ByTeshu Singh

The Institute of Peace and Conflict Studies (IPCS), in collaboration with the National Maritime Foundation (NMF), has been conducting a series of discussions on the Indian Ocean Region. Based on the insights generated via the discussions, the IPCS hopes to produce a set of policy briefs for India, in 2015.

To that end, on December 2, 2014, the fourth round of the IPCS-NMF discussion series, titled ‘Securing Our Interests in the Indian Ocean: New Strategies and Approaches’, was held at the NMF Conference Hall. Five presentations were made, and were followed by a brainstorming session between the panellists and the audience.

‘China’s Endgame’ and the Maritime Silk Road’
Teshu Singh, Senior Research Officer (CRP), IPCS

China is using various tactics in its search for a stable and peaceful environment for its ‘peaceful development’ strategy – and the Maritime Silk Road (MSR) is one of them. Essentially, it is China’s soft power strategy in the Indian Ocean Region (IOR). Today it has become a major tool of China’s economic and peripheral diplomacy. It is also part of China’s larger strategy to develop extensive transport networks – roads, railway lines, ports and energy corridors. It would further cater to somewhat resolving China’s Malacca Dilemma and help augment the ‘String of Pearls’ strategy. With the US’s ‘pivot to Asia’, China is concerned about its aspiration to become a global power. Additionally, it is not a South Asian power but seeks a presence in the region. Therefore it is using the MSR as a tool to make its presence felt by following a policy whereby it seeks cooperation with the IOR littoral states and making gradual infrastructural investment in these countries – catering to it Sea Lines of Communication (SLOC) impasse.

‘Maritime Silk Road’
Captain Gurpreet S. Khurana, Executive Director, National Maritime Foundation

In retrospect, one look of the MSR suggests the strategic nature of the proposal. There was a gap between the announcements of the MSR at the Bali summit and the release of the first document in, April 2014, followed by the map in Xinhua newspaper. China is good in strategic communication and it closely follows up each development. Hence, it is pertinent to view the development from the standpoint of this perspective. India has not joined the MSR until now because of its own security considerations. The entire development in the region can be viewed within the framework of the ‘Hub and Spokes’ model.

‘Towards an Indian Strategy: Maritime Asia/Asian Sea Lane’
D Suba Chandran, Director, IPCS

There are multiple developments taking place in the IOR. The increasing Chinese interest and announcement of the MSR is not the only development. There are other parallel developments such as the US’s pivot to Asia and the Indo-Pacific underway in the region. Notably, this signifies the re-emergence of the Indian Ocean or Maritime Asia. In the given scenario, India should pitch in for its own pivot in the region and start looking for regional partners such as Sri Lanka and the Maldives. India can term its pivot in the IOR as ‘Maritime Asia’. As a part of its pivot, India can initiate the Asian Sea Lane project where in it can work with the IOR littorals and, within the Non-Traditional Security framework, it can forward projects pertaining to ‘Blue Economy’ and ‘Search and Rescue operations’.

‘Maritime Piracy and Terrorism in the Indian Ocean Region: An Overview of Trends, Linkages and Countermeasures’
Aditi Chatterjee, Research Associate, National Maritime Foundation

In the current global environment, non-traditional security challenges such as piracy and maritime terrorism pose serious challenges to national and international stability. These dangers, which cannot be readily defeated by the traditional defences that states have erected to protect both their territories and populaces, reflect the remarkable fluidity that currently characterises world politics. It is a setting in which it is no longer apparent as to who can do what to whom with what means, exactly. The maritime realm is especially conducive to these types of threat contingencies given its vast, largely unregulated, and opaque nature. Since the end of Cold War, the maritime security environment in the IOR has been quite volatile and dynamic. While hard security questions of the maritime domain remain a familiar set of problem for policymakers, they have a much harder time conceptualising non-traditional and transnational security issues of piracy and maritime terrorism that do not respect national boundaries and that transcend institutional and policy stovepipes.

‘Blue Economy’
Dr Vijay Sakhuja, Director, National Maritime Foundation

The concept of ‘Blue Economy’ is being discussed widely. It was discussed at the 22nd APEC Economic Leaders Meeting in Beijing, the 9th East Asia Summit (EAS) and the 36-point Kathmandu Declaration. By discussing it at multiple fora, Asian countries believe they can help highlight the concept and develop a sustainable development of marine resources. The main drivers for blue economy are food chain, sea-based resources, bio-diversity, trade, and tourism. With these drivers in mind India can explore opportunities vis-à-vis blue economy and also the MSR. Furthermore, the IOR littoral countries can come together to deliver the ‘goods at sea’, for the Human Assistance Disaster Relief operations and also ‘Aid to Civil’.

Discussion

1. The China factor has been overemphasised in the IOR while in fact, the IOR littorals should explore opportunities coupled with it.

2. India and China have similar goals in the IOR. But India is conscious about Chinese activities in the IOR due to its own security considerations. India has launched its own project, titled ‘Mausam’ for the same. Mausam is a Ministry of Culture project with the Indira Gandhi National Centre for the Arts (IGNCA), New Delhi, as the nodal coordinating agency.

3. The MSR project was conceived to bypass all the troubled points in SLOCS. In a multi-polar world, we should not look at it from a fixated point of view. The MSR should also be viewed from broader perspectives.

4. The Indian Ocean Rim Association for Regional Co-operation did not prosper because of its narrowly focussed objectives. The newly formed Indian Ocean Rim Association should have both economic and political components.

5. Given its geostrategic location, India is in a position to use the entire development in the region utilising the networks of the region.

6. Piracy is an economic phenomenon and its origin can be traced to the poor statuses of the fishermen that forced them to resort to piracy.

Rapporteured by Teshu Singh, Senior Research Officer, CRP, IPCS

The post Securing India’s Interests In Indian Ocean: New Strategies And Approaches – Debate appeared first on Eurasia Review.

By Abdulateef Al-Mulhim

Just a few weeks prior to the announcement of Saudi national budget for the fiscal year 2015, the oil prices plunged to a five-year low. Since 1938, the price of an oil barrel has been the deciding factor in the Kingdom’s national budgets.

Oil exports amount to around 90 percent of the Saudi national income due to which media was abuzz with speculations about the 2015 budget. Severe impact of declining oil prices on various countries provided the basis for speculations and analyses but the Saudi budget rubbished all those speculations. Spending in the budget for the next fiscal is projected at SR860 billion, up from last year’s SR855 billion.

Once again the budget proved the strength of the Saudi economy amid all the political and economic turmoil around the globe particularly in our region. Despite enjoying this strong position, we have to keep into consideration the unpredictable length of the era of cheap oil.

As per the budget, despite the sharp decline in oil prices, the Kingdom will continue spending heavily during the year 2015. This is why some analysts believe that Riyadh is comfortable with the plunge in oil prices, which is viewed as a way to squeeze out competing producers in non-OPEC nations. But the Saudi announcement of its national budget was overtaken by two announcements made by Saudi Finance Minister Ibrahim Al-Assaf.

He told the Saudi television, “We have the ability to endure low oil prices over the medium term.” And that “Saudi Arabia does not need to create a sovereign wealth fund to manage its oil wealth.”

So, the question many people in the Kingdom and abroad are asking is: How the Saudi economy fare in the next five years or in the era of cheap oil, no sovereign wealth fund and no national income diversifications in the near future?

It is true that the announcement of the largest annual budget in Saudi Arabia’s history is comforting to all Saudis but the majority of the Saudi population is very young. Half of the Saudi population was born after the Iraqi invasion of Kuwait in 1990 and Saudi Arabia still has the highest fertility rate in the world.

As we know, the needs of the younger generation are higher than that of the elders like education, health care, future family planning, employment, housing and recreational facilities etc. It is true that these needs are for all segments of the population but the youths always demand more. They don’t like to wait and don’t take a no for an answer. The young ones don’t like to hear about plans, they want to see results. This is why all ministries, government agencies and private companies should put the Saudi youths on top of their priority list particularly in employment.

At this stage, there is a great need for Saudi Arabia to find ways to diversify its sources of income, to eradicate or reduce corruption, to ensure transparency in spending and to introduce strict rules to protect public funds. The Saudi government has allocated around one-third of the national budget for health care and education.

This shows the seriousness of the government to raise the living standards of all Saudis. There is enough money and resources to make many changes but it requires a sense of patriotism and honesty from all Saudis. We all have the duty to ensure a better future for future generations.

The post Saudi Development In Era Of Cheap Oil – OpEd appeared first on Eurasia Review.

According to reports, one of the first acts of the Republican congress will be to fire Doug Elmendorf, current director of the non-partisan Congressional Budget Office, because he won’t use “dynamic scoring” for his economic projections.

Dynamic scoring is the magical-mystery math Republicans have been pushing since they came up with supply-side “trickle-down” economics.

It’s based on the belief that cutting taxes unleashes economic growth and thereby produces additional government revenue. Supposedly the added revenue more than makes up for what’s lost when Congress hands out the tax cuts.

Dynamic scoring would make it easier to enact tax cuts for the wealthy and corporations, because the tax cuts wouldn’t look as if they increased the budget deficit.

Incoming House Ways and Means Chairman Paul Ryan (R-Wis.) calls it “reality-based scoring,” but it’s actually magical scoring – which is why Elmendorf, as well as all previous CBO directors have rejected it.

Few economic theories have been as thoroughly tested in the real world as supply-side economics, and so notoriously failed.

Ronald Reagan cut the top income tax rate from 70 percent to 28 percent and ended up nearly doubling the national debt. His first budget director, David Stockman, later confessed he dealt with embarrassing questions about future deficits with “magic asterisks” in the budgets submitted to Congress. The Congressional Budget Office didn’t buy them.

George W. Bush inherited a budget surplus from Bill Clinton but then slashed taxes, mostly on the rich. The CBO found that the Bush tax cuts reduced revenues by $3 trillion.

Yet Republicans don’t want to admit supply-side economics is hokum. As a result, they’ve never had much love for the truth-tellers at the Congressional Budget Office.

In 2011, when briefly leading the race for the Republican presidential nomination, Newt Gingrich called the CBO “a reactionary socialist institution which does not believe in economic growth, does not believe in innovation and does not believe in data that has not been internally generated.”

The CBO has continued to be a truth-telling thorn in the Republican’s side.

The budget plan Paul Ryan came up with in 2012 – likely to be a harbinger of what’s to come from the Republican congress – slashed Medicaid, cut taxes on the rich and on corporations, and replaced Medicare with a less well-funded voucher plan.

Ryan claimed these measures would reduce the deficit. The Congressional Budget Office disagreed.

Ryan persevered. His 2013 and 2014 budget proposals were similarly filled with magic asterisks. The CBO still wasn’t impressed.

Yet it’s one thing to cling to magical-mystery thinking when you have only one house of Congress. It’s another when you’re running the whole shebang.

Now that Elmendorf is on the way out, presumably to be replaced by someone willing to tell Ryan and other Republicans what they’d like to hear, the way has been cleared for all the magic they can muster.

In this as in other domains of public policy, Republicans have not shown a particular affinity for facts.

Climate change? It’s not happening, they say. And even if it is happening, humans aren’t responsible. (Almost all scientists studying the issue find it’s occurring and humans are the major cause.)

Widening inequality? Not occurring, they say. Even though the data show otherwise, they claim the measurements are wrong.

Voting fraud? Happening all over the country, they say, which is why voter IDs and other limits on voting are necessary. Even though there’s no evidence to back up their claim (the best evidence shows no more than 31 credible incidents of fraud out of a billion ballots cast), they continue to assert it.

Evolution? Just a theory, they say. Even though all reputable scientists support it, many Republicans at the state level say it shouldn’t be taught without also presenting the view found in the Bible.

Weapons of mass destruction in Iraq? America’s use of torture? The George W. Bush administration and its allies in Congress weren’t overly interested in the facts.

The pattern seems to be: if you don’t like the facts, make them up.

Or have your benefactors finance “think tanks” filled with hired guns who will tell the public what you and your patrons want them to say.

If all else fails, fire your own experts who tell the truth, and replace them with people who will pronounce falsehoods.

There’s one big problem with this strategy, though. Legislation based on lies often causes the public to be harmed.

Not even “truthiness,” as Stephen Colbert once called it, is an adequate substitute for the whole truth.

The post The Republican’s Magical Mystery Tour (Starting Next Week) – OpEd appeared first on Eurasia Review.

The style and substance of the foreign policies of Narendra Modi’s six-month-old government have been remarkably different from those of his predecessors. Gateway House examines the changes in India’s equations with three critical countries—the US, China and Pakistan—and outlines a foreign policy forecast for 2015.

By Neelam Deo*

The end of 2014 and the middle of Narendra Modi’s first year as prime minister is an opportunity to compare the style and substance of the foreign policies of his government with those of the previous dispensation. The contrast is most apparent in the energy and attention that has been invested in international relations, rather than in the direction. After all, while core national interests—such as border security and development—endure, the manner of pursuing them can indeed change.

Modi’s articulation of his vision of the country has included new elements like the “Make in India” campaign; he has also brought a greater speed and intensity to the pursuit of foreign policy objectives such as attracting foreign direct investment to promote manufacturing in India. In pursuing the goal of industrialisation, Modi has shed some of the ideological elements of “third-worldism” and non-alignment, which were the signature of the previous government.

His government’s decisive foreign engagements have already changed international perceptions. The change is most visible in India’s relationships with the U.S. and Pakistan, though the outcome of his proactive engagement with China remains ambiguous. The differences between Modi’s and the previous governments approaches to these three critical bilateral equations are discussed in the following sections:

U.S.

Although it was the UPA government that signed the India-U.S. nuclear agreement in July 2005, it remained passive about implementing the deal. The new government has so far not been able to move ahead on amending the nuclear liability legislation, but it has been outspoken about the importance of a good relationship with the U.S.

Modi has proactively intensified interactions—the best proof of which is U.S. President Barack Obama’s acceptance of the invitation to be the chief guest at the Republic Day parade in New Delhi in 2015, which will make it an unprecedented second visit to India by a serving U.S. president.

The importance explicitly placed by this government on India-U.S. ties stems from several factors such as India’s need for U.S. investment and access to its technology. Good relations with the U.S. also usually translate into good relations with its allies such as Australia, Japan and west European countries, which in turn bring strategic support and increased investments from all these countries.

Washington’s capacity to influence Islamabad is another critical factor in the India-U.S. relationship. Additionally, in India’s experience, good relations with the U.S. tend to relieve pressure from China.

China

Previous risk-averse governments were oversensitive about Chinese reactions to India’s positions on the border issue. In a clear departure, the Modi government has overtly reached out to China. The first foreign leader that Modi received was Chinese foreign minister Wang Yi. In turn, China has responded positively, as was evident in the warmth during President Xi Jinping’s India visit in September, and his calls for a solution to the contentious border issue.

Although Modi’s admiration for China’s economic growth was noticeable during the meeting with Xi, the outcome of this diplomacy with China is still ambiguous. This is because Beijing has combined offers of investment in India’s infrastructure with consistent probing on the northern border; and it continues to pressure members of SAARC to promote Chinese membership to reduce India’s influence in the grouping.

Pakistan

Modi took the initiative on Pakistan by inviting Prime Minister Nawaz Sharif (and other South Asian leaders) to his swearing-in ceremony in May 2014, and later by calling off high-level talks when Pakistan high commissioner Abdul Basit’s meeting with separatists clearly disregarded a démarche from the Indian Ministry of External Affairs.

Modi has also implemented a policy of strong military retaliation—rather than mere condemnation and exhortation—to provocative acts on the border, and he virtually isolated a domestically diminished Pakistan at the recent SAARC Summit. In contrast, the previous government sought to maintain a dialogue with Islamabad—often under pressure from Washington—even during times of strained bilateral relations.

Forecast for 2015

Modi’s efforts will be vindicated if investments begin to flow into India in 2015. That will depend as much on diplomacy as on internal reform, on whether industrial production can pick up, and on oil prices—which together determine India’s fiscal deficit, levels of inflation, and other economic indices.

In the past, Indian governments have all stated that alleviating poverty is a major policy objective—for which conducive international equations and a peaceful neighbourhood are necessary conditions. Modi has tried to bridge domestic and foreign policy by pushing for economic growth through industrialisation that involves FDI and foreign manufacturing in India. These, in turn, can address poverty.

After a busy international itinerary in 2014, Modi’s foreign policy will now be better executed by focusing on legislating reforms at home, such as the Goods and Services Tax and banking sector reforms, in order to propel the Indian economy towards higher growth.

* Neelam Deo is Co-founder and Director of Gateway House. She has been the Indian Ambassador to Denmark and Ivory Coast with concurrent accreditation to several West African countries. This feature was written for Gateway House.

The post India’s Foreign Policy Reimagined – Analysis appeared first on Eurasia Review.

China begins the New Year as the world’s largest economic power. Has China risen? Amidst never-ending talks and discussion about a rising China, what are the indicators of a risen China?

By Amanda Huan*

Since the 1990s, China has been engaged in what it once referred to as a “peaceful rise”. Fast forward to a quarter of a century later and people still speak of the ‘rise of China’, despite its vast developments and advancements in the areas of economics, military power, and soft power. What would it take for China to be recognised as having risen? How would one determine if and when China has risen?

Perhaps to help answer this, one needs to look back at the last great-power transition. The last transition, between Britain and the United States, needed a cataclysmic event – World War II – to herald the change in perception and power. After the events of World War II, it was clear as day to everyone that the United States was the top power in the world. Needless to say, no one is looking for a repeat of a great war in order to recognise China’s ascent. So, short of a shock to world order, what needs to happen, or what indicators must China fulfil in order for the country to be perceived as a ‘risen’ power?

China’s standing in the East Asia region

It is perhaps more pertinent to examine China’s standing within its own backyard, as it is unlikely for China to be recognised globally as having ‘risen’ if its own neighbours do not see it as such. Economically, in October this year, the International Monetary Fund found that China had overtaken the United States to become the world’s largest economy. Measured in terms of purchasing-power adjusted GDP, China is expected to make up 16.5% (or US$17.6 trillion) of the world’s GDP at the end of 2014, while the US trails behind at 16.3% (or US$17.4 trillion).

Latest figures from the World Bank affirm this. Within East Asia, China is a major trading partner, and in some cases the largest trading partner, with most countries in the region. For example, it was reported this year that Japan, South Korea, and Malaysia were among the top ten trading partners of China in 2013. China’s robust trade and economic activities with the countries in the Indo-China region are well known as well. As such, China’s economic strength is indisputable. But is this enough for it to be perceived as having ‘risen’?

Militarily, China has ramped up its defence spending. In the last four years, military expenditure alone has consistently accounted for 2% of its GDP. While this percentage seems small, one must bear in mind that China’s GDP has been increasing throughout the years. The sheer size of the budget is best seen in absolute terms. In the first quarter of 2014, China announced its 2014 defence budget of US$132 billion, which is a 12% increase on the year before. In response to this, China’s neighbours have also raised their respective military expenditure, but their combined spending is still far less than that of the Chinese. As such, on the military front, few would dispute the military capabilities of the Chinese.

Looking at the economic and military factors, it seems, on the face of it, that China has, in fact, already risen. Yet many in the region still talk about a ‘rising’ China, and not a ‘risen’ one. This points to a possible third factor in play – the notion of acceptance.

Acceptance: The issue of ‘winning hearts and minds’

Despite its growing economic and military strength, China is still not widely accepted as the top power even in its own backyard. The US retains that position in most people’s perceptions. That is not to say that China has done little to try to win the hearts and minds of people. From its setting up of Confucian Institutes around the world to educate people about Chinese culture and values, to its mainstream pop-culture offerings such as Jet Li and Jackie Chan, China has attempted in a multitude of ways to assert its ‘soft power’. Yet, it pales in comparison to the pervasiveness of America’s Hollywood culture and the ‘American Dream’.

Some may contend that this notion of ‘acceptance’ is unnecessary. Should China emerge as the unequivocal number one in economic and military terms, the world is likely to perceive it as having ‘risen’ regardless of whether its ‘soft power’ is dominant. But this is unlikely to happen anytime soon as we are more likely to end up in a situation where there is economic and military parity between both China and the US. As such, whether or not China has ‘risen’ may thus hinge on this notion of acceptance.

With that in mind, what else does China need to do in order to be ‘accepted’ as the top power? Does it need to be more or less assertive? Should it make its intentions clearer? Is China’s less dominating ‘soft power’ the only reason why it has failed to be perceived as ‘risen’?

The relativistic nature of ‘rise’

Another possible explanation could be due to the problematic nature of the concept of ‘rise’ in itself. In this case, for one to say that China has risen might require one to invoke a relativistic comparison with that of the US. That is to say that China can only rise if the US declines or cedes its position.

In line with the relativistic argument, it is also possible that China has not ‘risen’ because it continues a relatively poor/under-developed country. Based on the IMF’s World Economic Outlook 2014 data, China is ranked 89th in the world for GDP (PPP) per capita. In comparison, the US stands at 10th place and Singapore in 3rd. Until China is able to improve its GDP per capita ratio, it remains to be perceived as a ‘rising’ power.

In all, it is quite remarkable that despite China’s advancements in the economic and military sectors, it is still widely perceived as a rising power, rather than as one that has risen. China itself, however, insists on calling itself still a developing country. Still, after 20 years of a ‘rising’ China, is it not time that the indicators of a ‘risen’ China be recognised?

* Amanda Huan is a research analyst at the S. Rajaratnam School of International Studies (RSIS), Nanyang Technological University.

The post China’s Peaceful Rise: Till When? – Analysis appeared first on Eurasia Review.

All the talk on ‘inclusiveness’ ‘peaceful co-existence’ ‘reconciliation’ all need to be questioned given the discussions that reveal the demands being made by minority ethno-political parties in support for Presidential candidates. These ethno-political parties are demanding exclusive separate ethnic-districts for their people while having the right to live and own land throughout the rest of the island. How fair is this and what type of bargaining will this lead to? The Tamils and Muslims themselves need to ask the question while the Sinhalese politicians must also realize that they need to ensure that such bargaining politics is not accepted under whatever conditions.

Leaving aside the historical aspects of how minorities came to arrive, be welcomed and settle in Sri Lanka, what needs to be said is that while political parties can be formed using petty slogans to garner support which gets additional support from external mischief makers, it is in the hands of the people to realize where the country will head if main political parties give in to these minority ethnic-based political parties and their demands.

Sri Lanka is 65,610 km², the Northern Province is 8884 km² while the Eastern Province is 9996 km² and if North were to be declared separate for Tamils and East was declared separate for Muslims that would mean 17174 km² loss of territory for the Sri Lankan state which will end up having 48436 km² to call Sri Lanka where Sinhalese, Tamils, Muslims, Burghers and others will continue to live. If Tamils and Muslims are to continue to live among Sinhalese in the rest of Sri Lanka what is the logic of having a separate ethnic state/district? Moreover what will happen to the Sinhalese and Muslims that live in the North and have lived so for centuries and the Sinhalese and Tamils that live in the East and have lived so for centuries? Let’s also not forget that there is historical evidence that the Sinhalese Buddhists were occupying all lands throughout Sri Lanka far before minorities lay claim to it and these can be proved with solid evidence and not the verbal claims being made via propaganda channels.

A good look at all territories that have been carved out under the same demands for ethnic-districts for exclusive ethnic nationality will reveal the chaos that has unfolded in these nations. Kosovo independence was given now the innocent Serbs who had been living in Kosovo are slowly been driven out of their once homes. Kosovo’s independence came with the assurance that it would be administered by an international civilian representative appointed by the West. Kosovo is thus controlled by the West and the people of Kosovo are controlled by the Albanian mafia that the West liaises with. Whoever wanted independence for Kosovo have to now live with gruesome statistics that reveal 45% unemployment, lack of international recognition for Kosovo’s domestic commerce document because Kosovo independence is not recognized, Kosovo has nothing to export yet EU charges the same tariffs it does to other nations (there are no favors any more), Kosovo has no international postal / telephone code and no web IP address thus no online purchasing ability, Kosovo has no internet banking, no national cyber security and even mobile phones have to be channeled through Slovenia or Monaco at a cost of course, Kosovo cannot send athletes to international sports events. Kosovo under Islamic fundamental and drug mafia rule has resulted in over 200 orthodox churches being destroyed. Kosovo is a drug haven and a ‘free market’ for 70% of Europes’ heroin, human trafficking and murder of non-ethnic Albanians and European nations are refusing to accept asylum claims by Kosovars. In exchange for the West to give Kosovo independence (which was promoted only by a handful of people and not the public) a gigantic military base for the West was built on 955 acres (360,000sq.m) of land which even has a secret prison for detention and torture. At one time 50,000 US troops was placed in this base in Kosovo.

No election should be about carving out bits and pieces of Sri Lanka. The minorities supporting these minority political parties need to take a hold on the situation and realize the likely damage that may occur if these ethno-based political parties attempt to create the scenario that has happened to Kosovo and even South Sudan and what is likely to take place in Iraq too. The West seeks geopolitical control in areas that they seek to take advantage. Minorities become easy bait drawing on emotional aspirations. The financial systems in control of the West are other tools that force developing nations to commit to compromising the nation and people simply to be given handouts to survive leaving no choice. It is in the hands of the people to realize the dangers in store.

What if North is given to Tamils, what if East is given to Muslims officially and legally – what next?

Why are we losing territory if Tamils and Muslims will go on living outside the areas that their political parties want carved out and declared exclusively theirs?

Tamil and Muslim voters need to look at this aspect very fairly and they need to ensure their political parties do not play footsy with Sri Lanka for petty political mileage but likely to lead to disastrous results for the nation in the future.

The country is looking to elect a suitable leader who can hold the country together and continue to keep the country stable and ensure that we do not enter a pre-May 2009 phase but ethno-based political parties are demanding exclusive territories for the support of their people to these candidates. Saner Tamils and Muslims must now come out and save the day.

The post Sri Lanka: What Kind Of Presidential Election Is This? – OpEd appeared first on Eurasia Review.

By Himani Pant*

While the world remains engrossed in the debates triggered by Western sanctions on Russia over Ukraine and the countersanctions, a serious humanitarian crisis is building up in Ukraine and the region in this freezing winter. The continuing Ukraine crisis has already resulted in more than 514,000 becoming internally displaced persons (IDPs), according to the latest Ukrainian State Emergency Service. The UNHCR estimates put the number of the IDPs here at 260,000. Such a rise in the magnitude of cases within such a short span of time spells out the gravity of the entire situation.

As the winter intensifies and the sanctions begin to impact the concerned countries, there loom several question marks on the fate of these IDPs in Ukraine who are actually facing the brunt of the crisis. Unemployment, lack of basic facilities and now the harsh weather seem to be making their life miserable.

Majority of these IDPs are in the eastern part of Ukraine, which is badly affected by the conflict between the Ukrainian army and pro-Russian separatists aligned with the self-proclaimed Donetsk and Luhansk People’s Republics. According to the spokesman for UNHCR, Adrian Edwards, “Fighting in the east, and the resulting breakdown of basic services, continues to drive more people from their homes”. If reports are to be believed, approximately 95% of the clashes have been reported in Donetsk, Kharkiv and Kyiv while the remainder have been found to be displaced from Crimea. According to the United Nations Office for the Coordination of Humanitarian Affairs (OCHA), 5.2 million Ukrainians live in areas affected by conflict, and OCHA expects more of them to become internally displaced as fighting continues.

Interestingly, women and children constitute most of the IDPs. Most men either choose to stay behind in order to protect property or sometimes they have to stay because they are prevented by the armed groups from leaving. According to UNHCR, 65% of the adult displaced population are women while 27% are children and 21% elderly or disabled people. This figure is despite the fact that not all displaced persons are registered with the authorities as a centralised registration system for keeping a track of IDPs came into existence only on October 15 this year.

The very uncertain future of Ukraine has, in turn, forced a large number of people to resettle in other areas. Nearly 172,000 people had applied for asylum in neighbouring countries in Europe, including more than 168,000 people in the Russian Federation. A further 149,000 applied for other forms of legal stay in the Russia. According to Russia’s Federal Migration Service, around 233,000 people have already applied for refugee status or temporary asylum in the Russian Federation. As is obvious, the largest chunk of people has fled to the Russian Federation.

With protests and clashes breaking out quite often in the region, there is an urgent need for international attention on the problems of these IDPs. The UN and international aid and efforts need to be properly allocated and closely monitored. Local administration needs to take charge of the situation and ensure proper food and other essential supplies to the displaced people.

Risks of human trafficking arise in conflict prone areas; hence the law and order situation needs to be sound enough to be able to prevent IDPs from such situations. On October 20, 2014 the Parliament of Ukraine did pass the Bill “On Ensuring the Rights and Freedoms of Internally Displaced Persons” No. 4490à-1 into law which identifies temporarily IDPs and determines the procedure for their obtaining employment, social services and appropriate assistance. However, since this procedure is paper-based, it leads to a lot of apprehensions in terms of practical application. According to UN monitoring, applicants are required to wait in two different lines to register and receive financial aid. Possibilities of inefficiency, duplication, red-tapism linger large on the applicability of such law, considering that one administrator can register an average of only 16 people per day. Moreover, the issue of tax exemption still needs to be addressed in order to guarantee the effective and efficient delivery of humanitarian assistance.

While there is no short term solution to the situation available, efforts need to be made to ensure the well-being of IDPs. The UNHCR has claimed that it is working on this front by citing the Cluster Approach that it is using to ensure care and protection of IDPs. In spite of this, the biggest challenge for it still remains ensuring equal allocation of basic facilities in and around Ukraine. For IDPs to survive the freezing temperatures, one of the basic challenges would be to ensure weather proof shelters considering the severity of winter in the region and the fact that about 20% of the displaced population are relying on collective shelters.

Access to food, shelter and medical facilitates are the basic requirements of every individual. Hence the authorities need to ensure that IDPs are not deprived of them. Temporary employment and allowances also need to be allocated for ensuring self sufficiency among the displaced individuals.

* The writer is a Research Intern at Observer Research Foundation, Delhi.

The post Rising Ukraine IDPs: Need For Urgent International Help – Analysis appeared first on Eurasia Review.

American corporate press has firmly established its second identity in the Internet: its twin, or its alias, one might say. It does apply, although perhaps not as vividly, in much of Western Europe, this time to the beating of war drums… where only common sound in the cacophony is the current displeasure for that daring devil: Vladimir Putin.

In a few months, Russia’s leader, and patriotic showoff at the Sochi Winter Olympics, has become an ogre-villain whose antumbra-image magnifies his average physical frame, and brings his mind to a mirror reflection of that of Darth Vader. Ironically, in our religious US, the Evangelical community has now been provided a choice between Vatican’s Francis and Kremlin’s Putin as leading contenders for anti-Christ.

Why are we in the West so intent in making Mr. Putin the world’s new villain; a step-brother of North Korea’s Kim Jong-un; the man we are told destiny has ordained to bring about World War III?

Perhaps it isn’t so much the West intent in demonizing the Russian mandatary as it is the United States, since all NATO nations’ leaders are trained to dance to Washington’s choreography. Lacking cojones by male NATO leaders, or gumption in Merkel’s case, the European squires insist on tying their nations’ futures to that of the US, and the belligerent policies coming out of Washington – policies by the US State Department and the Pentagon which are counter to those expressed and implied by understandings of a quarter of a century ago, as the Soviet Union capitulated to capitalism, and new geopolitical lines of influence were jointly redrawn to ensure long-lasting peace.

Now the US wants those lines redrawn once again, keeping Ukraine away from Russia’s influence, or even allowing it to be a détente buffer zone. But there is this adventurous Putin standing in the way… damned! And as weird and unpalatable as we Americans want to make him, the Russian people refuse to cooperate, giving him an 85 percent acceptability rating… which dwarfs the current popularity of Western leaders. [Except for Germany’s Merkel approval rating of 59 percent, Western leaders – Cameron, Hollande and Obama at the head – barely muster acceptability figures in the 20 to 45 percent.] Yet, the Russian leader continues to be portrayed by most of the Western media as a scoundrel ex-KGB agent who aims to revive the Soviet Union, take it out of its sepulcher, and launch a Samson last-ditch effort in bringing down Temple-West and all the western philistines… if he doesn’t get his Eurasian common market dream – the Eurasian Economic Union.

For the Eurasian Economic Union (EEU) to arrive as a major world economic power in the next decade, it will require more than just a few former Soviet republics to join in. Likely, it will take three nations to embrace in order to achieve not only reasonable economic synergy but geopolitical common ground. Russia would need to ally both Iran and Turkey, Islamic countries – one fundamentalist in its religion (Iran) but not the other, something which may pose a problem for a harmonious association, but certainly doable as commonality of interests by the three nations becomes obvious.

Membership by Iran and Turkey in the EEU would not only add almost 2.5 million square kilometers of area, but double the population in that common market, making it comparable to that of the US, and nearing that of the European Union. And although the combined annual GDP would initially not surpass the US$3.3 trillion mark, the synergy that could come about from the combined natural and human resources, could make the EEU the world’s fourth largest economy (soon passing Japan), and co-leader with the US and China in political-military strength.

And, of course, there would be a high probability the rest of the Middle East would join the EEU if Russia is allowed to have a mediating hand helping attain peace in the region …and it’s successful. But the idea may seem too Pollyannaish, and totally out of reach, when the US government and the American corporate media point an accusatory finger and burn in effigy that wicked wizard of the East, Vladimir Putin. When this Land of Oz, the United States of America, continues to promote sanctions, embargoes and ill-will against those who stand in the way of what Washington proclaims to be in US’ national interests; interests impossible to mask as being other than world hegemony.

For now, dealing with Vladimir Putin soothes the strain of bellicosity in us; and, in our visionless short term approach, we prefer not to worry about Xi Jinping, or China’s possible aspirations in Asia.
But eventually we will… what then?

The post Why Is The West Intent In Making Vladimir Putin Its Villain? – OpEd appeared first on Eurasia Review.

By Michael Lelyveld

A comprehensive study of the world coal market suggests China will face major challenges in meeting its commitment to cap greenhouse gas emissions by 2030.

China’s annual coal consumption of nearly 4 billion metric tons accounts for about half of the world’s use of the high-polluting fuel, comprising the biggest single source of man-made carbon dioxide (CO2).

In November, the United States and China reached a groundbreaking agreement on more ambitious CO2 reductions by the two leading emitters, ending years of wrangling over relative responsibilities and stages of development.

Under the agreement, the United States pledged to cut CO2 emissions by 26-28 percent from 2005 levels by 2025, while China promised to reach a peak in its releases by “around 2030″ or sooner if possible.

China is also working to double the share of non-fossil fuels in its energy mix to “around 20 percent,” reducing its heavy reliance on coal.

To hit the 2030 targets, China would have to stop the growth of coal use considerably earlier, capping consumption by “around 2020,” according to a Tsinghua University study released in November.

More will be needed

But in its annual Medium-Term Coal Market Report this month, the Paris-based International Energy Agency (IEA) said China would not reach a plateau in coal consumption during its forecast period through 2019 and probably beyond.

Additional coal will be needed for years to meet energy demand until capital-intensive projects for nuclear power and other non-fossil sources can shoulder more load, the IEA said.

“Therefore, longer-term trends might suggest peak coal in China during the next decade. However, we do not see that peak in the outlook period unless economic growth is much lower than assumed,” said the report.

The IEA’s medium-term finding is in keeping with longer- range estimates from its annual World Energy Outlook, also released in November, which forecast continuing growth in China’s coal demand until 2030.

The latest study concludes that the peak in coal use could be reached by 2019 only in case of unexpected circumstances, such as a sharp reduction in economic growth to 3 percent starting in 2015 from 7.3-7.4 percent this year.

Based on current trends, the agency sees coal demand growth slowing markedly to an annual rate of 2.6 percent through 2019, compared with a 9.7-percent growth rate over the past decade, due in part to energy efficiency efforts and a decelerating economy.

But even slower growth means China will be burning more than 100 million tons of additional coal with each passing year.

In 2013, China’s coal demand rose by 196 million tons to 3.894 billion tons, an increase of 5.3 percent, or more than double the global growth rate of 2.4 percent, the IEA said.

Uncertainty over goal

At an online press conference, the IEA’s executive director, Maria van der Hoeven, voiced uncertainty about meeting the CO2 goal by 2030.

“We think that this is a really very, very large step forward but … the devil is, of course, in the details, and the question is how are they going to manage that,” she said in response to a question from RFA.

Van der Hoeven acknowledged that China is the fastest growing country in developing renewable energy and also praised its energy efficiency drive.

“But at the same time, they are not yet stabilizing their coal consumption,” she said, although growth rates have started declining from high levels.

The critical issue is when China’s consumption will peak and start to come down, easing pressure on CO2 emissions.

“Not between now and 2019. The big question is will it be before 2030 or after 2030,” said van der Hoeven.

“I know that there are a lot of plans there, but plans are not enough,” she said.

A flexible limit?

In November, the State Council, or cabinet, announced an energy strategy that would cap coal consumption at 4.2 billion tons in 2020, but it was unclear whether that limit would be permanent or adjusted upwards for future years to allow for energy demand growth.

The IEA forecasts have sparked some online debate from experts who believe a peak in China’s coal use is still possible by 2020.

The environmental group Greenpeace noted in a posting at energydesk.greenpeace.org that China’s coal consumption has already dropped by 1.2 percent in the first nine months of 2014 from the year-earlier period, according to industry estimates.

In the first eleven months, coal production of 3.513 billion tons fell 2.1 percent, Reuters reported, citing the website coalstudy.com.

The decline may be the result of a combination of factors, including weak power demand growth and a 22-percent jump in hydropower output in a wet year.

Last week, a National Energy Administration (NEA) official estimated that the share of coal in China’s total energy mix dropped from 65.7 percent to 64.2 percent in 2014, the official Xinhua news agency reported.

The IEA studies come as China’s government considers policies to implement the 2030 goal, which could be part of a new five-year energy plan.

Pledge may still be binding

China has countered criticism that its CO2 pledge is not legally binding by arguing that it will be, once the plan is approved by the National People’s Congress (NPC).

In November, Xie Zhenhua, vice-chairman of the National Development and Reform Commission (NDRC) planning agency, said the goal would also be made legally binding by including it in the next three Five-Year Plans of the government, the official English-language China Daily reported.

Speaking at the two-week United Nations climate change conference in Lima, Peru, Xie indicated that China would announce more detailed CO2 plans in the first quarter of 2015.

Some steps are likely to coincide with previous plans to fight smog in China’s cities and cut both energy use and carbon emissions per unit of gross domestic product (GDP).

In November, Xie said China had lowered carbon emissions per unit of GDP by 28.5 percent from 2005 levels as of 2013, Xinhua reported.

In the first three quarters of the past year, the country reduced carbon “intensity” by 5 percent, Xie said.

Longer-term plans to limit CO2 emissions in terms of total volume may rely on a combination of administrative measures and reforms.

Efforts may increase demand

China has already turned to administrative steps by ordering the closure of all coal-burning power plants in Beijing by 2017.

But power needs may restrain similar directives to curb coal use throughout the country.

The IEA noted that some anti-pollution efforts might actually lead to increased coal demand.

New ultra-high voltage lines between coal production bases and distant cities may require more energy to offset transmission losses, for example.

It is unclear how much of a role pricing will play in future coal use.

Following its annual Central Economic Work Conference this month, the government issued a statement that called for speeding up a series of reforms, including pricing, in the coming year, but it did not specify whether these would cover coal and other energy sources.

Coal still the cheapest fuel

Although benchmark coal prices in China have crept up since October, they remain at five-year lows, down about 15 percent for the year, thanks to oversupply and slower economic growth.

While demand for cleaner but costlier natural gas for power may almost double by 2019, coal is expected to remain China’s highest-polluting but lowest-priced fuel.

In 2013, coal-fired power accounted for 75-80 percent of China’s total generation, the IEA study said.

The government has been considering a carbon tax that would reduce incentives for coal use since early 2012, according to state media reports.

But the option of simply capping coal consumption could prove problematic for the government, which faced heavy criticism for administrative measures aimed at meeting five- year energy efficiency targets in 2010.

As the end of the year approached, local officials tried to meet the central government’s goal by imposing brownouts and power outages on businesses, homes, and even hospitals, artificially lowering energy use in relation to GDP to produce a more favorable efficiency ratio.

The public outcry over the practice prompted the then-director of the NDRC, Zhang Ping, to take the blame for the fiasco.

“I must apologize for these acts because we, as the responsible department, did not give proper guidance,” said Zhang, as reported by China Daily at the time.

The NDRC promised that such arbitrary cuts to meet emissions targets would not happen again.

The post China’s Coal Use Imperils Climate Pledge – Analysis appeared first on Eurasia Review.

Chief PLO Negotiator Saeb Erekat said on Sunday eight amendments have been introduced to the original draft resolution, adding that the Security Council would vote on it Tuesday or Wednesday. He pointed out that Jordan would present the amended resolution on behalf of the Palestinians and Arab countries.

Palestinian efforts to win support for the resolution would continue “until the last minute,” Erekat said, repeating earlier threats that the Palestinians would join international organizations and treaties if the US chooses to veto the resolution, which calls for setting a timeline for Israel’s withdrawal to the pre-1967 lines.

At least nine votes are needed for the resolution to pass. It was not clear by Sunday night whether the Palestinians had succeeded in winning the backing of nine members of the Security Council.

Although Erekat said changes have been introduced to the resolution, a senior Palestinian official in Ramallah said it was not different from the original one.

Ahmed Majdalani, secretary- general of the Palestinian Popular Struggle Front, said the original draft resolution, which was made public last week, complies with the national rights of the Palestinians. Attempts to change the wording of the original draft resolution have been strongly opposed by the US, he said, predicting that the US and Israel would exert pressure on members of the Security Council to refrain from voting in favor of the resolution.

Several Palestinian groups have voiced opposition to the original draft resolution under the pretext that it does not meet the aspirations of the Palestinians.

They claim the resolution equates Israel and the Palestinians and is “ambiguous” on issues such as settlements, Jerusalem, refugees, prisoners and borders.

Hamas called on the Palestinian Authority leadership to withdraw the resolution from the Security Council and “acknowledge” the failure of the peace process.

It warned that the proposed resolution includes “dangerous concessions” on the rights of the Palestinians, and criticized the resolution’s reference to Jerusalem as a “shared capital” of two states, saying the city will remain the capital of a Palestinian state only.

Hamas said it also was opposed to the content of the resolution because it does not allow “future Palestinian demands to Palestine.”

Khaledah Jarrar, a senior member of the Popular Front for the Liberation of Palestine, said her group was opposed to the resolution because it does not meet Palestinian rights to self-determination and the establishment of a sovereign state with east Jerusalem as its capital.

Bassam al-Salhi, leader of the Palestinian People’s Party (formerly the Communist party), called for an emergency meeting of the Palestinian leadership to revise the resolution, saying the Palestinians must withdraw the resolution unless it is amended to meet the aspirations of the Palestinians.

Original article

The post Jordan To Present Palestinian Draft Resolution To UN appeared first on Eurasia Review.

By Andrew Topf

The oil price drop that has dominated the headlines in recent weeks has been framed almost exclusively in terms of oil market economics, with most media outlets blaming Saudi Arabia, through its OPEC Trojan horse, for driving down the price, thus causing serious damage to the world’s major oil exporters – most notably Russia.

While the market explanation is partially true, it is simplistic, and fails to address key geopolitical pressure points in the Middle East.

Oilprice.com looked beyond the headlines for the reason behind the oil price drop, and found that the explanation, while difficult to prove, may revolve around control of oil and gas in the Middle East and the weakening of Russia, Iran and Syria by flooding the market with cheap oil.

The oil weapon

We don’t have to look too far back in history to see Saudi Arabia, the world’s largest oil exporter and producer, using the oil price to achieve its foreign policy objectives. In 1973, Egyptian President Anwar Sadat convinced Saudi King Faisal to cut production and raise prices, then to go as far as embargoing oil exports, all with the goal of punishing the United States for supporting Israel against the Arab states. It worked. The “oil price shock” quadrupled prices.

It happened again in 1986, when Saudi Arabia-led OPEC allowed prices to drop precipitously, and then in 1990, when the Saudis sent prices plummeting as a way of taking out Russia, which was seen as a threat to their oil supremacy. In 1998, they succeeded. When the oil price was halved from $25 to $12, Russia defaulted on its debt.

The Saudis and other OPEC members have, of course, used the oil price for the obverse effect, that is, suppressing production to keep prices artificially high and member states swimming in “petrodollars”. In 2008, oil peaked at $147 a barrel.

Turning to the current price drop, the Saudis and OPEC have a vested interest in taking out higher-cost competitors, such as US shale oil producers, who will certainly be hurt by the lower price. Even before the price drop, the Saudis were selling their oil to China at a discount. OPEC’s refusal on Nov. 27 to cut production seemed like the baldest evidence yet that the oil price drop was really an oil price war between Saudi Arabia and the US.

However, analysis shows the reasoning is complex, and may go beyond simply taking down the price to gain back lost marketshare.

“What is the reason for the United States and some U.S. allies wanting to drive down the price of oil?” Venezuelan President Nicolas Maduro asked rhetorically in October. “To harm Russia.”

Many believe the oil price plunge is the result of deliberate and well-planned collusion on the part of the United States and Saudi Arabia to punish Russia and Iran for supporting the murderous Assad regime in Syria.

Punishing Assad and friends

Proponents of this theory point to a Sept. 11 meeting between US Secretary of State John Kerry and Saudi King Abdullah at his palace on the Red Sea. According to an article in the Wall Street Journal, it was during that meeting that a deal was hammered out between Kerry and Abdullah. In it, the Saudis would support Syrian airstrikes against Islamic State (ISIS), in exchange for Washington backing the Saudis in toppling Assad.

If in fact a deal was struck, it would make sense, considering the long-simmering rivalry between Saudi Arabia and its chief rival in the region: Iran. By opposing Syria, Abdullah grabs the opportunity to strike a blow against Iran, which he sees as a powerful regional rival due to its nuclear ambitions, its support for militant
groups Hamas and Hezbollah, and its alliance with Syria, which it provides with weapons and funding. The two nations are also divided by religion, with the majority of Saudis following the Sunni version of Islam, and most Iranians considering themselves Shi’ites.

“The conflict is now a full-blown proxy war between Iran and Saudi Arabia, which is playing out across the region,” Reuters reported on Dec. 15. “Both sides increasingly see their rivalry as a winner-take-all conflict: if the Shi’ite Hezbollah gains an upper hand in Lebanon, then the Sunnis of Lebanon—and by extension, their Saudi patrons—lose a round to Iran. If a Shi’ite-led government solidifies its control of Iraq, then Iran will have won another round.”

The Saudis know the Iranians are vulnerable on the oil price. Experts say the country needs $140 a barrel oil to balance its budget; at sub-$60 prices, the Saudis succeed in pressuring Iran’s supreme leader, Ayatollah Ali Khamanei, possibly containing its nuclear ambitions and making the country more pliable to the West, which has the power to reduce or lift sanctions if Iran cooperates.

Adding credence to this theory, Iranian President Hassan Rouhani told a Cabinet meeting earlier this month that the fall in oil prices was “politically motivated” and a “conspiracy against the interests of the region, the Muslim people and the Muslim world.”

Pipeline conspiracy

Some commentators have offered a more conspiratorial theory for the Saudis wanting to get rid of Assad. They point to a 2011 agreement between Syria, Iran and Iraq that would see a pipeline running from the Iranian Port Assalouyeh to Damascus via Iraq. The $10-billion project would take three years to complete and would be fed gas from the South Pars gas field, which Iran shares with Qatar. Iranian officials have said they plan to extend the pipeline to the Mediterranean to supply gas to Europe – in competition with Qatar, the world’s largest LNG exporter.

“The Iran-Iraq-Syria pipeline – if it’s ever built – would solidify a predominantly Shi’ite axis through an economic, steel umbilical cord,” wrote Asia Times correspondent Pepe Escobar.

Global Research, a Canada-based think tank, goes further to suggest that Assad’s refusal in 2009 to allow Qatar to construct a gas pipeline from its North Field through Syria and on to Turkey and the EU, combined with the 2011 pipeline deal, “ignited the full-scale Saudi and Qatari assault on Assad’s power.”

“Today the US-backed wars in Ukraine and in Syria are but two fronts in the same strategic war to cripple Russia and China and to rupture any Eurasian counter-pole to a US-controlled New World Order. In each, control of energy pipelines, this time primarily of natural gas pipelines—from Russia to the EU via Ukraine and from Iran and Syria to the EU via Syria—is the strategic goal,” Global Research wrote in an Oct. 26 post.

Poking the Russian bear

How does Russia play into the oil price drop? As a key ally of Syria, supplying Assad with billions in weaponry, President Vladimir Putin has, along with Iran, found himself targeted by the House of Saud. Putin’s territorial ambitions in the Ukraine have also put him at odds with US President Barack Obama and leaders of the EU, which in May of this year imposed a set of sanctions on Russia.

As has been noted, Saudi Arabia’s manipulation of the oil price has twice targeted Russia. This time, the effects of a low price have hit Moscow especially hard due to sanctions already in place combined with the low ruble. Last week, in an effort to defend its currency, the Bank of Russia raised interest rates to 17 percent. The measure failed, with the ruble dropping another 20 percent, leading to speculation the country could impose capital controls. Meanwhile, Putin took the opportunity in his annual televised address to announce that while the economy is likely to suffer for the next two years and that Russians should brace for a recession, “Our economy will get diversified and oil prices will go back up.”

He may be right, but what will the effect be on Russia of a sustained period of low oil prices? Eric Reguly, writing in The Globe and Mail last Saturday, points out that with foreign exchange reserves at around $400 billion, the Russian state is “in no danger of collapse” even in the event of a deep recession. Reguly predicts the greater threat is to the Russian private sector, which has a debt overhang of some $700 billion.

“This month alone, $30-billion of that amount must be repaid, with another $100-billion coming due next year. The problem is made worse by the economic sanctions, which have made it all but impossible for Russian companies to finance themselves in Western markets,” he writes.

Will it work?

Whether one is a conspiracy theorist or a market theorist, in explaining the oil price drop, it really matters little, for the effect is surely more important than the cause. Putin has already shown himself to be a master player in the chess game of energy politics, so the suggestion that sub-$60 oil will crush the Russian leader
has to be met with a healthy degree of skepticism.

Moscow’s decision on Dec. 1 to drop the $45-billion South Stream natural gas pipeline project in favor of a new pipeline deal with Turkey shows Putin’s willingness to circumvent European partners to continue deliveries of natural gas to European countries that depend heavily on Russia for its energy requirements. The deal also puts Turkey squarely in the Russian energy camp at a time when Russia has been alienated by the West.

Of course, the Russian dalliance with China is a key part of Putin’s great Eastern pivot that will keep stoking demand for Russian gas even as the Saudis and OPEC, perhaps with US collusion, keep pumping to hold down the price. The November agreement, that would see Gazprom supply Chinese state oil company CNPC with 30
billion cubic meters of gas per year, builds on an earlier deal to sell China 38 bcm annually in an agreement valued at $400 billion.

As Oilprice.com commented on Sunday, “ongoing projects are soldiering on and Russian oil output is projected to remain unchanged into 2015.”

“Russia will go down with the ship before ceding market share – especially in Asia, where Putin reaffirmed the pivot is real. Saudi Arabia and North America will have to keep pumping as Putin plans to uphold his end in this game of brinksmanship.”

Source:
http://oilprice.com/Energy/Oil-Prices/Did-The-Saudis-And-The-US-Collude-In-Dropping-Oil-Prices.html

The post Did The Saudis And The US Collude In Dropping Oil Prices? – Analysis appeared first on Eurasia Review.

By Rahul Bhonsle

Use of the web – internet chat rooms, weblogs, social media as Facebook, Twitter and Instagram to spread extremist propaganda and attract youth to join terrorist groups as al-Qaeda and more recently the Islamic State has been prevalent for some time now.

Al-Qaeda has used tools as web magazine, “Inspire,” to attract youth through the internet and has succeeded in recruiting many; the Islamic State has taken this form to the next level. The return and interrogation of Areeb Majeed, one of the four youth from Kalyan near Mumbai from Iraq after having fought with the Islamic State for some months brought the challenge of radicalization closer home. Majeed revealed that he was indoctrinated through the web and given directions through social media messages on how to join the Islamic State.

The arrest of 24-year-old Mehdi Masroor Biswas, handler of the Twitter account @ShamiWitness in Bangalore in December 2014 for carrying out propaganda for the Islamic State underlined necessity for undertaking comprehensive measures to monitor activities of youth who may have swayed from the path of rationality. Biswas an employee of the India Tobacco Company (ITC) and others may have lacked perspective of the consequences of their acts.

In this light, India’s Intelligence Bureau Director, Asif Ibrahim briefing a galaxy of top police officials in front of the Prime Minister and the Home Minister on 30 November prioritized counter radicalization.

A counter or de-radicalisation response will have to operate at seven levels to dissuade youth from joining terrorist groups; individual, family, community, education, employer and media, government and security forces and international community.

At the individual level youth will have to be constantly guided to stay on the path of non violence by providing alternate channels for airing grievances as well as managing concerns be it of education or employment.

The role of the family is important as was shown in the case of Areeb, where influence was used to cajole him to return to the country once contact was established when he was injured. While youth today are unwilling to submit to parental influence, monitoring of their activity, particularly the company they keep and web history has assumed importance howsoever unpleasant the task may be. Mothers, sisters and wives have a major role to play to keep male members in the family away from the path of extremism and violence.

At the next level involving community leaders, in the case of Muslims, the Ulema, heads of seminaries and clerics is important. In India there are a number of Muslim clergy who have condemned violence by terrorist groups unequivocally, repeating the message is necessary where media will have an important role.

Education both syllabi and institutions are an important intervention for counter radicalization. The syllabus duly vetted by acknowledged educationists and social scientists must ensure information and knowledge is presented in a way to inculcate the right values of tolerance, equity, secularism and pluralism. Educational institutions have a major role to play and should not only follow laid down syllabus and guidelines but have to wily nily monitor activities within to prevent radicalization of the student community. Discreet monitoring has become essential how so ever abhorrent it may be in an open society as ours.

Employers have an increasing role to play in ensuring that their employees are acting responsibly and are not violating social as well as legal norms. This aspect is frequently ignored or lightly brushed aside by corporate who claim that they do not have the right to monitor their employee’s private and social life. Yet this is an essential aspect of social responsibility that every business has to bear and may bring a bad name to the company in case an employee is apprehended.

The media should also highlight atrocities committed by terrorists and publish interviews of those who have returned as Areeb and who are amenable to shed their links with the extremist groups. The electronic media – television and radio will have an important role to play in the same. At the next level, government will have to provide direction in the form of a national strategy, policy or guidelines for countering radicalization. Pluralism or secularism depending on the political ideology should be encouraged and leaders should avoid falling prey to indiscretions particularly during election campaigning.

Security forces should avoid targeting youth of a particular community or locality merely on the basis of information or hearsay. A wrong arrest can lead to adverse reaction in the community at large and should be avoided. Intelligence will remain a key tool to focus on actual offender while avoiding targeting innocents. An extensive monitoring of the web including social media has also become important. This will require necessary regulatory approvals from the government and should not be undertaken in an unrestrained manner. International affirmation towards building a pluralist and humane society has to be led by the highest religious and national leadership denoting the moral compass to shun extremism and violence. Cooperation amongst intelligence agencies will be a contributory factor but use of inputs has to be based on national philosophy of countering terrorism. There is a gigantic task ahead in which the society and the government will have to co-join to prevent innocents being drawn in the web of terror. This is a collective responsibility.

The post A Seven Level Counter Radicalisation Response – Analysis appeared first on Eurasia Review.

By Mushvig Mehdiyev*

Relations between Russia and three South Caucasus countries – Azerbaijan, Georgia and Armenia – have always had their ups and downs, as politics tends to do, resulting in uneasiness in the region.

Russia is going through a tough period as a result of Western-applied sanctions, that along with the falling price of oil and the depreciating ruble, risks seeing Russia’s woes travel south into the Caucasus.

If that were to occur one might well ask what impact will Russia’s failing economy have on Azerbaijan, Georgia and Armenia ? How will it further take its toll on the South Caucasus countries to the point where they would start reconsidering their relations with the northern giant?

Let’s first take a brief tour to the root of the challenge facing the world’s largest country. The Ukrainian crisis made Russia discern the first glimpses of the trouble waiting ahead when the Western forces – Europe and U.S. – blamed it for escalating tensions in Ukraine during the Maidan unrest. Russian authorities then rebuffed all accusations, saying it was just trying to help Russians living in Ukraine.

Further actions by Russia revealed its active involvement in the events in Ukraine as it annexed the Crimea peninsula in March, 2014, prompting accusations from the West and the introduction of sanctions.

Given that a large number of Ukrainians aspire to integrate Europe politically, Russia’s intervention was labeled as an act of aggression and Western forces vowed to back Ukraine. This does not seem to have influenced Russia who is still reportedly involved in military hostilities in eastern Ukraine, where it is backing the separatist forces, according to the West’s allegations. More than 1.7 million children in conflict-torn areas of eastern Ukraine face an extremely serious situation amid conflict and winter cold, according to UNICEF.

Although Russian President Vladimir Putin called the ongoing hardship in his country an “unfavorable scenario” rather than accepting it as a crisis, Moscow is trying to prevent the ruble turmoil from turning into an economic catastrophe, and finds itself more isolated than at any period over last 25 years.

The most recent exchange rate of the ruble against the US dollar is 57 rubles for one dollar. In addition to Western sanctions, the ruble’s overwhelming depreciation is reportedly linked to the global depreciation in oil prices, which is a serious blow on Russia’s oil-oriented economy.

What should Azerbaijan expect from the Russian crisis? Azerbaijan’s relations with Russia has always cordial and at a relatively constant and at a high-level.

Azerbaijan

Azerbaijan

Azerbaijan refused to join the Russia-lead Collective Security Treaty Organization (CSTO) and Eurasian Economic Union (EEU), explaining it with its preference to an independent course in political and economic policies in the region, rather than bearing certain compulsory responsibilities within a union. Positive feedback of that decision by the Azerbaijani authorities was reflected in the International Monetary Fund report about the impact of the Russian crisis on its neighboring countries. The IMF claimed that Azerbaijan’s economy will be among those to have less and even intangible consequences of the crisis in Russia.

“Both Europe and Russia are our good partners and neighbors, and we cooperate with either side based on our national interests,” said Ali Hasanov, Head of Public and Political Department of the Presidential Administration.

Hasanov noted that Azerbaijan sees Russia as a great player in the region. He said Azerbaijan was not making a choice between Russia and Europe.

Last August Russia announced it was closing its markets to European products in retaliation to the “punishing” sanctions from the West. Preventing Western food products from entering its markets, Russia started to trust on more active involvement of its eastern partners by increasing their export to Russian markets.
Azerbaijan is seen as one of the main exporters who can fill part of the void in the Russian market after Moscow in a retaliatory move banned European products. Foreign Minister Sergey Lavrov has even said the fruits imported from Azerbaijan were much more tasty and high-quality than the fruits brought from Europe.

Meanwhile, Azerbaijani officials are confident that the Russian slowdown will not affect their economy given the stability of the national currency, the manat. Indeed, President Aliyev has recently said the fall in oil prices would not affect the country’s economy, due to stable rate of the national currency the manat based on strong economic basis and well-thought economic policy.

In a nutshell, Azerbaijan’s political and economic skills were not seriously affected by the deepening crisis in Russia, so far. Moreover, the “evil days” in the northern giant could not threaten Azerbaijan to turn away from its neighbor and leave it alone in the region.

Georgia

Georgia

But if relations between Baku and Moscow are cordial the same cannot be said about Moscow and Tbilisi, who fought a brief , but bloody war in August 2008, when Russia recognized the independence of Georgia’s breakaway South Ossetia and Abkhazia regions, causing a serious uproar among Georgian authorities to cut diplomatic ties with Moscow.

Economic relations between the countries worsened in 2006, when Russia banned the importation of Georgian wines, mineral water and agricultural products, claiming low quality of such goods. The measure, which Georgia described as politically motivated, came as ties between the two former Soviet nations soured with the rise to power of pro-Western Georgian leader Mikheil Saakashvili.

Russian-Georgian relations improved after the Georgian Dream Team took power in 2012. This was characterized by Moscow’s conciliatory gestures towards Georgia, including the opening of the Russian market to Georgian goods in 2013, resumption of direct flights, Tbilisi’s great willingness to contacts with Russia and its consideration of Russia’s some interests. This did not affect Russia’s overall priority for Georgia. Russia signed a versatile treaty with the breakaway Abkhazia region in November to provide a multi-sided assistance to the separatist regime, once more deteriorating the relented relations of the two countries. Grigory Karasin, Russia’s Special Envoy for Georgian Issues, said the agreement with Abkhazia was Russia’s respond to Georgia’s strong aspiration for European integration.

Political negotiations between Russia and Georgia are being held by special representatives Grigory Karasin and Zurab Abashidze under the Geneva Format of Talks, a coordinated negotiation framework to soften the Russia-Georgia relations escalated after August 2008 war.

Georgia as a neighbor of Russia also has some predictions in regard to the economic slowdown in Russia. First of all, as a small country, it expects a smaller impact caused by Russia’s troubling economy compared to Germany, France and Italy, whose trade balance with Russia amounts to tens of billions of dollars. Russia is the fourth major trade partner of Georgia and the third main export market, particularly for wine and mineral water.

If the Russian economy suffers from a sharp decline, the solvency of Russian population will simultaneously drop to affect Georgia’s export potential, Georgian economic analysts worry. Moreover, there are hundreds of Georgian citizens who work in Russia and send money to their families. Soso Archvadze, an economic analyst, claims that the deepening economic crisis in Russia threatens Georgian migrants with a possible loss of jobs. Reduction in their income will seriously affect money transfers to Georgia, which make up almost 60 percent of overall remittances to the post Soviet country.

“Money transfers share one third of the Georgian residents’ revenues and roughly 14-15 percent of GDP. Nearly 60 percent of the total money inflow comes from Russia. Therefore, Georgia should make a very serious analysis and shift its focus to Asian markets. China, for example, is a very attractive wine market due to its huge population,” Archvadze said.

Georgia’s national currency the lari faced a decline in its value in recent days, which is reportedly linked to the Russian ruble’s devaluation. Nevertheless, Georgia is not threatened by financial hassle given the sustainable support from the Western forces. Now, the government is developing fundamental plans to build firm relations with the European Union and NATO, accepting the west as a best roof over its head amid aggressive Russian policy in the region. The European Union ratified the Association Agreement with Georgia on December 18, 2014, to push the post Soviet nation a step closer inside Europe.

Armenia

Armenia

Armenia is most likely the main country to feel the fallout of the Russian crisis.

It is a member of the Russia-lead Collective Security Treaty Organization and the Eurasian Economic Union, having irreversible obligations under the common rules of the alliances. Russian Foreign Minister Sergey Lavrov said Armenia should resist the Western sanctions along with Russia in any necessary circumstance.

Russian-Armenian political relations date back to very old times, as Russia has always been accepted as the main strategic ally and “big brother” of Armenia, reviewing South Caucasus nation’s each step in regional and even international policy.

In return to Armenia’s long-lasting loyalty, Russia, as a chief protector, pledges to ensure the South Caucasus country’s security (under the CSTO membership terms) and welfare (under the EEU membership terms) in the region.

Russia is also an important regional player for Armenia in regard to the Nagorno-Karabakh conflict. Amid its regular decentralization on the peaceful resolution to the protracted conflict, Russia is a key power to urge the South Caucasus country to stay committed to the peaceful negotiations, since any turmoil in the region is a threat to the northern giant’s interests. Also, Russia is playing a dual role in the region to keep the balance in military skills of Armenia and Azerbaijan by selling weapons to the belligerents. But, anyway, a peaceful end to the conflict is one of the key issues in regional policy of Russia, a co-chair country of the OSCE Minsk Group, and Armenia obeys Russia’s instructions in regard to the Karabakh knot.

Any tremor in Russia’s economy means an earthquake in the economy of Armenia – this may be the best saying to express the mutual economic ties of the two former Soviet nations. Russia is the top destination for Armenian-made products, since nearly 85 percent of the overall exportations are directed to Russia. Dependence on Russian markets paralyzes Armenia’s economy on the background of the modern crisis hitting the northern giant. Weakening purchasing power in Russia, which is a clear result of the crisis, inflicts painful blows on the Armenian export.

“An unpleasant causal chain started in the Russian markets simultaneously with the ruble’s fall. Drop in purchasing power in Russia decreased orders from Armenia,” said Vaahn Mkrtchyan, Co-owner of the Armenian Wine Company, while Avag Harutunyan, Head of Armenian Winemakers Union, revealed a $86,000 daily loss of the Armenian winemakers in Russia given the financial tussle.

Over 2.2 million Armenians live in Russia today, according to the Armenian Diaspora’s data. Many of them are labor migrants, who left Armenia to earn their life and provide for their family living in the native land. The money transfers from migrant workers in Russia take a considerable share in the South Caucasus country’s income, making up nearly 84 percent of the overall private remittances and 15.4 percent or $1.6 billion of Armenia’s Gross Domestic Product, the Central Bank revealed.

The bank announced that the total transfers made by Armenian migrant workers in Russia was nearly $146 million this year, which testifies to a sharp fall by $11 million compared to the last year. Just in October, the remittances from Russia has dropped by 20 percent.

Current dethronement of the Armenian dram started all while the Russian ruble began to slide to an all-time low following the isolating sanctions by the Western forces. Experts claim that Armenia’s tightening relations with Russia, amid the partnership within the Eurasian Economic Union, show green light for future challenges in its economy if Russia fails to tackle the deepening economic hassle facing it. Economic experts believe that the prices in the Armenian markets have taken a sharp rise this year ahead of the New Year holiday season compared to the previous years, linking it to the dram and ruble devaluation, as well as the dollar’s significant appreciation in the global market.

President Vladimir Putin promised to overcome the “unfavorable scenario” in two years, maybe less. Amid the ongoing developments the three South Caucasus nations will have to take the best stand not to sink their ships in a battle of big powers.

* Mushvig Mehdiyev is a journalist at the Baku-based AzerNews newspaper, and is engaged in developing regular analytical articles about the South Caucasus region.

The post Crisis-Hit Russia And Three South Caucasus Musketeers – Analysis appeared first on Eurasia Review.

The World Trade Organization (WTO) is probably one of the best-known international institutions, certainly when compared with its nearest counterparts, the IMF and WB. It was tasked with providing a level playing field so that countries would be able to conduct trade under common rules. However, in the eyes of its members the importance of belonging to WTO is as much political as economic.

The WTO is criticized in many circles or not keeping pace with the changes affecting world trade. The global economy has been put into a state of flux by the shifting levels of cross-border flows of goods, services, know-how, investment and people – supply-chain trade, in economic jargon. Therefore, the WTO is facing a difficult dilemma: whether to keep on fulfilling its original mission or address the new and emerging realities of the 21st century.

Its lack of response to new challenges has made the WTO appear to be in the grip of a chronic malaise. For instance, developing and industrial countries have been caught up in an acrimonious conflict over tariffs and agricultural barriers since the beginning of the Doha Development Round in 2001, despite its mission to be a mediator in such conflicts. However, two apparatuses within the WTO have performed extremely well: the Dispute Settlement Body and The World Intellectual Property Organization (WIPO) Arbitration and Mediation Centre.

The World Trade Organization (WTO) dispute settlement system is a vital element in the maintenance of international trade and the enforcement of WTO rules. Established in 1995, it has an impressive compliance rate (over 80%), particularly when compared to other international state-to-state dispute settlement mechanisms. It addresses a wide range of trade-related topics: from trade in goods and services to intellectual property (IP) rights. WTO success in regulating international trade over the past 15 years is in no small way attributable to its dispute settlement mechanism.

This work is undertaken by WTO’s Dispute Settlement Body (DSB), a political body composed of representatives from all WTO member states. Decisions to initiate dispute proceedings and adopt reports from one of the two WTO dispute instances (Panel and Appellate Body) are taken by “reverse consensus” or “consensus against” – if at least one member agrees, the decision is adopted. This unique feature, not present under the old GATT (1947-1994), has transformed the WTO dispute settlement system into both an automatic and a compulsory mechanism.

Despite the relatively large number of cases dealt with, many disputes are resolved merely through consultations between the parties concerned: of the 482 consultation requests made so far by WTO members, less than half (46%) of disputes have progressed to the Panel hearing stage. In turn, approximately 70% of Panel reports have been appealed against, and in the vast majority (88%) of cases, one or more violations of substantive WTO obligations have been found by Panels or the Appellate Body. Finally, in only 19 cases has the WTO authorized trade sanctions or the suspension of WTO concessions, the measure of last resort in the event a WTO member fails to implement adverse rulings within a reasonable timeframe.

In 2009, after a decade-long dispute, Brazil was authorized to “retaliate” against U.S. products as a result of WTO-inconsistent subsidies granted to U.S. cotton producers. There was an added twist, though: Brazil was also authorized to impose sanctions on IP rights held by U.S. companies. This so-called “cross retaliation” has been authorized by the WTO in only three cases so far, and Brazil seems to be the only country actually preparing to take such measures. Yet, in 2010, Brazilian retaliatory measures were suspended thanks to a U.S.-Brazil agreement (the U.S. agreed to pay the Brazilian cotton industry $147.3 million annually, in monthly installments), which managed, at least temporarily, to defuse a major trade dispute. However, for budgetary reasons, the Obama Administration put an end to those payments in October 2013. In January 2014, Brazil threatened again to take retaliatory measures against a wide variety of U.S. goods and intellectual property rights.

The World Intellectual Property Organization (WIPO) Arbitration and Mediation Centre, created in 1994, is another ‘success story’. It aims to resolve commercial intellectual property disputes between private parties. It has heard over 320 mediation and arbitration cases, dealing mainly with patents (44%), IT and telecom (17%), trademark (9%) and copyright (7%) issues. Common users of the WIPO Centre’s services include collecting societies, artists, inventors, producers and universities. The WIPO Centre also offers internet domain name resolution dispute, having conducted almost 18,000 proceedings under the Uniform Domain Resolution Policy. These proceedings, which involve primarily .com, .org, and .net domains, enable trademark-holders to challenge bad faith registration and use of domain names associated with their trademarks. Thanks to this mechanism, pop stars including Madonna and Sting successfully reclaimed websites or domain names carrying their name.

WIPO and WTO dispute settlement mechanisms are used by different parties (only states, not private parties, have standing at the WTO), and are governed by different rules: WIPO applies WIPO treaties, and WTO applies WTO agreements. There is a point of overlap, however, in that the WTO can also deal with IP disputes between states under the Trade-Related Aspects of Intellectual Property Rights Agreement (TRIPS), and, as noted above in the U.S.-cotton subsidies case, authorization to “retaliate” can also affect IP rights.

Three interesting developments are worth noting in this respect. Firstly, the TRIPS Agreement has rarely been invoked, in fact in only around 3% of total WTO disputes. Second, developing countries are not the main parties involved in IP dispute proceedings. On the contrary, the EU (as respondent) and the U.S. (as complainant) are the two parties most involved in IP disputes. Finally, Panels and the Appellate Body have never authorized trade sanctions in other WTO covered areas (“cross-retaliation”) to enhance TRIPS enforcement, a major fear held by developing countries when the TRIPS Agreement was adopted. Actually, and rather ironically, the WTO has authorized developing countries to cross-retaliate in IP to enforce goods and services-related rulings against the EU and U.S. WTO panels and the Appellate Body have been able to deal with complex IP issues in the few TRIPS disputes by working closely with WIPO and reinforcing the mutual cooperation of these two organizations.

In sum, both the WTO and the WIPO Centre offer unique and broadly successful means of peacefully settling disputes using international rule of law. This being so, they provide possible templates for the future development of WTO as a whole.

Richard Rousseau is Associate Professor and Chair of the Department of Humanities and Social Sciences at the American University of Ras Al Khaimah, United Arab Emirates. His research, teaching and consulting interests include Russian politics, Eurasian geopolitics, international political economy and globalization.

This article appeared at http://g20summitmagazine.imirus.com/Mpowered/book/vgsm14/i2/p118 and is reprinted with permission.

The post WTO And WIPO Dispute Settlement Systems: Success Stories – Analysis appeared first on Eurasia Review.

Has the growth of global civil society promoted popular self-government, and most particularly in developing countries? Many advocates of progressive social change have championed civil society—the “third sector”—as an arena of virtue, which has the capacity to overcome domination in government and exploitation in the free market economy.

The phrase ‘civil society’ usually refers to the voluntary associations whose activities seek to shape policies, norms, and/or deeper social structures. Civil society is therefore distinct from both public and commercial institutions, though the lines can sometimes become blurred (for example, in a business lobby on social issues). Civil society groups, also known as Non-Governmental Organizations (NGOs), include consumer protection bodies, community-based organizations, academic institutions, think tanks, environmental campaigns, business forums, cooperation groups, co-operatives, labor unions, charitable foundations, ethnic lobbies, clan and kinship circles, criminal syndicates, relief organizations, religious institutions, youth campaigns, human rights advocates, farmers’ groups, labor unions, peace activists, women’s networks, professional associations, and more. Much of civil society is formally constituted and officially registered, but many grassroots civic activities are also ad hoc and informal.

Talk of global civil society began to spread in the 1990s. Commentators have spoken in related veins of ‘international nongovernmental organizations’, ‘transnational advocacy networks’, ‘global social movements’, a ‘new multilateralism’, and so on.

Many people indeed find significant empowerment through global civil society. For example, a wide range of associations often allow disabled persons, youth, lesbians and homosexuals, and indigenous peoples to gain voice in ways and extents previously unavailable to them at the national level. In addition, some global civic activities (for example, many women’s associations) provide encouraging examples of non-hierarchical, non-authoritarian, non-violent, highly participatory politics.

Environmental movements, consumer groups, and human rights advocates often contributed valuable civic education about their issues of interest. NGOs repeatedly call official agencies to account when development projects are harmful to local communities. Several civil society foundations with global operations (e. g. Ford, MacArthur, Soros, etc.) provide resources to support grassroots democracy in dozens of countries.

Civil society activities also frequently enhance democracy in globalization by stimulating open and informed debate. Democratic governance is made possible through dynamic, uncensored debates involving, or brokered by, civil society groups in which diverse viewpoints and perspectives are expressed. Many global civic groups and associations have challenged established agendas, methodologies, explanations, and prescriptions regarding political, economic, cultural, or environmental globalization. Such activities can contribute to keeping official powers’ thinking and policies rigorous and effective. Indeed, critiques from a number of civil society circles have played an important part in highlighting the shortcomings of U.S., EU, United Nations, IMF, and World Bank policies on globalization. In addition, civil society activities can contribute to a democratic legitimation of the governance of globalization. Authority is legitimate when participants feel that rulers have a right to govern them and that they, as citizens, have a duty to submit to the established rules.

The truth is that the governance of globalization has had limited legitimacy over the last 50 years or so. Citizens of all countries have accepted most policies toward global relations with passivity, ignorance, and resignation rather than active engagement. Yet if civil society offers stakeholders civic education, opportunities to speak, and chances to debate options, then people can begin to feel that they ‘own’ global politics and can positively endorse its outputs. Such increased legitimacy not only renders global governance more democratic, it also tends to make policies more viable and peaceful. For instance, a global trade regime negotiated by the World Trade Organization members and legitimated through these members’ civil society groups would have better chances of achieving its aims than a regime that is produced solely by heads of states and technocrats.

However, the legitimating potential of global civil society has remained largely underdeveloped to date. For instance, substantial parts of the Middle East and countries of the former Soviet Union—and many other parts of the world—have had little civil society input to policies on globalization simply because the states of these regions do not allow the development of genuine autonomous social organizations or have nationalized almost all media outlets. Even where global civic activism has grown on a greater scale, it has in many cases generated only modest contributions to civic education, participant representation, and policy debate. Much of the promise of global civil society is therefore as yet unfulfilled.

Moreover, global civic associations have no grounds for being complacent about their own democratic credentials. On the contrary, in practice these groups all too often give insufficient attention to questions concerning the depth of participation that they allow their constituents. Civil society organizations also frequently lack adequate consultation mechanisms, transparency, and public accountability. A civic movement can be run with top-down managerial authoritarianism just as well as a government department, ministry, or a business firm. Even some of the civic organizations that press hardest for a democratization of global relations show substantial democratic failings in their own practices. For instance, the Global Network for Rights and Development (GNRD), a Norway-based group established in 2008 and with alleged links to the United Arab Emirates, is anonymously funded by donors to the tune of $4.4 million a year, according to veteran Middle East journalist and author Brian Whitaker.

Only a small proportion of the world’s population has thus far become actively involved in global civil society. Most people have little participation in the policymaking processes of international business associations, NGOs, professional networks, religious agencies, and trade unions, the latter being in some cases even involved in criminal activities. In the West in particular, even where individuals and collective groups have membership in such an interest group they often make no input to its activities beyond the payment of an annual subscription. The wider public tends to mobilize behind civic campaigns only on a short-term and ad hoc basis, for example, in response to calls for humanitarian relief, the protection of the environment, public security, or public health. Consequently, global civil society is mostly the preserve of a relatively small number of full-time activists.

Although these civil society professionals generally hold good intentions in respect of democracy, they are not particularly representative of the world demos. Global civic activity is disproportionately undertaken by white, Northern, university-educated, computer-literate, or propertied persons. In the mid-2000s fewer than 15 percent of the NGOs accredited to engage with the United Nations were based in the Global South, and this ratio has not improved. Moreover, many purportedly ‘grassroots’ civic associations in poorer regions of the world are in fact branches of North-based organizations and/or draw their memberships chiefly from local elites in the South. To cite one illustrative example, the Secretary General of the Unrepresented Nations and Peoples Organization, Marino Busdachin, an Italian, is not even originally from the indigenous groups that the agency allegedly represents. The world’s under-classes still lack the funds, language fluency, and organizational capacities required for effective participation in global civil society.

Global civic associations also demonstrate ‘democratic deficits’ in respect of transparency. Many legal business associations, community groups, labor movements, NGOs, religious bodies, and think tanks do not make clear who they are, what objectives they pursue, where their funds originate, how they reach their policy positions, etc. Many civic groups do not issue annual reports of their activities, or make them readily available to the public.

Likewise, many global interest groups have a poor record of public accountability. Many are not registered with the relevant authorities of the countries in which they operate. Most global interest groups do not hold regular, independently monitored elections of their officers, nor do they conduct and publish external evaluations of their activities. All too often the staff of global civic organizations are responsible only to a largely self-selected board of trustees, private funders (many of them anonymous) and/or official donors who have little contact with their clients.

Fortunately, some civic organizers have become aware of, and disturbed by, the democratic shortcomings of much global civil society. Critical voices within civic movements demand more social responsibility from business associations, an end to cronyism in trade unions, more dialogue and partnership between South-based and North-based NGOs, and greater voice in all civil society sectors for marginalized social groups. However, it is too early to say whether this promising rhetoric will bring substantial long-term democratic change in global civil society.

Richard Rousseau is Associate Professor and Chair of the Department of Humanities and Social Sciences at the American University of Ras Al Khaimah, United Arab Emirates. His research, teaching and consulting interests include Russian politics, Eurasian geopolitics, international political economy and globalization.

This article appeared in the Diplomatic Courier and is reprinted with permission.

The post Globalization, Democracy And Civil Society: An Assessment appeared first on Eurasia Review.

By Amit R. Saksena*

The Commonwealth of Australia had for long been proclaimed as a forerunning advocate of solving humanitarian issues such as refugee settlement and asylum seekers plight. Then, after 40 years of solid abidance to the Refugee Convention, the then Prime Minister John Howard made a decision that sent the very foundation of Australian refugee policy crashing down and left other ‘safe havens’ rethinking their own outlook on the issue. Overnight, the very core elements of the Refugee Convention were shaken by a liberal belief that made realists stop in their tracks and resulted in a decade long back-log of helpless people being bounced around with no place to call home.

In the August of 2001, a Norwegian freighter MV Tampa in the Australian waters carrying 438 Afghan Hazara refugees (rescued from a fishing boat stranded in the international waters) was denied permission from the Howard cabinet from docking in Christmas Island, as the refugees desired. Under a bilateral agreement with Indonesia, the responsibility of refugees from this water route fell on Jakarta. Under no international obligation was Australia bound to accept these refugees into an already overflowing system of asylum seekers. However the refugees were adamant to go to Australia, and have their claims verified there. The Captain of the freighter, after assessing the situation and concerned about the deteriorating health of the rescuees, declared a state of emergency and proceeded to dock at Christmas Islands. The Australian Government retaliated by having the vessel boarded by the SASR (paramilitary troops), and secured before giving medical and relief aid to the refugees. This incident drew the ire of intergovernmental organizations and major humanitarian factions, calling it a gross violation of human rights and breach of international law.

Domestically, however, this incident marked a shift in the existing mindset of the Australian public, who were disdainfully accepting refugees into their societies. The people, liberal in their stance of the entire matter, evolved into a controlled or liberal realist approach for taking refugees in their midst. Even though it was still a sympathizing humanitarian issue, unlike a proper liberal approach of co-existence, the foundation of the matter was evaluated at a realist level. This incident did not stop future refugees from attempting to resettle in Australia, nor did it stop the hundreds of mandatory detention centers from operating. Yet, it heralded a new outlook on the issue of asylum seekers. The government did a quick paradigm shift, using an evolved state of solidarity to garner public support at the expense of the refugee seekers.

The defendants of the refugees made two main arguments. Firstly, they argued that the provisions of the Migration Act 1958 (which regulates immigration) applied to the asylum seekers, and the normal procedures for dealing with other non-citizens should be applied. The Migration Act however, in a realist context, did empower the Government to detain all non-citizens, under the system of mandatory detention. But according to the existing liberal norms of the government, it also gave non-citizens certain rights, such as the right to seek asylum and to apply for protection visas. As such, they argued that the asylum seekers should be taken to the mainland and be allowed to apply for visas. Alternatively, they argued that if the Migration Act did not apply to the situation of these asylum seekers, then they were being detained unlawfully, and that no-one in Australia, regardless of their citizenship status, could be detained unlawfully or arbitrarily, and so they should be released.
On the other hand, the somewhat liberal realist Government argued that the non-citizens (whom they described as “unlawful non-citizens”) were not being detained at all, and contended that they were free to go anywhere they pleased, with the exception of Australia. They also argued that even if the non-citizens were being detained, then despite there being no statutory authority for their detention, the Government had a prerogative power to expel non-citizens from Australian waters.

Eventually, the Howard cabinet came up with the ‘Pacific Solution’, a midpoint policy between the original Liberal outlook and the newly evolved liberal realist view which allowed asylum seekers to be transported to various island nations of the Pacific, instead of coming to mainland Australia for refugee claims. Eight years down the line, Kevin Rudd’s government abolished the policy describing it as ‘a cynical, costly and ultimately unsuccessful exercise.’ In 2012, Julia Gillard’s Labor Party initiated a similar policy of offshore processing of refugee claims. In 2013, reinstated premier Kevin Rudd signed a bilateral agreement with Papua New Guinea, for a Third World Processing Regime, effectively diverting all refugee traffic away from Australia, and making it virtually impossible to resettle in Australia for the next ten years. All this indicates a shift in the liberal approach of the government to a more somewhat realist stand.

Australia is one of the few countries in the world where someone called a liberal, can actually be considered one. The Liberal Party here at least purports to stand for individual rights and limited government. These used to be the twin pillars of political liberalism. The Tampa Incident happened and instead liberalism is now identified with group rights – deriving from class, race, gender, and sexual preference – and expansive government – in order to dispense benefits and make the people more equal. Old-style liberals claim that individual rights exist irrespective of government – are unalienable – and government must not invade them. Seeking equality at the expense of liberty realizes neither. New-style liberals believe government must actively extend rights to previously excluded groups and that equality is indisputably a moral good. The modern Liberal Party of Australian is not wholly the former and none of the latter. On issues such as refugee rights, some Liberal politicians have argued that there is an individual right to life and that the government has no power to abrogate. Some new-style liberals – or progressives – believe the government should actively promote, not merely tolerate, these humanitarian causes. Some old-style liberals would prefer the government not interpose itself into the global schematics of what is morally right. Some progressives, want government to explicitly approve of what goes on there.

Australian politics is perennially divided on how powerful the central government should be. The Liberal Party, by and large, is skeptical that government is always the solution to what ails the people. The Labor Party, by and large, invests significant faith in public policy to improve society. Liberals want smaller government, Labor want bigger.

Even a cursory glance at Australian history reveals Liberal governments keen to extend federal government power – John Howard and his war on refugees, for example. But unlike their progressive opponents, Liberals at least have a conscience about it. For some of these reasons how Liberals relate to political power is more interesting than how progressives do.

The Australian government places importance on liberal elements of the international system, such as the effective functioning of the UN and other multilateral rules, standards and institutions. This approach reflects the governments understanding that many international problems require cooperation among nations but it is also an archetypal ‘middle power’ strategy that seeks to obviate the lack of decisive military power through active involvement and support for international institutions and regimes. The government also holds an unblemished single barreled view of the Refugee Convention, ensuring that it is still incorporated in the same sense as it was fifty years ago.

The influence of Realism, however, is also apparent in the current approach of the government. In noting the pre – eminence of the Refugee Convention, the government essentially asserts that strengthening of the domestic alliance with the UN is fundamental for the country’s security and prosperity. The reliance on a powerful mandate is in keeping with a realist response to an uncertain security environment and has been a recurring feature of many liberal state’s foreign policy since the disintegration of the USSR. While liberal approaches to international relations are therefore recognized by the Australian Government as important tools of policy, its focus of primary national interest of putting its own citizens before refugee and asylum seekers has led it to also pursue a realist approach in its alliance with the UN and other regional entities.

* Amit R. Saksena is an independent researcher and member of the Wikistrat analytic community from New Delhi. He tweets @arsaksena

The post The Australian Approach To The Asylum Seeker’s Policy: Realist Or Liberal? – OpEd appeared first on Eurasia Review.

The U.S. Energy Information Administration (EIA) estimates that in 2013, Brazil was the eighth-largest energy consumer in the world and the third-largest in the Americas (North America, Central America, the Caribbean, and South America), behind the United States and Canada. Total primary energy consumption in Brazil has increased by more than one-third in the past decade because of sustained economic growth. The largest share of Brazil’s total energy consumption is oil and other liquid fuels, followed by hydroelectricity and natural gas.

Preliminary statistics show Brazil was the 10th largest energy producer in the world in 2013. In addition, Brazil has increased its total energy production, particularly oil and ethanol. According to the Empresa de Pesquisa Energética (EPE), ethanol production represented 19% of Brazil’s total energy production compared to 15% a decade ago. Oil remained at an average of 41% of total energy production as total energy production increased 36% in the past decade.¹ Increasing domestic oil production has been a long-term goal of the Brazilian government, and recent discoveries of large offshore, pre-salt oil deposits could transform Brazil into one of the largest oil producers in the world.

Petroleum and other liquids

Brazil was the largest producer of petroleum and other liquids in South America in 2013.

Sector organization

Brazil

State-controlled Petróleo Brasileiro S.A.(Petrobras) is the dominant participant in Brazil’s oil sector, holding important positions in upstream, midstream, and downstream activities. The company held a monopoly on oil-related activities in Brazil until 1997, when the government opened the sector to competition. Royal Dutch Shell was the first foreign crude oil producer in the country, and it has been joined by Chevron, Repsol, BP, Anadarko, El Paso, Galp Energia, Statoil, BG Group, Sinopec, ONGC, TNK-BP, among others. Competition in the sector is not just from foreign companies. Brazilian oil company OGX, which is staffed largely with former Petrobras employees, started to produce oil in the Campos Basin in 2011.

The principal government agency charged with regulating and monitoring the oil sector is the the Agência Nacional do Petróleo, Gás Natural e Biocombustíveis (ANP), which is responsible for issuing exploration and production licenses and ensuring compliance with relevant regulations. Recent legislation concerning pre-salt exploration and production has changed the operating environment somewhat. See the “Presalt Oil” section for a full discussion.

Reserves

EIA estimates that in January 1, 2014, Brazil had 13.2 billion barrels of proved oil reserves. According to Brazil’s oil regulator the Agência Nacional do Petróleo, Gás Natural e Biocombustíveis (ANP), Brazil had 15.6 billion barrels of proved oil reserves as of December 31, 2013, the second-largest level in South America after Venezuela. More than 94% of Brazil’s reserves are located offshore, and 80% of all reserves are found offshore near the state of Rio de Janeiro. Offshore the state of Espirito Santo held the next largest accumulation at 9% of country’s reserves.²

Production and consumption

More than 91% of Brazil’s oil production is offshore in very deep water and consists of mostly heavy grades.

In 2013, Brazil produced 2.7 million barrels per day (bbl/d) of petroleum and other liquids, 2.0 million bbl/d was crude oil, and 527,000 bbl/d was biofuels. Petrobras accounted for 1.9 million bbl/d of domestic crude oil and natural gas liquids (NGL) production.³ Of Brazil’s crude oil production, more than 91% was produced offshore, of which 79% was developed near the state of Rio De Janeiro, primarily in the Santos and Campos basins. A growing share of production is coming from Brazil’s relatively recent discovery of oil deposits in the presalt layer. In 2013, crude oil production from the pre-salt layer was 303,000 bbl/d. This accounted for 15% of total production, a significant increase from 0.4% of total production in 2008 when oil from the presalt was first produced.⁴

Brazil’s liquid fuels consumption continues to surpass its production. In 2013, Brazil’s demand for liquid fuels broke the 3.0 million bbl/d mark, while its domestic production continued to remain relatively unchanged at about 2.7 million bbl/d. EIA projects that consumption will continue to be greater than production through 2015.

Brazil announced in September 2014 that it expects the country will produce 4.0 million bbl/d of crude oil by 2020-22 and export 1.5-2.0 million bbl/d by 2022, buoyed by the discoveries in its presalt oil fields.⁵ This production level represents a downward revision from its expectations last year of 5.0 million bbl/d of production and exports of more than 2.25 million bbl/d by 2021.

Petrobras projects that the company will produce an average of 2.9 million bbl/d of oil domestically between 2013-20 and average 3.7 million bbl/d between 2020-30, according to its latest business and management plan.⁶

Downstream

According to the ANP, Brazil had a total of 2.2 million bbl/d of crude oil refining capacity at 16 refineries in 2013. Petrobras operates 13 facilities that produce 2.0 million bbl/d of product.⁷ The largest facility is the 415,000-bbl/d Replan refinery in Sao Paulo. Because Brazil’s oil refineries do not have the technical capabilities to process heavier crudes, the country must export some of its heavy crude oil and import light crude oil. With domestic demand growing, Brazil’s refineries are currently operating at 98% capacity.⁸

Petrobras plans to increase its Brazilian refining capacity to more than 3.2 million bbl/d by 2020 and by 3.9 million bbl/d by 2030 to meet anticipated domestic demand. Under the company’s 2014-18 business and management plan, Petrobras will build four additional refineries with one coming online this year to meet this goal.⁸ The Abreu e Lima, a 230,000-bbl/d refinery, came into operation in December 2014. The refinery initially began as a joint-venture with Petroleos de Venezuela (PdVSA), but it moved forward without PdVSA when it was unable to provide the 40% equity ($17 billion).¹⁰

Exports and imports

The United States imported 110,000 bbl/d of Brazilian crude oil and exported 179,000 bbl/d of petroleum products to Brazil in 2013.

According to the ANP, Brazil exported 381,000 bbl/d of crude oil in 2013, a 31% decrease from the previous year. The United States imported 110,000 bbl/d of crude oil from Brazil in 2013, a decrease of more than 30% from 2012. Because of increasing U.S. domestic supply and growing Chinese demand, China became the largest importer of Brazil’s crude oil in 2013, importing 115,000 bbl/d. The third-largest destination of Brazil’s crude oil after China and the United States is India, which imported 49,000 bbl/d in 2013.¹¹

To meet the rising demand, compensate for its fuel price subsidies¹², and supplement its underinvested refining sector¹³, Brazil continues to be a significant importer of petroleum products. In 2013, the country imported 528,000 bbl/d of petroleum products, an increase of 12% from the previous year. The United States exported 179,000 bbl/d of products to Brazil in 2013 and was its largest source of imported products. Brazil’s imports of petroleum product from the United States rose 8% from the previous year and increased 225% compared with the level five years earlier. India was Brazil’s second-largest source of imported petroleum products at 72,000 bbl/d of products to Brazil.¹⁴

The transportation accounted for the largest share of petroleum products demand. Because of continued fuel price subsidies and struggling refining sector, more than two-thirds of Brazil’s petroleum products imports were for the transportation sector in 2013. The largest import was 177,000 bbl/d of diesel oil; India supplied 72,000 bbl/d and the United States provided 59,000 bbl/d of the total.¹⁵

Biofuels

To address the country’s dependence on oil imports and surplus of sugar cane, the government implemented policies to encourage ethanol production and consumption beginning in the 1970s.

Brazil is the second largest producer and consumer of ethanol in the world after the United States. According to the ANP, in 2013, Brazil produced 479,000 bbl/d of ethanol, an 18% increase from the previous year.¹⁶

The government raised the ethanol blend requirement in gasoline back up to 25% in May 2013. It is now considering an increase to 27.5% as a measure to reduce gasoline imports.¹⁷

In 2013, Brazil exported 50,000 bbl/d of ethanol, 81% of which was shipped to the United States, South Korea, the Netherlands, and Japan. The United States imported 30,000 bbl/d of ethanol from Brazil in 2013 and 35,000 bbl/d in 2012, a significant increase from 12,000 bbl/d in 2011, as U.S. policy in 2012 lifted domestic tariffs on Brazilian sugarcane.¹⁸

Brazil also produces biodiesel but at smaller quantities. In 2013, the country produced 50,000 bbl/d of biodiesel. More than 80% of production was concentrated in the south central region of the country.¹⁹

Pre-salt oil

The world’s largest oil discoveries in recent years have come from Brazil’s offshore, presalt basins.

In 2005, Petrobras drilled exploratory wells near the Tupi field and discovered hydrocarbons below the salt layer. In 2007 a consortium of Petrobras, BG Group, and Petrogal drilled in the Tupi field and discovered an estimated 5-8 billion barrels of oil equivalent (boe) resources in a presalt zone 18,000 feet below the ocean surface under a thick layer of salt. EIA defines ultradeep drilling in the Gulf of Mexico as 5,000 feet or more. Further exploration showed that hydrocarbon deposits in the presalt layer extended through the Santos, Campos, and Espirito Santo basins.

Presalt oil is generally characterized as oil reserves situated exceptionally deep under thick layers of rock and salt and requiring substantial investment to extract. The large depth and pressure involved in presalt production present significant technical hurdles that must be overcome. Further, the scale of the proposed expansion in production will also stretch Petrobras’ financial and technical resources.

Petrobras plans to develop its major pre-salt assets in three discrete phases: 1) extended well tests; 2) pilot projects; and 3) large-scale production through multiple, duplicate floating production, storage, and offloading (FPSO) facilities.

Following Tupi, many presalt finds were announced in the Santos Basin. Pilot projects in the Lula and Sapinhoa fields began production in 2009 and 2010, respectively. In 2013, Brazil produced an average of 303,000 bbl/d of oil from its presalt fields. In October 2014, Brazil produced an average of 607,000 bbl/d of oil from the presalt fields.²⁰

With the exception of the Libra field, all presalt areas currently under development were non competitively granted to Petrobras. Through the Transfer of Rights Agreement of 2010, in exchange for $42 billion (USD) of Petrobras shares, the government gave Petrobras rights to explore and produce 5 billion boe from six presalt areas in the Santos Basin: Florim, Buzios, Sul de Guara, Entorno de lara, Sul de Lula, and Nordeste de Tupi. Petrobras discovered significant reserves in addition to the original 5 billion boe. In June 2014, the government granted Petrobras the rights to produce surplus volumes estimated at 9.8-15.2 billion boe found in the Buzios, Entorno de lara, Florim, and Nordeste de Tupi areas. Petrobras expects first production from the Transfer of Rights areas by 2016 and from the surplus volumes by 2021.²¹

In October 2013, Brazil concluded its first presalt licensing round for the Libra field, estimated to hold 8-12 billion barrels of recoverable reserves. The lone and winning bid was a consortium of Petrobras, Royal Dutch Shell, Total, and Chinese national oil companies China National Petroleum Corporation (CNPC) and China National Offshore Oil Corporation (CNOOC). First production is scheduled for 2017 with peak production of 1.3 million bbl/d by 2030.²² Brazil anticipates oil production from the presalt layer will account for most of the projected growth from 2020-30.

In November 2013, a month after concluding its first pre-salt licensing round for the Libra field, Brazil’s Petrobras announced its discovery of the Franco field, a presalt finding, which could be larger than the 8-12 billion barrels of recoverable reserves found in the Libra field.²³ Additionally, in May 2014, Petrobras made another presalt finding of potentially 5 billion barrels in the Entorno de lara block.²⁴

In its 2014-18 business and management plan, Petrobras laid out plans to invest $153.9 billion in exploration and production, representing nearly 70% of Petrobras’ total planned investment including downstream, distribution, international activities, etc. More than 53% ($82 billion) of the total investment will be in presalt exploration and production activities over the five year period.²⁵ The company is shifting its focus away from downstream and international expansion to the domestic upstream sector. Petrobras may have to further divest its investments into the domestic upstream sector with the addition of potentially billions of boe as a result of the surplus volumes from the Transfer of Rights areas.

Regulatory reforms

In contrast to the earlier concession-based framework, Petrobras will be the sole operator of each production-sharing agreement and will hold a minimum 30% stake in all presalt projects.

The Brazilian government passed legislation instituting a new regulatory framework in 2010 for the presalt reserves that includes four notable attributes: First, the legislation created a new agency, Pré-Sal Petróleo SA, to administer new presalt production and trading contracts in oil and gas industry. The second component allowed the government to capitalize Petrobras by granting the company 5 billion barrels of unlicensed pre-salt oil reserves in exchange for larger ownership share. The other two components established a new development fund to manage government revenues from presalt oil and lay out a new production-sharing agreement (PSA) system for presalt reserves. In contrast to the concession-based framework for non presalt oil projects, where companies are largely uninhibited by the state in exploring and producing, Petrobras will be the sole operator of each PSA and will hold a minimum 30% stake in all pre-salt projects. However, to incentivize companies, the PSA will also include a signing bonus of $6.6 billion (USD) and a low-cost recovery cap.

In its first and, thus far, only competitive licensing round for a pre-salt field, the winning bid was a consortium made up of Petrobras (with 40% stake), Royal Dutch Shell (20%), Total (20%), CNPC (10%), and CNOOC (10%).²⁶

Natural gas

Although natural gas accounted for 8% of Brazil’s total energy consumption, the country has the second-largest reserves in South America, located primarily offshore in the Campos Basin.

Sector organization

Petrobras plays a dominant role in Brazil’s entire natural gas supply chain. In addition to controlling most of the country’s natural gas reserves, the company is responsible for most domestic Brazilian natural gas production and for natural gas imports from Bolivia. Petrobras controls the national transmission network, and it has a stake in 21 of Brazil’s 27 state-owned natural gas distribution companies. In the upstream and the midstream sector, the Ministry of Mines and Energy set policy, and the ANP is the regulatory authority. In the downstream sector, regulation is overseen by state agencies.

Reserves

EIA estimates that Brazil had 13.7 trillion cubic feet (Tcf) of proved natural gas reserves at the beginning of 2014. The ANP estimates that, at the end of 2013, Brazil had an estimated 16 trillion cubic feet (Tcf) of proved natural gas reserves, second in South America after Venezuela. About 85% of Brazil’s natural gas reserves are located offshore, 66% of offshore reserves are concentrated off the coast of the state of Rio de Janeiro. About 72% of the country’s onshore natural gas reserves are located in the state of Amazonas.²⁷

Production and consumption

Along with the potential to significantly increase oil production in the country, the pre-salt areas are estimated to contain sizable natural gas reserves as well.

In 2013, Brazil produced 911 billion cubic feet (Bcf) of gross natural gas, of which 752 (Bcf) was dry natural gas. More than two-thirds of the gross natural gas produced was associated with oil and over 50% of associated natural gas production occurred in offshore fields in the Campos Basin off the coast of Rio de Janeiro. About 72% of non-associated natural gas production occurred primarily offshore the states of Sao Paulo, Bahia, and Espirito Santo. And 68% of onshore production occurs in the states of Amazonas and Bahia and is mostly for local consumption because of the lack of transportation infrastructure. Brazil also produced natural gas from its pre-salt fields amounting to 131 Bcf in 2013, a significant increase from 4 Bcf in 2008 when it first began producing from the pre-salt areas.²⁸

Brazil consumed 1.3 Tcf of dry natural gas, with imports from neighboring countries adding to domestic production. More than 900 Bcf of dry natural gas went to domestic consumption, of which 75% went to natural gas distributors, 14% to refineries and some to fertilizer plants, and 11% went to electric generators.²⁹ Petrobras expects domestic demand to increase to 1.7 Tcf by 2020 largely from increased demand from refining and distributors. The company plans to meet this demand by increasing domestic supply by 110% and increasing liquefied natural gas (LNG) imports, while keeping pipeline imports relatively unchanged.³⁰

Recent announcements about additional discoveries in Brazil’s offshore presalt layer have generated excitement about new natural gas production. Along with the potential to significantly increase oil production in the country, the presalt areas are estimated to contain sizable natural gas reserves as well.

Pipelines

Petrobras operates Brazil’s domestic natural gas transport system through its subsidiary company Transpetro. The network has more than 5,700 miles of natural gas pipelines, predominantly along the country’s southeast and northeast areas of the country, from the state of Rio Grande do Sul to Ceara. For years these systems were not interconnected, which has hindered the development of domestic production and consumption. However, in March 2010, the Southeast Northeast Integration Gas Pipeline (GASENE) linked these two markets for the first time. This 860-mile pipeline, which runs from Rio de Janeiro to Bahia, is the longest pipeline ever built in Brazil.

The other major natural gas market in Brazil is the Amazon region. In 2009, Petrobras completed construction of the Urucu pipeline linking Urucu to Manaus, the capital of Amazonas state. This project is expected to facilitate development of the Amazon’s considerable natural gas reserves.

Imports

Brazil imported 599 Bcf of natural gas in 2013, a 27% increase from 2012. Bolivia accounted for more than 68% of Brazilian natural gas imports.

Brazil imported 599 Bcf of natural gas in 2013, a 27% increase from 2012, as a result of large increase in domestic gas demand. The country currently receives natural gas imports by pipeline from Bolivia and Argentina and LNG imports primarily from Nigeria, Qatar, Spain, and Trinidad and Tobago.³¹ Total imports of natural gas increased 26% in 2013 compared to 2012, LNG import growth (59%) accounted for much of the year-on-year change.³²

According to the Ministry of Mines and Energy, Bolivia accounted for more than 68% of total Brazilian gas imports and 99% of its pipeline imports in 2013. Brazil imports natural gas from Bolivia through two pipelines. The Gasbol pipeline, established in 1999, links Santa Cruz, Bolivia to Corumba, Brazil and continues to Sao Paulo, Brazil. The 1,960-mile pipeline has a maximum capacity of 1.1 Bcf per day (Bcf/d).³³ The 98 million cubic per day (Mcf/d) San Matias pipeline runs from San Jose de Chiquito, Bolivia to San Matias, Brazil, and then connects to the GasOcidente pipeline to supply the Empresa Productora de Energia Ltda power plant in Cuiaba.³⁴ Despite efforts to reduce dependence on imports, Brazilian imports of Bolivian gas increased by 15% in 2013.³⁵

Liquefied natural gas

Brazil has three LNG regasification terminals with a combined capacity of 1.4 Bcf/d: the Pecem terminal in the northeast, the Guanabara Bay terminal in the southeast, and the TRB terminal which opened in January 2014 in the state of Bahia.³⁶ The facilities are floating regasification and storage units (FRSU). The Pecem received its first LNG cargo from Trinidad and Tobago in July 2008. The Guanabara Bay terminal came online in May 2009.

Electricity

Brazil has the third-largest electricity sector in the Americas, behind the United States and Canada.

According to Brazil’s energy planning company, Empresa de Pesquisa Energética (EPE), Brazil had an installed generating capacity of 127 megawatts (MW) in 2013. Hydroelectricity accounted for 86 MW of generating capacity, fossil-fuel sources contributed 37 MW, and small amounts from wind, solar, and nuclear made up the rest.³⁷

Brazil generated 570 billion kilowatthours (kWh) of electricity in 2013. Public service power plants accounted for 484 billion kWh, self producers accounted for 86 billion kWh, and the remainder was either traded or accounted for as losses. Final end-use consumption of electricity in 2013 was 516 billion kWh, with the industrial sector accounting for 210 billion kWh and the residential sector generating 125 billion kWh. The energy sector generated 30 billion kWh in 2013. At least 71% of electricity generated in 2013 came from hydroelectric. Natural gas and oil represented 11% and 4%, respectively, and biomass accounted for 8%.³⁸

Sector organization

The government plays a substantial role in the Brazilian electricity sector. Until the 1990s, the government controlled the electricity sector almost completely. Brazil initiated an electricity sector privatization process in 1996 that led to the establishment of the National Electric Energy Agency (Aneel). However, when drier-than-average weather led to severe energy shortages in 2000 and 2001, the privatization process stalled. Although the electricity sector was privatized in the early 2000s, the bulk of Brazil’s major generation assets remain under government control. Eletrobras, a state-owned holding company, is the dominant player in the electricity market. The government also owns almost the entire electricity transmission network.

In 2004, the Brazilian government implemented a new model for the electricity sector. This hybrid approach to government involvement splits the sector into regulated and unregulated markets for different producers and consumers. This approach allows for both public and private investment in new generation and distribution projects. Under the plan, however, Eletrobras was formally excluded from privatization efforts.

Hydroelectricity

Brazil is planning new hydroelectric power projects, such as the Belo Monte plant, which upon completion will be the third-largest hydroelectric power plant in the world.

Brazil generated 405 billion kWh of hydroelectric power in 2013. Many of Brazil’s hydropower generating facilities are located far from the main demand centers, resulting in high transmission and distribution losses. The world’s largest hydroelectric plant by generation is the 14,000 MW Itaipu hydroelectric dam on the Parana River, which Brazil maintains with Paraguay. According to Itaipu Binacional, the facility generated 98.6 billion kWh of electricity in 2013.³⁹ Although Brazil plans to move away from hydropower to mitigate the risk of supply shortages as a result of dry weather, new hydro projects continue to move forward. Most notable among these projects is the Belo Monte plant in the Amazon Basin, which upon completion will be the third-largest hydroelectric plant in the world behind China’s Three Gorges Dam and the Itaipu Dam.

Nuclear power

Brazil has two nuclear power plants, the 640-megawatt (MW) ANGRA 1 and the 1,350-MW ANGRA 2. State-owned Eletronuclear, a subsidiary of Eletrobras, operates both plants. The ANGRA 1 nuclear power plant began commercial operations in December 1984, and the ANGRA 2 began commercial operations in December 2000. Construction of a third plant, the 1,405-MW Admiral Alvaro Alberto Nuclear Power Station (CNAA), formerly ANGRA 3, started in 1984 and still under construction. Electronuclear anticipates that the plant will enter into commercial operations by May 2018.⁴⁰

Notes

• Data presented in the text are the most recent available as of December 29, 2014.
• Data are EIA estimates unless otherwise noted.

Endnotes
1. Empresa de Pesquisa Energética, “EPE disponibiliza o Relatório Final do Balanço Energético Nacional – BEN 2014,” (August 6, 2014) http://www.epe.gov.br/Estudos/Paginas/Balan%C3%A7o%20Energ%C3%A9tico%20
Nacional%20%E2%80%93%20BEN/EPEdisponibilizaoRelat%C3%B3rioFinaldoBalan%C3%A7oEnerg%C3%A9ticoNacional%E2%80%93BEN2014.aspx.
2. Agência Nacional do Petróleo, Gás Natural e Biocombustíveis, “Oil, Natural Gas, and Biofuels Statistical Yearbook 2014″ (2014).
3. Petrobras, Operational Highlights, http://www.investidorpetrobras.com.br/en/operational-highlights/production/monthly-crude-oil-and-natural-gas-production-in-brazil-and-abroad/monthly-crude-oil-and-natural-gas-production-in-brazil-and-abroad.htm.
4. Agência Nacional do Petróleo, Gás Natural e Biocombustíveis, “Oil, Natural Gas, and Biofuels Statistical Yearbook 2014″ (2014).
5. Platts, “Brazil to Export Up to 2 million b/d by 2018-2020: ANP,” (September 15, 2014), http://www.platts.com/latest-news/oil/riodejaneiro/brazil-to-export-up-to-2-million-bd-by-2018-2020-21231640.
6. Petrobras, “2030 Strategic Plan and 2014-2018 Business and Management Plan,” http://www.investidorpetrobras.com.br/en/business-management-plan/business-management-plan/ano/2014.htm.
7. Petrobras, Activities, http://www.petrobras.com/en/about-us/activities/.
8. Agência Nacional do Petróleo, Gás Natural e Biocombustíveis, “Oil, Natural Gas, and Biofuels Statistical Yearbook 2014″ (2014).
9. Petrobras, “2030 Strategic Plan and 2014-2018 Business and Management Plan,” http://www.investidorpetrobras.com.br/en/business-management-plan/business-management-plan/ano/2014.htm.
10. Rittner, Daniel and Ulhoa, Raquel, “Foster diz que rebaixamento da Petrobras pela Moody´s será superado,” Valor Economico (October 7, 2013), http://www.valor.com.br/empresas/3296250/foster-diz-que-rebaixamento-da-petrobras-pela-moody.
11. Agência Nacional do Petróleo, Gás Natural e Biocombustíveis, “Oil, Natural Gas, and Biofuels Statistical Yearbook 2014″ (2014).
12. Orihuela, Rodrigo and Godoy, Denyse, “Petrobras Falls as Brazil Fails to Phase Out Fuel Subsidy,” Bloomberg (December 2, 2013), http://www.bloomberg.com/news/2013-12-02/petrobras-fuel-price-increase-puts-limit-on-subsidy.html.
13. Blount, Jeb, “Analysis: Petrobras Fuel Woes Make Brazil Dependent on U.S., India,” Reuters January 22, 2014), http://www.reuters.com/article/2014/01/23/us-brazil-refining-analysis-idUSBREA0M04I20140123.
14. Agência Nacional do Petróleo, Gás Natural e Biocombustíveis, “Oil, Natural Gas, and Biofuels Statistical Yearbook 2014″ (2014).
15. Ibid
16. Agência Nacional do Petróleo, Gás Natural e Biocombustíveis, “Oil, Natural Gas, and Biofuels Statistical Yearbook 2014″ (2014).
17. Goy, Leonardo, “Brazil to Test Higher Ethanol Requirement in Gasoline-Source,” Reuters (June 18, 2014), http://in.reuters.com/article/2014/06/18/brazil-biofuels-idINL2N0OZ0OC20140618.
18. Winters, Brian, “Insight: U.S. and Brazil – At Last, Friends on Ethanol,” Reuters (September 14, 2012), http://www.reuters.com/article/2012/09/14/us-brazil-us-ethanol-idUSBRE88D19520120914.
19. Agência Nacional do Petróleo, Gás Natural e Biocombustíveis, “Oil, Natural Gas, and Biofuels Statistical Yearbook 2014″ (2014).
20. Agência Nacional do Petróleo, Gás Natural e Biocombustíveis, “BOLETIM MENSAL DA PRODUÇÃO DE PETRÓLEO E GÁS NATURAL,” (October 2014), http://www.anp.gov.br/?pg=73213&m=&t1=&t2=&t3=&t4=&ar=&ps=&cachebust=1418163326605.
21. Petrobras, “Petrobras 2030 Strategic Plan Surplus Volumes of Transfer of Rights,” (June 27, 2014) http://www.investidorpetrobras.com.br/en/presentations/presentation-to-analysts-surplus-volumes-of-transfer-of-rights-ceo-maria-das-gracas-silva-foster.htm.
22. LatAmOil, “Libra Consortium Signs Deal for First FPSO,” Newsbase (October 14, 2014).
23. Agencia EFE, “Brazil’s Petrobras Confirms High-Quality Find at Pre-Salt Field” (November 20, 2013).
24. Oil and Gas Journal, “Petrobras Completes Exploration Well in TOR Area of Santos Basin” (May 9, 2014), http://www.ogj.com/articles/2014/05/petrobras-completes-exploration-well-in-tor-area-of-santos-basin.html.
25. Petrobras, “2030 Strategic Plan and 2014-2018 Business and Management Plan,” http://www.investidorpetrobras.com.br/en/business-management-plan/business-management-plan/ano/2014.htm.
26. Petrobras, “Libra Auction Results,” (2014) http://www.petrobras.com/en/magazine/post/libra-auction-result.htm.
27. Agência Nacional do Petróleo, Gás Natural e Biocombustíveis, “Oil, Natural Gas, and Biofuels Statistical Yearbook 2014″ (2014).
28. Agência Nacional do Petróleo, Gás Natural e Biocombustíveis, “Oil, Natural Gas, and Biofuels Statistical Yearbook 2014″ (2014).
29. Ministry of Mines and Energy, “Boletim Mensal de Acompanhamento da Indústria de Gás Natural,” (October 2014) http://www.mme.gov.br/spg/menu/publicacoes.html.
30. Petrobras, “2030 Strategic Plan and 2014-2018 Business and Management Plan,” http://www.investidorpetrobras.com.br/en/business-management-plan/business-management-plan/ano/2014.htm.
31. Ministry of Mines and Energy, “Boletim Mensal de Acompanhamento da Indústria de Gás Natural,” (October 2014) http://www.mme.gov.br/spg/menu/publicacoes.html.
32. Agência Nacional do Petróleo, Gás Natural e Biocombustíveis, “Oil, Natural Gas, and Biofuels Statistical Yearbook 2014″ (2014).
33. Ministry of Mines and Energy, “Boletim Mensal de Acompanhamento da Indústria de Gás Natural,” (October 2014) http://www.mme.gov.br/spg/menu/publicacoes.html.
34. GasOriente Boliviano, “GasOriente Boliviano,” http://gasorienteboliviano.com/espanol/company/company.html.
35. Agência Nacional do Petróleo, Gás Natural e Biocombustíveis, “Oil, Natural Gas, and Biofuels Statistical Yearbook 2014″ (2014).
36. Ministry of Mines and Energy, “Boletim Mensal de Acompanhamento da Indústria de Gás Natural,” (October 2014) http://www.mme.gov.br/spg/menu/publicacoes.html.
37. Empresa de Pesquisa Energética, “EPE disponibiliza o Relatório Final do Balanço Energético Nacional – BEN 2014,” (August 6, 2014) http://www.epe.gov.br/Estudos/Paginas/Balan%C3%A7o%20Energ%C3%A9tico%20
Nacional%20%E2%80%93%20BEN/EPEdisponibilizaoRelat%C3%B3rioFinaldoBalan%C3%A7oEnerg%C3%A9ticoNacional%E2%80%93BEN2014.aspx.
38. Empresa de Pesquisa Energética, “EPE disponibiliza o Relatório Final do Balanço Energético Nacional – BEN 2014,” (August 6, 2014) http://www.epe.gov.br/Estudos/Paginas/Balan%C3%A7o%20Energ%C3%A9tico%20
Nacional%20%E2%80%93%20BEN/EPEdisponibilizaoRelat%C3%B3rioFinaldoBalan%C3%A7oEnerg%C3%A9ticoNacional%E2%80%93BEN2014.aspx.
39. >Itaipu Binacional, “Production from Year to Year,” http://www.itaipu.gov.br/en/energy/production-year-year.
40. Eletrobras Eletronuclear, “Angra 3: energia para o crescimento do país,” http://www.eletronuclear.gov.br/AEmpresa/CentralNuclear/Angra3.aspx.

The post Brazil Energy Profile: 8th Largest Total Energy Consumer In World – Analysis appeared first on Eurasia Review.

The Spanish government said that four Eurofighters from the 11th Wing of the Spanish Air Force took off on Monday from Morón de la Frontera Air Base (Seville) bound for Amari Air Base (Estonia) to join the NATO air policing mission in the Baltic, thereby filling a gap in the air defense capabilities of the Baltic countries.

The government said that Spain is contributing 144 Spanish military personnel to the NATO ‘Baltic Air Policy’ mission, of which eight are pilots to form two crews per aircraft. The mission will begin on 1 January and last until 30 April.

According to the Spanish government, the aircraft will perform policing operations in their assigned airspace, which covers practically the entire north of Europe and the Baltic region in particular. To do so, they will complete air patrols and Quick Reaction Alert (QRA) missions against possible air threats that enter the airspace for which they are responsible without authorisation. They will fly under operational control from Allied Air Command (AIRCOM) based in the German town of Ramstein, the government said.

The Spanish government said the operation is being developed by various NATO countries on a rotating basis. For this 37th rotation period, the Spanish contingent will take over from the German contingent that has been deployed on this mission for the last four-month period of this year. Together with Spain, similar contingents will be deployed from Poland and Italy in Lithuania, and from Belgium in Poland.

This is the second time that Spain has taken part in the air policing operation in the Baltic region. The Spanish Air Force previously deployed four F-18s in Lithuania in 2006.

“By participating in this mission, Spain is contributing to international security and stability, and reaffirming its commitment to NATO and its Member States, while also providing a boost to the capabilities deployed by NATO,” the Spanish government said in a statement.

The post Four Spanish Eurofighters Join NATO Air Policing Mission In Baltic Region appeared first on Eurasia Review.

The South Korean and Japanese defense ministries and the U.S. Defense Department have finalized a trilateral information-sharing arrangement concerning the nuclear and missile threats posed by North Korea, according to a press statement from the US Defense Department.

According to Pentagon officials, this arrangement creates a framework by which the defense authorities of the three nations may voluntarily share classified information. The Defense Department is to serve as the hub for information shared trilaterally, officials said, adding that the arrangement does not impose any new legal obligations on the signatories.

The arrangement advances the security of the three signatories, officials said, because sharing information on the nuclear and missile threats posed by North Korea will allow for a more effective response to future provocations and during contingencies.

The post South Korea, Japan And US To Share Info On North Korea Threats appeared first on Eurasia Review.

Bahrain’s arrest of Sheikh Ali Salman on December 28 marks a further step in the confrontation between a part of the opposition and the authorities of the Kingdom of Bahrain that carries the risk of jeopardizing an already difficult political and security situation, said the spokesperson for the EU’s External Relations and Foreign Affairs in a statement.

“The requisite standards of due process have to be ensured, including the presence of Sheikh Ali Salman’s legal counsel at all stages, transparency regarding his whereabouts, the objective application of guidelines for release on bail and, should Sheikh Ali Salman be brought to trial, fair and transparent court proceedings,” the statement continued.

According to the EU spokesperson, only a process of national reconciliation, without preconditions, can ensure stability and prosperity for Bahrain’s citizens.

The post EU Critical Of Bahrain’s Detaining Sheikh Ali Salman appeared first on Eurasia Review.