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Press review: NATO boosts Black Sea presence and Turkey offers US ‘Greek’ S-400 deal

Top stories in the Russian press on Thursday, February 11
NATO Secretary General Jens Stoltenberg EPA-EFE/DIDIER LEBRUN/POOL
NATO Secretary General Jens Stoltenberg

Izvestia: NATO steps up activities in the Black Sea

NATO is boosting its presence in the Black Sea, the organization’s Secretary General Jens Stoltenberg said after a meeting with Ukrainian Prime Minister Denis Shmygal. The alliance attributed this move to the allegedly growing Russian threat. Kiev and NATO plan to hold joint military drills in Odessa this year, Izvestia writes.

Deputy Director of the Center for Comprehensive European and International Studies at the Higher School of Economics Dmitry Suslov notes that NATO is not planning either to grant Kiev membership in the alliance in the near future or even an action plan on membership. "Every year Ukraine hopes that it will be granted the Membership Action Plan (MAP). But even Western experts, who are unfriendly towards Russia, believe that Georgia is more likely to get the MAP than Ukraine. NATO wouldn’t dare do it since this could sharply escalate tensions and pose a threat to Ukraine’s state system. Everyone understands this," the political scientist told the newspaper. Since the alliance can neither grant Kiev membership nor the MAP, it will compensate this by boosting its presence and ramping up drills in the Black Sea. "Tensions and an arms race on the Russia-NATO contact line are on the rise, especially in the Black Sea. This is fraught with the risk of an unintended military confrontation in case of any incident," according to Suslov.

In his turn, Russian International Affairs Council expert Ilya Kramnik believes that it is too early to speak about any significant increase in the military presence of the alliance in the region now. "This is impossible given the current agreements on the regime of the Black Sea straits - the 1936 Montreux Convention. The Turks are carefully watching how this document is implemented. Besides, there is a conflict in the alliance between Turkey and some other NATO members. Ankara will hardly wish to back the North Atlantic bloc in case of its willingness to boost its naval presence there." In any case, Russia should not step up its military presence in the region and initiate any arms race, especially given the current challenging economic situation, the expert pointed out.


Nezavisimaya Gazeta: Turkey offers Greek-style deal on S-400s to Washington

Ankara is ready to make concessions to the Biden administration in terms of using Russia’s S-400 missile systems, but in return the Erdogan government demands Washington stop supporting the Kurdish armed units in northeastern Syria, Nezavisimaya Gazeta writes. The key issue now is how this deal will actually work.

A recent statement by Turkish Minister of National Defense Hulusi Akar suggests that Ankara will be satisfied by the so-called "Greek" scenario of using Russia’s air defense systems. Akar said Turkey was open to talks with the US on the "Crete" model that is working for the S-300s in Crete. "The statement on the Crete model is a reference to the crisis of 1998-1999 around the S-300s, when the Republic of Cyprus, a non-NATO member-state, acquired the S-300 missile system and Turkey threatened to start a war," political scientist and co-founder of the Geopolitical Cyprus analytical project Ioannis-Sotirios Ioannou told the newspaper.

"After the talks, the weapons were handed over to Greece. "The Crete model" for Turkey and the S-400s are a realistic scenario given the importance of these systems in the troublesome US-Turkish relations. The question is how will this work and whether the right place will be found for a possible handover, which will suit all parties. Ankara sent a signal to the US by this statement.

According to the expert, Turkey is not ruling out the S-400 handover to another state. In his words, Azerbaijan could host the S-400s. "This will occur if Turkey decides that it cannot have the S-400s anymore and it will have to remove it from its soil," Ioannou said, noting that this would be decided in coordination with the US. "Qatar is ruled out and so is the occupied territory of Cyprus," he pointed out.


Izvestia: Putin’s state-of-the-nation address to focus on social issues

Russian President Vladimir Putin is expected to deliver his state-of-the-nation address to the Federal Assembly soon. Several of Izvestia’s experts in the State Duma (lower house) and the United Russia ruling party believe that this will happen in the last week of February. Earlier, mass media reports said the address could be delivered on February 23-24. However, Kremlin Spokesman Dmitry Peskov said no decision on the date had been made so far.

Experts interviewed by the newspaper believe that this year the address will be less high-profile than last year when the constitutional amendments were proposed. This time, the president is likely to focus more on domestic policy due to the upcoming elections to the State Duma.

First Deputy Chairman of the Federation Council (upper house) on Social Policy Valery Ryazansky said that Putin is bound to focus on social policy. According to him, the president will raise the issues of overcoming the COVID-19 aftermath and poverty, fine-tuning the healthcare system as well as the National Projects, which are aimed at improving Russians’ living conditions.

Several State Duma MPs expect that a decision will be announced on adjusting pensions for inflation for working seniors. This crucial issue can be only solved by the head of state, who has shed light on this problem. Chairman of the State Duma Committee on Labor Yaroslav Nilov also believes that social issues will become a priority in Putin’s address.

Deputy Chairman of the Federation Council’s Committee on Foreign Affairs Andrei Klimov expects that the president’s address will answer the question of how Russia will ensure its sovereignty given the emerging new challenges. Konstantin Kalachev, who heads the Political Expert Group, believes that the address will have a conservative tone, "since the president is a supporter of evolutional reforms without any revolutions."


Kommersant: Lukashenko to head to Russia for a new loan

Belarusian President Alexander Lukashenko plans to visit Russia by the end of February to meet with his Russian counterpart Vladimir Putin in Sochi. The two leaders are likely to discuss a new Russian loan to the tune of $3 bln. Kremlin Spokesman Dmitry Peskov confirmed to Kommersant that the preparations for this year’s first meeting between the two presidents were underway. Meanwhile, the Belarusian leader is not planning to fast-track constitutional reform backed by Moscow and diminish his presidential powers, the newspaper writes.

According to Kommersant sources, the talks are likely to take place on February 22 or on February 25. Sources in the Russian government said Belarus would like to get access to the remaining funds allocated by Moscow for the construction of the NPP (this sum exceeds $3 bln).

Since the start of the Belarusian crisis, triggered by the August presidential election, Moscow has supported Lukashenko both financially and politically, the newspaper notes. Russia attributed the large-scale protests in Belarus to the West’s meddling in the republic’s domestic affairs. Meanwhile, the Kremlin and the Russian Foreign Ministry hinted that they expected Lukashenko to carry out constitutional reform, which he promised in early autumn. However, after quashing the mass unrest, which now has transformed into small flash mobs, Lukashenko has apparently decided to choose the longest possible procedure.

The discussion on the anticipated reform is due to kick off at the All Belarusian People’s Assembly on February 11. No one expects any breakthrough on the constitutional reform at the two-day forum. Pyotr Petrovsky, an expert from the pro-presidential Belaya Rus think tank, anticipates that the forum will draw up "a strategy on amending the constitution." By the end of 2021, the commission will come up with its ideas on the amendments and a referendum is likely to take place in late 2021 - January 2022, he said. According to Petrovsky, Lukashenko does not want to lose the tools of sustaining stability and control of the country.


Vedomosti: Foreign investors losing interest in Russian companies amid pandemic

The volume of mergers and acquisitions (M&A) in Russia last year dropped to the level of 2017, according to a report by KPMG, an Anglo-Dutch multinational professional services network. Given the uncertainty on when the pandemic will end, the quarantine restrictions, decreasing oil prices and the ruble’s depreciation, investors lost interest in Russian assets, Vedomosti writes.

Foreign investments into Russian assets in 2020 dropped 34% in terms of volume and 50% in terms of price (up to $10.6 bln). Another factor behind the delays in fulfilling the deals were logistics restrictions, which prevented comprehensive checks, said Alexey Gashkov, Director for Corporate Finance at BCS Global Markets. However, by the end of the year the situation had improved. In the fourth quarter, amid optimistic news, seven major M&A deals were announced. As a result, the decrease in mergers and acquisitions in Russia was less than in Europe.

Experts believe that the key trend on the Russian market will be fulfilling delayed or suspended deals and signing deals related to the pandemic (sales of non-core assets, consolidation of the market by players less affected by the pandemic, and structural changes, aimed at adapting life to the new conditions).

"The Russian market meets actual global trends such as accelerated digitalization and high activity on capital markets," said Lydia Petrashova, head of Deal Advisory for KPMG in Russia and the CIS. However, Russia’s most capital-intensive market in terms of investments is oil and gas while the global market is dominated by IT, media and telecommunication.


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