Western countries and new centers of the multipolar world order should sooner or later begin equitable dialogue on a shared future and the sooner this happens, the better, Russian President Vladimir Putin said at Thursday’s session of the Valdai Discussion Club in Moscow. The club’s 19th annual meeting was entitled "A Post-Hegemonic World: Justice and Security for Everyone". The world’s multipolarity is Europe’s only chance to recover its political and economic identity, the Russian leader said, noting that Moscow is pursuing the creation of new international financial platforms independent of a single control center and of the dollar and the euro. According to him, technological development should not increase global inequality but reduce it. Putin hoped that the United Nations and UNSC structures would come to reflect the diversity of global regions.
On Thursday, Russian officials discussed issues directly related to counteracting hegemony in the economic sphere. The situation in the Russian economy has stabilized, it is better than initially expected, and the quarterly growth may begin as early as the end of 2022, said Economic Development Minister Maxim Reshetnikov at the 15th Verona Eurasian Economic Forum in Baku.
According to him, along with the countries of the Eurasian Economic Union (EAEU), Russia is reviewing the possibilities of creating free-trade zones with Mongolia and the UAE. The EAEU, which includes Armenia, Belarus, Kazakhstan, Kyrgyzstan and Russia, has already concluded agreements on free trade zones with Vietnam and Singapore as well as a temporary agreement with Iran.
The struggle against the hegemons is also conducted by way of consistently shunning their currency stimulated by the arrest of $300 bln of Russian gold reserves. The rejection of the dollar and euro has already become an irreversible process for Russia whose top priority is switching to payments in national currencies with China, EAEU countries, Turkey, India, Middle Eastern and Central Asian states, Latin America and Africa, VTB CEO Andrey Kostin said. According to him, the countries that did not support Western sanctions in 2021 formed about 45% of Russia’s entire foreign trade turnover while 10 years ago their share was about 30%.
However, Kostin recognized that the interest of friendly countries in switching to non-dollar payments was not high and urged to be patient and consistently promote this initiative at all levels emphasizing the reliability and mutual economic benefit of such payments.
As of the end of September 2022, Saudi Arabia doubled its oil deliveries to Europe compared to September last year, from 490,000 barrels to 950,000 barrels per day, the country’s Energy Minister Prince Abdulaziz bin Salman told at a conference for investors in Riyadh.
According to Alexey Kokin, an oil and gas analyst with Open Investments, the Arab states of the Persian Gulf view the preservation of OPEC+ as a counterbalance to the aspiration of major consumers to cap oil prices. These countries’ future actions depend on the balance of two priorities: occupying Russia’s share of the EU market and preventing the creation of a buyers’ alliance.
OPEC+ has already proved its effectiveness and the alliance’s coordinated actions helped restore the market’s balance, according to Portfolio Manager at Alfa Capital Dmitry Skryabin. In his opinion, no one would dismantle a well-working mechanism in order to attain illusory goals of taking up a larger market share.
The US is threatening OPEC+ mainly for political reasons. With the congressional midterm elections nearing, US President Joe Biden has to show voters that he cares about average Americans and is working to bring fuel prices down, says Associate Professor at the Russian Government’s Financial University Valery Andrianov. That said, the US has no real opportunities to pressure the Saudis because if it had any, it would have used them already.
A package of bills on fighting LGBT propaganda has passed the first reading. Lawmakers were unanimous in standing up against Western values which they considered alien to Russia. That said, the legislators particularly stressed that they were not going to infringe on the rights of Russians.
In addition to propaganda, the bills ban the display of LGBT information and information which may induce teenagers to gender reassignment surgery. The amendments concern the spread of such information on the Internet, in the media and in books, audiovisual services, movies and commercials.
Nina Ostanina, chairwoman of the State Duma Committee on Family, Women and Children, asserted that not only children but adults as well should be protected against ideological weapons "since the attack is underway on all fronts." The legislator considered the Duma’s decision to be a step in the right direction.
LDPR leader Leonid Slutsky concurs that lawmakers should protect young people "from brainwashing, and from the expansion of alien values" and resolutely block LGBT propaganda.
The participants of the 15th Verona Eurasian Economic Forum in Baku discussed the switch from the global East-West axial development model to the North-South format, the absurdity of the idea to cut Russia out of the global economy and shunning the dollar and euro. It was also stated that as early as this year, the Russian economy will turn upward on the quarterly basis and that since 2014, Russia has learned to live and even develop under the US-led West’s sanctions. Corporate leaders, scientists, experts and diplomats from different countries discussed the new challenges under the conditions of the new geopolitical reality.
According to Deputy Director General of the National Energy Institute Alexander Frolov, the saddest part for Western players is losing the status of a global hegemon and they are trying to make up for this loss by destabilizing the global hydrocarbon markets and cannibalizing their European allies with the US trying to resolve several issues at Europe’s expense: hold a partial reindustrialization and weaken its main adversaries, China and Russia.
According to AMarkets Analytics Department Chief Artyom Deyev, the Baku forum has vividly demonstrated that all talk about Russia’s international isolation is just the West’s unrealistic fantasies. He noted that a number of statements were made at the forum which indicated the direction of the development of the domestic economy: a course towards de-dollarization and cultivating partnerships with CIS states and friendly countries. He added that the forum also sent a message to the West that Russia won’t maintain relations with those states that promote anti-Russian sanctions policies.
Fyodor Sidorov, founder of the School of Practical Investing, concurs that Russia intends to develop partner ties with those friendly states that do not kowtow to the collective West, while de-dollarization and the redirection of Russian exports to the East are viable strategies that Moscow has already been actively implementing. According to him, the actions of unfriendly countries only stimulate and inspire Russia to make tough but necessary decisions.
Russia cannot increase the export of coking coal to India due to the lengthy transit, decreased steel demand, the country’s long-term contracts with Australian suppliers and the threat of Western sanctions. That said, India remains a prospective market for metallurgic raw materials. By 2030, it intends to double its output of steel production which would increase demand for coking coal. According to analysts, the growth of Russian exports of raw materials to India will occur only if purchases on traditional markets decrease.
Boris Krasnozhenov at Alfa Bank told the newspaper that the main markets for Russian exporters of coking coal in Asia are Japan, South Korea and China, noting that the distance for hauling exports in these directions is much shorter than to India. The exporters’ client base is relatively stable since the coal composition is important for cokemaking and it is not an easy process to switch to coal by different producers while the discount on Russian coal amounts up to 60%.
Given the diversification of coking coal imports by China over restrictions on imports from Australia, Russian coal-producing companies have significantly increased their sales to China, the expert notes, adding that Russia is capable of delivering coking coal to India only if demand on traditional markets drops significantly. "Given the size of China’s steel industry sector, almost the entire volume of Russian coking coal exports can be redirected to this market. In September, China imported 2.5 mln metric tons of coking coal from Russia," he pointed out. According to Krasnozhenov, in the future, prices and discounts will play a major part in choosing between exports to China or to India.
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