Press review: Russia's gamble on Maduro and May’s Brexit stalemate

Press Review January 25, 2019, 13:00

Top stories in the Russian press on Friday, January 25

Media: Moscow gambles on Maduro

Russian President Vladimir Putin in a telephone conversation voiced support for incumbent Venezuelan President Nicolas Maduro and noted that "flagrant foreign interference" was the reason behind the escalating domestic political crisis. Experts interviewed by Izvestia believe that the crisis won't generate military intervention.

Russian diplomats will do everything possible to help stabilize the situation in Venezuela, Academic Director of the Russian Academy of Sciences’ Institute of Latin American Studies Vladimir Davydov told the paper. In his view, the US will not opt for military intervention because Washington is not interested in sparking a huge conflict in its backyard. However, the US will continue using political and diplomatic means.

"Now that tensions have escalated in Venezuela and the US and some other countries have expressed support for the opposition, the risk of intervention and an armed conflict is increasing," military expert Colonel Vladimir Popov told Nezavisimaya Gazeta. "But I am sure that Russia will not abandon its Caribbean ally and it will be an enormous deterrent for potential aggressors. However, it is crucial for the Maduro regime to iron out political and economic issues peacefully. In this case, the army and the people will be on its side," the expert assessed.

Andrei Pyatakov, a senior research fellow with the Political Research Center at the Russian Academy of Sciences’ Institute of Latin American Studies, told Rossiyskaya Gazeta that "at the moment, everything depends on the position of the army, which will play a key role in finding a way out of the conflict." According to him, "there are no clear signs of a rift among senior military officers but the recent attempted revolt shows that some of the mid-ranking military officers are disloyal to Maduro."

The expert doubts that the US will support any military intervention. "Washington certainly has no intention of getting directly involved in it, so if it takes action, it will be through close allies. Colombia and Brazil have been mentioned as potential invaders. However, I consider this option to be unlikely. After all, the United States is not interested in creating an explosive situation in its own backyard," Pyatakov said, adding that "much will depend on Russia and China if the Venezuela crisis is brought up for discussion at the United Nations."

The deteriorating situation in Venezuela has raised the question of Russia’s business prospects in the country. Moscow has poured large amounts of investment into Venezuela’s energy sector, Caracas is also one of the leading purchasers of Russian weapons. "Moscow had done a lot to strengthen Venezuela’s defense capabilities because the country is one of the richest in energy resources. However, there is a risk of losing our ally because the US is determined to regain control of Venezuela. A tough military, economic and geopolitical struggle is on and the Russian authorities certainly should take that into consideration," military expert Lieutenant General Yuri Netkachev told Nezavisimaya Gazeta.

 

Media: Theresa May's hotly-debated Brexit plan headed for dead-end

The European Parliament has called on London to clarify its position on its Brexit program in the coming days. However, a plan for future action is yet to be agreed on in Britain. The most radical initiatives include postponing the withdrawal and holding a second referendum, Kommersant writes.

After presenting her new Brexit plan, British Prime Minister Theresa May tossed the ball into the lawmakers’ court. She pointed out that it was her cabinet’s prerogative to negotiate Brexit conditions with the European Union, but at the same time, she agreed to make every effort to take Parliament's views into account.

Head of the Strategic Assessment Section at the Russian Academy of Sciences’ Institute of World Economy and International Relations Sergei Utkin told Kommersant that "the draft agreement the May government agreed on with the EU is a reasonable and realistic compromise" since it makes it possible "to keep most rules concerning the United Kingdom’s interaction with the EU in place" for the interim period. According to the expert, "the parliament’s decision to reject the document is a result of mutually exclusive aspirations that British lawmakers have. "They would like unimpeded trade with the EU and no barriers, and at the same time, total independence from the European Union, the freedom to make bilateral trade agreements with other countries, and change their standards, tariffs and rules of economic activity," Utkin noted.

"Parliamentary members mistakenly believe that the United Kingdom is such a valued partner for the EU that in the end Brussels is going to let it do whatever it wants in exchange for nothing, only to maintain partnership," he said.

Head of the Department of European Integration at Moscow State Institute of International Relations Alexander Tevdoi-Burmuli told Nezavisimaya Gazeta that "Theresa May has little room to maneuver because the deal she made with the EU is too lenient for her support group." The expert did not rule out that if her plan B fails in the House of Commons, May will resign and a new referendum may take place. "At the end of the day, it is up to the people to decide. In a situation where politics is at a dead-end, the people decide. This is the standard scheme, which is politically justified in this particular case," Tevdoi-Burmuli stressed.

 

Nezavisimaya Gazeta: Made in China 2025 plan intimidates America

The US has already made China give it significant trade concessions but now, Washington’s main claim concerns Beijing’s bid to achieve technological and scientific leadership through implementing the Made in China 2025 plan, Nezavisimaya Gazeta writes.

The trade war that broke out between the US and China last year for a long time looked like a battle of nerves. On the sidelines of the G20 summit in Argentina, Trump backed off a bit, making an agreement with Chinese President Xi Jinping to postpone new tariffs for 90 days. However, Washington reserved the right to continue increasing tariffs on Chinese goods if the parties failed to make a deal.

Presumably, even if China concedes on technology and copyrights (which looks dubious as the Chinese industrial miracle was based on "borrowed" technologies) the US will still make new demands.

"Since Beijing and Washington expressed their willingness to mutually search for a way out of the situation in December, they haven’t made an important statement about achieving any compromise," President of the Russian-Asian Union of Industrialists and Entrepreneurs Vitaly Mankevich said. "Washington hasn’t supported China’s initiatives for a roadmap to correct the trade imbalance with the US within six years, instead (the US) announced a timeframe of two years, which is impossible to meet. At the same time, the United States is trying to influence China’s domestic policy, criticizing the Made in China program, which is strategically important for Beijing. Under no circumstances can China accept this," the expert stressed.

Associate Professor with the Russian Presidential Academy of National Economy and Public Administration Sergei Khestanov does not rule out that China’s pledge to increase its purchases of US goods will reduce the deficit, but in his opinion, Washington seems to be demanding more. "Even if an agreement is made, it is highly likely to happen at the very end of the negotiation process. There is a kind of a battle of nerves going on, when both parties make unacceptable claims, particularly to test the other one’s mood," Khestanov told the paper.

 

Izvestia: ‘Mobile voter’ program to be rolled out for legislative elections

New technologies are going to be used for the State Duma election that is coming up in 2021. As many as 5,000 digital polling stations will be set up across the country in accordance with the Mobile Voter project, which came to replace absentee ballot documents, Central Election Commission Chairperson (CEC) Ella Pamfilova said at a meeting with Russian President Vladimir Putin. According to her, the new system will be tested during Russia’s Unified Election Day in Moscow later this year, Izvestia wrote.

The CEC chief said that digital services would bring civil control of the election process to a new level and enhance the credibility of elections.

The CEC has been using digital technologies since 2012, when CCTV cameras started to be set up at polling stations at President Putin’s initiative. Now, there are plans to ensure complete and long-term video surveillance. The CEC has been included in the Digital Russia project. More than seven million people have taken advantage of new technologies, Pamfilova noted.

The introduction of digital technologies has huge potential as it may help make the voting process more convenient for the public, said Sergei Volodenkov, Professor of the Political Science Department at Moscow State University. "Today’s society has new demands for the operation of many institutions, including elections," he told the newspaper.

Pamfilova added that the election commissions’ capacities were intended to be used during the 2020 population census. According to her, the CEC has established a reliable database and did much work together with the Interior and Foreign Ministries to verify voter registration.

 

Kommersant: Dollar purchases unable to stop ruble from strengthening

The value of Russia’s national currency has been robustly increasing since the beginning of the year. On Wednesday, the US dollar-ruble exchange rate fell below 66 rubles, while the euro-ruble rate dipped below the 75-ruble mark. The seasonal increase in the currency supply from Russian exporters, especially amid recovering oil prices, offset the negative impact of foreign currency purchases by the Bank of Russia, Kommersant points out.

"The ruble is growing stronger along with other developing market currencies, the reason being that investors have become less concerned about trade wars," said Chief Economist at Alfa-Bank Natalia Orlova.

Increasing oil prices are providing additional support. However, the Central Bank’s move to resume foreign currency purchases under the budget rule turned out to be on a smaller-than-expected scale. From January 15 to February 6, the Central Bank plans to spend 265.8 bln rubles on foreign currency purchases, which translates to buying foreign currency to the tune of $15.6 bln rubles every day. This is the largest figure since April 2018. "The market had larger amounts in mind when setting out currency prices, so now this factor will not influence the prices much," Head of Fixed Income, Currencies & Commodities at Citi Russia Denis Korshilov said.

Under the current climate, market participants expect the ruble exchange rate to continue growing. According to Chief Analyst at Promsvyazbank Mikhail Poddubsky, the ruble still is not expensive and if risk appetite remains steady on global markets, it may continue to grow moderately. "Russia’s current transactions are seasonally strong and easily offset foreign currency purchases under the budget rule. We expect the dollar-ruble exchange rate to gradually decline to 65 rubles by the end of the quarter," Poddubsky stated. "However, tensions over sanctions will persist in the coming two months and the ruble should not be expected to strengthen significantly," Orlova noted.

 

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