Hilary Clinton condemns Russia’s “occupation” of Georgia. According to the New York Times, the US Secretary of State
used her toughest language yet to condemn Russia’s “invasion and ongoing occupation” of Georgia during a Monday visit to Tbilisi. (…)
Alexander Rondeli, the president of the Georgian Foundation for Strategic and International Studies, said Mrs. Clinton’s willingness to use the word “occupation” carried particular weight. “Sometimes words are actions,” Mr. Rondeli said. “Not many countries in the world are willing to call the Russians occupiers. Just the Georgians, and now the Americans.”
Russia, Belarus, Kazakhstan form customs union. The New York Times reports:
The leaders of Russia, Belarus and Kazakhstan took their longest stride to date in linking their economies, forming a customs union that they say will soon evolve into a more ambitious common market, with Russia at its hub. The agreement, for now, eases trade among the three large former Soviet economies without fully abolishing all duties and tariffs. (…)
The signing was a victory for Russia’s leaders, who have made the customs union a pet project for a variety of reasons, notably because Moscow stands to benefit as a natural hub for regional finance and trade.
However beneficial for Russia’s regional standing, though, the agreement seemed to risk again derailing its long-delayed membership application for the World Trade Organization. Last summer, Prime Minister Vladimir V. Putin said that Russia would abandon its unilateral membership bid and instead seek to join with Belarus and Kazakhstan in the customs union — an apparent signal that Russia had other options if W.T.O. conditions were seen as too onerous. Later, ministers backtracked and said Russia would negotiate for entry separately.
But after signing the agreement on Monday, Kazakhstan’s president, Nursultan Nazarbayev, again said Russia, Kazakhstan and Belarus had agreed to apply collectively.
If that indeed reflects policy in Moscow, it would most likely push over the horizon any membership for Russia, by far the largest economy outside the W.T.O. A Russian first deputy prime minister, Igor I. Shuvalov, clarified to reporters that countries were still deciding their W.T.O. accession strategy, and hoped to resolve differences on this matter “in the coming weeks.”
The Russian president, Dmitri A. Medvedev, said at the signing ceremony that the three countries would try to open their economies fully by the beginning of 2012. The first step is harmonizing customs rules. Later, they will discuss free movement of labor and capital. “A lot of work remains before the formation of a common economic space,” Mr. Medvedev said, according to comments published on the Kremlin’s Web site. “But, considering that it really is a beneficial and interesting endeavor, I’m sure we can agree on everything.” (…)
“This is a very positive paradigm shift in how Russia deals with the near abroad,” Yaroslav Lissovolik, the chief economist at Deutsche Bank in Moscow, said in a telephone interview. “Previously, it was a one-way street where Russia was giving out economic favors in exchange for political favors.” A free trade pact, in contrast, is an economic strategy to elevate the prospects of the entire region where Russia is a natural center of gravity.
In the short term, Russian farmers could suffer from competition from Belarus, and Russian steel workers from competition from Kazakhstan. But in the longer term, the exposure to competition will help Russia diversify away from its dependence on natural resources while elevating the role of Moscow as a regional financial and business center, Mr. Lissovolik said. (…)
Russia also holds a powerful lure to bring other former Soviet states into the union, if it chooses: access to its domestic labor market. With its diminishing population but rising oil wealth, Russia is the world’s second-largest importer of labor after the United States. Already on Monday, the leaders of Tajikistan and Kyrgyzstan — two countries heavily reliant on migrant labor remittances from Russia — said they were interested in joining the union.
Candidates will surely have in mind failed efforts to create free trade areas on the territory of the former Soviet Union. The Commonwealth of Independent States, the Eurasian Economic Community and the union state of Russia and Belarus all made little headway toward creating a true common market in the region.
For now, Ukraine has said it will remain outside the union despite the election this year of a president, Viktor F. Yanukovich, who is on friendlier terms with the Kremlin than his predecessor.
Belarus, too, has been a reluctant partner. The agreement on Monday was to have been in effect by July 1. However, Belarus had held out amid a dispute over tariffs that Russia charges on crude oil exports delivered to Belarussian refineries, which caused a brief oil pipeline shutdown last winter. The signing went ahead, but the disagreement apparently was never resolved. A Belarussian official said the tariffs would be abolished immediately, but Mr. Shuvalov said the entire package of treaties forming a common economic space would have to be in place first.
EU will discuss Kyrgyz request for police mission. AFP has the story:
The European Union will examine a request from Kyrgyzstan to deploy a police mission to the south of the country to prevent a resurgence of ethnic violence, the European Commission said Monday.
Kristalina Georgieva, the European humanitarian aid and crisis response commissioner, said after a three-day visit to Kyrgyzstan that President Roza Otunbayeva made the request in the wake of deadly unrest in June. “Security protection is paramount now, and yes having a neutral party there would be helpful,” Georgieva told reporters.
Georgieva said she would report back to EU foreign affairs chief Catherine Ashton and European foreign ministers that Kyrgyzstan had made “a plea for Europe to provide police support, training for local police forces, and also a presence that would ensure some neutrality on both sides.” The European commissioner said she would raise the issue with EU ambassadors on Monday and again at a meeting of foreign ministers on July 26.
More tensions in Israeli-Turkish relations. The New York Times reports:
There were continuing signs of stress in Israeli-Turkish relations on Monday, with Israel again rejecting a Turkish demand for an apology for the fatal raid. During a visit to Latvia, Israel’s foreign minister, Avigdor Lieberman, said Israel had no intention of apologizing. His remarks followed a report in the Turkish newspaper Hurriyet that quoted Turkey’s foreign minister, Ahmet Davutoglu, as saying that Israel “will either apologize or acknowledge an international impartial inquiry and its conclusion. Otherwise, our diplomatic ties will be cut off.”
Turkey: Rising economic power. The New York Times has a backgrounder:
For decades, Turkey has been told it was not ready to join the European Union — that it was too backward economically to qualify for membership in the now 27-nation club. That argument may no longer hold. Today, Turkey is a fast-rising economic power, with a core of internationally competitive companies turning the youthful nation into an entrepreneurial hub, tapping cash-rich export markets in Russia and the Middle East while attracting billions of investment dollars in return.
For many in aging and debt-weary Europe, which will be lucky to eke out a little more than 1 percent growth this year, Turkey’s economic renaissance — last week it reported a stunning 11.4 percent expansion for the first quarter, second only to China — poses a completely new question: who needs the other one more — Europe or Turkey? (…)
It is an astonishing transformation for an economy that just 10 years ago had a budget deficit of 16 percent of gross domestic product and inflation of 72 percent. It is one that lies at the root of the rise to power of Prime Minister Recep Tayyip Erdogan, who has combined social conservatism with fiscally cautious economic policies to make his Justice and Development Party, or A.K.P., the most dominant political movement in Turkey since the early days of the republic.
So complete has this evolution been that Turkey is now closer to fulfilling the criteria for adopting the euro — if it ever does get into the European Union — than most of the troubled economies already in the euro zone. It is well under the 60 percent ceiling on government debt (49 percent of G.D.P.) and could well get its annual budget deficit below the 3 percent benchmark next year. That leaves the reduction of inflation, now running at 8 percent, as the only remaining major policy goal. (…)
In June, Turkish exports grew by 13 percent compared with the previous year, with much of the demand coming from countries on Turkey’s border or close to it, like Iraq, Iran and Russia. With their immature manufacturing bases, they are eager buyers of Turkish cookies, automobiles and flat-screen televisions. (…)
No one here disputes that these trends give Mr. Erdogan the legitimacy — both at home and abroad — to lash out at Israel and to cut deals with Iran over its nuclear energy, moves that have strained ties with its chief ally and longtime supporter, the United States. (Turkey has exported $1.6 billion worth of goods to Iran and Syria this year, $200 million more than to the United States.)
But some worry that the muscle flexing may have gone too far — perhaps the result of tightening election polls at home — and that the aggressive tone with Israel may jeopardize the defining tenet of Turkey’s founder, Mustafa Kemal Ataturk: peace at home, peace in the world. “The foreign policy of Turkey is good if it brings self-pride,” said Ferda Yildiz, the chairman of Basari Holding, a conglomerate that itself is in negotiations with the Syrian government to set up a factory in Syria that would make electricity meters. Even so, he warns that it would be a mistake to become too caught up in an eastward expansion if it comes at the expense of the country’s longstanding inclination to look to the West for innovation and inspiration. “It takes centuries to make relations and minutes to destroy them,” he said.
End of Turkey’s “zero conflict” policy? At Project Syndicate, Shlomo Avineri argues that the recent Iranian-Brazilian-Turkish initiative on Iran marks the end of the “zero conflicts with our neighbors and in our neighborhood” policy, devised by Foreign Minister Ahmet Davutoglu:
Erdogan must have known that, by trying in this way to shield Iran, he is opening a wider chasm with the EU – and obviously with the United States. Opposing new sanctions against Iran in the Security Council further alienated Turkey from both the EU and the US. This does not sit well with a “zero conflict” policy.
The same can be said about the shrill tone that Turkey, and Erdogan himself, has recently adopted vis-à-vis Israel. Walking off the stage at Davos during a round-table debate with Israel’s President Shimon Peres might have gained Erdogan points in the Arab world, which has historically viewed Turkey with the suspicion owed to the old imperial ruler. But the vehemence with which he lashed out at Israel during the Gaza flotilla crisis obviously went far beyond (justified) support for beleaguered Palestinians and (equally justified) criticism of the messy way in which Israel dealt with an obviously difficult situation.
While gaining support on the so-called Arab street, and perhaps upstaging Iranian President Mahmoud Ahmedinejad in the role of a modern Commander-of-the-Faithful, Erdogan’s policy and behavior have shocked not only Israelis, but also moderate Arab leaders in Egypt, Saudi Arabia, Jordan, and some of the Gulf states. (…)
Turkey is thus emerging not as a regional mediator, equidistant from contending local players, but as an assertive, if not aggressive, regional power aiming for hegemony. Far from avoiding conflicts and mediating existing tensions, Turkey under the AKP appears intent on stoking new conflicts and creating new frontlines.
EU foreign ministers accept invitation to Gaza. Reuters reports:
A delegation of European foreign ministers on Monday accepted Israel’s invitation to visit the Gaza Strip and said it was an “important opportunity” to monitor the implementation of measures announced by Israel. Israel has largely refused to let foreign diplomats pass through its checkpoints into Gaza since it tightened its blockade on the coastal enclave after Hamas Islamists seized control in 2007.
In a joint letter, the foreign ministers of Italy, Great Britain, France, Spain and Germany thanked Israeli Foreign Minister Avigdor Lieberman for the invitation. “In the joint written reply, we said we would gladly accept the invitation and hoped that the measures announced by the Israeli government regarding Gaza would soon be implemented,” the German Foreign Ministry said in a statement. The steps that had already been taken were “a noteworthy and encouraging sign of Israeli policy toward Gaza,” it added. (…)
The German Foreign Ministry said the European diplomats aimed to conduct talks with the Israeli government and Palestinian Authority during their visit throughout Israel and the Palestinian Territories. An Israel official said last month the delegation would not meet Hamas officials.
EU to withdraw trade concessions from Sri Lanka. The BBC reports:
The European Union has decided to withdraw Sri Lanka’s preferential trade access to EU markets after it failed to improve its human rights record. The concessions will be stopped on 15 August on a temporary basis after the war-torn nation refused to implement human right conventions. The deal, known as GSP Plus, gives 16 developing countries trade benefits in return for set commitments.
Sri Lankan officials say the demands amount to interference in its affairs. Last month, the government said the request was an insult to Sri Lankans and should be placed “in the dustbin”.
The Sri Lankan government has faced repeated accusations of human rights violations carried out during its civil war against Tamil Tiger rebels, which the military won in 2009. The EU was particularly critical of alleged human rights abuses during the last stage of the war.
The move comes after the government failed to make a written promise of progress on three human rights conventions, which deal with torture, children’s rights, and civil and political rights.
“We very much regret the choice of Sri Lanka not to take up an offer made in good faith and in line with the EU commitment to a global human rights agenda,” EU foreign affairs chief, Catherine Ashton, said in a statement.
Correspondents say the move may not necessarily be a huge blow to the government, but could hit business hard. Sri Lanka’s garments industry will likely be impacted the most, as it enjoys tax breaks to sell to retailers in Europe. The BBC’s Charles Haviland in Colombo says that there are fears for the jobs of textile workers, although some clothing companies say the industry is so buoyant that they will not be affected.
The EU says it is open to talks in the future, but that it would depend on the island nation’s commitment to the charters and to working with the EU, our correspondent adds.
President Mahinda Rajaspaksa, who has often denounced foreign criticism, has shrugged off the decision, saying that they do not need the concessions. “If the EU doesn’t want to give it, let them keep it. I don’t want it. We have gone and explained what we have done,” he said.
In 2008, Sri Lankan exports to the EU totalled 1.24bn euros (£1bn; $1.55bn).
See also a press statement from the Commission.
Van Rompuy on Balkans visit. The President of the European Council visits Croatia, Serbia and Kosovo. Waz.Observer has an interview with Van Rompuy on EU-Balkans relations.
Europe in crisis. A seminar with George Soros, Emma Bonino, Joschka Fischer, Lord Kerr, Anatole Kaletsky and Mark Leonard, organized by the European Council on Foreign Relations (ECFR), audio here.
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