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Press review: China’s economy on the rebound and Russia may pass virus peak in ten days

Top stories in the Russian press on April 2


Izvestia: COVID-19 affects nuclear non-proliferation

The coronavirus pandemic has dealt a heavy blow to arms control. Amid the infection, Moscow and Washington have suspended bilateral consultations on New START (Strategic Arms Reduction Treaty) and have also postponed a meeting of the Bilateral Consultative Commission (BCC) until autumn. However, Russia believes that the coronavirus is not a factor for deciding the deal’s fate, Izvestia writes.

Chairman of the Russian Federation Council (upper house of parliament) Foreign Affairs Committee Konstantin Kosachev told the paper that the only obstacle was the uncertain position of the United States. "The coronavirus is the smallest threat to the New START deal. Yes, certain circumstances crop up, but I would not consider them as absolutely unsurmountable," the senator told the paper. "The problem is that the Americans are placing their bets on a unilateral military lead in all types of armaments and therefore disarmament deals are meaningless to them. If the US decides in favor of preserving this treaty, then neither infections nor momentary circumstances will be an obstacle."

Experts agree that the New START is a safety net allowing the sides to draw up new disarmament deals in the future. At this stage, its terms have been fulfilled and this means that bilateral consultations are conducted not with the goal of reducing armaments but for preserving this safety net.

"The previous stages outlined in the treaty stipulated reducing strategic offensive arms. But the US and Russia have achieved this threshold and therefore special measures on further reduction or elimination of certain systems are not needed," Pyotr Topychanov, a senior research fellow at the Stockholm International Peace Research Institute (SIPRI), told the paper. "The measures written down in the treaty are basically needed for keeping predictability and transparency. That’s why the lack of inspections and meetings of the consultative commission at the current stage is not changing anything."

Meanwhile, the sides should agree at least whether they intend to extend the treaty for a maximum of five years or less, and here personal meetings are important, the expert noted. Richard Weitz, Senior Fellow and Director of the Center for Political-Military Analysis at the Hudson Institute, believes that delaying Russian-US meetings is a waste of time, which could be spent on discussing some kind of an intermediate mechanism during the period when Moscow and Washington will hammer out a new comprehensive deal.


Media: Chinese economy on the rebound, Europe, Russia and US heading towards rock bottom

Market figures are indicating that industrial activity in China is on the rise. Based on surveys of purchasing managers, China, which saw a serious decline in February, has started resuming production. In contrast, there is a significant deterioration in the Eurozone, where the Purchasing Managers’ Index (PMI) was the worst over the past 7.5 years, Kommersant business daily writes. In the United States, the index showed just a small decline, but it will be worse in future surveys, experts note. In Russia, the March PMI slightly dropped. The figure has not yet reflected the tough phase of the economy’s switch to the quarantine and obviously the real recession will show its ugly head in April. Meanwhile, neither the Eurozone, Russia nor the US will apparently manage to repeat the Chinese rebounding figures. Unlike these countries, China has avoided a quick spread of the virus across the entire country due to swift and harsh measures, according to the paper.

Russia’s PMI in March dropped from 48.3 to 47.5, the lowest level since December 2019. The reason is minimum output and orders since November while the prices have risen. However, Kommersant business daily writes that the poll was conducted on March 12-25 and does not fully reflect the scale of decreasing business activity since the harsh restrictions were introduced in late March. "We are not ruling out that by the end of March, Russia’s industry could show negative dynamics amid a sharp deterioration of indicators not only in manufacturing but also in mining sector," Denis Polevoy, an analyst at the Russian Direct Investment Fund (RDIF) wrote.

Unlike the crisis in 2008-2009, this recession is both economic and financial. Production chains are broken and as a result, the entire global economy is falling like a house of cards, experts told Nezavisimaya Gazeta. "All this is a long-term trend: even China, which has almost fully restored production after the quarantine, faced the problem of the lowest demand over the past 20 years. People have run out of money and many of them have lost their jobs. Hunger strikes are beginning in Italy. It will take a long time to restore the economy under these conditions. In Russia, the crisis worsened due to low oil prices and the budget will be in the red by the end of this year," Pavel Sigal, first vice president of Opory Rossii, warns.


Nezavisimaya Gazeta: Afghanistan’s arch enemies take steps towards reconciliation

A team of three delegates from the Taliban (outlawed in Russia) has arrived in Kabul to kick start a prisoner swap. This is envisaged by a deal between the United States and the Taliban signed in Qatar, under which 6,000 prisoners of war from both sides should walk free.

Afghan President Ashraf Ghani stonewalled the deal’s implementation since Washington had not coordinated it with him. US Secretary of State Mike Pompeo had to exert pressure to jump-start the process.

Arkady Dubnov, an expert on Central Asia and Afghanistan, told Nezavisimya Gazeta that the arrival of the Taliban team in Kabul means that the process of inter-Afghan dialogue was underway. The key condition of this dialogue is releasing prisoners on both sides. Ghani’s stubborn position had hindered the swap, but it finally began under Washington’s pressure.

"If the prisoner swap takes place, the next step should be a decision on picking the venue for talks. It’s up to the sides to decide whether this will be Qatar’s capital of Doha, a European city, or Tashkent. But it’s very unlikely that the dialogue will be held in Kabul. When the venue is chosen, this will mean that the talks on the inter-Afghan truce have entered a crucial phase," Dubnov said.

However, Afghanistan’s troubles are now aggravated by the coronavirus threat, the paper writes. More than 160,000 Afghans have recently returned home from neighboring Iran and the Afghan Ministry of Public Health has warned that some 16 mln people could be infected. This could frustrate the negotiations and the sides will have to consider both how to stop the conflict and fight the pandemic.


Izvestia: Russia projected to pass coronavirus peak in ten days

Under the most favorable scenario, Russia could pass the peak of the COVID-19 pandemic in ten days, a leading virologist Alexander Lukashev told Izvestia. However, should things get worse, Russia could pass the peak of the disease in May-June, not in the end of April, said Lukashev, who heads the Martsinovsky Institute of Medical Parasitology and Tropical Medicine at Sechenov University.

Most recently, Moscow imposed a total lockdown and other Russian regions have followed suit. Speaking on these anti-coronavirus measures, the medical pundit said that this effort would definitely help contain the virus. "Time will only tell if they will fully stop the spread of the virus. But there is no doubt that they will help control the process and prevent a catastrophic overflow [of patients] in hospitals."

According to the expert, if these measures had not been introduced, Russia could have seen a disastrous peak of the disease in the second half of April, even worse than in Italy. "Now, if the measures are strictly implemented we will see a decrease in the number of cases. In the worst case scenario, we will delay the peak until late May-June. In the best case scenario, the peak will be passed in ten days and then a decline will begin."

The experience of other countries shows that the change in the dynamics of the disease will be seen only in 11-12 days after the self-isolation measures. In the coming two weeks it will be clear whether these measures should be extended or could become milder or not, the expert noted.


Nezavisimaya Gazeta: Over 7 mln Russians could lose jobs over coronavirus

In April and May, many Russians could face hard times due to a sudden loss of employment and reduced salaries, and finding a new job would be a challenging task, Nezavisimaya Gazeta writes citing surveys carried out among businesses and industrial enterprises. At least 7 million citizens could lose their jobs, according to estimates by the Russian Presidential Academy of National Economy and Public Administration (RANEPA).

The owners of 49% of enterprises in the Russian services sector (except for tourism) and in catering, 45% of hotels, 37% of shops selling non-grocery goods, 26% of transport enterprises and over 20% of manufacturing and construction enterprises plan to fire personnel or reduce their salaries, according to Russian business ombudsman Boris Titov.

Russia’s catering companies, non-food shops and services sector have reported a 50-80% drop in revenues and sacked at least 20% of their staff. Against this background, the employment problem is becoming especially acute.

According to RANEPA, nearly 10% of employed Russians (some 7 mln-8 mln) worked in the shadow economy, and 10-12% others were employed unofficially. "Most of them worked in the services field. These citizens have no guarantees in the event of losing jobs or some revenues," Director of the Center for Social and Political Monitoring at RANEPA’s Institute of Public Sciences Andrei Pokida noted. Those Russians, who are unable to work remotely, for example hairdressers, fitness coaches, massage therapists and builders, will face the greatest difficulty.

Meanwhile, the estimates on the number of Russians working in the shadow economy differ. Russian Deputy Prime Minister Tatyana Golikova said in mid-2019 that nearly 15 mln Russians were employed unofficially.


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