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Press review: THAAD threat nearing Russia and Danish meddling in Nord Stream 2 aids Kiev

Top stories in the Russian press on Wednesday

Nezavisimaya Gazeta: THAAD missile system deployed near Russian borders

The US Army has deployed one of its seven Terminal High-Altitude Area-Defense missile-interceptor batteries (THAAD) to Romania, while the Aegis Ashore ballistic missile system stationed here earlier is under planned maintenance and modernization. Experts interviewed by Nezavisimaya Gazeta believe the decision underscores mistrust on the part of the United States and its NATO allies regarding pro-peace assurances from Moscow.

According to the newspaper, the US military claims that the Aegis Ashore system is unable to use ground-to-ground missiles and therefore cannot act as a hidden first strike weapon.

An anonymous but recognized Russian expert in the field of missile weaponry told Nezavisimaya Gazeta that this system has universal MK-41 launchers that can use Tomahawk cruise missiles instead of SM-3 Block IB interceptor missiles, but there is no sense in this decision. For example, the Aegis Ashore combat point has only 24 missiles, but there will be 48 once it is upgraded. This number of Tomahawks does not cause serious damage, as seen in Syria. In addition, the stationary position of the launcher makes it very vulnerable.

According to the newspaper, the Russian military-political leadership views the US global missile defense system as a threat to the global balance of forces. Theoretically, it can reduce the effectiveness of Russia's ICBMs to a minimum. In reality, most US missile defenses lack the speed, range, and accuracy to intercept ICBMs, Nezavisimaya Gazeta wrote.

Outside the United States, in addition to Romania, American units equipped with THAAD are deployed on the island of Guam, in South Korea, and Israel. As of early 2019, the US Army had acquired about 200 THAAD missiles.


Izvestia: Denmark’s meddling in Nord Stream 2 may rattle Russia-Ukraine gas transit

Last week, the operator of the Nord Stream 2 gas pipeline, Nord Stream 2 AG, admitted that the project's commissioning could be delayed if construction will have to be carried out along a third route, that is, a project that had already been handed over to the Danish authorities in April. Meanwhile, according to Izvestia, if Nord Stream 2 is not completed by the end of the year, the Ukrainian transit question will arise again. For the most part, the deliveries will be conducted through the Ukrainian gas transportation system, though the contract with Kiev expires in 2020.

The situation gets stickier with Ukraine's gas transit. One of the goals of the Nord Stream project was Gazprom seeking to reduce its dependency on a difficult partner. The long-term contract between Gazprom and Naftogaz expires at the end of 2019.

Head of Analytical Department at the National Energy Security Foundation Alexander Pasechnik told Izvestia, that a possible delay in launching the pipeline provides, if not a trump card, then at least some benefit to the Ukrainian authorities in these negotiations.

"We have different positions with Ukraine. We would like to have Ukrainian transit as an annex for strategic directions. We can have 15-20 bln cubic meters a year there. Kiev also wants to receive more than 40 bln - with smaller volumes, yet the Ukrainian system allegedly cannot be self-sufficient. In my opinion, these are unfounded appeals," he told Izvestia, adding that strategic position of Russian suppliers will not suffer much from the postponement.


Kommersant: Novatek moves to invest in its third LNG plant this year

Novatek is planning to adopt an investment decision on its third liquefied natural gas (LNG) project after Yamal LNG and Arctic LNG 2 in 2019, the company told Kommersant. The company is generally set on the project. It will be a small plant with a capacity of 4.8 mln tonnes of LNG per year based on Russian equipment and technology located in Sabetta. The company will be able to launch the plant at full capacity in the mid-2023.

"The project’s details and deadlines are preliminary and intended for receiving offers from potential Russian suppliers and contractors," Novatek told Kommersant.

The project’s key feature is that it will be implemented using Russian equipment and Russian liquefaction technology in its entirety. At the same time, sources told Kommersant that the Russian equipment is around 50% cheaper than foreign equipment.

This year, Novatek is expected to introduce the first line on Russian equipment for 0.9 mln tonnes in the framework of Yamal LNG. The unit cost of it is $500 per tonne against $1,100 on the "large lines" of Yamal LNG. "It is reasonable to assume that the specific cost of liquefaction will not be significantly higher than the one on the Arctic LNG 2, otherwise the selection of small line concepts seems meaningless," a source told Kommersant. According to the newspaper, the cost of the entire project with a capacity of 4.8 mln tonnes may amount to around $5 bln.


Nezavisimaya Gazeta: Budgetary policy may restrain Russia’s National Projects potential

The Russian Ministry of Economic Development assured that the country would avoid a recession and that negative factors would transform into positive ones. That being said, one of those negative factors right now is "weak demand". So with that in mind, the National Projects are expected to drive growth. However, according to Nezavisimaya Gazeta, their effect may be limited.

According to the Ministry of Finance, in 2019-2021, during the implementation of the National Projects, the amount of money invested in the economy from the federal budget will be 1.5-fold lower than what will be withdrawn from the economy within the fiscal guidelines. Experts label the current situation a dead end.

Deputy Director of the Institute of Economic Forecasting of the Russian Academy of Sciences Alexander Shirov told Nezavisimaya Gazeta, the potential contribution of National Projects to accelerating economic dynamics is estimated at 0.6 percentage points. According to the expert, peak funding for the National Projects is expected in 2021 and that is where a significant effect can be seen. Russia, according to the expert, has fallen into a "macroeconomic deadlock". "On the one hand, all indicators of macro-financial stabilization have been achieved - relatively low inflation, a stable exchange rate, and a deficit-free budget. On the other hand, there are no real signs of economic recovery," he stated.

"The Russian economy stands out among the rest of the leading economies in terms of a combination of tight fiscal and monetary policy at the same time," leading specialist of the Institute for Complex Strategic Studies Dmitry Plekhanov told the newspaper. "That is, we have a budget surplus combined with high real interest rates. These are two factors that, to one degree or another, play against the acceleration of economic growth," he added.


Izvestia: Number of US tourists visiting Russia grows despite diplomatic tensions

Almost 1.4 mln US citizens have visited Russia for tourist, business, and private purposes since 2014, Izvestia wrote citing the FSB’s data. Since the beginning of the recent crisis in Russian-American relations, the number of tourists from the United States to Russia has steadily increased, the newspaper wrote. Thus, in Q1 2019, almost 9,000 US tourists entered Russia, which is more than the same period in the previous four years. Experts believe that if Moscow and Washington manage to normalize relations, the tourist flow will increase significantly. After all, now US authorities continue to warn their citizens against traveling to Russia.

Traveling to Russia for tourist purposes is the most attractive for Americans. Over the past five years, the number of American travelers has increased by 40%. In 2014, 162,100 US citizens visited Russia, and in 2018, that number rose to 227,700.

Official ties between Moscow and Washington differ from relations between ordinary citizens, Deputy Chairman of the State Duma Committee on International Affairs Alexey Chepa told Izvestia. "The majority of ordinary Americans and Russians do not have problems with each other. On the contrary, US citizens show a great interest in our country and enjoy visiting it, despite calls from the American authorities," the politician said.

The tourists flow from the United States, as well as the number of private and business trips to Russia, will only increase if Moscow and Washington manage to normalize bilateral relations, Professor at the HSE Faculty of Law Alexander Domrin told the newspaper. "The flow of tourists from the United States only rose against surging sanctions in the recent years. I am sure that this trend will continue," he said.


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