Why The EU And U.S. May Not Rescue Russia’s Energy Industry
President Donald J. Trump’s efforts to attain peace between Russia and Ukraine have already prompted questions about the future of Russian energy exports, the country’s main cash cow, and whether the door will open to joint projects between Russia and the E.U or the U.S. Whatever progress is made in any negotiations, will be difficult if not impossible to go back to pre-2022 arrangements. Doing so isn’t necessarily in the E.U.’s or America’s strategic or economic interests.
Read the full article here
Water Challenges in Central Asia
Ariel Cohen discusses the water security challenges faced by the Central Asian states and potential solutions to these issues at a panel event with The Clingendael Institute.
Watch the video here
Putin’s Trolling: A Strategic Minerals Offer For Trump
Just as President Volodymyr Zelensky was preparing to arrive in Washington D.C. on Friday, February 28th to sign an unprecedented US-Ukraine agreement on strategic minerals, Vladimir Putin came up with a proposal of his own, involving joint development with the U.S. of rare earth metals, aluminum, and hydro power in Russia. It’s trolling of 99th level.
At face value, this could be seen as a step towards renormalizing U.S.-Russia trade relations. President Trump is entertaining the notion of economic rapprochement but isn’t ready to commit yet. Economic cooperation comes after the cease-fire or peace accord in Ukraine, not before. On February 27th, only a couple of days after Putin’s proposal, Trump extended wide-ranging sanctions on Russia. Meanwhile, US Russia watchers are telling this author that Putin’s offer is nothing more than a troll to counter the Trump-Zelensky mineral deal.
Read the full article here
Report: Water Insecurity in Central Asia: The Imperative for Regional and International Cooperation
Water security is an urgent issue that demands immediate attention from Central Asian governments, businesses, civil society, and their international partners. Climate change, population growth, infrastructure problems, a lack of government foresight, and the unequal distribution of precious water resources between the upstream countries (Kyrgyzstan and Tajikistan) and the downstream nations (Kazakhstan, Turkmenistan, and Uzbekistan) have created a ”perfect storm” of pressing water insecurity.
The 2021 Central Asia drought, the loss of the Aral Sea, the evaporation of glaciers in the Tian Shan mountains, and the alarming shrinking of the Caspian Sea are reminders of how natural and man-made disasters have destructive consequences on Central Asia’s strained water resources.
This report addresses the status of water security across the five Central Asian countries, outlining recent developments, ongoing
challenges, and opportunities for improvement. Geopolitically, interstate tensions and the role of international politics—e.g., influence from the West, Russia, and China and tensions with Afghanistan—all will continue to affect the region’s water security. This report will address international cooperation in projects for water sharing, including the current and future role of agencies like the International Fund for Saving the Aral Sea and partners like the United States Agency for International Development, the
World Bank, and extraregional governments. The report concludes with a holistic set of policy recommendations to help improve water security in Central Asia.
Read the full report here: Central Asia needs regional and international cooperation to bolster water security - Atlantic Council
Russian Nuclear Energy Researchers In Europe Endanger Western Security
As international tensions grow, scientific developments become more crucial than ever to creating war-winning technologies. There is a reason the Manhattan Project was kept under strict security measures – and even then, there were leaks.
Beginning in the 1940s, Stalin’s USSR used intelligence to steal America’s atomic secrets and develop nuclear weapons. Throughout the Cold War, the Soviets ran a massive spying operation to gain access to submarine, computer, and space tech. In preparation for its 2022 invasion of Ukraine and as the conflict continued, Russia ramped up its intelligence gathering and influence activities around the world. Recently, concerns have once again been raised that Moscow has had an unobstructed path to obtaining information about cutting-edge nuclear technology from the European Organization for Nuclear Research (CERN).
Read the full article here.
Russia and Iran’s Defense Pact is a Challenge Trump Must Confront
Russia and Iran signed a mutual defense and security cooperation pact on Jan. 17 — just days before President Trump’s inauguration. Both nations are primary opponents of the U.S., demonstrated by Russia’s war against Ukraine and Iran’s attempts to assassinate Trump, its regular proclamations of “Death to America, death to Israel!” and its backing of terrorist proxies Hamas, Palestinian Islamic Jihad, the Houthis and Hezbollah.
This new pact represents the next move in a long game to shift the global balance of power away from the U.S. and its allies. Although the new administration is coming into office with many pressing agenda items, the Moscow-Tehran partnership needs quick attention before it leads to threats, bloodshed and more war.
Read the full article here.
A New Start: Central Asia's Nuclear Potential & Peril
The International Tax and Investment Center's Energy, Growth, and Security Program organized a panel on March 12th, 2024, discussing the rise of Central Asia's civilian nuclear industry and how to best incorporate it as a part of the energy mix across the region.
The West’s role in solving Central Asia’s water crisis
The Caspian Sea, vital to Eurasia’s economy and environment, is shrinking at an alarming rate. The declining water level in the sea is one visible consequence of a larger regional water crisis faced by the C5 nations of Central Asia—Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan, and Uzbekistan. This water crisis threatens the more than 82 million people who call the largely arid region home.
Read Full Article Here
New Sanctions Against Gazprombank: Too Little, Too Late
The U.S. Treasury has announced sanctions against Russia’s Gazprombank, a lending institution inexorably linked with Russia’s state-owned gas giant Gazprom, along with fifty other small and medium-sized banks and forty securities registrars. Treasury’s Office of Foreign Assets Control (OFAC) also issued a warning of sanctions risks for financial institutions joining Russia’s System for Transfer of Financial Messages, which Moscow stood up in an attempt to work around having been excluded from the Society for Worldwide Interbank Financial Communication (SWIFT), the main global network to wire funds.
Read Full Article Here
Winter Is Coming, But Russia Refuses To Stop The Energy War On Ukraine
A massive attack by Russia against the Ukrainian energy infrastructure on Sunday, November 17th may have caused the Biden Administration to green-light Ukraine’s use of the U.S. ATACMS long-range missiles. Ukraine took parts of the Kursk region during its 2024 summer offensive and is struggling to hold on in the region as some 50,000 Russian forces, bolstered by North Korean troops, fight to regain control. Biden’s OK, long awaited by Kyiv, was followed by green lights from the French and British for use of their SCALP/Storm Shadow missiles, with a range of 250 km. Yet, most military experts and analysts doubt that the addition of these long-range systems into the battle for Kursk will bring a decisive turn in the ongoing war, let alone a Ukrainian victory.
Full Article Here
Russia’s Landmark BRICS Summit and the Specter of De-Dollarization
Last week saw a landmark summit of the BRICS group of nations, a nine-country economic bloc led by Moscow and Beijing, which drew representatives from 36 countries, including 22 heads of state.
Held from Oct. 22 to Oct. 24 in the Russian city of Kazan, the event focused largely on “de-dollarization”—the idea of phasing out the U.S. dollar as a reserve currency and preferred medium of global exchange.
Energy Revenue Fuels A War-Time Moscow Boom
Hundreds of billions of dollars flowing into Russia from oil and gas sales are fueling Moscow’s war effort in Ukraine, and more. Unbeknownst to some diplomats and other decision-makers, energy export revenues drive the massive geo-economic polarization between East and West, as petro and gas dollars pour into the Russian tech sector.
Russia’s capital—and especially the hi-tech/IT sectors—are the prime beneficiaries of the East-West confrontation. This has significant long-term secondary and tertiary consequences. According to the Russian news agency TASS, in 2023, public and private annual investment inflows into the capital city reached $73.5 billion and a growing. $1.7 billion in high-tech exports were projected for 2023. These geo-economic effects are still working to change the geopolitical landscape and the global balance of power of the 21st century, something many Western policymakers may not be aware of.
China And Russia Now Dominate The Global Nuclear Trade
The global competition between the West and the rest takes many forms, including in the energy area. The nuclear energy industry has long been such a battlefield. Unfortunately, the U.S. and Europe are not doing great when it comes to winning bids in the developing world.
In late May 2024, Uzbekistan signed an agreement with Russia for the sanctioned Russian State Atomic Energy Corporation (Rosatom) to build a nuclear power plant in Uzbekistan. It will be the first nuclear power plant in Central Asia, providing emission-free electricity to an energy-hungry nation. It will also give Moscow renewed leverage in a region that used the war in Ukraine as an opportunity to slip out of Moscow’s orbit. This Russian success is not fully consolidated; neighboring Kazakhstan has rebuffed Russian advances, at least for now. Astana is considering four options: from China, Russia, South Korea and France, and the issue will be voted upon in the national referendum to be held this Autumn
The Global Take | Russia | Change of Defense Minister: Sergei Shoigu Moved to Russia's Security Council
Dr. Ariel Cohen provides his commentary on BBC concerning a sudden change in Russia's defense minister and Sergei Shoigu's move to Russia's Security Council. In this interview, Dr. Cohen discusses the implications of these changes and what they could mean for the war in Ukraine.
American Deterrence Is Failing In The South China Sea
One of Beijing's enduring hobbies is accusing Washington of violating or abusing international law. This selective outrage is justifiably ignored, given China’s unwillingness to abide by international law and disregard for U.N. arbitration concerning demarcation in the South China Sea. “International law with Chinese characteristics” was easily mocked and ignored when American deterrence and international safeguards stymied Beijing’s ambitions. Unfortunately, that security architecture is unraveling.
Read more here.
Despite Wars And Sanctions, Superyacht Market Continues Recent Growth
A superyacht is a status symbol and the ultimate pleasure boat. What ordinary people envisage doing on cruise ships, the super-rich do on their mega-yachts. Space and change of scenery have appealed to humans from time immemorial. However, with luxury yacht ownership requiring vast sums of disposable income, one would think that factors putting the global economy under pressure, such as inflation, Houthi terrorists and Somali pirates attacking ships in the Red Sea, sanctions following the Russian invasion of Ukraine, and before that, the COVID-19 pandemic, would slow down the demand for superyachts. Instead, despite severe disruptions, mainly because of the post-Ukraine 2022 Russian invasion sanctions, with billions sloshing around in the global economy, demand for these vessels has reached a high point, driven by changes in the tastes of the ultra-rich, innovative new uses for superyachts, and the number of buyers able to splurge on such craft.
Read more here.
Ukraine Needs An Economic Victory
For Ukraine, winning on the battlefield is not enough, as Kyiv must ensure that the country’s economy stays afloat. If exports continue to slump, Kyiv could lose its ability to finance the war effort and sustain its population even further. Thus, maintaining the flow of its agricultural exports is vital.
Read more here.
The Global Take| Navalny’s Widow Enters Fray as Putin Eyes Fifth Term: Bloomberg Surveillance| March 11, 2024
Dr. Ariel Cohen appeared on Bloomberg Surveillance with Tom Keene to discuss the elections in Russia.
Watch here.
Are Drones Putting Global Peace In Danger?
Three recent wars highlighted the use of drones in 21st-century warfare. Houthi and Iranian attacks on Saudi oil infrastructure and military in Yemen brought the war between Iranian proxies and the UAE-Saudi coalition to a stalemate by 2015. Azerbaijan used drones massively against Armenia in 2020 and 2023, and a deluge of drone-focused combat footage flooded the internet after Russia’s February 2022 re-invasion of Ukraine. Ukrainian songs cheering on the Turkish Baykar company’s Bayraktar drone went viral as drones devastated Russian armor. The Kremlin is playing catch-up quite successfully. The Russian military used swarms of drones, many of them Iranian-made, in attacks against Ukrainian civilian infrastructure targets.
Read the full article here.
Can Europe Count On US LNG?
The US House of Representatives appears to be so dysfunctional that Mike Turner, the Chairman of the House Intelligence Committee, had to go public to respond to a major national security threat from new Russian anti-satellite weaponry. Meanwhile, the other Mike, Speaker of the House Mike Johnson, is delaying a vote on crucial foreign aid to provide means for Israel, Taiwan, and Ukraine to defend themselves.
Energy, specifically the Biden Administration’s liquified natural gas (LNG) future infrastructure development pause/ban, is also on the Congressional agenda. The recent White House decision is one of the worst in a string of failed energy decisions, including the cancellation of the Keystone XL pipeline from Canada’s oil sands to the Gulf of Mexico.
Read the full article here.
Xi And The Red Sea: Protect Iran Or China’s Economy?
A US bombing campaign against Iranian proxies, which hit more than 85 targets in response to a recent drone attack in Jordan that killed three Americans and injured dozens, threatens a regional conflagration. This crisis began after the Houthi attacks out of Yemen on commercial shipping in the Red Sea disrupted the supply chain, raised maritime insurance and transport costs, and threatened a global recession.
Amidst the deluge of international condemnation, one actor’s silence speaks volumes: China’s. Outwardly, China and President Xi Jinping are putting on an excellent poker face. However, this cannot hide China’s unenviable dilemma: its ambitions for global leadership require expanding influence in the Middle East, while simultaneously China’s economy and the legitimacy of the Chinese Communist Party are threatened by Iran’s truculence.
Read the full article here.
The U.S. Is Losing the Nuclear Energy Race to Russia and China
Even as Russia remains under unprecedented Western economic sanctions, the U.S. finds itself dependent on one Russian vital import: enriched uranium. The U.S. is the largest producer of nuclear energy in the world, but it has allowed its civilian nuclear infrastructure to languish since Jimmy Carter and Ronald Reagan’s presidencies in the 1970s and 1980s.
While the U.S. has coasted on its laurels, with nuclear energy production not changing much in over 30 years, Russia continues its gradual climb upward and exports many reactors, while China is investing heavily in civilian nuclear tech and boosting its atomic power generation at home. Beijing plans to build 24 new nuclear power plants by 2030, bringing the total up to 60, overtaking the U.S. with its old reactor fleet. For comparison, the U.S. has 93 operational nuclear power plants in total, and in the same period as China’s building spree, the U.S. added 2 with none under development now.
Read the full article here.
Electric Vehicles 2024 Tax Changes Are Not Enough For Global Leadership
Considering an electric vehicle in 2024? Be aware of policy changes that could negatively affect your purchase. Starting in January, new rules will allow car dealers to give EV buyers their tax credit upfront. However, many EV models, batteries and components from China will no longer be eligible as the Sino-American competition goes green.
The 2022 Inflation Reduction Act, which includes the Clean Vehicle Tax Credit, offers up to $7,500 to new EV buyers. As part of the U.S. strategy to reduce greenhouse gas emissions and bring industries back to the country, this initiative has boosted EV sales, benefiting manufacturers like Tesla and General Motors GM +1.2%. Since 2021, EV sales have tripled, with over 3 million vehicles currently on the roads.
Read the full article here.
Leveraging Central Asia’s Rare Earth Elements for Economic Growth
December 2023 | Wilder Alejandro Sanchez, Ariel Cohen, and Wesley Alexander Hill |Read the report here.
The global energy transition has underscored the vital importance to advanced economies of rare earth elements (REEs), the 17 minerals with broad and, to this point, irreplaceable uses in a wide variety of high technology, green energy, and defense industries. As the uses for these minerals has expanded, so too has global competition for them in a time of sharply increasing geostrategic and geoeconomic tension. Advanced economies with secure, reliable access to REEs enjoy economic advantages in manufacturing and corresponding economic disadvantages accrue for those without this access. China’s current dominance of both mining and, importantly, processing of REEs poses challenges for Western and other companies seeking to continue leadership in the global energy transition and other high technology industries. This report therefore features an increasingly attractive opportunity in the global market for REEs, analyzing the abundance of many of these materials in Central Asia. It has a particular focus on Kazakhstan, the region’s leading economy and holder of the largest reserves of REEs in the region. Kazakhstan also holds the world’s largest chromium reserves and the second largest reserves of uranium, as well as a very strong position in many other mining and extractive industries. The need for reliable supplies of REEs reaffirms the importance of ties with these countries, and in particular with Kazakhstan, not only in securing REEs for Western markets but in building closer geopolitical ties. While recent diplomatic initiatives are encouraging, more must be done to build deeper and more sustainable ties with those countries — and to encourage further economic partnership and integration among them, strengthening their collective impact on the global stage. Further, the report recommends reforms Central Asian countries can take to expand their global share of REE mining and processing, including greater transparency of data and access, steps towards limiting the environmental impact of REE mining through new extracting and processing technologies, diversifying the customer base, building stronger transportation links, and encouraging foreign investment. Looking beyond the region for foreign investment will both signal Central Asia’s openness to global markets and help safeguard Central Asian countries’ sovereignty and economic progress. What has been termed “soft infrastructure” — tax, trade, and regulatory polices — is essential to attract foreign investment. By establishing a strong investment climate, nations can unleash private capital for sustainable economic growth. Using market signals, rather than simply relying on subsidies, to encourage private investments in critical minerals for the energy transition will best ensure both a just transition and strong US leadership in that transition. While the report offers steps Central Asian nations to take advantage of this increasingly important global market, its call to action applies with equal force to nations outside the region, not least the United States, to recognize the importance of Central Asia to this highly significant global market and act with urgency to build the ties that will ensure the US and Western countries have access to REEs in a highly competitive global market. The report aims to spur action to seize this unique opportunity.
Russia Uses New Arctic LNG To Dodge Energy Sanctions
Vladimir Nekrasov, a prominent executive in Russia’s energy sector who criticized Putin, has had a tragic accident. These unavoidable twists of fate mean that up to 40 of the top managers in Russian energy have died since the war in Ukraine began. Coincidentally, they all commonly express skepticism towards Russia’s energy strategy, its funding streams, and its ability to fund the Kremlin’s war effort.
Prior to exposés recently released by Le Monde and Der Spiegel, it was assumed these deaths were Putin sweeping away the opposition and shaking down oligarchs for much-needed capital. While this remains true, the revelations that multiple French and German companies were cooperating with the Russian state in an “arctic pivot” for energy exports may have revealed another reason. Many of these Russian executives stood to lose significantly from Russia’s new energy strategy: pivot exports to the difficult-to-monitor Arctic to mitigate sanctions and may have resisted the transition.
Read the full article here.
