.

Meanwhile, no news is bad news in Russia and South Africa. In Russia’s case, the ongoing economic crisis means that reforms are highly unlikely to take place over the next year or so. President Vladimir Putin is reliant on his patronage network for political support, and any attempt to privatise state energy companies and banks would undermine his support base. Furthermore, state-owned assets would have to be sold at a steep discount following the market crash – a very unpalatable option for Putin and the Russian electorate.

In South Africa, the ongoing power crisis (seebelow) is symptomatic of highly uncompetitive labour and product markets, but reforms still appear to be a long way off. We believe that the necessary changes – the reduction of trade union influence and increased private sector participation in state-owned enterprises – would undermine the ruling African National Congress’s left-wing support base.

Idiosyncratic Impediments To Growth

South Africa: Since the publication of the SoBeR article in November 2014, we have downgraded our growth forecasts for South Africa, and now project real GDP growth of 1.9% in 2015, versus our previous 2.1% forecast.

Anaemic Growth At Best
South Africa – Real GDP Growth, %

One of the key drivers behind this revision is the crisis in the power sector. As detailed in the accompanying table, the problems at state-owned utility Eskom are deep-rooted and manifold – and as mentioned, symptomatic of the lack of structural reforms.

Major Problems Facing Eskom
Source: BMI
Leadership Chairman Zola Tsotsi has resigned following a vote of no confidence and four other board members – including CEO Tshediso Matona – have been suspended while an independent enquiry into the utility is carried out. An inter-ministerial committee known as the ‚War Room‘ has been set up to oversee the country’s energy crisis
Underinvestment Eskom is reported to have a funding gap of ZAR275bn (USD18.4bn) through to 2018. Infrastructure is old and inefficient and maintenance has been delayed
Tariffs Eskom has repeatedly asked regulator NERSA for permission to charge higher retail electricity tariffs, but tariffs are still not cost-reflective
Delays To Key Projects The Medupi and Kusile coal-fired power plants are behind schedule and over budget due to a host of technical and operational problems. Medupi was due online by October 2013 but is not estimated to be fully operational until June 2018.
Liquidity /Financing Problems Cost overruns, outages and a subsequent fall in sales have hit cash flow. Recent credit rating downgrades have raised borrowing costs

Our Power analysts believe that the government’s inability to deal decisively with the financial and operational problems mean that the domestic power sector will remain in crisis mode. Tariff hikes and government cash injections will be the short-term measures employed to stave off collapse of the electricity system. Privatisation could be forced on the government in the long run – although we do not think this will occur in 2015/2016 as it would be too contentious politically. This being the case, the power sector will be characterised by crisis management and electricity shortages. Inadequate electricity supply will weigh on industrial output, erode investor sentiment and ultimately curb economic growth.

Brazil: We have made more substantial downgrades to our forecasts for Brazil. We now forecast a 0.5% recession in 2015 while previously we expected 1.0% growth.

Petrobras Scandal Has Wide Ramifications
Brazil – Real GDP Growth, %

The downgrade is largely predicated on the unfolding corruption scandal at national oil company Petrobras. Investigations into corruption allegations will have significant macroeconomic and political implications, as well as a major negative impact on the energy and construction sectors. Both consumer and business confidence are slumping.

Slumping Confidence
Brazil – ICC Consumer Confidence Index (LHS) & ICEI Business Confidence Index (RHS)

These factors will weigh on gross fixed capital formation, causing real GDP to contract in 2015 and grow only modestly thereafter. From a political perspective, Brazilian President Dilma Rousseff will struggle to maintain control of her legislative coalition in light of widespread public unrest and dwindling political capital.

Russia: In December 2014, we highlighted that we saw only two scenarios for Russia, both of which were bearish: (1) economic collapse, and (2) modest reform with weak but positive growth (see ‚Only Bearish Scenarios Ahead‘, December 4). Since this time, we have leaned more towards the former scenario, and now project a 5.1% recession in 2015 versus a previous projection of 1.2% growth.

Deep Recession
Russia – Real GDP Growth, %

The combination of continued sanctions and sustained low oil prices bodes extremely ill for the Russian economy. Regarding oil, our Oil & Gas analysts have made successive downward revisions to our oil price forecasts in recent months, and now project that Brent crude will average just USD53/bbl in 2015 and USD58/bbl in 2016. Aforementioned rouble weakness and rising inflation will put further pressure on the economy as consumers are suffocated.

Real GDP Growth, %
Country 2011 2012 2013 2014e 2015f 2016f 2017f 2018f 2019f 2020f 2021f 2022f 2023f 2024f
e/f = BMI estimate/forecast. Source: National Sources/BMI
South Africa 3.2 2.2 2.2 1.5 1.9 2.0 2.3 2.4 2.7 2.7 2.7 2.7 2.7 2.7
Brazil 2.7 1.0 2.5 0.2 -0.5 1.0 1.6 2.1 2.2 2.5 2.4 2.2 2.4 2.1
Russia 4.3 3.4 1.3 0.6 -5.2 0.4 2.3 2.4 2.5 2.5 2.3 2.4 2.3 2.2



moderated by Srecko Velimirovic

Kerry sends letter to Nikolic on behalf of Obama

BELGRADE – United States Secretary of State John Kerry sent a letter on behalf of U.S. President Barack Obama to Serbia’s President Tomislav Nikolic, indicating that the U.S.-Serbia relations are growing stronger and following an upward trend, the Serbian president’s media relations office said in a release.

The U.S. agrees with President Nikolic’s assessment that the role of Serbia, both regionally and globally, has changed significantly over the past years.

The letter underlines the role of Serbian OSCE Chairmanship, and welcomes Serbia’s determination to adhere to the Helsinki Principles during the Ukrainian crisis. At a global level, Serbian contribution to peacekeeping missions in Africa and the Middle East show that the country is committed to supporting peacekeeping operations around the world.

Kerry also pointed to Serbia’s support to the global coalition against ISIS, and the government plans to hold a regional ministerial meeting on foreign fighters, stressing that this shows the country’s commitment to countering extremism and terrorism.

The United States also welcomes the latest successful round of talks with Pristina, the letter reads.



*Coming to Terms With the American Empire*

by George Friedman (STRATFOR)

“…. the idea that the Americans are coming will become more and more rare. The United States will not intervene.

It will manage the situation, sometimes to the benefit of one country and sometimes to another…”

"Empire" is a dirty word. Considering the behavior of many empires, that is not unreasonable. But empire is also simply a description of a condition, many times unplanned and rarely intended. It is a condition that arises from a massive imbalance of power. Indeed, the empires created on purpose, such as Napoleonic France and Nazi Germany, have rarely lasted. Most empires do not plan to become one. They become one and then realize what they are. Sometimes they do not realize what they are for a long time, and that failure to see reality can have massive consequences.

World War II and the Birth of an Empire

The United States became an empire in 1945. It is true that in the Spanish-American War, the United States intentionally took control of the Philippines and Cuba. It is also true that it began thinking of itself as an empire, but it really was not. Cuba and the Philippines were the fantasy of empire, and this illusion dissolved during World War I, the subsequent period of isolationism and the Great Depression.

The genuine American empire that emerged thereafter was a byproduct of other events. There was no great conspiracy. In some ways, the circumstances of its creation made it more powerful. The dynamic of World War II led to the collapse of the European Peninsula and its occupation by the Soviets and the Americans. The same dynamic led to the occupation of Japan and its direct governance by the United States as a de facto colony, with Gen. Douglas MacArthur as viceroy.

The United States found itself with an extraordinary empire, which it also intended to abandon. This was a genuine wish and not mere propaganda. First, the United States was the first anti-imperial project in modernity. It opposed empire in principle. More important, this empire was a drain on American resources and not a source of wealth. World War II had shattered both Japan and Western Europe. The United States gained little or no economic advantage in holding on to these countries. Finally, the United States ended World War II largely untouched by war and as perhaps one of the few countries that profited from it. The money was to be made in the United States, not in the empire. The troops and the generals wanted to go home.

But unlike after World War I, the Americans couldn’t let go. That earlier war ruined nearly all of the participants. No one had the energy to attempt hegemony. The United States was content to leave Europe to its own dynamics. World War II ended differently. The Soviet Union had been wrecked but nevertheless it remained powerful. It was a hegemon in the east, and absent the United States, it conceivably could dominate all of Europe. This represented a problem for Washington, since a genuinely united Europe — whether a voluntary and effective federation or dominated by a single country — had sufficient resources to challenge U.S. power.

The United States could not leave. It did not think of itself as overseeing an empire, and it certainly permitted more internal political autonomy than the Soviets did in their region. Yet, in addition to maintaining a military presence, the United States organized the European economy and created and participated in the European defense system. If the essence of sovereignty is the ability to decide whether or not to go to war, that power was not in London, Paris or Warsaw. It was in Moscow and Washington.

The organizing principle of American strategy was the idea of containment. Unable to invade the Soviet Union, Washington’s default strategy was to check it. U.S. influence spread through Europe to Iran. The Soviet strategy was to flank the containment system by supporting insurgencies and allied movements as far to the rear of the U.S. line as possible. The European empires were collapsing and fragmenting. The Soviets sought to create an alliance structure out of the remnants, and the Americans sought to counter them.

The Economics of Empire

One of the advantages of alliance with the Soviets, particularly for insurgent groups, was a generous supply of weapons. The advantage of alignment with the United States was belonging to a dynamic trade zone and having access to investment capital and technology. Some nations, such as South Korea, benefited extraordinarily from this. Others didn’t. Leaders in countries like Nicaragua felt they had more to gain from Soviet political and military support than in trade with the United States.

The United States was by far the largest economic power, with complete control of the sea, bases around the world, and a dynamic trade and investment system that benefitted countries that were strategically critical to the United States or at least able to take advantage of it. It was at this point, early in the Cold War, that the United States began behaving as an empire, even if not consciously.

The geography of the American empire was built partly on military relations but heavily on economic relations. At first these economic relations were fairly trivial to American business. But as the system matured, the value of investments soared along with the importance of imports, exports and labor markets. As in any genuinely successful empire, it did not begin with a grand design or even a dream of one. Strategic necessity created an economic reality in country after country until certain major industries became dependent on at least some countries. The obvious examples were Saudi Arabia or Venezuela, whose oil fueled American oil companies, and which therefore — quite apart from conventional strategic importance — became economically important. This eventually made them strategically important.

As an empire matures, its economic value increases, particularly when it is not coercing others. Coercion is expensive and undermines the worth of an empire. The ideal colony is one that is not at all a colony, but a nation that benefits from economic relations with both the imperial power and the rest of the empire. The primary military relationship ought to be either mutual dependence or, barring that, dependence of the vulnerable client state on the imperial power.

This is how the United States slipped into empire. First, it was overwhelmingly wealthy and powerful. Second, it faced a potential adversary capable of challenging it globally, in a large number of countries. Third, it used its economic advantage to induce at least some of these countries into economic, and therefore political and military, relationships. Fourth, these countries became significantly important to various sectors of the American economy.

Limits of the American Empire

The problem of the American Empire is the overhang of the Cold War. During this time, the United States expected to go to war with a coalition around it, but also to carry the main burden of war. When Operation Desert Storm erupted in 1991, the basic Cold War principle prevailed. There was a coalition with the United States at the center of it. After 9/11, the decision was made to fight in Afghanistan and Iraq with the core model in place. There was a coalition, but the central military force was American, and it was assumed that the economic benefits of relations with the United States would be self-evident. In many ways, the post-9/11 wars took their basic framework from World War II. Iraq War planners explicitly discussed the occupation of Germany and Japan.

No empire can endure by direct rule. The Nazis were perhaps the best example of this. They tried to govern Poland directly, captured Soviet territory, pushed aside Vichy to govern not half but all of France, and so on. The British, on the other hand, ruled India with a thin layer of officials and officers and a larger cadre of businessmen trying to make their fortunes. The British obviously did better. The Germans exhausted themselves not only by overreaching, but also by diverting troops and administrators to directly oversee some countries. The British could turn their empire into something extraordinarily important to the global system. The Germans broke themselves not only on their enemies, but on their conquests as well.

The United States emerged after 1992 as the only global balanced power. That is, it was the only nation that could deploy economic, political and military power on a global basis. The United States was and remains enormously powerful. However, this is very different from omnipotence. In hearing politicians debate Russia, Iran or Yemen, you get the sense that they feel that U.S. power has no limits. There are always limits, and empires survive by knowing and respecting them.

The primary limit of the American empire is the same as that of the British and Roman empires: demographic. In Eurasia — Asia and Europe together — the Americans are outnumbered from the moment they set foot on the ground. The U.S. military is built around force multipliers, weapons that can destroy the enemy before the enemy destroys the relatively small force deployed. Sometimes this strategy works. Over the long run, it cannot. The enemy can absorb attrition much better than the small American force can. This lesson was learned in Vietnam and reinforced in Iraq and Afghanistan. Iraq is a country of 25 million people. The Americans sent about 130,000 troops. Inevitably, the attrition rate overwhelmed the Americans. The myth that Americans have no stomach for war forgets that the United States fought in Vietnam for seven years and in Iraq for about the same length of time. The public can be quite patient. The mathematics of war is the issue. At a certain point, the rate of attrition is simply not worth the political ends.

The deployment of a main force into Eurasia is unsupportable except in specialized cases when overwhelming force can be bought to bear in a place where it is important to win. These occasions are typically few and far between. Otherwise, the only strategy is indirect warfare: shifting the burden of war to those who want to bear it or cannot avoid doing so. For the first years of World War II, indirect warfare was used to support the United Kingdom and the Soviet Union against Germany.

There are two varieties of indirect warfare. The first is supporting native forces whose interests are parallel. This was done in the early stages of Afghanistan. The second is maintaining the balance of power among nations. We are seeing this form in the Middle East as the United States moves between the four major regional powers — Iran, Saudi Arabia, Israel and Turkey — supporting one then another in a perpetual balancing act. In Iraq, U.S. fighters carry out air strikes in parallel with Iranian ground forces. In Yemen, the United States supports Saudi air strikes against the Houthis, who have received Iranian training.

This is the essence of empire. The British saying is that it has no permanent friends or permanent enemies, only permanent interests. That old cliche is, like most cliches, true. The United States is in the process of learning that lesson. In many ways the United States was more charming when it had clearly identified friends and enemies. But that is a luxury that empires cannot afford.

Building a System of Balance

We are now seeing the United States rebalance its strategy by learning to balance. A global power cannot afford to be directly involved in the number of conflicts that it will encounter around the world. It would be exhausted rapidly. Using various tools, it must create regional and global balances without usurping internal sovereignty. The trick is to create situations where other countries want to do what is in the U.S. interest.

This endeavor is difficult. The first step is to use economic incentives to shape other countries‘ behavior. It isn’t the U.S. Department of Commerce but businesses that do this. The second is to provide economic aid to wavering countries. The third is to provide military aid. The fourth is to send advisers. The fifth is to send overwhelming force. The leap from the fourth level to the fifth is the hardest to master. Overwhelming force should almost never be used. But when advisers and aid do not solve a problem that must urgently be solved, then the only type of force that can be used is overwhelming force. Roman legions were used sparingly, but when they were used, they brought overwhelming power to bear.

The Responsibilities of Empire

I have been deliberately speaking of the United States as an empire, knowing that this term is jarring. Those who call the United States an empire usually mean that it is in some sense evil. Others will call it anything else if they can. But it is helpful to face the reality the United States is in. It is always useful to be honest, particularly with yourself. But more important, if the United States thinks of itself as an empire, then it will begin to learn the lessons of imperial power. Nothing is more harmful than an empire using its power carelessly.

It is true that the United States did not genuinely intend to be an empire. It is also true that its intentions do not matter one way or another. Circumstance, history and geopolitics have created an entity that, if it isn’t an empire, certainly looks like one. Empires can be far from oppressive. The Persians were quite liberal in their outlook. The American ideology and the American reality are not inherently incompatible. But two things must be faced: First, the United States cannot give away the power it has. There is no practical way to do that. Second, given the vastness of that power, it will be involved in conflicts whether it wants to or not. Empires are frequently feared, sometimes respected, but never loved by the rest of the world. And pretending that you aren’t an empire does not fool anyone.

The current balancing act in the Middle East represents a fundamental rebalancing of American strategy. It is still clumsy and poorly thought out, but it is happening. And for the rest of the world, the idea that the Americans are coming will become more and more rare. The United States will not intervene. It will manage the situation, sometimes to the benefit of one country and sometimes to another.


April 16, 2015

The ISIS attack on the Bayji oil refinery – where is the airpower?

The so-called Islamic State, or the Islamic State in Iraq and Syria (ISIS), released a video that claims to chronicle its successful attack on the Bayji oil refinery in Iraq’s Salah al-Din Governorate. Bayji is located on the Tigris River about 125 miles north of Baghdad, just north of the city Tikrit – it is the country’s largest refinery.

The attack on the refinery comes immediately after Iraqi forces – with initial assistance from Iranian supported militias and finally from U.S.-led coalition airpower – were able to retake Tikrit from ISIS. The battle, which was touted to last just a few days, took over a month as the Iraqis and the Iranian-backed Shi’a militias found themselves in a stalemate because ISIS had effectively prepared the city for the expected offensive.

It should be noted that ISIS is simultaneously conducting an attack on al-Ramadi, the capital city of al-Anbar Governorate. Al-Ramadi is located about 65 miles west of Baghdad. (See my article from earlier this week, ISIS – making a play for al-Ramadi despite air campaign.) Despite U.S. Department of Defense claims that coalition airpower is stopping and even rolling back ISIS’s advances, the group continues to mount multiple offensive operations.

This video may partially explain how that can be. It is in Arabic, but much is self-explanatory – I will provide translations of key portions. This should be watched in conjunction with a review of my earlier article, Why is American airpower not stopping ISIS? (March 8, 2015).

Click on image to view video

The video is titled "Attack of the Defiant – on the Apostates in the [Bayji] Refinery." Keep in mind that this is a production of the skilled propagandists in the Information Office of the Islamic State’s Salah al-Din Governorate. It is well-produced and graphic. In addition to the message of a successful attack on what is critical infrastructure to Iraq, it also shows a level of brutality that is meant to terrify potential adversaries. It is effective.

NOTE: YouTube has deleted the original video, but I have obtained a copy. It too may be deleted – if that is the case, I will try to post it elsewhere.

Let’s take a look at some of the key points in the video:

Initially, there are preparatory fires from 122mm, 130mm and possibly 152mm artillery, as well as Katyusha rockets. The Katyusha rocket launcher is concealed in a dump truck (time 0:21/0:24/1:50). We have also seen these in the hands of Palestinians, and was probably supplied by the Iranians.

Between 0:30 and 0:50, we see ISIS drone footage of the refinery, followed by scenes from the "Islamic State Army Operations Room" – you can hear fire control orders being given.

At 2:03, there is the initial sighting of a U.S. Air Force Predator drone. At this time, there are numerous ISIS targets, primarily towed artillery pieces in static positions. The drone is seen again at 2:43.

At 4:00, the infantry assault begins. At 5:30, during this phase, a U.S. Air Force A-10 "Warthog" close air support aircraft is seen over the battlefield. By 6:30, the attack is over and numerous dead Iraqi soldiers are seen (WARNING – EXTREMELY GRAPHIC).

At 7:20, there is footage of ISIS fighters in the center of the refinery with destroyed Iraqi army equipment. At 8:05, the A-10 is again seen over the area. Later there is a burning M-1 Abrams tank, followed by Shi’a militia equipment and flag, and boxes of U.S.-manufactured ammunition. At 9:10, there is an abandoned Iraqi army T-72 tank.

At 9:20, an ISIS fighter being interviewed commented that there was no coalition airpower employed against them during the operation.

At 9:40, there is coverage of a suicide attack on retreating Iraqi troops. The suicide bomber recites his last statement, then from 10:15 to 10:35, drives the explosive laden Humvee into his target.

At 10:50, there is an abandoned, intact M-1 Abrams tank being taken over by ISIS fighters.

At 11:50, the celebrations begin – "they fled, we’re here."

Multiple sightings of at least one Predator drone and an A-10 attack aircraft – both of which are ideal platforms for attacking ISIS targets – indicate that the coalition was flying over the oil refinery, yet there are no indications of attacks. The remarks by the ISIS fighter at 9:20 say it all.

What are we doing? Either let the pilots and drone operators do their jobs, or bring them home.


KRG’s Barzani accuses PKK of meddling in internal affairs

Iraqi Kurdish leader Massoud Barzani addresses the media during a news conference in Arbil on April 6. April 17, 2015, Friday/ 18:06:38/ TODAY’S ZAMAN / ISTANBUL

In a blistering statement, Kurdistan Regional Government (KRG) President Massoud Barzani lashed out at the terrorist Kurdistan Workers‘ Party (PKK), which is based in northern Iraq’s Kandil Mountains, for meddling in the internal affairs of the region, accusing the terrorist group of provoking a civil war among Kurds.

In a series of tit-for-tat accusations, Duran Kalkan, the military commander of the armed wing of the PKK, and KRG officials engaged in mutual recriminations, revealing the state of frosty relations between the PKK and the Kurdistan Democratic Party (KDP), the ruling party in the Kurdish region.

Kalkan called Barzani a dictator, stirring a swift rebuke from Barzani, who is also leader of the KDP. Speaking to PKK-affiliated Med Nuçe in a televised interview on Thursday, Kalkan said the PKK won’t allow the establishment of a dictatorship in South Kurdistan [referring to the territories run by KRG]. "A dictatorship based in South Kurdistan can’t survive. It shouldn’t be said that south Kurdistan will be ruled only from Hewler [Arbil]. There must also be self-administrations in Sinjar, Kirkuk, Germiyan, Dohuk and Sulaimaniyah, " he said. Arbil is the capital of the Kurdish administration. "If this happens, Kirkuk also could join South Kurdistan," he added.

The PKK’s open desire to take part in administering the Kurdish region sparked fierce reaction from the KRG, as Barzani slammed the terrorist group as traitors to Kurdistan.

While the PKK enjoys self-rule within areas adjacent to the Kandil Mountains without interruption by the KRG security forces, or peshmerga, the Kurdish administration is strictly against the extension of the PKK’s reach, especially after fighting the Islamic State in Iraq and the Levant (ISIL) in northern Iraq. ISIL’s stunning capture of Mosul, the second largest city in Iraq, led to an uneasy alliance between the KDP and PKK to halt the advance of the radical militants who briefly threatened to take over Arbil.

ISIL’s advance deep into the Kurdish heartland uprooted the indigenous Yazidi population, which fled the city of Sinjar and sought refuge in the Sinjar mountains in 2014. Tens of thousands of Yazidis went through extreme difficulties in the mountainous terrain until Kurdish forces, backed by air strikes carried out by an anti-ISIL international coalition, broke the ISIL lines in Sinjar after months of ferocious battles.

Since then, the city and the surrounding area has become a source of friction between the KRG and the PKK, which are jostling for power there. The PKK aims to establish a canton in Sinjar, similar to city administrations run by the Democratic Union Party (PYD) in northern Syria, while the KRG has appeared an ardent opponent of the idea of self-rule in the city.

The PKK’s demand for a larger role in an area regarded by the KRG as its own territory has sparked uneasiness in Arbil, prompting Barzani to publicly challenge Kalkan. Barzani said the KRG will not allow for a dual structure in ruling the region, denouncing the PKK’s attempts as provocative acts designed to unleash civil war and unrest among Kurds.

Barzani’s KDP and the Turkish government in Ankara enjoy a close relationship expressed by some common policies against the PKK.


Der Bericht zum Bundeswehr Sturmgewehr G36: Nur eingeschränkt einsatztauglich, aber ohne Alternative (mit Ergänzung)*

(Warum nicht die U.S. Streitkräfte fragen? Anybody who worries about a soldier’s life? (UvM)

…. Das Planungsamt der Bundeswehr kommt in der zusammenfassenden Bewertung (Fähigkeitsbezogene taktisch-operative Bewertung des Bedarfsträgers der Untersuchungsergebnisse zum Sturmgewehr G36) zu dem Schluss, dass die technischen Untersuchungen eindeutig und zweifelsfrei bestätigt hätten, dass die Waffe G36 selbst eine wesentliche Ursache der festgestellten Präzisionseinschränkungen ist.

Das Fazit des Referats Wirkung, abgestimmt mit dem Amtschef des Planungsamtes:

In fordernden Gefechtssituationen ist das gezielte, präzise Bekämpfen eines Gegners nicht zuverlässig möglich. Die Waffe ist für den Einsatz nur eingeschränkt tauglich und daher nicht in vollem Umfang einsatzreif.

Aus taktisch-operativer Sicht ist daher eine erhebliche Fähigkeitslücke festzustellen, die im Sinne der Überlebens- und Durchhaltefähigkeit sowie der Wirksamkeit im Einsatz schnellstmöglich geschlossen werden muss.

Eine schnelle Lösung, also die Beschaffung einer neuen Waffe für die Truppe, ist allerdings weder aus Sicht des Planungsamtes noch aus Sicht des Projektleiters G36 beim Bundesamt für Ausrüstung, Informationstechnik und Nutzung der Bundeswehr (BAAINBw) möglich….

Eine kurzfristige materielle Lösung ist aufgrund der Notwendigkeit einer umfangreichen Vergleichserprobung sowie der Regularien des Vergaberechts nicht erreichbar. Insofern ist eine mehrjährige Übergangslösung unter Rückgriff auf die in der Bundeswehr eingeführten Waffen erforderlich. (…)

Sofern das G36 vollständig abgelöst werden muss, wird eine Zeitlinie von maximal 10 Jahren als realistisch angesehen….

Aus den Empfehlungen:

– die Nutzungsdauer des G36 über 2016 hinaus zu verlängern, bis eine materielle Lösung zur Schließung der aufgezeigten Fähigkeitslücke verfügbar ist;



see our letter on:

*Herausgegeben von Udo von Massenbach, Bärbel Freudenberg-Pilster, Joerg Barandat*



04-16-15 Mapping the US oil boom – FT.pdf

04-17-15 Worldbank Middle East – Towards a New Social Contract – MENA Economic Montor.pdf

04-17-15 Valdai- New Configuration of the Global Landscape.pdf

04-18-15 Der Bericht zum G36_ Nur eingeschränkt einsatztauglich, aber ohne Alternativ.pdf

150418 WATERINTAKE 03_2015.pdf