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Press review: Global response to Kerch standoff and EU joins Russia for SWIFT alternative

Top stories in the Russian press on Wednesday


Kommersant: West takes cautious line on Russia over Kerch Strait provocation

The decision to impose martial law in ten Ukrainian regions for 30 days is coming into force on Wednesday, November 28. However, the first effects of the move endorsed by the Ukrainian parliament were felt as early as Tuesday, when more than 70 Russian nationals were denied entry to Ukraine at Kiev’s airports.

"The expulsion of Russian citizens has been going on for the second day in a row, with an average of five or six Russians removed from each flight," a source to the Belarusian national airline Belavia told Kommersant.

Meanwhile, the first court hearing to impose a pre-trial restraint on 12 of the 24 Ukrainian sailors detained on Sunday evening in the Kerch Strait was held in Crimea. The sailors and warrant officers whose cases were considered by the court on Tuesday pleaded not guilty, asserting that they had just obeyed their commanders’ orders.

"My client understands perfectly well that big league politics is involved here," Defense Attorney Aider Azamatov told the paper.

Although some countries came out with some harsh statements in the wake of the standoff, the issue of anti-Russian sanctions, which could be imposed, has remained on the backburner.

"A very restrained international response to the escalation off the coast of Crimea indicates that as far as the West is concerned the incident has not become a substantial argument for slapping fresh sanctions on Russia immediately," Andrei Kortunov, Director General of the Russian International Affairs Council (RIAC), stressed talking to Kommersant.

"Whatever the claims against Russia over Crimea or Donbass, the West is perfectly aware of the fact that it is impossible to pin all the blame for the Black Sea incident on Russia."

"The developments off Crimea’s coast once again drew Europe’s attention to the Ukrainian issue, which the West started to forget amid new crises, such as Syria, the INF Treaty, relations between the EU and the US and inside the European Union itself," the paper quotes Nadezhda Arbatova, Head of the Department for European Political Studies at the Institute of World Economy and International Relations, as saying.

According to the expert, the telephone conversation between German Chancellor Angela Merkel and Russian President Vladimir Putin and other contacts indicate that European diplomacy will have to start turning up the heat by conducting negotiations with the key players in the Ukrainian settlement, that is, Kiev, Moscow and Washington.


Izvestia: Europe teaming up with Russia to create answer to SWIFT

Russia is taking part in developing a European counterpart of the Society for Worldwide Interbank Financial Telecommunications (SWIFT), the European Commission’s press service informed Izvestia. According to its spokesperson, the purpose of the new platform is to ensure legitimate cash turnover with Iranian companies in spite of Washington’s sanctions against Tehran. The system is aimed at maintaining cooperation with the Islamic Republic in the oil, gas and financial sectors, as well as in trade, investment and transport.

The parties to the nuclear deal, specifically, Russia, China, the UK, France and Germany, are involved in efforts to create a mechanism that would allow transactions with Iran to skirt US sanctions, the European Commission’s spokesperson told the paper. Other EU members have also been invited to join the venture.

Moscow’s participation in cultivating Europe’s answer to SWIFT is expected to raise the prestige of the Russian banking sector in the eyes of the EU business community, says Roman Blinov, Head of the Analytical Department at the International Financial Center. The expert noted, however, that its creation would require substantial investment. However, if Russia is eventually able to influence the system’s development, the investment is bound to pay off. For example, the new platform’s range of capabilities could be expanded towards national currency settlements, which is in line with Russia’s strategic objective to de-dollarize its economy.

Russian Finance Minister Anton Siluanov earlier said Russia was willing to join the European alternative to SWIFT. According to the minister, the emergence of this system could be a response to the sanctions imposed by the US on enterprises and financial institutions, which make payments in US dollars.



Nezavisimaya Gazeta: Chinese industrial growth slows due to US actions

US President Donald Trump can raise duties on Chinese goods by another $200 bln as of January 1, 2019. It seems highly unlikely that Washington will agree with China’s request to abandon its intention to raise tariffs from the current 10% to 25%, Nezavisimaya Gazeta writes.

Trump earlier said in an interview with the Wall Street Journal in the run-up to his meeting with Chinese leader Xi Jinping that such a scenario could only be avoided if China opened its markets for the US.

Meanwhile, the trade war between Washington and Beijing has already impacted China’s economy. The growth of industrial enterprises’ profit has been stagnating for the sixth consecutive month. In October, it was 3.6% higher than last year, while in April, according to China’s State Statistical Bureau, industry profits increased 21.9% compared to April 2017.

According to Alexander Lomanov, Chief Research Fellow at the Institute for Far Eastern Studies at the Russian Academy of Sciences, the problem is that China makes no secret of its willingness to expand foreigners’ access to its markets. "Moreover, it highlights this willingness. The most striking example to this effect was Xi Jinping’s speech at a recent foreign goods fair in Shanghai," he stressed.

"However, the issue at hand is that China has no plans to open its markets immediately," the expert went on to say. "The difference with Trump is that he threatens to raise duties in a month’s time. On the other hand, China’s markets will open slowly, gradually, taking into account the real pace of the Chinese economy’s development."

Trump wants the market to be opened now, at least until the 2020 presidential election, but China will not agree to a massive trade liberalization. Nevertheless, if the parties choose a businesslike approach to the issue and outline specific steps until the end of the next decade, there are some prospects for an agreement, the expert concluded.


Izvestia: Cyprus to keep granting citizenship in return for investment

Cyprus will not abandon the system of granting citizenship to foreign nationals investing in its real estate market and businesses despite the European Commission’s calls for ending this practice, President of the Cyprus Chamber of Commerce and Industry, Christodoulos Angastiniotis, told Izvestia.

According to Angastiniotis, that could be investment in real estate, securities, industry or in any other area. The program entitled Naturalization Through Investment and Entrepreneurship will continue to be implemented, he pointed out, adding that the program includes some provisions that would protect investors.

He noted that, in addition to Russians, Chinese, Vietnamese, British and Dutch nationals are also involved in the program. Information on its participants is not divulged, but the Russian Embassy in Cyprus said that Russians might make up half of the total number of foreigners holding Cypriot passports.

"According to the available expert estimates, Russian citizens could account for up to half of the over 3,600 ‘investment’ passports issued by the Cypriot authorities to foreign investors from 2014 to 2017," the embassy’s press service told Izvestia.

According to the embassy, Russian nationals are allowed to acquire Cypriot citizenship.

"Russia’s current legislation does not prohibit Russian citizens, with the exception of a specific group of individuals, to have foreign citizenship. Russia’s legislation only prescribes Russians who have foreign citizenship to notify the authorities about that in due time. On the other hand, Russian investors have the right to make investment decisions, including in foreign markets, at their own discretion," the embassy stressed.



RBC: Germans and Americans differ in foreign policy outlook

German citizens are more inclined to improve relations with Russia than with the United States, RBC writes citing the results of a survey conducted by the Pew Research and Korber foundation. Americans, on the contrary, are in favor of cultivating ties with EU countries rather than Russia.

As many as 69% of the German respondents said they would like Berlin to cooperate with Moscow more closely, while 23% were opposed to closer ties between the two countries. Nearly 50% of those polled said they would like their county to cooperate with the US less intensively than now, and 72% advocated a more independent foreign policy course.

Meanwhile, data from a similar survey in the US points to the opposite trend, with over 70% of Americans favoring closer cooperation with France, the UK and Germany, while only 35% said they wanted closer ties with Moscow. Besides, 39% of Americans believe Europe must increase military spending, while 43% of the German respondents said their country should beef up defense spending.

The survey’s results indicate their rejection of the policy pursued by US President Donald Trump, the paper quotes Vladislav Belov, Deputy Director of the Russian Academy of Sciences’ Institute of Europe, as saying. "Trump is unpredictable. He did enough to turn Europeans against the US. He withdrew from the Iran nuclear deal. The White House is threatening to impose sanctions against the Nord Stream 2 projects and keeps uncertainty brewing about new anti-Russian sanctions," he explained.

The approval of the idea to increase military spending among German citizens stems from the fact that Germany and the European Union began to see Russia and China as threats more actively, Belov said commenting on the issue. "German Defense Minister Ursula von der Leyen talks about that all the time," he explained. In addition, German citizens are responding to German Chancellor Angela Merkel’s message that the country should become independent, even as far as its defense industry goes, the expert added.


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