Tag: Business and competition

Spy hunt or witch hunt? Ukrainians fear the two are merging

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KYIV — From the glass cage in a Kyiv courtroom, Roman Dudin professed his innocence loudly.
And he fumed at the unusual decision to prevent a handful of journalists from asking him questions during a break in the hearing.
The former Kharkiv security chief is facing charges of treason and deserting his post, allegations he and his supporters deny vehemently.
“Why can’t I talk with the press?” he bellowed. As he shook his close-cropped head in frustration, his lawyers, a handful of local reporters and supporters chorused his question. At a previous hearing Dudin had been allowed during a break to answer questions from journalists, in keeping with general Ukrainian courtroom practice, but according to his lawyers and local reporters, the presence of POLITICO appeared to unnerve authorities.
Suspiciously, too, the judge returned and to the courtroom’s surprise announced an unexpected adjournment, offering no reason. A commotion ensued as she left and further recriminations followed when court guards again blocked journalists from talking with Dudin.
***
Ukraine’s hunt for traitors, double agents and collaborators is quickening.
Nearly every day another case is publicized by authorities of alleged treason by senior members of the security and law-enforcement agencies, prosecutors, state industry employees, mayors and other elected officials.

Few Ukrainians — nor Western intelligence officials, for that matter — doubt that large numbers of top-level double agents and sympathizers eased the way for Russia’s invasion, especially in southern Ukraine, where they were able to seize control of the city of Kherson with hardly any resistance.
And Ukrainian authorities say they’re only getting started in their spy hunt for individuals who betrayed the country and are still undermining Ukraine’s security and defense.
Because of historic ties with Russia, the Security Service of Ukraine and other security agencies, as well as the country’s arms and energy industries, are known to be rife with spies. Since the 2013-14 Maidan uprising, which saw the ouster of Viktor Yanukovych, Moscow’s satrap in Ukraine, episodic sweeps and purges have been mounted.
As conflict rages the purges have become more urgent. And possibly more political as government criticism mounts from opposition politicians and civil society leaders. They are becoming publicly more censorious, accusing Ukrainian President Volodymyr Zelenskyy and his tight-knit team of using the war to consolidate as much power as possible.
Volodymyr Zelenskyy said authorities were investigating more than 650 cases of suspected treason and aiding and abetting Russia by officials | Mandel Ngan/AFP via Getty Images
Last summer, Zelenskyy fired several high-level officials, including his top two law enforcement officials, prosecutor general Iryna Venediktova and security chief Ivan Bakanov, both old friends of his. In a national address, he said authorities were investigating more than 650 cases of suspected treason and aiding and abetting Russia by officials, including 60 who remained in territories seized by Russia and are “working against our state.”
“Such a great number of crimes against the foundations of national security and the connections established between Ukrainian law enforcement officials and Russian special services pose very serious questions,” he said.
***
But while there’s considerable evidence of treason and collaboration, there’s growing unease in Ukraine that not all the cases and accusations are legitimate.
Some suspect the spy hunt is now merging with a political witch hunt. They fear that the search may be increasingly linked to politicking or personal grudges or bids to conceal corruption and wrongdoing. But also to distract from mounting questions about government ineptitude in the run-up to the invasion by a revanchist and resentful Russia.
Among the cases prompting concern when it comes to possible concealment of corruption is the one against 40-year-old Roman Dudin. “There’s something wrong with this case,” Ivanna Klympush-Tsintsadze, a former Ukrainian deputy prime minister and now opposition lawmaker, told POLITICO.
And that’s the view of the handful of supporters who were present for last week’s hearing. “This is a political persecution, and he’s a very good officer, honest and dignified,” said 50-year-old Irina, whose son, now living in Florida, served with Dudin. “He’s a politically independent person and he was investigating corruption involving the Kharkiv mayor and some other powerful politicians, and this is a way of stopping those investigations,” she argued.
Zelenskyy relieved Dudin of his duties last May, saying he “did not work to defend the city from the first days of the full-scale war.” But Dudin curiously wasn’t detained and charged for a further four months and was only arrested in September last year. Dudin’s lead lawyer, Oleksandr Kozhevnikov, says neither Zelenskyy nor his SBU superiors voiced any complaints about his work before he was fired.
“To say the evidence is weak is an understatement — it just does not correspond to reality. He received some awards and recognition for his efforts before and during the war from the defense ministry,” says Kozhevnikov. “When I agreed to consider taking the case, I told Roman if there was any hint of treason, I would drop it immediately — but I’ve found none,” he added.
The State Bureau of Investigation says Dudin “instead of organizing work to counter the enemy … actually engaged in sabotage.” It claims he believed the Russian “offensive would be successful” and hoped Russian authorities would treat him favorably due to his subversion, including “deliberately creating conditions” enabling the invaders to seize weapons and equipment from the security service bases in Kharkiv. In addition, he’s alleged to have left his post without permission, illegally ordered his staff to quit the region and of wrecking a secure communication system for contact with Kyiv.
But documents obtained by POLITICO from relevant Ukrainian agencies seem to undermine the allegations. One testifies no damage was found to the secure communication system; and a document from the defense ministry says Dudin dispersed weapons from the local SBU arsenal to territorial defense forces. “Local battalions are grateful to him for handing out weapons,” says Kozhevnikov.
And his lawyer says Dudin only left Kharkiv because he was ordered to go to Kyiv by superiors to help defend the Ukrainian capital. A geolocated video of Dudin in uniform along with other SBU officers in the center of Kyiv, ironically a stone’s throw from the Pechersk District Court, has been ruled by the judge as inadmissible. The defense has asked the judge to recuse herself because of academic ties with Oleh Tatarov, a deputy head of the presidential administration, but the request has been denied.
According to a 29-page document compiled by the defense lawyers for the eventual trial, Dudin and his subordinates seem to have been frantically active to counter Russia forces as soon as the first shots were fired, capturing 24 saboteurs, identifying 556 collaborators and carrying out reconnaissance on Russian troop movements.
Roman Dudin is facing charges of treason and allegations that he eased the way for Russian invaders | Jamie Dettmer for POLITICO
Timely information transmitted by the SBU helped military and intelligence units to stop an armored Russian column entering the city of Kharkiv, according to defense lawyers.
“The only order he didn’t carry out was to transfer his 25-strong Alpha special forces team to the front lines because they were needed to catch saboteurs,” says Kozhevnikov. “The timing of his removal is suspicious — it was when he was investigating allegations of humanitarian aid being diverted by some powerful politicians.”
***
Even before Dudin’s case there were growing doubts about some of the treason accusations being leveled — including vague allegations against former prosecutor Venediktova and former security chief Bakanov. Both were accused of failing to prevent collaboration by some within their departments. But abruptly in November, Venediktova was appointed Ukraine’s ambassador to Switzerland. And two weeks ago, the State Bureau of Investigation said the agency had found no criminal wrongdoing by Bakanov.
The clearing of both with scant explanation, after their humiliating and highly public sackings, has prompted bemusement. Although some SBU insiders do blame Bakanov for indolence in sweeping for spies ahead of the Russian invasion.
Treason often seems the go-to charge — whether appropriate or not — and used reflexively.
Last month, several Ukrainian servicemen were accused of treason for having inadvertently revealed information during an unauthorized mission, which enabled Russia to target a military airfield.
The servicemen tried without permission to seize a Russian warplane in July after its pilot indicated he wanted to defect. Ham-fisted the mission might have been, but lawyers say it wasn’t treasonable.
Spy hunt or witch hunt? With the word treason easily slipping off tongues these days in Kyiv, defense lawyers at the Pechersk District Court worry the two are merging.

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( With inputs from : www.politico.eu )

April 28, 2023
Activision and Microsoft to appeal after CMA blocks takeover

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Activision has said it will “work aggressively” with Microsoft to overturn the U.K. competition regulator’s decision to block Microsoft’s proposed takeover of the game developer.
Microsoft and Activision were confident of approval after agreeing remedies to address concerns raised by the Competition and Markets Authority (CMA). But the CMA said on Wednesday that the proposed solution “failed to effectively address the concerns in the cloud gaming sector.”
It said: “The deal would reinforce Microsoft’s advantage in the market by giving it control over important gaming content such as Call of Duty, Overwatch, and World of Warcraft.”
A spokesperson for Activision said the CMA’s report “contradicts the ambitions of the U.K. to become an attractive country to build technology businesses… The report’s conclusions are a disservice to U.K. citizens, who face increasingly dire economic prospects. We will reassess our growth plans for the U.K.
“Global innovators large and small will take note that — despite all its rhetoric — the U.K. is clearly closed for business.”
Microsoft submitted proposals earlier this year to address some of these concerns but the CMA said they contained “a number of significant shortcomings” as they only applied to a defined set of Activision games.
Martin Coleman, chair of the independent panel of experts conducting the investigation, said: “Microsoft already enjoys a powerful position and head start over other competitors in cloud gaming and this deal would strengthen that advantage giving it the ability to undermine new and innovative competitors.”
Brad Smith, vice chair and president of Microsoft said the company would appeal and remained “fully committed” to the deal.

“The CMA’s decision rejects a pragmatic path to address competition concerns and discourages technology innovation and investment in the United Kingdom.” He said the decision showed a “flawed understanding” of the market.
Microsoft agreed to buy Activision in a $69 billion deal in January 2022, prompting investigations in the U.K., EU and U.S.

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( With inputs from : www.politico.eu )

April 26, 2023
Biden’s Northern Ireland ultimatum looks doomed to fail

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LONDON — Joe Biden is not someone known for his subtlety.
His gaffe-prone nature — which saw him last week confuse the New Zealand rugby team with British forces from the Irish War of Independence — leaves little in the way of nuance.
But he is also a sentimental man from a long gone era of Washington, who specializes in a type of homespun, aw-shucks affability that would be seen as naff in a younger president.

His lack of subtlety was on show in Belfast last week as he issued a thinly veiled ultimatum to the Democratic Unionist Party (DUP) — return to Northern Ireland’s power sharing arrangements or risk losing billions of dollars in U.S. business investment.
The DUP — a unionist party that does not take kindly to lectures from American presidents — is refusing to sit in Stormont, the Northern Ireland Assembly, due to its anger with the post-Brexit Northern Ireland protocol, which has created trade friction between the region and the rest of the U.K.
The DUP is also refusing to support the U.K.-EU Windsor Framework, which aims to fix the economic problems created by the protocol, despite hopes it would see the party reconvene the Northern Irish Assembly.
The president on Wednesday urged Northern Irish leaders to “unleash this incredible economic opportunity, which is just beginning.”
However, American business groups paint a far more complex and nuanced view of future foreign investment into Northern Ireland than offered up by Biden.
Biden told a Belfast crowd on Wednesday there were “scores of major American corporations wanting to come here” to invest, but that a suspended Stormont was acting as a block on that activity.
One U.S. business figure, who spoke on condition of anonymity, said Biden’s flighty rhetoric was “exaggerated” and that many businesses would be looking beyond the state of the regional assembly to make their investment decisions.
The president spoke as if Ulster would be rewarded with floods of American greenbacks if the DUP reverses its intransigence, predicting that Northern Ireland’s gross domestic product (GDP) would soon be triple its 1998 level. Its GDP is currently around double the size of when the Good Friday Agreement was struck in 1998.
Emanuel Adam, executive director of BritishAmerican Business, said this sounded like a “magic figure” unless Biden “knows something we don’t know about.”
DUP MP Ian Paisley Jr. told POLITICO that U.S. politicians for “too long” have “promised some economic El Dorado or bonanza if you only do what we say politically … but that bonanza has never arrived and people are not naive enough here to believe it ever will.”
“A presidential visit is always welcome, but the glitter on top is not an economic driver,” he said.
Joe Biden addresses a crowd of thousands on April 14, 2023 in Ballina, Ireland | Charles McQuillan/Getty Images
Facing both ways
The British government is hoping the Windsor Framework will ease economic tensions in Northern Ireland and create politically stable conditions for inward foreign direct investment.
The framework removes many checks on goods going from Great Britain to Northern Ireland and has begun to slowly create a more collaborative relationship between London and Brussels on a number of fronts — two elements which have been warmly welcomed across the Atlantic.
Prime Minister Rishi Sunak has said Northern Ireland is in a “special” position of having access to the EU’s single market, to avoid a hard border with the Republic of Ireland, and the U.K.’s internal market.
“That’s like the world’s most exciting economic zone,” Sunak said in February.
Jake Colvin, head of Washington’s National Foreign Trade Council business group, said U.S. firms wanted to see “confidence that the frictions over the protocol have indeed been resolved.”
“Businesses will look to mechanisms like the Windsor Framework to provide stability,” he said.
Marjorie Chorlins, senior vice president for Europe at the U.S. Chamber of Commerce, said the Windsor Framework was “very important” for U.S. businesses and that “certainty about the relationship between the U.K. and the EU is critical.”
She said a reconvened Stormont would mean more legislative stability on issues like skills and healthcare, but added that there were a whole range of other broader U.K. wide economic factors that will play a major part in investment decisions.
This is particularly salient in a week where official figures showed the U.K.’s GDP flatlining and predictions that Britain will be the worst economic performer in the G20 this year.
“We want to see a return to robust growth and prosperity for the U.K. broadly and are eager to work with government at all levels,” Chorlins said.
“Political and economic instability in the U.K. has been a challenge for businesses of all sizes.”
Prime Minister Rishi Sunak has said Northern Ireland is in a “special” position of having access to the EU’s single market | Pool photo by Paul Faith/Getty Images
Her words underline just how much global reputational damage last year’s carousel of prime ministers caused for the U.K., with Bank of England Governor Andrew Bailey recently warning of a “hangover effect” from Liz Truss’ premiership and the broader Westminster psychodrama of 2022.
America’s Northern Ireland envoy Joe Kennedy, grandson of Robert Kennedy, accompanied the president last week and has been charged with drumming up U.S. corporate interest in Northern Ireland.
Kennedy said Northern Ireland is already “the number-one foreign investment location for proximity and market access.”
Northern Ireland has been home to £1.5 billion of American investment in the past decade and had the second-most FDI projects per capita out of all U.K. regions in 2021.
Claire Hanna, Westminster MP for the nationalist SDLP, believes reconvening Stormont would “signal a seriousness that there isn’t going to be anymore mucking around.”
“It’s also about the signal that the restoration of Stormont sends — that these are the accepted trading arrangements,” she said.
Hanna says the DUP’s willingness to “demonize the two biggest trading blocs in the world — the U.S. and EU” — was damaging to the country’s future economic prospects.
‘The money goes south’
At a more practical level, Biden’s ultimatum appears to carry zero weight with DUP representatives.
DUP leader Jeffrey Donaldson made it clear last week that he was unmoved by Biden’s economic proclamations and gave no guarantee his party would sit in the regional assembly in the foreseeable future.
“President Biden is offering the hope of further American investment, which we always welcome,” Donaldson told POLITICO.
“But fundamental to the success of our economy is our ability to trade within our biggest market, which is of course the United Kingdom.”
A DUP official said U.S. governments had been promising extra American billions in exchange “for selling out to Sinn Féin and Dublin” since the 1990s and “when America talks about corporate investment, we get the crumbs and that investment really all ends up in the Republic [of Ireland].”
“President Biden is offering the hope of further American investment, which we always welcome,” Donaldson said | Behal/Irish Government via Getty Images
“The Americans talk big, but the money goes south,” the DUP official said.
This underscores the stark reality that challenges Northern Ireland any time it pitches for U.S. investment — the competing proposition offered by its southern neighbor with its internationally low 12.5 percent rate on corporate profits.
Emanuel Adam with BritishAmerican Business said there was a noticeable feeling in Washington that firms want to do business in Dublin.
“When [Irish Prime Minister] Leo Varadkar and his team were here recently, I could tell how confident the Irish are these days,” he said. “There are not as many questions for them as there are around the U.K.”
Biden’s economic ultimatum looks toothless from the DUP’s perspective and its resonance may be as short-lived as his trip to Belfast itself.
This story has been updated to correct an historical reference.

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( With inputs from : www.politico.eu )

April 11, 2023
Macron fails to move Xi Jinping over Russia’s war on Ukraine

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BEIJING — Chinese President Xi Jinping showed no sign of changing his position over Russia’s war on Ukraine after talks Thursday with French counterpart Emmanuel Macron.
On the second day of Macron’s state visit to China, Xi took his long-standing line on Russia’s full-scale invasion of Ukraine — saying that “all sides” have “reasonable security concerns” — and gave no hint he would use his influence to help end the conflict.
“China is willing to jointly appeal with France to the international community to remain rational and calm,” was as far as the Chinese leader would go during a press conference at the Great Hall of the People in Beijing.

“Peace talks should be resumed as soon as possible, taking into account the reasonable security concerns of all sides with reference to the U.N. Charter … seeking political resolution and constructing a balanced, effective and sustainable European security framework,” he added, sitting next to Macron.
The French president arrived in China on Wednesday in the hope of pushing China to use its leverage with Russia to end the conflict, and to get Beijing to speak out against the Kremlin’s threat to host nuclear missiles in Belarus.
During his private meeting with Xi, Macron raised Western concerns that Beijing will deliver weapons to China, according to a French diplomat with knowledge of the talks. But the French leader didn’t seem to get far.
“The president urged Xi not to make deliveries to Russia that would help its war against Ukraine. Xi said this war is not his,” the diplomat said, speaking anonymously to describe the private session.
The talks — which an Elysée Palace official nonetheless described as “frank and constructive” — ultimately lasted an hour and a half.
Afterward, the action moved to a signing ceremony, where officials and business leaders inked several deals, including the sale of 160 Airbus aircraft. According to the Elysée, the Chinese government approved the purchase of 150 A320 Neo planes and 10 A350s — a delivery that was part of a €36-billion deal Airbus announced last year. The information contradicted previous information from an Elysée official, who said a new sale was being negotiated.
During the deal-signing ceremony, every Chinese minister and business executive bowed deeply to Xi before signing the contracts with their French counterparts.
Xi and Macron then stepped in for their joint appearance, billed as a “press conference with Communist characteristics” — essentially meaning no press questions allowed.
The two leaders’ contrasting styles were immediately apparent. Xi read his carefully scripted remarks while staring straight ahead before ceding to Macron. The French leader then proceeded to speak for roughly twice as long as his host — a protocol faux pas that members of Xi’s Chinese entourage noticed.
Xi himself at times looked impatient and annoyed as Macron continued speaking. The Chinese leader heaved several deep sighs and appeared uncomfortable as Macron addressed him directly while apparently ad-libbing on the Ukraine war and their joint responsibility to uphold peace.
Macron also appealed to Xi to explicitly condemn Russia’s aggression against Ukraine.
“Speaking about peace and stability means talking about the war waged by Russia against Ukraine. You’ve made some important comments,” the French leader said. “This is a war that involves all of us because a member of the Security Council has decided to violate the U.N. charter. We cannot accept that.”
Macron and Xi spent one and a half hours in bilateral talks that were described as “frank and constructive” by an Elysée Palace official | POOL photo by Ng Han Guan/AFP via Getty Images
French lawmaker Anne Genetet, who also held talks Thursday with Chinese officials, admitted there were “no surprises” in the Chinese position on Ukraine, but argued it was still useful to lay some groundwork on the issue.
“It’s the beginning,” Genetet said. “There will be more talks and some private moments [between Xi and Macron]. Maybe we’ll get some other messages.”
Xi and Macron will head to the Chinese city of Guangzhou on Friday, where they will hold more talks and a private dinner.
However, in what will be read as a concession to the French, Xi did talk about the need for the warring parties to “protect victims including women and children,” which comes after the International Criminal Court issued an arrest warrant against Putin over his role in illegally transferring Ukrainian children to Russia.
Xi didn’t explicitly mention Russia in his remarks, though. And in a move likely to irk U.S. officials, Xi also said that China and France should “resume exchanges between the legislative bodies and militaries.” He then included France in a common refrain that Chinese officials use to criticize the U.S.
“China and France shall continue to … oppose Cold War mentality and bloc confrontation, joining hands in addressing all types of global challenges,” Xi said.
On Thursday, Xi also held talks with Macron and with European Commission President Ursula von der Leyen, who was invited by Macron to showcase European unity but who will not take part in many of the events between the Chinese and French leaders.
Indeed, von der Leyen held her own solo press conference as night fell on Thursday in Beijing. Unencumbered by the formalities of a state visit, the EU leader took questions from reporters and sent several pointed messages to Beijing.
She warned it against aiding Moscow’s war effort in Ukraine: “Arming the aggressor is a clear violation of international law — he should never be armed,” she said. “This would indeed significantly harm the relationship between the European Union and China.”
And she touched a diplomatic third rail: Taiwan.
“Nobody should unilaterally change the status quo by force in this region,” she said, alluding to China’s threats toward the self-governing island. “The threat of the use of force to change the status quo is unacceptable.”
Von der Leyen did echo Macron’s message, however, that China could play an important role in Ukraine, calling Beijing’s stance “crucial.”
She added: “We expect China will play its role and promote a just peace, one that respects Ukraine’s territorial sovereignty.”
Clea Caulcutt and Jamil Anderlini reported from Beijing. Stuart Lau reported from Brussels.

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( With inputs from : www.politico.eu )

April 4, 2023
Europe must resist pressure to become ‘America’s followers,’ says Macron

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Cet article est aussi disponible en français.
ABOARD COTAM UNITÉ (FRANCE’S AIR FORCE ONE) — Europe must reduce its dependency on the United States and avoid getting dragged into a confrontation between China and the U.S. over Taiwan, French President Emmanuel Macron said in an interview on his plane back from a three-day state visit to China.
Speaking with POLITICO and two French journalists after spending around six hours with Chinese President Xi Jinping during his trip, Macron emphasized his pet theory of “strategic autonomy” for Europe, presumably led by France, to become a “third superpower.”
He said “the great risk” Europe faces is that it “gets caught up in crises that are not ours, which prevents it from building its strategic autonomy,” while flying from Beijing to Guangzhou, in southern China, aboard COTAM Unité, France’s Air Force One.
Xi Jinping and the Chinese Communist Party have enthusiastically endorsed Macron’s concept of strategic autonomy and Chinese officials constantly refer to it in their dealings with European countries. Party leaders and theorists in Beijing are convinced the West is in decline and China is on the ascendant and that weakening the transatlantic relationship will help accelerate this trend.
“The paradox would be that, overcome with panic, we believe we are just America’s followers,” Macron said in the interview. “The question Europeans need to answer … is it in our interest to accelerate [a crisis] on Taiwan? No. The worse thing would be to think that we Europeans must become followers on this topic and take our cue from the U.S. agenda and a Chinese overreaction,” he said.
Just hours after his flight left Guangzhou headed back to Paris, China launched large military exercises around the self-ruled island of Taiwan, which China claims as its territory but the U.S. has promised to arm and defend.
Those exercises were a response to Taiwanese President Tsai Ing-Wen’s 10-day diplomatic tour of Central American countries that included a meeting with Republican U.S. House Speaker Kevin McCarthy while she transited in California. People familiar with Macron’s thinking said he was happy Beijing had at least waited until he was out of Chinese airspace before launching the simulated “Taiwan encirclement” exercise.

Beijing has repeatedly threatened to invade in recent years and has a policy of isolating the democratic island by forcing other countries to recognize it as part of “one China.”
Taiwan talks
Macron and Xi discussed Taiwan “intensely,” according to French officials accompanying the president, who appears to have taken a more conciliatory approach than the U.S. or even the European Union.
“Stability in the Taiwan Strait is of paramount importance,” European Commission President Ursula von der Leyen, who accompanied Macron for part of his visit, said she told Xi during their meeting in Beijing last Thursday. “The threat [of] the use of force to change the status quo is unacceptable.”
Chinese President Xi Jinping and French President Emmanuel Macron in Guangdong on April 7, 2023 | Pool Photo by Jacques Witt / AFP via Getty Images
Xi responded by saying anyone who thought they could influence Beijing on Taiwan was deluded.
Macron appears to agree with that assessment.
“Europeans cannot resolve the crisis in Ukraine; how can we credibly say on Taiwan, ‘watch out, if you do something wrong we will be there’? If you really want to increase tensions that’s the way to do it,” he said.
“Europe is more willing to accept a world in which China becomes a regional hegemon,” said Yanmei Xie, a geopolitics analyst at Gavekal Dragonomics. “Some of its leaders even believe such a world order may be more advantageous to Europe.”
In his trilateral meeting with Macron and von der Leyen last Thursday in Beijing, Xi Jinping went off script on only two topics — Ukraine and Taiwan — according to someone who was present in the room.
“Xi was visibly annoyed for being held responsible for the Ukraine conflict and he downplayed his recent visit to Moscow,” this person said. “He was clearly enraged by the U.S. and very upset over Taiwan, by the Taiwanese president’s transit through the U.S. and [the fact that] foreign policy issues were being raised by Europeans.”
In this meeting, Macron and von der Leyen took similar lines on Taiwan, this person said. But Macron subsequently spent more than four hours with the Chinese leader, much of it with only translators present, and his tone was far more conciliatory than von der Leyen’s when speaking with journalists.
‘Vassals’ warning
Macron also argued that Europe had increased its dependency on the U.S. for weapons and energy and must now focus on boosting European defense industries.
He also suggested Europe should reduce its dependence on the “extraterritoriality of the U.S. dollar,” a key policy objective of both Moscow and Beijing.
Macron has long been a proponent of strategic autonomy for Europe | Ludovic Marin/AFP via Getty Images
“If the tensions between the two superpowers heat up … we won’t have the time nor the resources to finance our strategic autonomy and we will become vassals,” he said.
Russia, China, Iran and other countries have been hit by U.S. sanctions in recent years that are based on denying access to the dominant dollar-denominated global financial system. Some in Europe have complained about “weaponization” of the dollar by Washington, which forces European companies to give up business and cut ties with third countries or face crippling secondary sanctions.
While sitting in the stateroom of his A330 aircraft in a hoodie with the words “French Tech” emblazoned on the chest, Macron claimed to have already “won the ideological battle on strategic autonomy” for Europe.
He did not address the question of ongoing U.S. security guarantees for the Continent, which relies heavily on American defense assistance amid the first major land war in Europe since World War II.
As one of the five permanent members of the U.N. Security Council and the only nuclear power in the EU, France is in a unique position militarily. However, the country has contributed far less to the defense of Ukraine against Russia’s invasion than many other countries.
As is common in France and many other European countries, the French President’s office, known as the Elysée Palace, insisted on checking and “proofreading” all the president’s quotes to be published in this article as a condition of granting the interview. This violates POLITICO’s editorial standards and policy, but we agreed to the terms in order to speak directly with the French president. POLITICO insisted that it cannot deceive its readers and would not publish anything the president did not say. The quotes in this article were all actually said by the president, but some parts of the interview in which the president spoke even more frankly about Taiwan and Europe’s strategic autonomy were cut out by the Elysée.

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( With inputs from : www.politico.eu )

April 4, 2023
Why China wants Macron to drive a wedge between Europe and America

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Chinese leader Xi Jinping had one overriding message for his visiting French counterpart Emmanuel Macron this week: Don’t let Europe get sucked into playing America’s game.
Beijing is eager to avoid the EU falling further under U.S. influence, at a time when the White House is pursuing a more assertive policy to counter China’s geopolitical and military strength.
Russia’s yearlong war against Ukraine has strengthened the alliance between Europe and the U.S., shaken up global trade, reinvigorated NATO and forced governments to look at what else could suddenly go wrong in world affairs. That’s not welcome in Beijing, which still views Washington as its strategic nemesis.

This week, China’s counter-offensive stepped up a gear, turning on the charm. Xi welcomed Macron into the grandest of settings at the Great Hall of the People in Beijing, along with European Commission chief Ursula von der Leyen. This was in sharp contrast to China’s current efforts to keep senior American officials at arm’s length, especially since U.S. Secretary of State Antony Blinken called off a trip to Beijing during the spy balloon drama earlier this year.
Both American and Chinese officials know Europe’s policy toward Beijing is far from settled. That’s an opportunity, and a risk for both sides. In recent months, U.S. officials have warned of China’s willingness to send weapons to Russia and talked up the dangers of allowing Chinese tech companies unfettered access to European markets, with some success.
TikTok, which is ultimately Chinese owned, has been banned from government and administrative phones in a number of locations in Europe, including in the EU institutions in Brussels. American pressure also led the Dutch to put new export controls on sales of advanced semiconductor equipment to China.
Yet even the hawkish von der Leyen, a former German defense minister, has dismissed the notion of decoupling Europe from China’s economy altogether. From Beijing’s perspective, this is yet another significant difference from the hostile commercial environment being promoted by the U.S.
Just this week, 36 Chinese and French businesses signed new deals in front of Macron and Xi, in what Chinese state media said was a sign of “the not declining confidence in the Chinese market of European businesses.” While hardly a statement brimming with confidence, it could have been worse.
For the last couple of years European leaders have grown more skeptical of China’s trajectory, voicing dismay at Beijing’s way of handling the coronavirus pandemic, the treatment of protesters in Hong Kong and Xinjiang’s Uyghur Muslims, as well as China’s sanctions on European politicians and military threats against Taiwan.
Then, Xi and Vladimir Putin hailed a “no limits” partnership just days before Russia invaded Ukraine. While the West rolled out tough sanctions on Moscow, China became the last major economy still interested in maintaining — and expanding — trade ties with Russia. That shocked many Western officials and provoked a fierce debate in Europe over how to punish Beijing and how far to pull out of Chinese commerce.
Beijing saw Macron as the natural partner to help avoid a nosedive in EU-China relations, especially since Angela Merkel — its previous favorite — was no longer German chancellor.
Macron’s willingness to engage with anyone — including his much-criticized contacts with Putin ahead of his war on Ukraine — made him especially appealing as Beijing sought to drive a wedge between European and American strategies on China.
Xi Jinping sees Macron as the natural to Angela Merkel, his previous partner in the West who helped avoid a nosedive in EU-China relations | Ludovic Marin/AFP via Getty Images
Not taking sides
“I’m very glad we share many identical or similar views on Sino-French, Sino-EU, international and regional issues,” Xi told Macron over tea on Friday, in the southern metropolis of Guangzhou, according to Chinese state media Xinhua.
Strategic autonomy, a French foreign policy focus, is a favorite for China, which sees the notion as proof of Europe’s distance from the U.S. For his part, Macron told Xi a day earlier that France promotes “European strategic autonomy,” doesn’t like “bloc confrontation” and believes in doing its own thing. “France does not pick sides,” he said.
The French position is challenged by some in Europe who see it as an urgent task to take a tougher approach toward Beijing.
“Macron could have easily avoided the dismal picture of European and transatlantic disunity,” said Thorsten Benner, director of the Berlin-based Global Public Policy Institute. “Nobody forced Macron to show up with a huge business delegation, repeating disproven illusions of reciprocity and deluding himself about working his personal magic on Xi to get the Chinese leader to turn against Putin.”
Holger Hestermeyer, a professor of EU law at King’s College London, said Beijing will struggle to split the transatlantic alliance.
“If China wants to succeed with building a new world order, separating the EU from the U.S. — even a little bit — would be a prized goal — and mind you, probably an elusive one,” Hestermeyer said. “Right now the EU is strengthening its defenses specifically because China tried to play divide and conquer with the EU in the past.”
Xi’s focus on America was unmistakable when he veered into a topic that was a long way from Europe’s top priority, during his three-way meeting with Macron and von der Leyen. A week earlier the Biden administration had held its second Summit for Democracy, in which Russia and China were portrayed as the main threats.
“Spreading the so-called ‘democracy versus authoritarianism’ [narrative],” Xi told his European guests on Thursday, “would only bring division and confrontation to the world.”

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( With inputs from : www.politico.eu )

April 4, 2023
Big Tech lobbyists get stuck in to UK’s landmark competition bill

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LONDON — As the U.K. prepares to overhaul its competition regime, a fierce lobbying battle has broken out between the world’s largest tech companies and their challengers.
Ministers are gearing up to publish new competition legislation in late-April, giving regulators more power to stop a handful of companies dominating digital markets.
But concern over the U.S. tech giants’ influence in Westminster has prompted ministers close to the bill to warn that the new legislation could be watered down.

Two ministers have expressed concerns that Big Tech firms are seeking to weaken the process for appealing decisions made by the country’s beefed-up competition regulator, according to multiple people who were either present at those discussions or whose organizations were represented there. They requested anonymity to discuss private meetings.
One MP said a minister had also approached them to raise concerns, while at an industry roundtable, two ministers spoke of worry about Big Tech firms trying to influence the appeal mechanism.
An industry representative said: “There has been a sh*t load of lobbying from Big Tech, but I don’t know if they’ll succeed.”
Appealing to who?
The Digital Markets, Competition and Consumer Bill will give new powers to a branch of the Competition and Markets Authority called the Digital Markets Unit (DMU). Under the plan, the DMU will be able fine a company 10 percent of their annual turnover for breaching a code of conduct.
The code, which has not yet been published, would be designed to ensure that a company with ‘strategic market status’ cannot “unfairly use its market power and strategic position to distort or undermine competition between users of the … firm’s services,” the government has said.
Jonathan Jones, senior consultant in public law at Linklaters and formerly the head of the U.K. government’s legal department, wrote that the plan would have “very significant consequences” for Big Tech firms and could force them to “significantly alter” their business models.
One of Big Tech’s concerns is that the bill will only allow companies to appeal decisions made by the DMU on whether or not the right process was followed, known as the judicial review standard, rather than the content or merit of the decision. That puts it in line with other regulators and should mean the process is faster, but it also makes it harder to appeal decisions.
Big Tech firms want to be able to appeal on the “merit”, arguing it is unfair that they can’t challenge whether a DMU decision was correct or not. They also argue it won’t necessarily be slower than the judicial review standard.
One of the biggest fears from medium-sized firms is that the biggest tech companies will use strategies to lengthen the appeals process or even get the entire bill delayed | iStock
Tech Minister Paul Scully, who has responsibility for the bill, told POLITICO: “We want to make sure that the legislation is flexible, proportionate and fair to both big and challenger companies. Any remediation needs to be in place quickly as digital markets move quickly.”
One representative of a mid-sized tech firm said: “This is the fundamental point of contention and it will influence whether the bill works for SMEs and challengers against Big Tech.
“The fear is that big companies with big lawyers understand how to eke things out (during the appeals process) so that they’ll keep their market advantage for years. We’ve heard ministers express these concerns too.”
Consumer group Which? is also urging the government to stay with its proposed appeal system. “For the DMU to work effectively, the government must stick to its guns and ensure that the decisions it reaches are not tied up in an elongated appeals process,” said director of policy, Rocio Concha.
‘Investigator and executioner’
But Jones argued that the bill will make the DMU too powerful.
“The DMU will have power to decide who it is going to regulate, set the rules that apply to them, and then enforce those rules,” he wrote. “This makes the DMU effectively legislator, investigator and executioner.”
On the appeal method, Jones argued that it is an “oversimplification” to think that the government’s proposed standard of appeal would be quicker than one based on merits.
Ben Greenstone, managing director of tech policy consultancy Taso Advisory, said: “I can understand the argument from both sides. The largest tech companies are incentivized to push back against this, but my guess is the government will keep the appeals process as it is, because it keeps it in line with the wider competition regime.”
However, he added the bill would work better if some sort of compromise can be found with the biggest tech companies.
The international playbook
One of the biggest fears from medium-sized firms is that the biggest tech companies will use strategies already tried and tested abroad to lengthen the appeals process or even get the entire bill delayed.
In the U.S., the Open App Markets Act has failed to pass following huge spends on lobbying.
Rick VanMeter, executive director of the Coalition for App Fairness, which is based in the U.S. but has U.K. members, said: “In the U.S. we’ve learned that these mobile app gatekeepers’ will stop at nothing to preserve the status quo and squash their competition.
“To be successful, policymakers around the world must see through these gatekeepers’ efforts for what they are: self-serving attempts to retain their market power.”
Google and Microsoft declined to comment. Apple did not respond.

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( With inputs from : www.politico.eu )

April 1, 2023
IMF’s Georgieva: ‘Risks to financial stability have increased’

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The outlook for the global economy is likely to remain weak in the medium term amid heightened risks to financial stability, according to International Monetary Fund Managing Director Kristalina Georgieva.
“We expect 2023 to be another challenging year, with global growth slowing to below 3 percent as scarring from the pandemic, the war in Ukraine, and monetary tightening weigh on economic activity,” Georgieva said on Sunday at a conference in China. “Even with a better outlook for 2024, global growth will remain well below its historic average of 3.8 percent,” she said.
“It is also clear that risks to financial stability have increased,” Georgieva said. “At a time of higher debt levels, the rapid transition from a prolonged period of low-interest rates to much higher rates — necessary to fight inflation — inevitably generates stresses and vulnerabilities, as evidenced by recent developments in the banking sector in some advanced economies.”
Policymakers have acted decisively in response to threats to financial stability, helping ease market stress to some extent, she said. But “uncertainty is high, which underscores the need for vigilance,” she added.
Georgieva also warned about risks of geo-economic fragmentation, which she said “could mean a world split into rival economic blocs — a ‘dangerous division’ that would leave everyone poorer and less secure. Together, these factors mean that the outlook for the global economy over the medium term is likely to remain weak,” she said.
Georgieva spoke during the second day of the China Development Forum in Beijing. The three-day annual event is a social mixer of politics and business, bringing together members of the Chinese Politburo with dozens of CEOs from Western companies like Siemens, Mercedes-Benz and Allianz.
“Fortunately, the news on the world economy is not all bad. We can see some ‘green shoots,’ including in China,” Georgieva said, adding that Beijing is set to account for around a third of the global growth this year.

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( With inputs from : www.politico.eu )

March 23, 2023
German Christian Democrats rewrite Merkel’s China playbook

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BERLIN — Germany’s Christian Democrats, the country’s largest opposition group, are planning to shift away from the pragmatic stance toward China that characterized Angela Merkel’s 16 years as chancellor, claiming that maintaining peace through trade has failed.
It’s a remarkable course change for the conservative party that pursued a strategy of rapprochement and economic interdependence toward China and Russia during Merkel’s decade and a half in power. The volte-face has been spurred by Moscow’s invasion of Ukraine and Beijing’s increasingly aggressive stance — both economically and politically — in the Asian region and beyond.
According to a draft position paper seen by POLITICO, the conservatives say the idea of keeping peace through economic cooperation “has failed with regard to Russia, but increasingly also China.” The 22-page paper, which is to be adopted by the center-right Christian Democratic Union/Christian Social Union (CDU/CSU) parliamentary group in the Bundestag around Easter, outlines key points for a new China policy.

In a world order that is changing after Russia’s full-scale invasion of Ukraine, Chancellor Olaf Scholz last year announced a Zeitenwende, or major turning point, in German security policy. Economy Minister Robert Habeck and Foreign Minister Annalena Baerbock, in particular, have stressed the necessity of a comprehensive China strategy, an idea already mentioned in the coalition agreement to form Scholz’s government. Their ministries have elaborated two different drafts, but a comprehensive strategy is not yet in sight.
“We realize at this point in time, with some surprise, which is why we prepared and presented this paper, that the German government is significantly behind schedule on key foreign and security policy documents,” said CDU foreign policy lawmaker Johann Wadephul.
The foreword to the position paper states that “the rise of communist China is the central, epochal challenge of the 21st century for all states seeking to preserve, strengthen, and sustain the rules-based international order.” The CDU/CSU parliamentary group is open to working out a “national consensus” with Scholz’s government. That consensus, the group says, must be embedded in the national security strategy and in a European China strategy.
The relationship with China is described in the same triad fashion that was formulated by the European Commission in 2019 and is in the coalition agreement of the current German government. Under this strategy, the Asian country is seen as a partner, economic competitor and systemic rival.
But the CDU/CSU group’s paper says policy should move away from a Beijing-friendly, pragmatic stance toward China, especially on trade. “We should not close our eyes to the fact that China has shifted the balance on its own initiative and clearly pushed the core of the relationship toward systemic rivalry,” the text states.
Such an emphasis from the conservative group is remarkable given its long-held preference for economic cooperation and political rapprochement toward both China and Russia under Merkel. Before leaving office, for example, Merkel pushed a major EU-China investment deal over the line, though it was later essentially frozen by the European Parliament due to Beijing’s sanctions against MEPs.
“I say to this also self-critically [that] this means for the CDU/CSU a certain new approach in China policy after a 16-year government period,” Wadephul said.
The paper calls for a “Zeitenwende in China policy,” too, concluding that Germany should respond “with the ability and its own strength to compete” wherever China seeks and forces competition; should build up its resilience and defensive capability and form as well as expand alliances and partnerships with interest and value partners; and demonstrate a willingness to partner where it is openly, transparently and reliably embraced by China.
The CDU/CSU paper calls for a European China strategy and a “European China Council” with EU neighbors for better cooperation. A central point is also strengthening reciprocity and European as well as German sovereignty.
“Decoupling from China is neither realistic nor desirable from a German and European perspective,” according to the text.
To better monitor dependencies, the paper proposes an expert commission in the Bundestag that would present an annual “China check” on dependencies in trade, technology, raw materials and foreign trade, with the overall aim of developing a “de-risking” strategy.

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( With inputs from : www.politico.eu )

March 23, 2023
Finland on course for NATO membership after Hungarian vote

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The Hungarian parliament ratified Finland’s NATO membership on Monday, putting Helsinki one step closer to joining the alliance but leaving Sweden waiting in the wings.
Members of Hungary’s parliament voted by a margin of 182 to 6 in favor of Finnish accession.
Helsinki now only needs the Turkish parliament’s approval — expected soon — to become a NATO member.
Hungary’s move comes after repeated delays and political U-turns.
Hungarian officials spent months telling counterparts they had no objections and their parliament was simply busy with other business.
Budapest then changed its narrative last month, with Hungarian Prime Minister Viktor Orbán — who has an iron grip over his ruling Fidesz party — arguing the point that some of his legislators had qualms regarding criticism of the state of Hungarian democracy.
Finland and Sweden have been at the forefront of safeguarding democratic standards in Hungary, speaking out on the matter long before many of their counterparts.
But earlier this month — just as Turkish President Recep Tayyip Erdoğan announced that he will support Finland’s NATO membership — the Fidesz position flipped again, with its parliamentary group chair then announcing support for Helsinki’s bid.

Turkey’s parliament is expected to ratify Finnish membership soon. But it is keeping Sweden in limbo, as Turkish officials say they want to see the country implement new anti-terror policies before giving Ankara’s green light.
Following in Turkey’s footsteps, Hungary is now also delaying a decision on Sweden indefinitely — prompting criticism from Orbán’s critics.
Attila Ara-Kovács, a member of the European Parliament from Hungary’s opposition Democratic Coalition, said that Orbán’s moves are part of a strategy to fuel anti-Western attitudes at home.
The government’s aim is “further inciting anti-Western and anti-NATO sentiment within Hungary, especially among Orbán’s fanatical supporters — and besides, of course, to serve Russian interests,” he said.
“This has its consequences,” Ara-Kovács said, adding that “support for the EU and NATO in the country is significantly and constantly decreasing.”
A recent Eurobarometer poll found that 39 percent of Hungarians view the EU positively. A NATO report, published last week, shows that 77 percent of Hungarians would vote to stay in the alliance — compared to 89 percent in Poland and 84 percent in Romania.
But Hungarian officials are adding the spin that they do support Sweden’s NATO membership.
The Swedish government “constantly questioning the state of Hungarian democracy” is “insulting our voters, MPs and the country as a whole,” said Balázs Orbán, the Hungarian prime minister’s political director (no relation to the prime minister).
It is “up to the Swedes to make sure that Hungarian MPs’ concerns are addressed,” he tweeted on Sunday. “Our goal,” he added, “is to support Sweden’s NATO accession with a parliamentary majority as broad as possible.”

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( With inputs from : www.politico.eu )

March 23, 2023