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Press review: NATO flexes muscles near Belarus and Israel’s plans after UAE-Bahrain deal

Top stories in the Russian press on Wednesday, September 16
NATO drills in Lithuania AP Photo/Mindaugas Kulbis
NATO drills in Lithuania
© AP Photo/Mindaugas Kulbis

Izvestia: Russian market unaffected by EU threats to pass ‘Navalny Act’

The Russian market has not yet reacted to the European Union’s proclaimed intentions to impose sanctions over the case of Russian blogger Alexey Navalny, in a manner mirroring the Magnitsky Act in the United States. Experts interviewed by Izvestia note that investors have gotten used to such statements and react calmly. If new restrictive measures are introduced, it is not going to hurt the Russian economy.

Russian legislators have castigated the EU’s sanctions approach as a travesty of common sense and a violation of European values such as the rule of law. "It stipulates the presumption of innocence and a thorough investigation into cases before any decisions are adopted. What the EU is trying to do now is directly the opposite of its commitments and what it is trying to teach the others," said Konstantin Kosachev, who heads the Federation Council’s Foreign Affairs Committee.

According to experts, the EU’s potential sanctions over the Navalny case will be restrictions against individuals, which envisage a traditional entry ban and a freezing of assets. This won’t trigger any negative macroeconomic consequences for Russia, Director of the Center for Business Tendencies Studies at the Higher School of Economics Georgy Ostapkovich told Izvestia. The commentator pointed out that this conclusion could be drawn after analyzing the situation with the Magnitsky Act: the Russian economy was not affected and the sanctions were demonstrative.

Finam analyst Alexey Korenev noted that the news on the potential restrictions did not change the stock markets’ positive dynamics. However, Russia is going to face some repercussions. According to Ostapkovich, these sanctions inevitably result in the downgrading of Russia’s investment rating by international agencies such as Moody’s, Fitch and S&P.


Nezavisimaya Gazeta: NATO flexes its muscles amid Slavic Brotherhood drills

During the course of the Russian-Belarusian maneuvers dubbed Slavic Brotherhood-2020, currently being carried out in the Brest Region, NATO has been holding international drills called Tobruq Legacy 2020 in Lithuania, in direct proximity to the Union State’s borders, since Monday. The exercises involve the air defense forces of Lithuania, Estonia, Italy, the US, Latvia, Poland, France, Slovakia and Hungary. Minsk views these actions as a provocation, Nezavisimaya Gazeta writes. Meanwhile, Kremlin Spokesman Dmitry Peskov announced that Moscow was withdrawing the force reserve, deployed at the Belarusian border.

According to experts, this step by Moscow was aimed at preventing an escalation. No permanent Russian military presence in Belarus is expected besides two military facilities located there (the Volga radar station and the 43rd Communications Center of the Russian Navy).

"The increased NATO maneuvers near the Union State’s borders are certainly an alarming factor. Moscow and Minsk have already developed a strategy of how to counter this," said Alexander Kanshin, who heads the Association of Unions of Reserve Officers of Ministry of Defense (MEGAPIR) and is a member of the Russian Civic Chamber. Meanwhile, he is sure that "the alliance is not expected to take any real military action against Belarus." This country is facing a domestic political conflict, which should be solved without any foreign meddling, the expert said, noting that no one in the West seeks a war with Russia and its allies.


Izvestia: Despite recognition by UAE and Bahrain, Israel won’t give up on annexing Jordan Valley

The decision by the United Arab Emirates and Bahrain to recognize Israel won’t motivate the Palestinian authorities to improve ties with the Jewish state, they are still rejecting any attempts of ironing out the conflict under US auspices, Palestinian Ambassador to Moscow Abdel Hafiz Nofal told Izvestia. "We consider all Arabs as our brothers and our stance will remain unchanged despite their mistakes and the rejection of the 2002 Arab Peace Initiative, which stipulates normalizing ties with Israel only after its departure from the territories occupied in 1967," the diplomat said.

Meanwhile, the Israeli prime minister’s administration told the paper that Israel was holding talks with other Arab countries and the Muslim world, so Oman could be the next one to recognize the Jewish state. However, Israel is not going to give up plans on annexing the Jordan Valley, despite this having been one of the conditions for normalizing ties with the UAE. The Jewish state just temporarily postponed applying its sovereignty to these territories.

Chairman of the Federation Council (upper house) Foreign Affairs Committee Konstantin Kosachev believes that the normalization of ties between the UAE, Bahrain and Israel is unlikely to bolster the peace process in the Middle East, stressing that on the contrary, the escalation is going to mount.

According to Senior Research Fellow of the Center for Arab and Islamic Studies at the Institute of Oriental Studies in the Russian Academy of Sciences Boris Dolgov, the Bahraini and Emirati recognition of Israel did not come as a surprise. Both countries are known for their pro-US position: Bahrain hosts the Fifth Fleet of the US Navy and the US air force’s Al Dhafra air base is located in the UAE. This step won’t drastically change the situation in the Middle East, but it will split the Arab and Muslim world, the expert pointed out.


Nezavisimaya Gazeta: Normandy Quartet’s fate put into question

The Ukrainian parliament’s decision not to recognize the official results of the Belarusian presidential election could trigger a new round of confrontation between Ukraine and Russia. The Ukrainian lawmakers had postponed the consideration of this issue for a month but they put it up for discussion shortly after the meeting between the Russian and Belarusian leaders in Sochi, Nezavisimaya Gazeta writes.

The Ukrainian parliament said in a statement passed on September 15 that the presidential election in Belarus "was neither free nor fair" and was held with numerous violations, while the outcome "does not reflect the real expression of the Belarusian citizenry’s will." The MPs also voiced concerns over the possible participation of Russia and the Collective Security Treaty Organization in solving the strife in Belarus. The Verkhovna Rada stressed that Kiev would see this as "a direct threat to the safety of all of Europe and Ukraine’s security."

Such concerns were voiced earlier, but they gained momentum after the talks between Putin and Lukashenko, the paper says. The stance of the Ukrainian lawmakers is in line with the decisions of their European colleagues. It’s noteworthy that it was announced right when a diplomatic scandal between Russia and France began to evolve. It gained real steam amid the standoff between Russia and Germany over the Navalny case. Amid the deterioration of Russia’s ties with Berlin and Paris, the fate of the Normandy Quartet could be put in question, Nezavisimaya Gazeta writes. Both Germany and France are part of the so-called Normandy Four along with Russia and Ukraine.

Another bone of contention is the issue on the local elections in the territories beyond Kiev’s control. Ukrainian experts note that even an attempt by the Verkhovna Rada to vote on the elections in the self-proclaimed Donetsk and Lugansk People’s Republics would spell their legitimization and recognition, and would subsequently spark mass protests. According to political scientist Yuri Romanenko, in case Russia insists on holding the polls without handing over control of the border, this could be a trap for Ukraine. As a result, Russia will keep control over the settlement process and certain areas in the Donetsk and Lugansk regions, and the Donbass region would turn into a Trojan Horse for Kiev.


Kommersant: Russia pursuing more taxes from metals and chemical producers

Russia’s Finance Ministry is trying to find new sources to fill the state coffers and decided to more than triple taxes on producing some fertilizers and nonferrous metal ores. The adjustments were discussed at a meeting of the government’s lawmaking commission on September 15.

Due to this measure, tax payouts will climb by 90 bln rubles ($1.2 bln) per year, according to the business community’s estimates, Kommersant business daily writes. This will concern all types of solid commercial minerals, except for coal, diamonds, gold, turf and common commercial minerals. Among the most affected companies will be Nornickel, Rusal, the Novolipetsk Metallurgical Plant, PhosAgro and EuroChem. The market participants strongly oppose the surge in tax payments, saying that this decision had not been discussed with them. However, analysts believe that the extra spending won’t turn into a disaster for export-oriented companies.

The Finance Ministry has been long relishing the idea of introducing an extra tax on solid minerals’ exporters, the newspaper writes. Initially, it sought to get 40 bln rubles ($532 mln) in extra taxes from coal producers. However, after a sharp decline in coal prices in 2019 this idea was rejected in early 2020.

Sources in the market note that the draft law, which changes all rules of the game in the sector, once again shows the Russian regulator’s unpredictability and instability. This also breaks President Vladimir Putin’s promise given in his address to the Federal Assembly in January 2020 that tax terms for businesses would remain stable until 2024.


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