Tag: United States

  • Russian diamonds lose their sparkle in Europe

    Russian diamonds lose their sparkle in Europe

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    In the European bubble in Brussels, diamonds aren’t anyone’s best friend anymore. 

    The Belgian government’s reluctance to ban imports of Russian diamonds, which would hurt the city of Antwerp, a global hub for the precious stones, has outraged Ukraine and its supporters within the EU.

    Ukraine has been pushing to stop the import of Russian rough diamonds because the trade enriches Alrosa, a partially state-owned Russian enterprise. 

    While such a crackdown wouldn’t inflict the same damage on Vladimir Putin’s economy as a prohibition on all fossil fuels, for example, the continuing flow of Russian diamonds has become a symbol of Western countries putting their national interests above those of Ukraine. 

    New plans for a fresh round of sanctions against Putin have now reignited the debate over the morality of Europe’s trade in diamonds from Russia. 

    Belgium is fed up with being scapegoated. According to Prime Minister Alexander De Croo, Putin’s ability to sell diamonds to all western markets now needs to be shut off. 

    “Russian diamonds are blood diamonds,” De Croo said in a statement to POLITICO. “The revenue for Russia from diamonds can only stop if the access of Russian diamonds to Western markets is no longer possible. On forging that solid front, Belgium is working with its partners.” 

    The West’s economic war against Russia has already had an impact. Partly because of U.S. sanctions, the Russian diamond trade in Antwerp has already been severely hit. But those rough Russian diamonds are diverted to other diamond markets, and often find their way back to the West, cut and polished.

    That’s why Belgium is working with partners to introduce a “watertight” traceability system for diamonds, a Belgian official said. If it works, this could hurt Moscow more than if Washington or Brussels are flying solo.

    “Europe and North America together represent 70 percent of the world market for natural diamonds,” the official said. “Based on this market power, we can ensure the necessary transparency in the global diamond sector and structurally ban blood diamonds from the global market. The war in Ukraine provides for a strong momentum.”

    Sanctions at last?

    Belgium’s offensive comes just when its position on sanctioning Russian diamonds is under renewed attack — not just from other EU countries and Belgian opposition parties, but also within De Croo’s own government.

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    According to Belgian Prime Minister Alexander De Croo, Putin’s ability to sell diamonds to all western markets now needs to be shut off | Laurie Dieffembacq/Belga Mag/AFP via Getty Images

    The EU is preparing a new round of sanctions against Russia ahead of the first anniversary of Putin’s invasion of Ukraine on February 24. Countries such as Poland and Lithuania are again urging the EU to include diamonds. However, one EU diplomat said the discussion is now more an “intra-Belgian fight than a European one.”

    De Croo leads a coalition of seven ideologically diverse parties. The greens and socialists within his government are pushing him to actively lobby for hitting diamonds in the next EU sanctions round.

    In particular, Vooruit, the Dutch-speaking socialist party, is making a renewed push. Belgian MP Vicky Reynaert will be introducing a new resolution in the Belgian Parliament proposing an import ban. 

    “It’s becoming impossible to explain that Belgium is not open to blocking Russian diamonds,” Reynaert said. “We want Belgium to actively engage with the European Commission to take action.” Belgian socialist MEP Kathleen Van Brempt is pushing the same idea at the European level.

    But the initiative from the socialists isn’t likely to deliver an import ban, or even import quotas, four officials from other Belgian political parties said. De Croo is now set on an international solution instead. No one expects the socialists to destabilize De Croo’s fragile Belgian coalition government over the issue of diamonds.

    Even if all seven parties in the Belgian government did agree to hit Russian diamonds, there would be another key obstacle.

    In the complicated Belgian political system, the regional governments would have a say as well. The government of the northern region of Flanders is against an import ban. That government is led by the Flemish nationalists, whose party president, Bart De Wever, is also the mayor of Antwerp. “Nothing will change their minds on this,” one of the Belgian officials said of the nationalists’ position.

    Blood diamonds

    Belgium hopes that by building an international coalition to trace Russia’s “blood diamonds” it will finally stop being seen as a roadblock to action. 

    The industry agrees. “Sanctions are not the solution,” said Tom Neys of the Antwerp World Diamond Centre. “An international framework of complete transparency, with the same standards of compliance as Antwerp, can be that solution,” he said.

    Such a transatlantic plan would have a huge impact, according to Hans Merket, a researcher with the International Peace Information Service, a human rights nonprofit organization. “That would have much more effect than the current U.S. sanctions, which are being circumvented,” said Merket.

    But the devil will be in the details. Will Belgium succeed in building a transatlantic coalition? Are consumers willing to pay more for their diamonds, or does it still risk diverting the goods to other markets where traders are less diligent?

    One of the Belgian officials was doubtful of Belgium’s chances of success. If the international alliance falters, Belgium and the EU should consider moving ahead on their own to convince the rest of the world to act. “But let’s give De Croo a shot at this,” the official said. 



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    ( With inputs from : www.politico.eu )

  • Scholz doubles down on refusal of fighter jets for Ukraine

    Scholz doubles down on refusal of fighter jets for Ukraine

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    German Chancellor Olaf Scholz doubled down on his rejection of demands by Kyiv to supply Ukraine with fighter jets on the heels of Berlin’s agreement to send battle tanks.  

    “The question of combat aircraft does not arise at all,” Scholz said in an interview with Tagesspiegel published on Sunday. “I can only advise against entering into a constant competition to outbid each other when it comes to weapons systems.”

    His comments come after a top Ukrainian official said on Saturday that Kyiv and its Western allies were engaged in “fast-track” talks on possibly sending military aircraft as well as long-range missiles to help fight the invasion by Russia.

    Scholz last week ruled out providing fighter jets, citing the need to prevent further military escalation. “There will be no fighter jet deliveries to Ukraine,” he said on Wednesday, soon after Germany and the U.S. agreed to provide advanced tanks for Kyiv’s war effort.

    Ukraine renewed its request for the fighter aircraft almost immediately after Berlin and Washington announced the tanks. Berlin said Germany and its European allies will send about 80 Leopard 2 tanks.

    “If, as soon as a decision has been made, the next debate starts in Germany, this does not look very serious and shakes the confidence of the citizens in government decisions,” Scholz told Tagesspiegel. “Such debates should not be conducted for reasons of domestic political profiling. It is important to me now that all those who have announced their intention to supply battle tanks to Ukraine do so,” he said.

    Mykhailo Podolyak, an adviser to Ukrainian President Volodymyr Zelenskyy, said on Saturday that Kyiv was in talks with allies about aircraft, but that some partners have a “conservative” attitude on arms deliveries. Without citing any partners by name, he said this attitude was “due to fear of changes in the international architecture.”

    Hans von der Burchard contributed to this report.



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    ( With inputs from : www.politico.eu )

  • Poland ready to build ‘smaller coalition’ to send tanks to Ukraine without Germany

    Poland ready to build ‘smaller coalition’ to send tanks to Ukraine without Germany

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    If Germany won’t play ball, then Poland will find other partners to deliver Leopard 2 battle tanks to Ukraine, Polish Prime Minister Mateusz Morawiecki said in pointed remarks accusing Berlin of foot-dragging in its support of Kyiv against invading Russian forces.

    Poland is prepared to go around German opposition to build a “smaller coalition” of countries and find allies willing to send the tanks to Ukraine, Morawiecki said in an interview with the Polish Press Agency published on Sunday.

    “We will not passively watch Ukraine bleed to death,” Morawiecki said.

    His remarks come amid a heated debate over whether to send the German-made battle tanks to Ukraine. Kyiv has requested the weapons in order to renew its offensive against Russia in a push to reconquer captured territory.

    Germany has expressed reluctance toward sending tanks without the U.S. doing the same, as it fears an escalation of the conflict. Berlin also holds a veto power over the re-export of the weapons from any of its allies. German Defense Minister Boris Pistorius has denied blocking any deliveries.

    “We are in very close dialogue on this issue with our international partners, above all with the U.S.,” Pistorius, who took up the defense post last week, said in an interview with Bild published on Sunday.

    Morawiecki has previously said that he was ready to go ahead with Leopard deliveries even without Berlin’s approval.

    “Since Minister Pistorius denies that Germany is blocking the supply of tanks to Ukraine, I would like to hear a clear declaration that Berlin supports sending them,” the prime minister told the Polish Press Agency.

    “The war is here and now. … Do the Germans want to keep them in storage until Russia defeats Ukraine and is knocking on Berlin’s door?” Morawiecki said.

    Political analyst Volodymyr Fesenko said in a statement that Germany was edging towards allowing the tanks to be sent — and advised “patience and perseverance.” But the broader takeaway was that Ukraine had to rebuild its own armaments industry in order to not have to only rely on help from abroad in the future, he added.



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    ( With inputs from : www.politico.eu )

  • Top Russia official threatens West with ‘global catastrophe’ over weapons to Ukraine

    Top Russia official threatens West with ‘global catastrophe’ over weapons to Ukraine

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    Continued deliveries of arms to Ukraine by its allies in the West will lead to retaliation with “more powerful weapons,” a top official in Russian President Vladimir Putin’s regime said on Sunday.

    Vyacheslav Volodin, chairman of Russia’s lower house, the State Duma, threatened Europe and the U.S. with “global catastrophe” over their continued military support to the government in Kyiv, which is trying to continue retaking territory it lost in the Russian invasion.

    Volodin directly invoked the use of nuclear weapons in his statement over messaging app Telegram.

    “Arguments that the nuclear powers have not previously used weapons of mass destruction in local conflicts are untenable. This is because these states have not faced a situation in which the security of their citizens and the territorial integrity of their countries were threatened,” the Russian official wrote in his social media post.

    The threat comes amid arguments over whether Germany will send Leopard 2 battle tanks to Ukraine to fight the Russian invasion. Kyiv has requested the German-made tanks, which it says it needs to renew its counteroffensive against Moscow’s forces. But Berlin has so far resisted the call from Ukraine and its allies to send the tanks without the U.S. making the first move, over fears of an escalation in the conflict.

    Berlin also hasn’t approved deliveries of the tanks from its allies, as Germany gets a final say over any re-exports of the vehicles from countries that have purchased them.

    Newly appointed German Defense Minister Boris Pistorius is planning a trip to Ukraine, which could come in the next month, German newspaper Bild, a sister publication of POLITICO in the Axel Springer Group, reported on Sunday, citing an interview. Asked about the Leopard tanks, Pistorius said: “We are in very close dialogue on this issue with our international partners, above all with the U.S.”

    In his Telegram post, Russia’s Volodin said: “With their decisions, Washington and Brussels are leading the world to a terrible war … foreign politicians making such decisions need to understand that this could end in a global tragedy that will destroy their countries.”

    It’s not the first time that top Russian politicians threaten a nuclear escalation. Former Russian President Dmitry Medvedev has invoked the use of nuclear weapons more than once since the outbreak of the conflict 11 months ago.



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    ( With inputs from : www.politico.eu )

  • Scholz upbeat about trade truce with US in ‘first quarter of this year’

    Scholz upbeat about trade truce with US in ‘first quarter of this year’

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    PARIS — German Chancellor Olaf Scholz raised optimism on Sunday that the EU and the U.S. can reach a trade truce in the coming months to prevent discrimination against European companies due to American subsidies.

    Speaking at a press conference with French President Emmanuel Macron following a joint Franco-German Cabinet meeting in Paris, Scholz said he was “confident” that the EU and the U.S. could reach an agreement “within the first quarter of this year” to address measures under the U.S. Inflation Reduction Act that Europe fears would siphon investments in key technologies away the Continent.

    “My impression is that there is a great understanding in the U.S. [of the concerns raised in the EU],” the chancellor said.

    Macron told reporters that he and Scholz supported attempts by the European Commission to negotiate exemptions from the U.S. law to avoid discrimination against EU companies.

    The fresh optimism came as both leaders adopted a joint statement in which they called for loosening EU state aid rules to boost home-grown green industries — in a response to the U.S. law. The text said the EU needed “ambitious” measures to increase the bloc’s economic competitiveness, such as “simplified and streamlined procedures for state aid” that would allow pumping more money into strategic industries. 

    The joint statement also stressed the need to create “sufficient funding.” But in a win for Berlin, which has been reluctant to talk about new EU debt, the text says that the bloc should first make “full use of the available funding and financial instruments.” The statement also includes an unspecific reference about the need to create “solidarity measures.” 

    EU leaders will meet early next month to discuss Europe’s response to the Inflation Reduction Act, including the Franco-German proposal to soften state aid rules.

    The relationship between Scholz and Macron hit a low in recent months when the French president canceled a planned joint Cabinet meeting in October over disagreements on energy, finance and defense. But the two leaders have since found common ground over responding to the green subsidies in Washington’s Inflation Reduction Act. Macron said that Paris and Berlin had worked in recent weeks to “synchronize” their visions for Europe. 

    “We need the greatest convergence possible to help Europe to move forward,” he said.

    But there was little convergence on how to respond to Ukraine’s repeated requests for Germany and France to deliver battle tanks amid fears there could be a renewed Russian offensive in the spring. 

    Asked whether France would send Leclerc tanks to Ukraine, Macron said the request was being considered and there was work to be done on this issue in the “days and weeks to come.”

    Scholz evaded a question on whether Germany would send Leopard 2 tanks, stressing that Berlin had never ceased supporting Ukraine with weapons deliveries and took its decisions in cooperation with its allies.

    “We have to fear that this war will go on for a very long time,” the chancellor said.

    Reconciliation, for past and present

    The German chancellor and his Cabinet were in Paris on Sunday to celebrate the 60th anniversary of the Elysée treaty, which marked a reconciliation between France and Germany after World War II. The celebrations, first at the Sorbonne University and later at the Elysée Palace, were also a moment for the two leaders to put their recent disagreements aside.

    Paris and Berlin have been at odds in recent months not only over defense, energy and finance policy, but also Scholz’s controversial €200 billion package for energy price relief, which was announced last fall without previously involving the French government. These tensions culminated in Macron snubbing Scholz by canceling, in an unprecedented manner, a planned press conference with the German leader in October.

    At the Sorbonne, Scholz admitted relations between the two countries were often turbulent. 

    “The Franco-German engine isn’t always an engine that purrs softly; it’s also a well-oiled machine that can be noisy when it is looking for compromises,” he said.  

    Macron said France and Germany needed to show “fresh ambition” at a time when “history is becoming unhinged again,” in a reference to Russia’s aggression against Ukraine. 

    “Because we have cleared a path towards reconciliation, France and Germany must become pioneers for the relaunch of Europe” in areas such as energy, innovation, technology, artificial intelligence and diplomacy, he said. 

    On defense, Paris and Berlin announced that Franco-German battalions would be deployed to Romania and Lithuania to reinforce NATO’s eastern front.

    The leaders also welcomed “with satisfaction” recent progress on their joint fighter jet project, FCAS, and said they wanted to progress on their Franco-German tank project, according to the joint statement. 

    The joint declaration also said that both countries are open to the long-term project of EU treaty changes, and that in the shorter term they want to overcome “deadlocks” in the Council of the EU by switching to qualified majority voting on foreign policy and taxation.



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    ( With inputs from : www.politico.eu )

  • China turns on the charm

    China turns on the charm

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    Beijing wants to be friends again.

    Chinese diplomats are fanning out with a new softer message for international partners and adversaries alike. Gone is the aggressive “wolf warrior” rhetoric. In its place, a warmer tone and a promise of economic cooperation.

    Vice Premier Liu He took Beijing’s diplomatic olive branch to the exclusive annual huddle of the global political and business elite in Davos, Switzerland this week. With a heated transatlantic trade spat exploding in panel after panel and melting the Swiss Alpine snow, Liu offered a kinder, gentler Beijing.

    “China’s national reality dictates that opening up to the world is a must, not an expediency. We must open up wider and make it work better,” Liu said on Tuesday.

    The Chinese charm offensive drove a lot of private conversations in Davos amid the World Economic Forum gathering. Executives are eager to learn more — and as always to explore opportunities in a market as big as China’s. The shift, if real, would signal a return to something the Davos crowd considers more normal: a somewhat predictable, business-friendly Chinese communist leadership, more interested in making money than waging fights against internal critics or outside enemies. The improved economic relationship between China and Australia has fueled such optimism.

    Western officials have heard the message as well, but are suspicious that the outreach is more diplomatic sparkle than an indication of substantive changes. They are leery that the growing economic and military threat posed by China remains despite the velvet gloves.

    The shift has been gathering steam for weeks after China’s President Xi Jinping offered a warmer tone in his meeting with U.S. President Joe Biden in Bali in November. Xi urged a return to “healthy and stable growth” in bilateral relations.

    That has set in motion a cascade of Chinese initiatives seemingly aimed at repairing the harm done by years of “wolf warrior”-style diplomacy; saber-rattling across the Taiwan Strait; a more bellicose military posture in the Indo-Pacific; economic coercion; and high-tech espionage.

    China’s Foreign Ministry is rolling out a rhetorical red carpet for U.S. Secretary of State Antony Blinken’s visit in early February. Europe is bracing for a multi-country diplomacy spree by former Foreign Minister Wang Yi. On Wednesday in Zurich, U.S. Treasury Secretary Janet Yellen’s meeting with Liu reaped an invitation to visit China “in the near future.” And the Chinese Foreign Ministry signaled gentler public messaging by banishing pugnacious spokesperson Zhao Lijian to the bureaucratic backwater of the ministry’s Department of Boundary and Ocean Affairs last week.

    Western officials still have their guard up, though — particularly since Chinese diplomats were until recently issuing outright threats to their host countries. 

    “We are seeing a warmer Beijing that’s keen to talk about a business-as-usual approach, and there are fewer wolf warrior narratives,” an EU official told POLITICO on condition of anonymity because he isn’t authorized to speak on the record. “However, a softer face doesn’t necessarily mean a softer heart.”

    Russia’s friend

    That skepticism springs from the fact that Beijing isn’t matching its rhetorical expressions of bilateral goodwill with any substantive policy shifts. China’s “no limits” alignment with Russia continues even after Moscow’s war on Ukraine and record numbers of Chinese military aircraft regularly menace Taiwan. Beijing denies its well-documented abuses against Uyghur Muslims in Xinjiang and continues what the U.S. calls “unfair trade practices” that sustain billions of dollars of U.S. tariffs on Chinese imports.

    There are also suspicions that China is seeking to prevent the imposition of additional crippling U.S. export restrictions on high-technology items such as semi-conductors — and slow down or derail U.S. efforts to persuade its allies to do likewise.

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    Vladimir Putin and Xi Jinping in Beijing | Pool photo by Ed Jones/Getty Images

    “Xi wants the American boot off his neck — he can’t stomach any more tech containment or more sanctions and recognizes that a lot of [Beijing’s] foreign diplomacy has backfired and he wants to lower the temperature,” said Craig Singleton, senior China fellow at the Foundation for Defense of Democracies. Beijing’s uptick in diplomatic outreach aims to “seek a reprieve from Washington’s regulatory assault on China’s tech sector, and then lay the groundwork to stimulate China’s economy after this current COVID wave subsides,” Singleton said.

    China is in desperate need of an international image overhaul. The results of a Pew Research survey published in June indicated “negative views of China remain at or near historic highs” in 19 European and Asian countries due to concerns about human rights and perceptions of a growing Chinese military threat. Pew Research Center survey results released in September revealed that 82 percent of Americans in 2022 had “an unfavorable opinion of China,” an increase from 76 percent the previous year.

    Beijing’s change in tone reflects its alarm at the Biden administration’s success in rallying international support for his China-countering Indo-Pacific Strategy. That has included arch-rival Japan’s embrace of closer defense ties with the U.S. underwritten by a multibillion-dollar investment in Tokyo’s military.

    The ruling Chinese Communist Party’s sense of vulnerability is heightened by China’s raging COVID outbreak and an economy pummeled by three years of lockdown linked to the country’s now-defunct zero-COVID policy. “There’s recognition [in Beijing] that — wait a minute, the U.S. is not going anywhere, it is still a major geopolitical power — and so China has to reengage with the United States,” said Victor Shih, an expert in Chinese elite politics at the University of California, San Diego’s School of Global Policy and Strategy.

    Uphill struggle

    But old habits die hard. Vice Foreign Minister Xie Feng, the incoming Chinese ambassador to the U.S., accused the Biden administration of “besieging China through geopolitics such as the Indo-Pacific Strategy,” in a speech on Monday. And besides Zhao’s removal from the Foreign Ministry press briefing platform, Xi hasn’t fired or demoted any senior “wolf warrior” diplomats, points out Joshua Kurlantzick, a senior fellow at the Council on Foreign Relations.

    EU officials in Brussels are preparing for a visit by Wang, the former Chinese foreign minister who has been promoted into the 24-person Politburo, the Communist Party’s ruling body, to oversee foreign affairs. 

    But Wang faces an uphill struggle in convincing Europe of a shift in China’s diplomatic settings. The EU is angered by Xi’s close relationship with Moscow despite Russia’s aggression against Ukraine. In response, European leaders have started exploring the diversification of sources of key imports, including those from China.

    In conversations with their European counterparts, Beijing officials and diplomats have adopted the tactic of highlighting recent transatlantic disputes to try to persuade the Europeans that the U.S. — even after the Donald Trump era — remains an untrustworthy ally.

    “They like to repeat the U.S. ‘gains’ in the Russian war against Ukraine, as well as the IRA,” another European official said, referring to the Biden administration’s Inflation Reduction Act, which is seen by many Europeans as a protectionist policy unfavorable to EU businesses. China claims that the U.S. military-industrial complex stands to gain from the war, while Europe suffers more from the energy crisis than the U.S. 

    Beijing is also reaching out to traditional allies in the U.S. business community to amplify its more benign messaging. Wang sat down in Beijing last month with John Thornton, former Goldman Sachs president and the current executive chair of Barrick Gold Corporation. That meeting signaled that “China is open to dialogue with the United States at all levels,” current Chinese Foreign Minister Qin Gang tweeted.

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    China’s former Foreign Minister Wang Yi addresses the 77th session of the United Nations General Assembly | Yuki Iwamura/AFP via Getty Images

    Similar outreach to the European business community may fall flat.

    “China heavily subsidizes its industry and restricts access to its market for EU companies,” European Commission President Ursula von der Leyen said during the World Economic Forum in Davos on Tuesday. “We need to focus on de-risking rather than decoupling. This means using all our tools to deal with unfair practices.”

    But Beijing will hope that persisting with the warmer rhetoric will pay off even if the fundamentals don’t change.

    “There are elements of Wall Street and certain constituencies in the U.S. government that are extremely receptive to talk about stability and predictability in the U.S.-China relationship after a very volatile two years,” said Singleton from the Foundation for Defense of Democracies. “But it’s an illusion.”

    Matt Kaminski contributed reporting from Davos, Switzerland.



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    ( With inputs from : www.politico.eu )