Press review: NATO flexes muscles near Russian border and South China Sea runs hot
Top stories from the Russian press on Wednesday, April 24th
NATO Secretary General Jens Stoltenberg and UK Prime Minister Rishi Sunak
MOSCOW, April 24. /TASS/. Ukraine's allies are building up their military presence near Russian borders; the US-Philippines military exercise sends a message to China; and the UK is trying to throw its weight around in Central Asia in an effort to stifle Russia. These stories topped Wednesday's newspaper headlines in Russia.
Nezavisimaya Gazeta: Ukrainian allies prioritize strengthening NATO’s eastern flank
As part of efforts to help Kiev, the United States and other NATO allies are demonstrating military activity near Russian soil. Russia’s defense chief, Sergey Shoigu, told a Defense Ministry board meeting on Tuesday that a number of NATO exercises for "repelling alleged Russian aggression" are being held near the Russian border with roughly 90,000 troops taking part. The maneuvers are related to the situation in Ukraine, and the headquarters of the Security Assistance Group-Ukraine based on the US European Command has been deployed in Germany, Shoigu said. While he did not elaborate on why this was done, NATO Secretary General recently told Western media that several NATO allies have military personnel at their embassies in Ukraine who are "giving advice."
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Politico said, citing US sources, that the latest tranche of new military aid to Kiev worth at least $300 mln would include armored vehicles, Bradley IFVs, HMWWV (Humvee) high mobility multipurpose vehicles, M113 AMPCs, artillery shells and air defense munitions.
Meanwhile, a heavier military package to the tune of $617 mln was announced by Great Britain. The British government said it would promptly give Kiev much-needed munitions, air defense weapons, drones and engineering systems. Over 1,600 strike and anti-aircraft missiles, including a new portion of Storm Shadow cruise missiles, as well as 60 boats and motor boats, 160 Husky armored vehicles, 162 other armored vehicles, 78 all-terrain vehicles and around 4 mln rounds of ammunition will be supplied to the Ukrainian armed forces.
Looking at the composition of military aid pledged by the United States and the United Kingdom, the bulk of it will include artillery shells, air defense missiles and armored vehicles, which shows that Kiev is building new reserve units with assistance from its major allies, military expert and retired Lieutenant General Yuri Netkachev told Nezavisimaya Gazeta. While additional NATO weapons supplies may complicate the situation along the line of engagement, that will not be critical. "And we must not forget that real threats to Russia are emerging near its western border," he said.
US and Polish troops have just wrapped up maneuvers near the Kaliningrad Region, and a series of NATO exercises are ongoing in Lithuania, Netkachev explained. All these drills serve the purpose of strengthening the North Atlantic Alliance’s eastern flank. "Therefore, the Russian Defense Ministry has taken a reasonable step to build and strengthen the Leningrad and Moscow military districts," he concluded.
Vedomosti: US-Philippines exercises seen as another signal to Beijing
The Philippines and the United States have kicked off Balikatan 2024, their largest joint military exercise since the Cold War era, in the South China Sea. The exercise running through May 10 will involve over 16,700 troops, including some 11,000 US troops and 5,000 Filipino troops. This number does not include Australian and French troops, who are also taking part. While 14 countries, including India, Germany and Vietnam, have sent their observers, no Chinese monitors are attending. The exercise comes at a time of increased tensions in the region. Moreover, it is the first exercise being held outside Philippine territorial waters, officials told The Washington Post. Apart from Manila, China, Vietnam and other regional players have laid claim to disputed islands and adjacent waters in the South China Sea.
For the exercise, the United States deployed SM-6 surface-to-air missiles that can hit targets at a maximum range of more than 400 km and the MRC Typhon system capable of launching them from the Philippines, TASS and CNN reported. While Army Colonel Michael Logico, the Philippine military’s spokesman for Balikatan 2024, emphasized that the drills are not aimed against China, he said in a separate interview that during the exercises, troops will simulate retaking islands occupied by hostile forces.
Similar scenarios show that "the drills are beyond self-defense purposes," Cao Weidong, a retired senior researcher at the PLA Naval Research Academy, told Bloomberg.
Commenting on the US-Philippines exercise, Chinese Foreign Ministry Spokesperson Lin Jian said on April 17 that drawing extraregional countries to the South China Sea "to demonstrate power and stoke confrontation" will only fuel tensions.
Until the dispute in the South China Sea is ultimately resolved, each party will continue to behave in those waters as it sees fit, Daria Panarina, a research fellow at the Russian Academy of Sciences’ Center for Southeast Asia, Australia and Oceania Studies, told Vedomosti. As the actors here struggle to make a compromise on this, China is ignoring the 2016 verdict by the Hague-based International Court of Arbitration which dismissed Beijing’s claim to much of the South China Sea. Since 2022, when Philippine President Bongbong Marcos was sworn in, Manila has drawn closer to Washington again as it uses this partnership to defend its interests, the expert said. However, the Philippines does not want its relationship with China to worsen seriously, she added. The current maneuvers allow the Philippines to send a signal to China, but no regional player is seeking an escalation, Panarina concluded.
Nezavisimaya Gazeta: UK seeking to push Russia out of Central Asia
British Foreign Secretary David Cameron has arrived in Central Asia to present a new strategy for developing the region with a view to reducing Russian influence on Tajikistan, Kyrgyzstan, Uzbekistan, Kazakhstan and Turkmenistan. Britain’s top diplomat is visiting these countries as part of the new C5+1 initiative. London is ready to commit 50 mln pounds to support the sovereignty and independence of Central Asian countries over the next three years. Also, Cameron announced a new British Council initiative to promote English in the region. On April 24-25, the high-profile British official is expected to travel to Astana.
Political analyst Asilbek Egemberdiyev believes that London is looking to throw its weight around in Central Asia and that it is set to counter both Russia and China there. "Countries like Tajikistan and Kyrgyzstan rely heavily on external forces. And the dire social and economic situation these nations are facing requires foreign support which Great Britain and the West have been successfully providing through NGOs," he said. A new generation of people educated in the West who have returned home to take up government positions has been raised, at least in Kyrgyzstan and Kazakhstan, he explained. On the contrary, Russia’s soft power is becoming increasingly less present there, Russian is now less popular than English, and migrant labor is unwelcome in Russia. "Therefore, Central Asian leaders will soon face a tough choice," Egemberdiyev told Nezavisimaya Gazeta.
Cameron’s agenda shows that Great Britain is seeking to gain influence in the region, which, in the context of the current geopolitical situation, is obviously aimed at countering Russia and China, Alexander Vorobyev, a researcher at the Institute of Asian Studies at the Russian Academy of Sciences, told the newspaper. Apart from economic benefits, cooperation with the West enables Central Asian leaders to diversify their foreign policy ties and remain committed to a multi-directional policy course by counterbalancing Moscow and Beijing, he continued. Regional players are interested in technological cooperation with the West as they expect more generous support amid the confrontation with Russia. However, despite the benefits, cooperation with the West has its limitations, the expert said.
Izvestia: Russia's 2024 GDP outlook brightens
In 2024, the Russian economy will grow by 2.8%, according to an updated macroeconomic outlook presented by Russian Economic Development Minister Maxim Reshetnikov at a government meeting. The ministry’s September forecast predicted a 2.3% growth.
The ministry also downgraded its forecasts for the country’s crude oil export prices as it expects Russian crude to trade at $65 per barrel in the next few years. Meanwhile, the Russian currency is expected to slightly weaken to 94 rubles per $1.
On the whole, the Russian economy has been quite resilient, despite unwavering attempts to increase sanctions pressure on it, Konstantin Tuzov from the Russian Presidential Academy on National Economy and Public Administration, told Izvestia
Foreign experts have been upbeat about Russia’s GDP as well. Earlier this month, the International Monetary Fund (IMF) reviewed its forecast for the Russian economy to 3.2% from its January estimate of 2.6%, and the World Bank, too, revised its outlook for GDP growth in Russia from 1.6% to 2.2%.
Commenting on the ruble’s expected slide, Natalia Milchakova, lead analyst at Freedom Finance Global, pointed to geopolitical risks and sanctions. "In general, the Economy Ministry’s forecast still looks conservative and it may be revised up in the fall," the expert said.
To Nikolay Dudchenko at Finam, the fact that the ministry has resumed giving forecasts for the export price of Russian oil means that global consumption of the fuel has somewhat stabilized. "However, the continued sanctions pressure aggravates the situation around Russian oil export prices," he said. The discount on Russian blends to global benchmarks may widen, he warned.
Kommersant: Gold prices go south
The steady rise in gold prices, seen since early March, was suddenly interrupted as, having barely topped $2,400 per ounce, gold prices fell sharply. On Tuesday, gold dropped below $2,300 per ounce, dipping by about 4% from its peak levels. The correction comes amid decreasing geopolitical risks in the Middle East.
In particular, tensions did not increase post mutual missile strikes by Iran and Israel. Thus, the key risk of an expanded armed conflict in the Middle East did not materialize. "The level of tensions in the region has dropped significantly, and the demand for safe assets has also decreased," analyst at Finam Alexander Potavin noted.
However, analysts believe that prices of the precious metal will be driven by geopolitics further down the road. "If the likelihood of de-escalation increases, gold prices will continue going south," Anna Pilgunova, senior analyst at SberCIB Investment Research, told Kommersant. And the outcome of the Fed meeting next week will matter for the market, too. "If the meeting shows that the regulator will not endeavor to lower interest rates later this year, this will put pressure on gold," Pilgunova said. She expects that gold will find support near $2,150-2,200 per ounce in the near term.
Also, the precious metal can be supported by central banks in developing countries, which have been actively buying it to replenish their reserves. "Certain countries that do not trust the dollar and want to diversify their reserves have increased their demand for gold," Lyudmila Rokotyanskaya, an expert on the stock market at BCS World of Investments, explained.
