Russia’s President Vladimir Putin should be tried in The Hague for war crimes, Ukrainian leader Volodymyr Zelenskyy said during a surprise visit to the Netherlands.
“We all want to see a different Vladimir here in The Hague,” Zelenskyy said. “The one who deserves to be sentenced for these criminal actions right here, in the capital of international law.”
The Ukrainian president spoke in The Hague, where he traveled unexpectedly Thursday. He is expected to meet Dutch Prime Minister Mark Rutte and Belgian Prime Minister Alexander De Croo later in the day.
In March, the Hague-based International Criminal Court (ICC) issued an international arrest warrant against Putin over the forced deportation of Ukrainian children to Russia following the Kremlin’s full-scale invasion of Ukraine.
Moscow has previously said it did not recognize the court’s authority, but the warrant means that the ICC’s 123 member countries are required to arrest Putin if he ever sets foot on their territory, and transfer him to The Hague.
The warrant’s existence has already caused a stir in South Africa, where the Russian president could attend the next BRICS summit in August.
Last week, South African President Cyril Ramaphosa said the country should leave the ICC — but his office backtracked a few hours later, stressing South Africa remained part of the court.
In spite of numerous reports that Russian forces have committed war crimes in Ukraine — including a recent U.N. investigation which said that Russia’s forced deportation of Ukrainian children amounted to a war crime — the Kremlin has denied it committed any crimes.
In his speech Thursday, Zelenskyy said Russian forces had committed more than 6,000 war crimes in April alone, killing 207 Ukrainian civilians.
The Ukrainian president renewed his call to create a Nüremberg-style, “full-fledged” tribunal to prosecute the crime of aggression and deliver “a full justice” — and lasting peace.
“The sustainability of peace arises from the complete justice towards the aggressor,” Zelenskyy said.
Speaking shortly before Zelenskyy, Dutch Foreign Minister Wopke Hoekstra said the Netherlands was “ready and willing” to host that court, as well as registers of the damages caused by Russia’s invasion, echoing similar statements he made in December.
“Illegal wars cannot be unpunished,” Hoekstra said. “We will do everything in our power to ensure that Russia is held to account.”
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( With inputs from : www.politico.eu )
The Ukrainian military shot down a hypersonic Russian missile over Kyiv using the newly acquired Patriot missile defense system, an air force commander confirmed on Saturday.
It’s the first time Ukraine has been known to intercept one of Moscow’s most sophisticated weapons, after receiving the long-sought, American-made defense batteries from the U.S., Germany and the Netherlands.
“Yes, we shot down the ‘unique’ Kinzhal,” Air Force Commander Mykola Oleshchuk said on Telegram, referring to a Kh-47 missile, which flies at 10 times the speed of sound. “It happened during the night time attack on May 4 in the skies of the Kyiv region.”
Ukraine confirmed that two Patriot batteries were operational last month, following training on the system from the U.S. and Germany, according to the Kyiv Independent. The interception of the hypersonic missile also represents a major success for the Patriot technology, in use on the battlefield after 20 years of upgrades.
Kyiv had initially denied that it had shot down the Kinzhal missile.
Ukraine first asked Washington for Patriot systems in 2021, well before Russia’s current war of aggression began in February 2022. The U.S. and Germany have each sent at least one Patriot battery to Ukraine; and the Netherlands said it has provided two.
Separately, a well-known Russian nationalist writer was injured in a car bomb, reported TASS, Russia’s state-owned news service. Zakhar Prilepin was wounded in the Russian city of Nizhny Novgorod, in a blast that killed one person, according to the report.
A Russian foreign ministry spokeswoman said the blast was the “direct responsibility of the U.S. and Britain,” without providing evidence, according to Reuters.
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( With inputs from : www.politico.eu )
Ukraine’s farmers played an iconic role in the first weeks of Russia’s invasion, towing away abandoned enemy tanks with their tractors.
Now, though, their prodigious grain output is causing some of Ukraine’s staunchest allies to waver, as disrupted shipments are redirected onto neighboring markets.
The most striking is Poland, which has played a leading role so far in supporting Ukraine, acting as the main transit hub for Western weaponry and sending plenty of its own. But grain shipments in the other direction have irked Polish farmers who are being undercut — just months before a national election where the rural vote will be crucial.
Diplomats are floundering. After a planned Friday meeting between the Polish and Ukrainian agriculture ministers was postponed, the Polish government on Saturday announced a ban on imports of farm products from Ukraine. Hungary late Saturday said it would do the same.
Ukraine is among the world’s top exporters of wheat and other grains, which are ordinarily shipped to markets as distant as Egypt and Pakistan. Russia’s invasion last year disrupted the main Black Sea export route, and a United Nations-brokered deal to lift the blockade has been only partially effective. In consequence, Ukrainian produce has been diverted to bordering EU countries: Hungary, Poland, Romania and Slovakia.
At first, those governments supported EU plans to shift the surplus grain. But instead of transiting seamlessly onto global markets, the supply glut has depressed prices in Europe. Farmers have risen up in protest, and Polish Agriculture Minister Henryk Kowalczyk was forced out earlier this month.
Now, governments’ focus has shifted to restricting Ukrainian imports to protect their own markets. After hosting Ukrainian President Volodymyr Zelenskyy in Warsaw in early April, Polish President Andrzej Duda said resolving the import glut was “a matter of introducing additional restrictions.”
The following day, Poland suspended imports of Ukrainian grain, saying the idea had come from Kyiv. On Saturday, Polish Prime Minister Mateusz Morawiecki, after an emergency cabinet meeting, said the import ban would cover grain and certain other farm products and would include products intended for other countries. A few hours later, the Hungarian government announced similar measures. Both countries said the bans would last until the end of June.
The European Commission is seeking further information on the import restrictions from Warsaw and Budapest “to be able to assess the measures,” according to a statement on Sunday. “Trade policy is of EU exclusive competence and, therefore, unilateral actions are not acceptable,” it said.
While the EU’s free-trade agreement with Ukraine prevents governments from introducing tariffs, they still have plenty of tools available to disrupt shipments.
Neighboring countries and nearby Bulgaria have stepped up sanitary checks on Ukrainian grain, arguing they are doing so to protect the health of their own citizens. They have also requested financial support from Brussels and have already received more than €50 million from the EU’s agricultural crisis reserve, with more money on the way.
Restrictions could do further harm to Ukraine’s battered economy, and by extension its war effort. The economy has shrunk by 29.1 percent since the invasion, according to statistics released this month, and agricultural exports are an important source of revenue.
Cracks in the alliance
The trade tensions sit at odds with these countries’ political position on Ukraine, which — with the exception of Hungary — has been strongly supportive. Poland has taken in millions of Ukrainian refugees, while weapons and ammunition flow in the opposite direction; Romania has helped transport millions of tons of Ukrainian corn and wheat.
Volodymyr Zelenskyy and Poland’s Prime Minister, Mateusz Morawiecki | Omar Marques/Getty Images
Some Western European governments, which had to be goaded by Poland and others into sending heavy weaponry to Kyiv, are quick to point out the change in direction.
“Curious to see that some of these countries are [always] asking for more on sanctions, more on ammunition, etc. But when it affects them, they turn to Brussels begging for financial support,” said one diplomat from a Western country, speaking on condition of anonymity.
Some EU countries also oppose the import restrictions for economic reasons. For instance, Spain and the Netherlands are some of the biggest recipients of Ukrainian grain, which they use to supply their livestock industries.
Politically, though, the Central and Eastern European governments have limited room for maneuver. Poland and Slovakia are both heading into general elections later this year. Bulgaria has had a caretaker government since last year. Romania’s agriculture minister has faced calls to resign, including from a compatriot former EU agriculture commissioner.
And farmers are a strong constituency. Poland’s right-wing Law & Justice (PiS) party won the last general election in 2019 thanks in large part to rural voters. The Ukrainian grain issue has already cost a Polish agriculture minister his job; the government as a whole will have to tread carefully to avoid the same fate.
This article has been updated.
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( With inputs from : www.politico.eu )
It’s the rumor inflating the Brussels bubble: The EU’s top executive, Ursula von der Leyen, could be crossing town to run NATO.
The rationale makes sense. She has a good working relationship with Washington. She is a former defense minister. And as European Commission president, she has experience working with most NATO heads of government. Plus, if chosen, she would become the alliance’s first-ever female leader.
The conversation has crested in recent weeks, as people eye current NATO Secretary-General Jens Stoltenberg’s pending exit at the end of September.
Yet according to those inside NATO and at the Commission, the murmurings are more wish-casting than hints of a pending job switch. There is no evidence von der Leyen is interested in the role, and those in Brussels don’t expect her to quit before her first presidential term ends in 2024.
The chatter is similar to the rumblings around Dutch Prime Minister Mark Rutte, a long-serving leader who checks every box but insists he doesn’t want the job.
The speculation illustrates how much Russia’s invasion of Ukraine has changed NATO — and who can lead it. The war has put a new spotlight on the alliance, making the job more politically sensitive and high-profile than in the past. And allies are suddenly much more cautious about who they want on the podium speaking for them.
In short, the chatter seems to be people manifesting their ideal candidates and testing ideas rather than engaging in a real negotiation.
“The more names, the clearer there is no candidate,” said one senior European diplomat, who spoke on condition of anonymity to discuss internal alliance dynamics.
A second senior European diplomat agreed: “There is a lot of backroom gossip,” this person said, “but no clear field at this stage.”
The (very) short list
The next NATO chief, officials say, needs to be a European who can work closely with whoever is in the White House.
But that’s not all. The next NATO chief needs to be someone who backs Ukraine but is not so hawkish that it spooks countries worried about provoking Russia. And the person has to have stature — likely a former head of state or government — who can get unanimous support from 31 capitals and, most importantly, the U.S.
There are several obstacles to Usula von der Leyen’s candidacy | Odd Andersen/AFP via Getty Images
That’s not a long list.
Von der Leyen is on it, but there are several obstacles to her candidacy.
The first is simply timing. If Stoltenberg leaves office in the fall as scheduled, his replacement would come into the office a year before von der Leyen’s term at the Commission ends in late 2024. She may even seek another five-year term.
“I don’t think she will move anywhere before the end of her mandate,” said one senior Commission official, who also spoke on condition of anonymity to discuss internal matters.
Speculation is rife that the current NATO chief may be asked to stay on, at least for a little while longer, to allow for a candidate such as von der Leyen to come in at a later stage.
“If Stoltenberg is prolonged until next summer, Ursula von der Leyen’s candidature would look logical,” said a third senior European diplomat.
But in an interview with POLITICO last week, Stoltenberg appeared keen to go home. The NATO chief has been in the job for over eight years, the second-longest tenure in the alliance’s seven-decade history.
Asked about gossip that he may stay on, the secretary-general shot back sarcastically: “First of all, there are many more questions in the world that are extremely more important than that.”
“My plan is to go back to Norway,” he added, “I have been here for now a long time.”
The alliance is divided on the matter. Some countries — particularly those outside the EU — would prefer a quick decision to avoid running into the EU’s own 2024 elections. The fear, a fourth European diplomat said, is that NATO becomes a “consolation prize in the broader European politics” as leaders haggle over who will run the EU’s main institutions.
Another challenge for von der Leyen would be Germany’s track record on defense spending — and her own record as Germany’s defense minister.
A decade ago, NATO countries pledged to move toward spending 2 percent of their economic output on defense by 2024. But Germany, despite being Europe’s largest economy, has consistently missed the mark, even after announcing a €100 billion fund last year to modernize its military.
From the German government’s perspective, keeping von der Leyen at the helm of the Commission might be a bigger priority than NATO | Kenzo Tribuillard/AFP via Getty Images
Additionally, some observers say von der Leyen bears some responsibility for the relatively poor state of Germany’s defenses.
From the German government’s perspective, keeping von der Leyen at the helm of the Commission might also be a bigger priority than NATO — even if she comes from the current center-right opposition. The EU executive is arguably more powerful than the NATO chief within Europe, pushing policies that affect nearly every corner of life.
Predictably, the Commission is officially dismissive of any speculation.
“The president is not a candidate for the job” of NATO secretary-general, a Commission spokesperson told POLITICO on Monday. “And she has no comment on the speculation.”
Who else can do it?
As with von der Leyen, it is unclear if some other names floated are actually available.
Dutch Prime Minister Rutte has dismissed speculation about a NATO role, telling reporters in January that he wanted to “leave politics altogether and do something completely different.”
A spokesperson for the prime minister reiterated this week that the his view has not changed.
Insiders, however, say the Dutch leader shouldn’t be counted out. In office since 2010, Rutte has significant experience working with leaders across the alliance and promotes a tight transatlantic bond.
The Netherlands is also relatively muscular on defense — it has been one of Europe’s largest donors to Ukraine — but not quite as hawkish as countries on the eastern flank.
“Rutte’s name keeps popping up,” said the second senior European diplomat, “but no movement on this beyond gossip.”
Others occasionally mentioned as possible candidates are Estonian Prime Minister Kaja Kallas and Spanish Prime Minister Pedro Sánchez, and to a lesser extent British Defense Secretary Ben Wallace, Canadian Deputy Prime Minister Chrystia Freeland, Romanian President Klaus Iohannis and Slovak President Zuzana Čaputová.
But despite the gossip, officials acknowledge many of these names are not politically feasible at this stage.
Kallas, for instance, is perceived as too hawkish. And conversely, Canada and some southern European countries are viewed within the alliance as laggards on defense investment. Then there’s the fact that some capitals would oppose a non-EU candidate, complicating a Wallace candidacy.
As a result, a senior figure from a northern or western EU country appears the most likely profile for a successful candidate. Yet for now, who that person would be remains murky. Officials do have a deadline, though: the annual NATO summit in July.
“Either a new secretary general will be announced,” said a fifth senior European diplomat, “or the mandate of Jens Stoltenberg will be prolonged.”
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( With inputs from : www.politico.eu )
Western governments are ticked off with TikTok. The Chinese-owned app loved by teenagers around the world is facing allegations of facilitating espionage, failing to protect personal data, and even of corrupting young minds.
Governments in the United States, United Kingdom, Canada, New Zealand and across Europe have moved to ban the use of TikTok on officials’ phones in recent months. If hawks get their way, the app could face further restrictions. The White House has demanded that ByteDance, TikTok’s Chinese parent company, sell the app or face an outright ban in the U.S.
But do the allegations stack up? Security officials have given few details about why they are moving against TikTok. That may be due to sensitivity around matters of national security, or it may simply indicate that there’s not much substance behind the bluster.
TikTok’s Chief Executive Officer Shou Zi Chew will be questioned in the U.S. Congress on Thursday and can expect politicians from all sides of the spectrum to probe him on TikTok’s dangers. Here are some of the themes they may pick up on:
1. Chinese access to TikTok data
Perhaps the most pressing concern is around the Chinese government’s potential access to troves of data from TikTok’s millions of users.
Western security officials have warned that ByteDance could be subject to China’s national security legislation, particularly the 2017 National Security Law that requires Chinese companies to “support, assist and cooperate” with national intelligence efforts. This law is a blank check for Chinese spy agencies, they say.
TikTok’s user data could also be accessed by the company’s hundreds of Chinese engineers and operations staff, any one of whom could be working for the state, Western officials say. In December 2022, some ByteDance employees in China and the U.S. targeted journalists at Western media outlets using the app (and were later fired).
EU institutions banned their staff from having TikTok on their work phones last month. An internal email sent to staff of the European Data Protection Supervisor, seen by POLITICO, said the move aimed “to reduce the exposure of the Commission from cyberattacks because this application is collecting so much data on mobile devices that could be used to stage an attack on the Commission.”
And the Irish Data Protection Commission, TikTok’s lead privacy regulator in the EU, is set to decide in the next few months if the company unlawfully transferred European users’ data to China.
Skeptics of the security argument say that the Chinese government could simply buy troves of user data from little-regulated brokers. American social media companies like Twitter have had their own problems preserving users’ data from the prying eyes of foreign governments, they note.
TikTok says it has never given data to the Chinese government and would decline if asked to do so. Strictly speaking, ByteDance is incorporated in the Cayman Islands, which TikTok argues would shield it from legal obligations to assist Chinese agencies. ByteDance is owned 20 percent by its founders and Chinese investors, 60 percent by global investors, and 20 percent by employees.
There’s little hope to completely stop European data from going to China | Alex Plavevski/EPA
The company has unveiled two separate plans to safeguard data. In the U.S., Project Texas is a $1.5 billion plan to build a wall between the U.S. subsidiary and its Chinese owners. The €1.2 billion European version, named Project Clover, would move most of TikTok’s European data onto servers in Europe.
Nevertheless, TikTok’s chief European lobbyist Theo Bertram also said in March that it would be “practically extremely difficult” to completely stop European data from going to China.
2. A way in for Chinese spies
If Chinese agencies can’t access TikTok’s data legally, they can just go in through the back door, Western officials allege. China’s cyber-spies are among the best in the world, and their job will be made easier if datasets or digital infrastructure are housed in their home territory.
Dutch intelligence agencies have advised government officials to uninstall apps from countries waging an “offensive cyber program” against the Netherlands — including China, but also Russia, Iran and North Korea.
Critics of the cyber espionage argument refer to a 2021 study by the University of Toronto’s Citizen Lab, which found that the app did not exhibit the “overtly malicious behavior” that would be expected of spyware. Still, the director of the lab said researchers lacked information on what happens to TikTok data held in China.
TikTok’s Project Texas and Project Clover include steps to assuage fears of cyber espionage, as well as legal data access. The EU plan would give a European security provider (still to be determined) the power to audit cybersecurity policies and data controls, and to restrict access to some employees. Bertram said this provider could speak with European security agencies and regulators “without us [TikTok] being involved, to give confidence that there’s nothing to hide.”
Bertram also said the company was looking to hire more engineers outside China.
3. Privacy rights
Critics of TikTok have accused the app of mass data collection, particularly in the U.S., where there are no general federal privacy rights for citizens.
In jurisdictions that do have strict privacy laws, TikTok faces widespread allegations of failing to comply with them.
The company is being investigated in Ireland, the U.K. and Canada over its handling of underage users’ data. Watchdogs in the Netherlands, Italy and France have also investigated its privacy practices around personalized advertising and for failing to limit children’s access to its platform.
TikTok has denied accusations leveled in some of the reports and argued that U.S. tech companies are collecting the same large amount of data. Meta, Amazon and others have also been given large fines for violating Europeans’ privacy.
4. Psychological operations
Perhaps the most serious accusation, and certainly the most legally novel one, is that TikTok is part of an all-encompassing Chinese civilizational struggle against the West. Its role: to spread disinformation and stultifying content in young Western minds, sowing division and apathy.
Earlier this month, the director of the U.S. National Security Agency warned that Chinese control of TikTok’s algorithm could allow the government to carry out influence operations among Western populations. TikTok says it has around 300 million active users in Europe and the U.S. The app ranked as the most downloaded in 2022.
A woman watches a video of Egyptian influencer Haneen Hossam | Khaled Desouki/AFP via Getty Images
Reports emerged in 2019 suggesting that TikTok was censoring pro-LGBTQ content and videos mentioning Tiananmen Square. ByteDance has also been accused of pushing inane time-wasting videos to Western children, in contrast to the wholesome educational content served on its Chinese app Douyin.
Besides accusations of deliberate “influence operations,” TikTok has also been criticized for failing to protect children from addiction to its app, dangerous viral challenges, and disinformation. The French regulator said last week that the app was still in the “very early stages” of content moderation. TikTok’s Italian headquarters was raided this week by the consumer protection regulator with the help of Italian law enforcement to investigate how the company protects children from viral challenges.
Researchers at Citizen Lab said that TikTok doesn’t enforce obvious censorship. Other critics of this argument have pointed out that Western-owned platforms have also been manipulated by foreign countries, such as Russia’s campaign on Facebook to influence the 2016 U.S. elections.
TikTok says it has adapted its content moderation since 2019 and regularly releases a transparency report about what it removes. The company has also touted a “transparency center” that opened in the U.S. in July 2020 and one in Ireland in 2022. It has also said it will comply with new EU content moderation rules, the Digital Services Act, which will request that platforms give access to regulators and researchers to their algorithms and data.
Additional reporting by Laura Kayali in Paris, Sue Allan in Ottawa, Brendan Bordelon in Washington, D.C., and Josh Sisco in San Francisco.
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( With inputs from : www.politico.eu )
Poland will deliver four Soviet-era MiG-29 fighter jets to Ukraine “in the next few days,” President Andrzej Duda said Thursday.
Poland is the first country to formally commit to sending combat planes to Ukraine, which Kyiv says it urgently needs to repel the Russian invasion, which has become a brutal war of attrition in the eastern Donbas region.
“We will be handing over four fully operational planes,” Duda said at a joint press conference with Czech President Petr Pavel, according to French newswire AFP.
Additional planes which are “currently under maintenance” will be “handed over gradually,” Duda added, and Poland will replace the MiGs with American-made F-35s and South Korean FA-50 fighters.
After convincing its Western allies to supply Ukraine with dozens of tanks following a months-long diplomatic marathon, Kyiv has been intensively lobbying its partners in recent weeks to send modern fighter jets.
As he toured European capitals last month, Ukrainian President Volodymyr Zelenskyy made repeated pleas to the U.K. and France to provide modern jets to boost his country’s aging air force, which is mostly made up of Soviet-era planes.
Yet, Kyiv’s allies have been wary of handing over the latest generation of combat planes, such as American F-16s, out of fear it would only serve to further escalate the conflict.
So far, the U.K. has started training Ukrainian pilots as a “first step” toward sending jets, while the U.S. has welcomed two pilots on an American airbase to assess their flying skills, but will not let them operate American F-16s.
Meanwhile, countries such as France and the Netherlands have expressed openness to the idea, but steered clear of making any formal commitments.
The Polish government — one of Ukraine’s staunchest supporters since Russia launched its full-scale invasion in February 2022 — had already signaled its intention to send jets in recent days.
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( With inputs from : www.politico.eu )
One year of war in Ukraine has left deep scars — including on the country’s natural landscape.
The conflict has ruined vast swaths of farmland, burned down forests and destroyed national parks. Damage to industrial facilities has caused heavy air, water and soil pollution, exposing residents to toxic chemicals and contaminated water. Regular shelling around the Zaporizhzhia nuclear power plant, the largest in Europe, means the risk of a nuclear accident still looms large.
The total number of cases of environmental damage tops 2,300, Ukraine’s environment minister, Ruslan Strilets, told POLITICO in an emailed statement. His ministry estimates the total cost at $51.45 billion (€48.33 billion).
Of those documented cases, 1,078 have already been handed over to law enforcement agencies, according to Strilets, as part of an effort to hold Moscow accountable in court for environmental damage.
A number of NGOs have also stepped in to document the environmental impacts of the conflict, with the aim of providing data to international organizations like the United Nations Environment Program to help them prioritize inspections or pinpoint areas at higher risk of pollution.
Among them is PAX, a peace organization based in the Netherlands, which is working with the Center for Information Resilience (CIR) to record and independently verify incidents of environmental damage in Ukraine. So far, it has verified 242 such cases.
Left: Hostomel, Ukraine, after a Russian assault. Right: Port of Mykolaiv after a Russian strike | Imagery courtesy of Planet Labs PBC
“We mainly rely on what’s being documented, and what we can see,” said Wim Zwijnenburg, a humanitarian disarmament project leader with PAX. Information comes from social media, public media accounts and satellite imagery, and is then independently verified.
“That also means that if there’s no one there to record it … we’re not seeing it,” he said. “It’s such a big country, so there’s fighting in so many locations, and undoubtedly, we are missing things.”
After the conflict is over, the data could also help identify “what is needed in terms of cleanup, remediation and restoration of affected areas,” Zwijnenburg said.
Rebuilding green
While some conservation projects — such as rewilding of the Danube delta — have continued despite the war, most environmental protection work has halted.
“It is very difficult to talk about saving other species if the people who are supposed to do it are in danger,” said Oksana Omelchuk, environmental expert with the Ukrainian NGO EcoAction.
That’s unlikely to change in the near future, she added, pointing out that the environment is littered with mines.
Before and after flooding in the Kyiv area, Ukraine | Imagery courtesy of Planet Labs PBC
Agricultural land is particularly affected, blocking farmers from using fields and contaminating the soil, according to Zwijnenburg. That “might have an impact on food security” in the long run, he said.
When it comes to de-mining efforts, residential areas will receive higher priority, meaning it could take a long time to make natural areas safe again.
The delay will “[hinder] the implementation of any projects for the restoration and conservation of species,” according to Omelchuk.
And, of course, fully restoring Ukraine’s nature won’t be possible until “Russian troops leave the territory” she said.
Azovstal steel plant in Mariupol before and after a Russian attack |Imagery courtesy of Planet Labs PBC
Meanwhile, Kyiv is banking that the legal case it is building against Moscow will become a potential source of financing for rebuilding the country and bringing its scarred landscape and ecosystems back to health.
It is also tapping into EU coffers.In a move intended to help the country restore its environment following Russia’s invasion, Ukraine in June became the first non-EU country to join the LIFE program, the EU’s funding instrument for environment and climate.
Earlier this month, Environment Commissioner Virginijus Sinkevičius announced a €7 million scheme — dubbed the Phoenix Initiative — to help Ukrainian cities rebuild greener and to connect Ukrainian cities with EU counterparts that can share expertise on achieving climate neutrality.
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( With inputs from : www.politico.eu )
BERLIN — In an earlier life as a reporter in Moscow, I once knocked on the door of an apartment listed as the home address of the boss of company that, our year-long investigation showed, was involved in an elaborate scheme to siphon billions of dollars out of Russia’s state railways through rigged tenders.
To my surprise, the man who opened the door wore only his underwear. He confirmed that his identity had been used to register the shell company. But he wasn’t a businessman; he was a chauffeur. The real owner, he told us, was his boss, one of the bankers we suspected of masterminding the scam. “Mr. Underpants,” as we called him, was amazed that it had taken so long for anyone to take an interest.
Mr. Underpants leapt immediately to mind when, nearly a decade on, I learned that a sulfurous academic dispute had erupted over whether foreign companies really are bailing out of Russia in response to President Vladimir Putin’s invasion of Ukraine and subsequent international sanctions.
Attempting to verify corporate activity in Russia — a land that would give the murkiest offshore haven a run for its money — struck me as a fool’s errand. Company operations are habitually hidden in clouds of lies, false paperwork and bureaucratic errors. What a company says it does in Russia can bear precious little resemblance to reality.
So, who are the rival university camps trying to determine whether there really is a corporate exodus from Russia?
In the green corner (under the olive banner of the University of St. Gallen in Switzerland) we have economist Simon Evenett and Niccolò Pisani of the IMD business school in Lausanne. On January 13, they released a working paper which found that less than 9 percent of Western companies (only 120 firms all told) had divested from Russia. Styling themselves as cutting through the hype of corporate self-congratulation, the Swiss-based duo said their “findings challenge the narrative that there is a vast exodus of Western firms leaving the market.”
Nearly 4,000 miles away in New Haven, Connecticut, the Swiss statement triggered uproar in Yale (the blue corner). Jeffrey A. Sonnenfeld, from the university’s school of management, took the St. Gallen/IMD findings as an affront to his team’s efforts. After all, the headline figure from a list compiled by Yale of corporate retreat from Russia is that 1,300 multinationals have either quit or are doing so. In a series of attacks, most of which can’t be repeated here, Sonnenfeld accused Evenett and Pisani of misrepresenting and fabricating data.
Responding, the deans of IMD and St. Gallen issued a statement on January 20 saying they were “appalled” at the way Sonnenfeld had called the rigor and veracity of their colleagues’ work into question. “We reject this unfounded and slanderous allegation in the strongest possible terms,” they wrote.
Sonnenfeld doubled down, saying the Swiss team was dangerously fueling “Putin’s false narrative” that companies had never left and Russia’s economy was resilient.
That led the Swiss universities again to protest against Sonnenfeld’s criticism and deny political bias, saying that Evenett and Pisani have “had to defend themselves against unsubstantiated attacks and intimidation attempts by Jeff Sonnenfeld following the publication of their recent study.”
How the hell did it all get so acrimonious?
Let’s go back a year.
The good fight
Within weeks of the February 24 invasion, Sonnenfeld was attracting fulsome coverage in the U.S. press over a campaign he had launched to urge big business to pull out of Russia. His team at Yale had, by mid-March, compiled a list of 300 firms saying they would leave that, the Washington Post reported, had gone “viral.”
Making the case for ethical business leadership has been Sonnenfeld’s stock in trade for over 40 years. To give his full job titles, he’s the Senior Associate Dean for Leadership Studies & Lester Crown Professor in the Practice of Management at the Yale School of Management, as well as founder and president of the Chief Executive Leadership Institute, a nonprofit focused on CEO leadership and corporate governance.
And, judging by his own comments, Sonnenfeld is convinced of the importance of his campaign in persuading international business leaders to leave Russia: “So many CEOs wanted to be seen as doing the right thing,” Sonnenfeld told the Post. “It was a rare unity of patriotic mission, personal values, genuine concern for world peace, and corporate self-interest.”
Fast forward to November, and Sonnenfeld is basking in the glow of being declared an enemy of the Russian state, having been added to a list of 25 U.S. policymakers and academics barred from the country. First Lady Jill Biden topped the list, but Sonnenfeld was named in sixth place which, as he told Bloomberg, put him “higher than [Senate minority leader] Mitch McConnell.”
Apparently less impressed, the Swiss team had by then drafted a first working paper, dated October 18, challenging Sonnenfeld’s claims of a “corporate exodus” from Russia. This paper, which was not published, was circulated by the authors for review. After receiving a copy (which was uploaded to a Yale server), Sonnenfeld went on the attack.
Apples and oranges
Before we dive in, let’s take a step back and look at what the Yale and Swiss teams are trying to do.
Sonnenfeld is working with the Kyiv School of Economics (KSE), which launched a collaborative effort to track whether companies are leaving Russia by monitoring open sources, such as regulatory filings and news reports, supported where possible through independent confirmation.
Kyiv keeps score on its Leave Russia site, which at the time of writing said that, of 3,096 companies reviewed, 196 had already exited and a further 1,163 had suspended operations.
Evenett and Pisani are setting a far higher bar, seeking an answer to the binary question of whether a company has actually ditched its equity. It’s not enough to announce you are suspending operations, you have to fully divest your subsidiary and assets such as factories or stores. This is, of course, tough. Can you find a buyer? Will the Russians block your sale?
The duo focuses only on companies based in the G7 or the European Union that own subsidiaries in Russia. Just doing business in Russia doesn’t count; control is necessary. To verify this, they used a business database called ORBIS, which contains records of 400 million companies worldwide.
The first thought to hold onto here, then, is that the scope and methodology of the Yale and Swiss projects are quite different — arguably they are talking about apples and oranges. Yale’s apple cart comprises foreign companies doing business in Russia, regardless of whether they have a subsidiary there. The Swiss orange tree is made up of fewer than half as many foreign companies that own Russian subsidiaries, and are themselves headquartered in countries that have imposed sanctions against the Kremlin.
So, while IKEA gets an ‘A’ grade on the Yale list for shutting its furniture stores and letting 10,000 Russian staff go, it hasn’t made the clean equity break needed to get on the St. Gallen/IMD leavers’ list. The company says “the process of scaling down the business is ongoing.” If you simply have to have those self-assembly bookshelves, they and other IKEA furnishings are available online.
The second thing to keep in mind is that ORBIS aggregates records in Russia, a country where people are willing to serve as nominee directors in return for a cash handout — even a bottle of vodka. Names are often mistranslated when local companies are established — transliteration from Russian to English is very much a matter of opinion — but this can also be a deliberate ruse to throw due diligence sleuths off the trail.
Which takes us back to the top of this story: I’ve done in-depth Russian corporate investigations and still have the indelible memory of those underpants (they were navy blue briefs) to show for it.
Stacking up the evidence
The most obvious issue with the Yale method is that it places a lot of emphasis on what foreign companies say about whether they are pulling out of Russia.
There is an important moral suasion element at play here. Yale’s list is an effective way to name and shame those companies like Unilever and Mondelez — all that Milka chocolate — that admit they are staying in Russia.
But what the supposed good kids — who say they are pulling out — are really up to is a murkier business. Even if a company is an A-grade performer on the Yale list, that does not mean that Russia’s economy is starved of those goods during wartime. There can be many reasons for this. Some companies will rush out a pledge to leave, then dawdle. Others will redirect goods to Russia through middlemen in, say, Turkey, Dubai or China. Some goods will be illegally smuggled. Some companies will have stocks that last a long time. Others might hire my old friend Mr. Underpants to create an invisible corporate structure.
A stroll through downtown Moscow reveals the challenges. Many luxury brands have conspicuously shut up shop but goods from several companies on the Yale A list and B list (companies that have suspended activities in Russia) were still easy to find on one, totally random, shopping trip. The latest Samsung laptops, TVs and phones were readily available, and the shop reported no supply problems. Swatch watches, Jägermeister liquor and Dr. Oetker foods were all also on sale in downtown Moscow, including at the historic GUM emporium across Red Square from the Kremlin.
Swatch watches, Jägermeister liquor and Dr. Oetker foods can all be bought in downtown Moscow, including at the historic GUM emporium across Red Square from the Kremlin | POLITICO
All the companies involved insisted they had ended business in Russia, but acknowledged the difficulties of continued sales. Swatch said the watches available would have to be from old stocks or “a retailer over which the company has no control.” Dr. Oetker said: “To what extent individual trading companies are still selling stocks of our products there is beyond our knowledge.” Jägermeister said: “Unfortunately we cannot prevent our products being purchased by third parties and sold on in Russia without our consent or permission.” Samsung Electronics said it had suspended Russia sales but continued “to actively monitor this complex situation to determine our next steps.”
The larger problem emerging is that sanctions are turning neighboring countries into “trading hubs” that allow key foreign goods to continue to reach the Russian market, cushioning the economic impact.
Full departure can also be ultra slow for Yale’s A-listers. Heineken announced in March 2022 it was leaving Russia but it is still running while it is “working hard to transfer our business to a viable buyer in very challenging circumstances.” It was also easy to find a Black & Decker power drill for sale online from a Russian site. The U.S. company said: “We plan to cease commerce by the end of Q2 of this year following the liquidation of our excess and obsolete inventory in Russia. We will maintain a legal entity to conduct any remaining administrative activities associated with the wind down.”
And those are just consumer goods that are easy to find! Western and Ukrainian security services are naturally more preoccupied about engineering components for Putin’s war machine still being available through tight-lipped foreign companies. Good luck trying to track their continued sales …
Who’s for real?
Faced with this gray zone, St. Gallen/IMD sought to draw up a more black-and-white methodology.
To reach their conclusions, Evenett and Pisani downloaded a list of 36,000 Russian companies from ORBIS that reported at least $1 million in sales in one of the last five years. Filtering out locally owned businesses and duplicate entries whittled down the number of owners of the Russian companies that are themselves headquartered in the G7 or EU to a master list of 1,404 entities. As of the end of November, the authors conclude, 120 companies — or 8.5 percent of the total — had left.
The Swiss team was slow, however, to release its list of 1,404 companies and, once Sonnenfeld gained access to it, he had a field day. He immediately pointed out that it was peppered with names of Russian businesses and businessmen, whom ORBIS identified as being formally domiciled in an EU or G7 country. Sonnenfeld fulminated that St. Gallen/IMD were producing a list of how few Russian companies were quitting Russia, rather than how few Western companies were doing so.
“That hundreds of Russian oligarchs and Russian companies constitute THEIR dataset of ‘1,404 western companies’ is egregious data misrepresentation,” Sonnenfeld wrote in one of several emails to POLITICO challenging the Swiss findings.
Fair criticism? Well, Sonnenfeld’s example of Yandex, the Russian Google, on the list of 1,404 is a good one. Naturally, that’s a big Russian company that isn’t going to leave Russia.
On the other hand, its presence on the list is explicable as it is based in the Netherlands, and is reported to be seeking Putin’s approval to sell its Russian units. “Of course, a large share of Yandex customers and staff are Russian or based in Russia. However, the company has offices in seven countries, including Switzerland, Israel, the U.S., China, and others. What criteria should we use to decide if it is Russian or not for the purpose of our analysis?” St. Gallen/IMD said in a statement.
Answering Sonnenfeld’s specific criticism that its list was skewed by the inclusion of Russian-owned companies, the Swiss team noted that it had modified its criteria to exclude companies based in Cyprus, a favored location for Russian entrepreneurs thanks to its status as an EU member country and its business-friendly tax and legal environment. Yet even after doing so, its conclusions remained similar.
Double knockout
Sonnenfeld, in his campaign to discredit the Swiss findings, has demanded that media, including POLITICO, retract their coverage of Evenett and Pisani’s work. He took to Fortune magazine to call their publication “a fake pro-Putin list of Western companies still doing business in Russia.”
Although he believes Evenett and Pisani’s “less than 9 percent” figure for corporates divesting equity is not credible, he bluntly declined, when asked, to provide a figure of his own.
Instead, he has concentrated on marshaling an old boys’ network — including the odd ex-ambassador — to bolster his cause. Richard Edelman, head of the eponymous public relations outfit, weighed in with an email to POLITICO: “This is pretty bad[.] Obvious Russian disinformation[.] Would you consider a retraction?” he wrote in punctuation-free English. “I know Sonnenfeld well,” he said, adding the two had been classmates in college and business school.
Who you were at school with hardly gets to the heart of what companies are doing in Russia, and what the net effect is on the Russian economy.
The greater pity is that this clash, which falls miles short of the most basic standards of civil academic discourse, does a disservice to the just cause of pressuring big business into dissociating itself from Putin’s murderous regime.
And, at the end of the day, estimates of the number of companies that have fully left Russia are in the same ballpark: The Kyiv School of Economics puts it at less than 200; the Swiss team at 120.
To a neutral outsider, it would look like Sonnenfeld and his mortal enemies are actually pulling in the same direction, trying to work out whether companies are really quitting. Yet both methodologies are problematic. What companies and databases say offers an imprecise answer to the strategic question: What foreign goods and services are available to Russians? Does a year of war mean no Samsung phones? No. Does it mean Heineken has sold out? Not yet, no.
This has now been submerged in a battle royal between Sonnenfeld and the Swiss researchers.
Appalled at his attacks on their work, St. Gallen and IMD finally sent a cease-and-desist letter to Sonnenfeld.
Yale Provost Scott Strobel is trying to calm the waters. In a letter dated February 6 and seen by POLITICO, he argued that academic freedom protected the speech of its faculty members. “The advancement of knowledge is best served when scholars engage in an open and robust dialogue as they seek accurate data and its best interpretation,” Strobel wrote. “This dialogue should be carried out in a respectful manner that is free from ad hominem attacks.”
With reporting by Sarah Anne Aarup, Nicolas Camut, Wilhelmine Preussenand Charlie Duxbury.
Douglas Busvine is Trade and Agriculture Editor at POLITICO Europe. He was posted with Reuters to Moscow from 2004-08 and from 2011-14.
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( With inputs from : www.politico.eu )
The Dutch government on Saturday ordered the expulsion of several Russian diplomats over Russia’s “continued attempts to place intelligence officers into the Netherlands under diplomatic cover.”
The Netherlands also said it will close its consulate general in St. Petersburg on Monday and the Russian trade office in Amsterdam by Tuesday.
The moves are the latest development in ongoing negotiations over visas for diplomats: The Netherlands expelled 17 Russian diplomats last March over espionage concerns following Russia’s invasion of Ukraine — after which Russia expelled 15 Dutch diplomats.
“Negotiations with Russia over the terms of sending diplomats back and forth to diplomatic posts have so far come to nothing,” the government said in a statement Saturday. “Russia keeps trying to surreptitiously place intelligence officers in the Netherlands as diplomats. At the same time, Russia refuses to issue visas for Dutch diplomats to staff the consulate general in St. Petersburg and the embassy in Moscow.”
It described the situation as “unacceptable” and “untenable.” The Dutch government added that it was “important to keep the embassies open as a communication channel, even now that relations with Russia are more difficult than ever.”
The diplomats now have two weeks to leave the country.
The Russian Ministry of Foreign Affairs said it will “give an appropriate response” to the Dutch decision, according to a report by Russian state news agency RIA Novosti.
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( With inputs from : www.politico.eu )
There’s more bad news for Vladimir Putin. Europe is on course to get through winter with its vital gas storage facilities more than half full, according to a new European Commission assessment seen by POLITICO.
That means despite the Russian leader’s efforts to make Europe freeze by cutting its gas supply, EU economies will survive the coldest months without serious harm — and they look set to start next winter in a strong position to do the same.
A few months ago, there were fears of energy shortages this winter caused by disruptions to Russian pipeline supplies.
But a combination of mild weather, increased imports of liquefied natural gas (LNG), and a big drop in gas consumption mean that more than 50 billion cubic meters (bcm) of gas is projected to remain in storage by the end of March, according to the Commission analysis.
A senior European Commission official attributed Europe’s success in securing its gas supply to a combination of planning and luck.
“A good part of the success is due to unusually mild weather conditions and to China being out of the market [due to COVID restrictions],” the official said. “But demand reduction, storage policy and infrastructure work helped significantly.”
Ending the winter heating season with such healthy reserves — above 50 percent of the EU’s roughly 100bcm total storage capacity — removes any lingering fears of a gas shortage in the short term. It also eases concerns about Europe’s energy security going into next winter.
The positive figures underlie the more optimistic outlook presented by EU leaders in recent days, with Energy Commissioner Kadri Simson saying on Tuesday that Europe had “won the first battle” of the “energy war” with Russia.
EU storage facilities — also vital for winter gas supply in the U.K., where storage options are limited — ended last winter only around 20 percent full. Brussels mandated that they be replenished to 80 percent ahead of this winter, requiring a hugely expensive flurry of LNG purchases by European buyers, to replace volumes of gas lost from Russian pipelines.
The wholesale price of gas rose to record levels during storage filling season — peaking at more than €335 per megawatt hour in August — with dire knock-on effects for household bills, businesses’ energy costs and Europe’s industrial competitiveness.
Gas prices have since fallen to just above €50/Mwh amid easing concerns over supplies. The EU has a new target to fill 90 percent of gas storage again by November 2023 — an effort that will now require less buying of LNG on the international market than it might have done had reserves been more seriously depleted.
“The expected high level of storages at above 50 percent [at] the end of this winter season will be a strong starting point for 2023/24 with less than 40 percent to be filled (against the difficult starting point of around 20 percent in storage at the end of winter season in 2022,” the Commission assessment says.
Analysts at the Independent Commodity Intelligence Services think tank said this week that refilling storages this year could still be “as tough a challenge as last year” but predicted that the EU now had “more than enough import capacity to meet the challenge.”
Across the EU, five new floating LNG terminals have been set up — in the Netherlands, Greece, Finland and two in Germany — providing an extra 30bcm of gas import capacity, with more due to come online this year and next.
However, the EU’s ability to refill storages to the new 90 percent target ahead of next winter will likely depend on continued reduction in gas consumption.
Brussels set member states a voluntary target of cutting gas demand by 15 percent from August last year. Gas demand actually fell by more than 20 percent between August and December, according to the latest Commission data, partly thanks to efficiency measures but also the consequence of consumers responding to much higher prices by using less energy.
The 15 percent target may need to be extended beyond its expiry date of March 31 to avoid gas demand rebounding as prices fall. EU energy ministers are set to discuss the issue at two forthcoming meetings in February and March.
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( With inputs from : www.politico.eu )
