Massenbach-Letter. NEWS 26.5.17

Massenbach-Letter. News

  • The Future of the US Navy
  • Pope and Trump discuss peace, dialogue, support for immigrants
  • Syrien: Für Christen keine Alternative zum Assad-Regime
  • Guarding the Guards at the CIA
  • Dmitri Trenin: Moscow Carnegie Center: What Can Japan Offer Russia?
  • Carnegie Moscow Center:The Silk Road to Nowhere
  • Saudi-U.S. Ties Shift as Kingdom Turns to Trump for Investments
  • France’s Mistral amphibious carrier arrived in Japan

From our Russian News Desk. (The views expressed are the author‘s own.)

  • Russia–Japan Political Dialogue at the Highest Level: Opportunities and Perspectives
  • The Syrian Arab Army
  • Russia and the West: How to Deal with the Threat of Extremism
  • russia and europe in times of uncertainty
  • How Does Social Media Influence Elections?
  • The Demise of the Turkish Democratic Model
  • How Rouhani Won a Second Presidential Term

Massenbach*Pope and Trump discuss peace, dialogue, support for immigrants

(Vatican Radio) Pope Francis and U.S. President Donald Trump met in the Vatican on Wednesday, discussing issues of peace, interfaith dialogue and religious freedom, as well as the role of the American Church in education, healthcare and support for immigrants.

The American leader spent half an hour in conversation with the Pope behind closed doors in the Apostolic Palace, before meeting with Vatican Secretary of State, Cardinal Pietro Parolin, and Archbishop Paul Gallagher, the Holy See’s Secretary for Relations with States or foreign minister.

Press office statement

A statement from the Vatican press office said during the course of the cordial encounter, the two men discussed the good bilateral relations that exist between the U.S. and the Holy See. They also spoke of their “common commitment in favour of life, religious liberty and freedom of conscience”.

The statement expressed the hope for a “serene cooperation between the State and the Catholic Church in the United States, which is committed to serving the population in the fields of health care, education and assistance to immigrants.

Dialogue and negotiations

It said the Pope and the President also exchanged views on international affairs and on the promotion of peace through political negotiations and interfaith dialogue, mentioning especially the situation in the Middle East and the protection of Christian communities.

Following the papal audience, Trump will meet with Vatican Secretary of State, Cardinal Pietro Parolin, together with Archbishop Paul Gallagher, the Holy See’s Secretary for Relations with States or foreign minister.

http://en.radiovaticana.va/news/2017/05/24/pope,_trump_discuss_peace,_dialogue,_support_for_immigrants/1314399

http://en.radiovaticana.va/news/2017/05/23/pope_and_us_president_vital_role_of_soft_power_diplomacy/1314287

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Syrien: Für Christen keine Alternative zum Assad-Regime

Die Christen in Syrien unterstützen das Regime von Präsident Bashar Assad allein aus dem Grund, weil sie keine Alternative haben. Das betont der Salzburger Ostkirchenexperte Dietmar Winkler. „Wenn Assad fällt, was passiert dann? Der Einfluss des fundamentalistischen Islam ist im Land bereits so stark, dass es für die Christen dann ganz düster aussehen würde“, so Winkler wörtlich in einem Interview in der aktuellen Ausgabe der Zeitschrift „Information Christlicher Orient“. Sogenannte „gemäßigte“ Rebellen gibt es laut Winkler in Syrien de facto nicht.

„Im Krieg gibt es keine Waisenknaben“, so Winkler. Kriegsverbrechen würden von allen Seiten begangen. Und wenn von mancher Seite das Assad-Regime als unschuldig dargestellt wird, stimme das natürlich auch nicht. Aber, so Winkler: „Die lokalen Bischöfe sagten und sagen mir immer wieder in Gesprächen: Was ist die Alternative für die Christen? Wer schützt die Christen, wenn nicht das Assad-Regime? Welche Perspektiven gibt es überhaupt?“

Natürlich sei das Assad-Regime eine Diktatur mit einer „gefürchteten und brutalen“ Geheimpolizei. Und trotzdem: „Vor dem Krieg war Syrien ein relativ stabiler Staat unter der Herrschaft des säkularen Baath-Regimes. Wer sich an den vorgegebenen politischen Rahmen hielt, konnte seine Religion frei leben.“ Das Verhältnis zwischen den Religionen – Sunniten, Alawiten, Christen oder Drusen – sei ein relativ gutes Nebeneinander und oft auch ein Miteinander gewesen.

Dazu komme die Beobachtung: „Dort, wo das Assad-Regime nach wie vor oder nun wieder an der Macht ist, so wie beispielsweise in Aleppo, dort ist die Lage wieder stabiler geworden.“ Nachdem die Assad-Truppen ganz Aleppo unter Kontrolle gebracht hatten, konnten die Christen dort wieder relativ sicher Ostern feiern. „Das war vorher so nicht der Fall. Und das ist auch der Blickpunkt der Christen“, so Winkler.

Christen sind nicht Kollaborateure, sondern Spielball

Dabei dürfe man aber auf keinen Fall sagen, dass die Christen mit dem Assad-Regime kollaborieren. Dafür seien sie auch eine viel zu kleine Minderheit. „Eigentlich sind sie seit vielen Jahrhunderten ein Spielball in Händen der jeweiligen Herrscher vor Ort. Und irgendwie mussten sie immer das Auskommen mit den Herrschenden suchen.“ Deshalb sei es auch nur allzu verständlich, dass Christen an der Gründung der säkularen Baath-Bewegung in Syrien in den 1940er und 1950er-Jahren beteiligt waren. Eine säkulare Politik, die weitgehend Religionsfreiheit einräumt, sei schließlich in einem muslimischen Umfeld die beste Variante für die Christen, zeigte sich Winkler überzeugt.

Das sei natürlich keine Freiheit bzw. Demokratie nach westlichem Muster, räumte der Ostkirchenexperte ein, Man müsse aber vorsichtig sein, westliche demokratische Vorstellungen auf Länder im Nahen Osten zu projizieren. Winkler: „Europa hat 500 Jahre Aufklärung und Reformation inklusive der damit verbundenen Religionskriege durchgemacht. Das Ergebnis dieser europäischen Entwicklung kann man nicht einem anderen Land und seiner Bevölkerung einfach von heute auf morgen überstülpen. Das funktioniert nicht.“ Die Schaffung eines demokratischen Bewusstseins in der Bevölkerung sei ein langer und schwieriger Prozess.

Kein Bürgerkrieg in Syrien

Die Frage, ob der Syrien-Krieg ein Bürgerkrieg sei, verneinte Winkler. Der Krieg sei von außen in das Land getragen worden. „Und es sind die vielen Mächte von außen, die ihre eigenen Interessen verfolgen: die Amerikaner, denen es um Öl geht, die Russen, die ihre Basis im Mittelmeerraum nicht verlieren wollen, der Iran, der seinen Einfluss zum Mittelmeer ausdehnen will; Saudi Arabien, das seine Art des sunnitischen Islam in Syrien und sich als Regionalmacht etablieren will, oder auch die Türkei, die vor allem auch gegen die Kurden operiert.“

Und von allen Seiten würden Waffen geliefert und werde der Krieg nach wie vor befeuert. Winkler: „Der Unterschied ist, dass wir es bei den Russen genau wissen, dass und wie sie Assad unterstützen. Bei den anderen internationalen Akteuren, militärischen Beratern, Spezialeinheiten und Rebellengruppen ist das nicht so deutlich zu erkennen.“ Deutlich sei aber, „dass der Waffennachschub von außen für alle Seiten nach wie vor funktioniert, sonst wäre der Krieg längst zu Ende.“ Ganz klar sei auch, „dass sich die christlichen Führer wieder und wieder für ein Ende der Gewalt und ein Ende der Interventionen von außen ausgesprochen haben“.

http://de.radiovaticana.va/news/2017/05/22/syrien_für_christen_keine_alternative_zum_assad-regime_/1313856

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From our Russian News Desk. (The views expressed are the author‘s own.)

  • Russia–Japan Political Dialogue at the Highest Level: Opportunities and Perspectives
  • The Syrian Arab Army
  • Russia and the West: How to Deal with the Threat of Extremism
  • russia and europe in times of uncertainty
  • How Does Social Media Influence Elections?
  • The Demise of the Turkish Democratic Model
  • How Rouhani Won a Second Presidential Term

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Moscow Carnegie Center: What Can Japan Offer Russia?

By Dmitri Trenin

The window of opportunity for improving Russo-Japanese relations is still open, at least for now. Russia’s main objectives are to attract Japanese investment into its national economic development programs and to continue to diversify its policies in the Asia-Pacific and on the international stage, where Japan plays an important and increasingly independent role.

Japanese Prime Minister Shinzo Abe has made it clear that he wants to resolve his country’s long-standing territorial dispute with Russia over the Kuril Islands and to prevent an overly close alliance between Moscow and Beijing—and Russo-Japanese relations are heating up as a result.

In December, Putin visited Abe in the prime minister’s home prefecture of Yamaguchi. Three months later, the Russian and Japanese foreign and defense ministers met in Tokyo for the first time in almost four years. Then in April Abe visited Moscow, marking only the second time in almost fifteen years that a Japanese premier has made an official visit to Russia.

The Kremlin is not rebuking Japanese diplomatic advances, but it is being more cautious than its counterpart; Moscow wants to improve bilateral relations with Tokyo in other ways before entering into concrete negotiations on the Kuril Islands.

The problem is that Russo-Japanese relations cannot move far beyond where U.S.-Russian relations have been since the 2014 Ukraine crisis: Japan is a close ally of the United States and has been steadfast in complying with all of the G7’s decisions regarding sanctions on Russia.

More than one hundred days into his presidency, Donald Trump has not backed away from the sanctions regime against Russia that Barack Obama introduced. Meanwhile, the results of the French presidential election and the forecasts for the upcoming German parliamentary elections leave no doubt that the countries of the European Union will also maintain sanctions against Moscow. This significantly limits the potential payoff of Russia’s main objective in improving relations with Japan.

This article originally appeared in Russian in RBC.

Still, there are differences between Russia’s relationship with the United States and its relationship with Japan. If Russia is able to emerge from the current crisis and start down the road of economic development, technological cooperation with and investment from Japan will be invaluable for Russia—particularly for Siberia and the Far East.

The key issue is not Tokyo’s willingness to provide resources but rather Moscow’s willingness to embark on a policy of economic development. Although we should not overestimate Russia’s enthusiasm for change in the run-up to the 2018 presidential election or in the period that follows, sooner or later Russia will have to reform its economy and its system of state administration.

The latest rapprochement between Russia and Japan has lasted for almost a year, though Tokyo has changed its priorities recently. Whereas initially Japan emphasized the importance of economic development, its focus has now shifted to security issues.

Prime Minister Abe’s visit to Moscow took place against a background of heightened concerns about North Korea’s nuclear and missile programs. Accordingly, the possibility of a military conflict in Northeast Asia requires a deep, confidential, and candid dialogue between Moscow and Tokyo.

Russia does not hold much sway in North Korea right now, but it could advise Japan on approaches to stabilizing relations and reducing the risk of confrontation, as well as on sensitive points where applying pressure to North Korea would be counterproductive or dangerous. Such a discussion could be more constructive in establishing a new model of Russo-Japanese relations than usual discussions of the U.S. missile defense system in South Korea or the increased presence of Russian armed forces in the region.

In March, representatives of an association of former residents of the southern Kuril Islands visited Russia. Because the local population was evacuated to Japan in 1947, there are few living former residents left. However, their children still honor their ancestors who lived on the islands. Naturally, any solution to the Kuril Islands dispute will not only need to be ratified by the Russian and Japanese parliaments, but also accepted by those countries’ populations.

Thus, in the interests of intensifying relations with Japan, Russia has expressed a willingness to take steps to accommodate the wishes of the former residents of the islands and their descendants. Visa-free travel to the islands, the right to visit Japanese cemeteries, various opportunities for “nostalgia tourism,” and other interactions between Japanese and Russian citizens could create a new fabric of relations and bring the two nations closer together.

Russia and Japan are still early in their journey toward normalizing bilateral relations, and a broader and deeper relationship will take time to develop. However, delays in the process of normalization benefit neither Moscow nor Tokyo, meaning that both sides are looking for regular, tangible achievements sooner rather than later. With this in mind, concrete measures for expanding and strengthening bilateral contacts (whether between diplomats, generals, or representatives of civic associations) present an opportunity to improve Russo-Japanese relations without waiting for top-level decisions to be made.

The objectives of Japan’s “Russia strategy” are evident. Russia’s main objectives are to attract Japanese investment into its national economic development programs and to continue to diversify its policies in the Asia-Pacific and on the international stage, where Japan plays an important and increasingly independent role. The window of opportunity for improving Russo-Japanese relations is still open, at least for now.

http://carnegie.ru/commentary/?fa=69934&mkt_tok=eyJpIjoiTjJWbFpXWTNPR00zTlRZeCIsInQiOiJnWVdMRlwvYjlrY0JGWWNaVEpmSmVDcUdGTjE3TXBiWkhqdm94bGNsQTB1ZTJmNlZUdDc0eVZJZGtUVXdVZUtoUEhwbkozNmx1d0FcL2E1Sm5WbldCTGZJcEpoRGMrWGRBUkMrNzI5YmdWSVc1ZFdjbU4rdGsxT3VUdnlEYzErQnZXIn0%3D

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Policy= res publica

Freudenberg-Pilster* Guarding the Guards at the CIA

By George Friedman

Trusting an agency to tell the lies it must is a tough enough sell in a democracy.

By George Friedman

Over the weekend, The New York Times published a report detailing the discovery and systematic degradation of the U.S. espionage network in China from 2010 to 2012. The report cites 10 officials, former and current, who describe the penetration of the network and speculate on the reason for its failure. Some claim there was a Chinese mole in the CIA. Others claim that lines of communication between assets and the agency had been breached.

The timing of the report is as interesting as the content itself. CIA officials, after all, have already been accused of leaking information designed to weaken President Donald Trump. And now, not only have a handful of officials revealed a massive intelligence failure, but they have done so, apparently in concert, five years after it happened.

One explanation is that a faction in the CIA means to weaken the agency’s credibility by revealing the failure. (I have no evidence for this, but then again, evidence to substantiate charges is optional in Washington.) This would, in effect, undermine the credibility of those claiming to know about secret Russian plots. “You claim to know about them, but you are actually not very good at intelligence,” or so the argument would go.

A Tough Question

Human intelligence is a game of deception. The acquisition of government sources depends on duplicity, and the intelligence agency must lie to protect the source. It is an industry in which secrecy and dishonesty are moral imperatives. Take World War II, for example. The United States and Britain won World War II in large part because they had broken the German and Japanese codes. They knew what their enemies were planning and could counter it. In order for the breach to work, it had to be kept secret from the public. The secrets of the breach were revealed years after the war, but had the Germans and the Japanese caught wind of it sooner, they would have changed their codes, and the outcome of the war might’ve been different.

In the long run, the CIA can’t deceive the Chinese government without also deceiving, in some way, the American public. This leaves us with an obvious problem: Should we believe anything the CIA says?

It’s a tough question for a democracy to answer. Trust is built on the tacit agreement that the “bad things” an agency does are good for the country. If the public believes that that is no longer the case – if it believes the agency is acting out of self-interest and not national interest – then the agreement is broken. The intelligence agency is seen as an impediment of the right to national self-determination, a means for the ends of the few.

Trust is also built on competence, and so it is always reasonable to question the intelligence of the intelligence agency. When questioned, the CIA, which again traffics in deception, tends to say something along the lines of, “If you only knew what I know, you would respect me completely.” But the public has no way of knowing whether the CIA is keeping secret its successes or its failures.

Trusting an agency to tell the lies it must is a tough enough sell in a democracy – it’s partly the reason the United States didn’t even have an intelligence service before World War II – but it becomes even more difficult the moment the agency enters the political arena, which is where it finds itself now. In addition to determining if the agency is telling the truth, the public must also ascertain whether its involvement in politics is such that it has lost its ability to carry out its mission – namely, gathering foreign intelligence. The question then becomes: Has the CIA been captured by an American political faction, and if so, can it still be an effective intelligence agency?

A High Price

It’s possible that the CIA has information that the president is in some way colluding with a foreign power. That is vital information, if it exists. But it is information that should be passed to Congress, via the intelligence committees, because only Congress is endowed with the constitutional responsibility to act on such a matter. In releasing intelligence to the public, the CIA may be revealing sources and methods, and more important, it is assuming powers of the Constitution — which each member of the CIA is sworn to “preserve, protect and defend” — that the CIA doesn’t have.

Participating in political debates will, in turn, divide the CIA, since CIA employees are no more of one mind on the politics of the day than anyone else. So when 10 officials step forward to reveal the intelligence failures in China, as they did in the New York Times report, we need to consider why they chose to do it now. Was the timing merely coincidental? Was it an attempt to undermine a possible faction in the CIA that is leaking damaging information on the president? This is all speculation, of course, but that’s the point: Once the CIA enters domestic politics, it is subject to the same speculation as others in the arena.

This is why moral rectitude is important for an intelligence organization in a democracy. The secrecy and duplicity needed to be effective are obviously distasteful, and the fear that the intelligence agency is using its trade to interfere in domestic politics is always there. Intelligence must have a moral standing to elicit the trust that its lies and deception are in defense of the Constitution and not an attempt to impose the will of a faction on the country. Once that suspicion becomes widespread, the intelligence organization loses its moral standing, the importance of which is paramount for gathering foreign intelligence. Once an agency loses its moral standing, then things like the New York Times report about China will be seen not as an act of public accountability but as an act of manipulation.

Forgoing foreign intelligence is not an option. A global power must know what is happening around the globe. A democratic global power must tolerate the discontents of deception, the risks it poses for a democracy notwithstanding. It’s an important if imperfect balance, and it’s thrown off when an intelligence organization enters public discourse. The organization betrays its oath by using its foreign intelligence capability selectively in favor of one or another faction. This calls into question its very survival.

The China report is a reminder of the high price we pay for having the CIA, which is no stranger to entering U.S. politics. The officials who will not go on the record because they are not allowed to are simply sowing seeds of distrust that will at some point consume them and weaken the United States. If the people of the CIA are guardians, then who will guard them?

https://geopoliticalfutures.com/guarding-guards-cia-1/

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Barandat* Carnegie Moscow Center:The Silk Road to Nowhere

It will take years for Russia to increase trade with China. To do so, Russia will need to strengthen its institutions, overcome non-tariff barriers to the Chinese market, and enhance its reputation among Chinese investors.

On May 14–15, 28 heads of state, including Vladimir Putin, attended the Belt and Road Forum for International Cooperation in Beijing, an event that was supposed to showcase the success of Chinese leader Xi Jinping’s Silk Road revival.

It didn’t.

The joint declaration issued at the conclusion of the forum is rife with platitudes about supporting the common good and opposing evil that were included to assuage fears that China is using the initiative to drag other countries into its sphere of influence. Instead, Beijing came off as disingenuous.

Perhaps most importantly, the Belt and Road Initiative suffers from a lack of performance criteria. Although Xi Jinping did announce five broadly defined areas of cooperation in 2013, Beijing never set any concrete goals. Chinese planners simply shrug off questions about key performance indicators, saying that the Silk Road incorporates too many countries and involves too many variables over which Beijing has no control.

While China’s partners think this uncertainty is problematic, it’s seen as a good thing inside China, including by Xi Jinping himself. After all, the lack of performance criteria allows the government to declare anything a success.

Beijing isn’t doing anything new with the Belt and Road Initiative. Long before plans to revive the Silk Road were made public, Chinese companies built infrastructure in other countries, ran pipelines and fiber-optic networks across Eurasia, and handed out loans, while Beijing invested billions in enhancing its soft power. It’s not surprising, then, that many of China’s old projects, like the construction of Gwadar Port in Pakistan, which began in 2002, are touted as the Belt and Road’s flagship achievements.

Developing transcontinental routes between Europe and China is in fact the only new and large-scale vector of the Silk Road initiative that Xi Jinping has discussed. Beijing has numerous reasons for devoting resources to this effort, one of which is geopolitical: Chinese military officials want to create land routes for cargo shipments (primarily oil) to bypass the Strait of Malacca in light of the current tensions over the South China Sea.

Other factors are purely economic: EU-China trade volumes are incredibly high, totaling 1.5 billion euros per day. Labor costs are increasing in coastal provinces but still low inland, making it an attractive place for investment. China has been constructing infrastructure in these areas since 2000 as part of the government’s program to develop the country’s western regions.

What’s more, land shipments save time: they take twelve to sixteen days, as opposed to thirty days or more by sea. If China concentrated on working out its land routes to Europe, it would hardly find a faster route than through the Eurasian Customs Union (Russia, Kazakhstan, and Belarus).

Still, actual trade numbers have thus far failed to live up to expectations. For now, overland and maritime transit costs are about equal, but sea transit is expected to again be at least 1.5 times cheaper than land in the future. And at the end of the day, delivery time, which Chinese officials love to talk about when they advertise the Silk Road, is not as important to businesses as the cost of shipping.

In the past three years, projects facilitating transportation links between China and Europe have received much less Chinese investment than many analysts, including this one, expected. This is particularly true in the post-Soviet states. Beijing has thus far failed to act on the list of 40 potential transportation projects prepared by the Russian government and the Eurasian Economic Commission. The Chinese have also slowed down the construction of a high-speed railroad between Moscow and Kazan, insisting that the project be commercially viable, which is rather unlikely.

What changed? Why is China, which once generously invested heavily in dubious construction projects all over the world, calculating its risks more carefully now?

This change has to do with Beijing’s reassessment of bad debt levels in China’s financial system, which began to rise two years ago. The Chinese stock market crashed in the summer of 2015, reducing market capitalization by $4.5 trillion. China managed to avoid a serious financial crisis, but the authorities did launch a comprehensive audit of the country’s entire financial sector, including state banks and leading development institutions like the China Development Bank and the Export-Import Bank, which had been seen as important sources of financing for the Silk Road initiative.

At the same time, Beijing started cleaning up debt pyramids accumulated by local governments, which had reached almost $4 trillion by the end of 2014. Money was borrowed through nontransparent mechanisms used to finance money-losing and superfluous infrastructure projects, which created economic growth, jobs, upward mobility for government officials, and, of course, opportunities for graft. By the end of 2015, it had become clear to Chinese authorities that it would be extremely dangerous to continue down a similar path internationally.

The work of the Silk Road Fund (SRF), with its $40 billion in capital, clearly illustrates this policy change. Created in 2014, the fund was slated to become the main driver of investment in the Silk Road project, but has closed only six deals in the past three years. Instead, Beijing now uses the SRF as a political purse: it is not linked to the global financial system and can therefore finance politically controversial projects. In fact, the Chinese used the SRF to invest in Yamal SPG and Sibur, which are co-owned by the head of the Russia-China Business Council, Gennady Timchenko, a close friend of Putin’s who is on Western sanctions lists. These two politically motivated investments are arguably the only tangible results of Russia’s participation in the Belt and Road Initiative.

This doesn’t mean that Russia should shy away from attracting Chinese investment and increasing trade with China. In 2016, Chinese companies invested over $225 billion overseas, twice as much as in 2014. Just as before, most of this investment went to European, American, and Australian markets, while Russia received only 2 percent of the money. To compete for Chinese money and increase trade with China, Russia will need to improve its investment climate.

It will be particularly difficult to do so now, as Moscow picked all the low-hanging fruit following the annexation of Crimea in 2014. Russia now needs to strengthen its institutions and overcome non-tariff barriers on China’s market (and be ready for stiff competition once it gets there). Russia also needs to enhance its reputation among Chinese investors. It will take years of persistent work to accomplish this—work that is unlikely to bring swift victories or praise for government officials and businessmen. Still, it is the only realistic way forward.

The New Silk Road has led nowhere so far. The idea of a Great Eurasian Partnership (a union of the SCO, EAEU, ASEAN, and even the EU), which Vladimir Putin spoke about in Beijing, is no less futile. It would be a mistake to spend the government’s limited human resources on this pipe dream instead of directing them to specific small-scale projects for Russian and Chinese businesses.

This article originally appeared in Russian in Vedomosti.

http://carnegie.ru/commentary/?fa=70061&mkt_tok=eyJpIjoiTjJWbFpXWTNPR00zTlRZeCIsInQiOiJnWVdMRlwvYjlrY0JGWWNaVEpmSmVDcUdGTjE3TXBiWkhqdm94bGNsQTB1ZTJmNlZUdDc0eVZJZGtUVXdVZUtoUEhwbkozNmx1d0FcL2E1Sm5WbldCTGZJcEpoRGMrWGRBUkMrNzI5YmdWSVc1ZFdjbU4rdGsxT3VUdnlEYzErQnZXIn0%3D

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Middle East

Saudi-U.S. Ties Shift as Kingdom Turns to Trump for Investments

Just a few years back, the business relationship between the U.S. and Saudi Arabia was pretty simple: The Americans bought oil, and the Saudis spent much of what they earned on equipment to keep the crude flowing and on planes, tanks, and missiles to protect their borders.

With crude prices down by half over the past three years, U.S. domestic oil production up dramatically, and the kingdom embarking on unprecedented economic reforms — including the sale of a stake in its state-owned oil company — the leverage is shifting toward the Americans as the U.S. emerges as a rival energy exporter. The changing relationship will come into sharp focus this weekend, as American corporate titans visit Riyadh for an investment summit scheduled to coincide with Donald Trump’s first foreign trip as U.S. president.

“At this point, the Saudis need the U.S. more than the reverse,” said Philippe Dauba-Pantanacce, global geopolitical strategist at Standard Chartered Plc in the U.K. “They need foreign direct investment to transform the economy, and the U.S. doesn’t need oil anymore.”

For Trump, the visit could provide a welcome respite from the turmoil he has unleashed in Washington over his firing of FBI Director James Comey and the investigation into Russian meddling in the presidential campaign. Saudi King Salman bin Abdulaziz wants backing for a plan to reduce the role of the state and wean the economy off of oil — without stoking popular discontent.

The American executives will want deals. Some, like Jamie Dimon, chief executive officer of JPMorgan Chase & Co., and Morgan Stanley boss James Gorman, already have agreements to advise oil giant Saudi Aramco on its initial public offering, which may be the largest ever. JPMorgan and Citigroup Inc. helped arrange a $17.5 billion Saudi bond sale last year and a $9 billion Islamic bond issue in April. This weekend the banks will aim for more contracts as the Saudis prepare to sell other state assets.

Defense Sales

Boeing Co. CEO Dennis Muilenburg and Lockheed Martin Corp. head Marillyn Hewson will be looking to cement defense sales. Aramco could sign at least 10 deals with companies including General Electric Co. and oil field-service businesses Schlumberger Ltd. and Halliburton Co. to open manufacturing plants in the kingdom, people familiar with the plans say.

The U.S. executives are expected to meet the Saudi ministers of finance, energy, and commerce and the head of the kingdom’s sovereign wealth fund, according to a draft agenda for the conference, which was hastily arranged after the Trump visit was announced just two weeks ago. They’ll discuss privatizations, investment opportunities, and the role of the Saudi sovereign fund, then they’ll travel to the Royal Court to sign agreements totaling billions of dollars as Trump and King Salman look on.

“Though ties have historically been strong, nothing of this scale and depth has ever happened before,” said John Sfakianakis, a director at the Gulf Research Center in Riyadh. “The relationship with the U.S. is entering a new phase.”

Asia Tour

In March, King Salman returned from a tour of Asia with agreements potentially worth tens of billions of dollars, including $65 billion from China, $13 billion from Malaysia and Indonesia, and 43 potential projects with Japanese companies. Contracts unveiled this weekend could well eclipse those deals, Sfakianakis said.

The Saudis have been enthusiastic about Trump after a lukewarm relationship with Barack Obama. The kingdom claimed relations had reached a “historic turning point” in March when Trump met Deputy Crown Prince Mohammed bin Salman at the White House. After the meeting, Trump offered his support for a new U.S.-Saudi program in energy, industry, infrastructure and technology that could lead to more than $200 billion in investments over the next four years.

That’s not to say the Saudis, who have cash reserves topping $500 billion, are no longer looking for investment opportunities. The country’s Public Investment Fund is expected to announce plans to plow $40 billion into U.S. infrastructure, and it’s seeking partners in the defense industry to help develop domestic arms production.

The goal is to create jobs. The government’s reform plan has so far focused largely on trimming generous fuel and energy subsidies, and scrapping bloated infrastructure projects — moves that have helped slow economic growth from 10 percent in 2011 to just 0.4 percent this year, the International Monetary Fund predicts.

‘Not All About Austerity’

“A big part of Saudi Arabia’s message is that the reform program is not all about austerity,’’ said Monica Malik, chief economist at Abu Dhabi Commercial Bank PJSC. “They will be keen to show some concrete commitments from U.S. companies and that this is a two-way street.’’

Some analysts caution that while the executives may announce billions of dollars worth of agreements, many of those will have long been in the works. And some newer deals announced with great fanfare will simply be agreements to explore investment opportunities, which can later be quietly dropped with few repercussions, said Peter Salisbury, a fellow at Chatham House, an international affairs research group in London.

“I expect to see a flurry of exciting-sounding deals with some large figures attached,” Salisbury said. “When you dig into them, they will be largely pre-existing agreements or early agreements that may or may not actually translate into action.”

https://www.bloomberg.com/news/articles/2017-05-18/saudi-u-s-business-ties-shift-as-kingdom-seeks-investment

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*Massenbach’s Recommendation*

The Future of the US Navy

How big a naval force does the U.S. need? Increased competition between the U.S., China, and Russia are bringing this eversimmering debate to a boil. Several big think-tank studies have emerged in the past year to argue that today’s 275-warship fleet is insufficient, woefully insufficient, or dangerously insufficient. In May, Chief of Naval Operations, Adm. John Richardson, offered his own thoughts in a nine-page white paper: 355 ships is the right size — but the 2040 target is about two decades too late. America’s competitors are building navies that outstrip our own, he writes, and so it’s time to challenge all assumptions and start turning out better, more flexible ships and aircraft for far less money and time. We’ll lead off this ebook with a look at his vision.

France’s Mistral amphibious carrier arrived in Japan

France’s Mistral amphibious carrier has arrived in Japan to take part in Pacific drills, as tensions in the region relating to North Korea’s nuclear tests, American responses and Chinese maritime aspirations grow.

© AFP 2017/ GERARD JULIEN

Why France is Boosting Its Military Muscle in Pacific

The Mistral arrived at the Japanese naval base of Sasebo on Saturday. The carrier will take part in military drills next month to practice amphibious landings on an island near Guam, about 2,500 km south of the Japanese capital of Tokyo, according to various media reports.

The media first reported the idea to dispatch the Mistral to the Pacific almost s month ago, at the end of March. The French ship also has two British helicopters onboard.

The drill coincides with North Korea’s latest failed missile test, but officials say the drills had been planned for some time.

"We did not expect the start of our visit to coincide with a North Korean missile launch," French Ambassador to Japan Thierry Dana said on the Mistral’s bridge, according to RT.

"Cooperation between our four nations in upholding laws, peace and stability in the region will display our readiness to deal with North Korea," he added.

Both Japan and the United States are concerned about what they call China’s efforts to extend its influence beyond its coastal waters and the South China Sea. France, which also owns several islands in the Pacific, shares these concerns to some degree.

However, Chinese maritime aspirations have been overshadowed by North Korea’s repeated missile tests. US President Donald Trump ordered several US ships, including the USS Carl Vinson supercarrier, to move to demonstrate to North Korea the potential military consequences of its nuclear ambitions.

The Mistral is an amphibious carrier — a ship that carries amphibious armored vehicles for ground attack inside its hull. It can also carry helicopters and VTOL (vertical takeoff and landing) aircraft to support the littoral assault.

https://sputniknews.com/military/201704301053144881-french-mistral-carrier-pacific/

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A Russian comment:

Why France is Boosting Its Military Muscle in Pacific

In an interview with Sputnik, Russian military expert Vasily Kashin gave his thoughts on France’s plans to deploy its Mistral-class helicopter carrier to the area near the Tinian Island in the Pacific Ocean to join the war games which will involve the US, Japan and Britain.S/ Stephane Mahe

Earlier this week, media reports said that France’s Mistral-class assault ship is due to be deployed to the area near Tinian Island in the Pacific Ocean where the vessel is due to join the military exercises which will include Japanese and US personnel as well as two assault helicopters from Britain.

Commenting on the issue in an interview with Sputnik, Russian military expert Vasily Kashin specifically drew attention to the fact that the Mistral ship is expected to pass through the South China Sea while en route to Tinian Island.

He recalled that Paris recently made a number of statements about its plans to increase France’s presence in the region, including a desire to support the freedom of navigation in the South China Sea.

"It seems that we have another example of the EU-style behavior pattern, namely, persistent demonstration of one’s involvement in world problems through lively gesticulation, not backed by any real opportunities," Kashin pointed out.

He described the Mistral as the best vehicle that the European Union can currently send to the Pacific given that Britain, one of the two leading European naval powers apart from France, does not possess aircraft carriers.© REUTERS/ U.S. Navy/Handout

As for France, it has only one aircraft carrier, the Charles de Gaulle, which has been under repair since the end of its Middle East military mission in February 2017. The repair work is expected to last for at least a year and a half, according to Kashin.

He also recalled that the Mistral is designed for low-intensity conflicts and has negligible survivability; theoretically, it could be useful in a possible war in the Pacific only as a carrier of anti-submarine helicopters.

"But compared to the huge and superbly armed Japanese warships, including the Izumo-class helicopter destroyers, the Mistral’s value will be extremely low. It is not quite clear what exactly the Europeans wanted to ‚demonstrate‘ when deploying the Mistral to the drills," Kashin said.

He warned that "in a situation where France can face China as a potential enemy, the use of the Mistral may lead to a catastrophe because the ship is almost defenseless."

Focusing on why the EU is so interested in taking part in disputes and conflicts in the Pacific, Kashin mentioned at least two reasons.

"First and foremost, the EU wants to demonstrate its significance against the backdrop of the European foreign policy flops. Secondly, Brussels hopes that the EU adhering to the American policy of deterring China will have a positive impact overall on EU security cooperation with Washington," Kashin noted.

For these reasons, the EU is ready to spend significant sums related to its participation in military events on the other side of the world, something that comes amid the ongoing degradation of European military capabilities, including those of France and the UK, according to him.© AFP 2017/ PATRICK HERTZOG

He also said that after the end of the Cold War, Europe turned into a kind of dependent for the US in military respect.

While European defense capabilities are unable to ensure the EU’s own security, Europeans spend significant funds to increase their military presence in the Pacific in the hope that it will allow them to demand US services in return.

The US, for its part, demands that Europe should boost investment in the defense sector, hoping that it will help them free up US forces in Europe. The EU’s position draws obvious fatigue and irritation from Washington, according to Kashin.

"At the same time, Europe’s current military impotence means that during any possible aggravation of the situation in Eastern Europe, Americans will be forced to concentrate all forces in this region to the detriment of their commitments in other parts of the world," Kashin concluded.

https://sputniknews.com/world/201703241051931097-france-china-pacific-ocean-drills/

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see our letter on: http://www.massenbach-world.de/41259.html

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

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05-24-17 – Russia_Japan – Syria – Turkey – EU- Elections&Media.docx

05-24-17 Defense One- The Future of the US Navy.pdf

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