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Press review: SPIEF records deals worth $52 bln and US strategy to split Moscow, Beijing

Top stories from the Russian press on Monday, June 7th

Izvestia: US realized it’s no use fighting against Nord Stream 2 project - Russian envoy

The United States remains negative about the Nord Stream 2 gas pipeline project but Washington has realized that it’s no use fighting against its implementation. At the same time, European Union members maintain a positive attitude towards the pipeline, Russian Permanent Representative to the EU Vladimir Chizhov told Izvestia.

The diplomat admitted that Russia-EU relations had come to a standstill. "The entire multi-level system of cooperation has been suspended - not by us but by the European Union - so now, there is a need to search for ways out of the impasse," Chizhov said. According to him, almost none of the EU officials attended the St. Petersburg International Economic Forum, due to political reasons. Chizhov noted that he had personally sent out more than a dozen invitations on behalf of the organizing committee but no one, except EU Ambassador to Russia Markus Ederer, responded.

"First, it is impossible to revive the entire system automatically and second, there is no need to do that, we should search for more flexible forms of cooperation," Chizhov explained. "For years, we - including me - have talked about strategic partnership but there is none to talk about now. This is why we need to choose some non-politicized topics and cooperation tracks to work on," the Russian envoy said, pointing to climate and environmental issues, healthcare, science and technology.

When speaking about the Nord Stream 2 gas pipeline project, the Russian representative emphasized that "as of now, the US has realized that it’s simply no use fighting against its construction." "There is the design phase, which is already over, the construction phase that is about to be completed, the certification phase and the operation phase. All phases need to be agreed on before a project starts operating," he said. "The US remains negative about the project, whereas Germany and a number of other European countries haven’t changed their positive attitude," Chizhov stressed.


Izvestia: SPIEF participants sign deals worth over $52 bln

The St. Petersburg International Economic Forum (SPIEF) has been record-breaking event in terms of the total value of deals signed there, which exceeded 3.8 trillion rubles ($52.2 bln). The number of participants at the forum passed 13,000, Izvestia writes, citing the organizing committee’s Executive Secretary Anton Kobyakov. The forum became a perfect platform for boosting international cooperation, defining joint goals and building dialogue between the Russian authorities and the business community, participants said.

Contracts in a wide range of fields were inked at the forum. Over 160 agreements were made in the area of social, economic and regional cooperation, more than 110 in the high-tech field, 80 in the banking industry and about 50 in education and science. Most deals involved Russian delegations but foreign participants also took advantage of the event to sign more than 50 agreements.

Specific contracts aside, the announcement about the completion of the first string of the Nord Stream 2 gas pipeline was the highlight of the forum, Center for Strategic Research (CSR) President Vladislav Onishchenko pointed out. In the long term, it will influence both Gazprom stocks and all areas related to the oil and gas industry, from investment to the currency market, the expert said.

As the pandemic is coming to an end, it was vitally important to hold the SPIEF, Director of the Center for Business Tendency Studies at Higher School of Economics Georgy Ostapkovich stressed. The forum brought together those who had only been in touch online over the past year, giving them the opportunity to look each other in the eye, exchange views and determine strategic goals. It guaranteed an absolute "wow effect" from the psychological standpoint, the expert emphasized. According to him, in-person communication is a crucial element for any large business event.


Nezavisimaya Gazeta: Beijing concerned about potential thaw between Moscow, Washington

US strategists are seeking to drive a wedge between Moscow and Beijing using Cold War tactics, Nezavisimaya Gazeta writes, citing Chinese media outlets. According to Li Haidong, a professor at China’s Institute of International Relations, some US experts are hopeful that an easing of tensions between Washington and Moscow will allow US President Joe Biden to focus on competition with China.

Alexander Lukin, who heads the International Affairs Department at the Higher School of Economics, points out that "some people in China have always said that Western countries may succeed in luring Russia into siding with them if they try hard enough." "It’s not an official stance but China always keeps a close eye on Russia’s policies. It’s only natural in light of relations between Moscow, Beijing and Washington. China has few friends who are ready to support it. Many are interested in Chinese money and investment but those maintaining allied or allied-like relations with Beijing can be counted on one hand. There are North Korea, Russia and Pakistan," the expert specified.

This is why Russia is becoming more and more important for China, which is facing a kind of blockade. While former US President Donald Trump tried to maintain the blockade alone, Biden seeks to mobilize all US allies.

When speaking about the prospects for the upcoming Russia-US summit in Geneva, the expert noted that "Russia is unlikely to change its policy." "It’s not because Putin doesn’t trust Biden but because it is hard to imagine any conditions that Russia would find acceptable. If we compare the current situation to the 1970s, the West was then luring China by promising investment and strategic interaction. And now, when the US talks about the need to improve relations with Russia, it has nothing to offer. The Americans admit that growing ties between Russia and China pose an issue for them but no one knows what to do about it," the expert stressed.


Kommersant: Damascus points to attempts to undermine Syria’s sovereignty

Syrian authorities are running out of chances to regain control of the country’s north and northeast. Ankara has recently begun issuing Turkish IDs to the residents of Idlib, sparking outrage from Damascus, Kommersant writes.

The Syrian authorities also resented the trips of European diplomats, who had failed to inform Damascus of their plans to visit the country. Dutch diplomats arrived in Syria’s northeastern city of Qamishli on Saturday to pick up four of their fellow citizens - a woman and four children - from a camp where the family members of militants from the Islamic State [outlawed in Russia] are kept. The area is run by a Kurdish administration. Meanwhile, a delegation representing the Paris mayor’s office and the Danielle Mitterrand Foundation also visited Qamishli without informing Damascus.

It is becoming clear that the Syrian authorities don’t control a large part of the country. They still manage to maintain ties with northeastern areas but have been almost completely cut off from the Idlib de-escalation zone and areas in the north where Turkey carried out its Euphrates Shield and Olive Branch operations and where the Ankara-backed Syrian opposition forces remain.

The Turkification of northern Syria is no longer a secret. A year ago, the opposition-controlled areas moved to use the Turkish lira, citing the devaluation of the Syrian currency. There is also a trend for changing the Arabic names of settlements to Turkish ones. At the same time, Ankara is funding the restoration of hospitals in northern Syria and is opening branches of Turkish colleges. The process has been extended to include Idlib, which began to receive electricity from Turkey in late May.

"We can see that Syria has lost Idlib. Ankara has no other option but to take responsibility for what is going on there and other areas in northern Syria, otherwise the areas will turn into ‘a grey zone’ with all the consequences that come with it. No one has plans to hand these areas back over to Damascus while there is no consensus on Syria’s political future," Russian International Affairs Council Kirill Semenov pointed out.


Nezavisimaya Gazeta: Risk of SWIFT ban has no impact on Russia’s credit ratings

The thing that defines Russia’s economic model is its resistance to the pressure of sanctions. The country’s economic defenses make it possible for Western experts to maintain Russia’s stable credit ratings even in scenarios that see the country under tougher sanctions and excluded from the SWIFT global payment network, Nezavisimaya Gazeta writes.

Moody's Investors Service has recently affirmed Russia’s credit ratings as stable for several reasons. Firstly, the Russian economy proved to be stable amid the coronavirus pandemic. Secondly, Russia’s government will be able to ensure financial flexibility in the next two years, taking advantage of the reserve fund and the country’s low sovereign debt, experts point out. According to Moody’s, Russia is unlikely to lose access to international payment systems though the risk increases uncertainty and complicates decision making in the field of economic policy.

Meanwhile, experts don’t view the risk of Russia being excluded from SWIFT as real. "I think that the threat to ban the country from SWIFT is clearly an instrument of economic pressure," said Executive Director of the Russian Electronic Money and Remittance Association Pavel Shust.

"Sanctions don’t have a strong impact on the credit quality of Russia’s sovereign bonds," BCS Chief Investment Strategist Maxim Shein pointed out. "Russia’s sovereign ratings, including the one by Moody’s, are underestimated for political reasons. It is sort of a restriction. Russia has very good macroeconomic indicators, primarily, the ratio of debt to GDP, which stands at 17%, and the country’s foreign currency reserves exceed $600 bln, head of the Alpari analytical center Alexander Razuvayev emphasized.

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