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Press review: Moscow game for Kiev talks at Western venue and Minsk seeks more China trade

Top stories from the Russian press on Tuesday, December 5th

MOSCOW, December 5. /TASS/. Moscow is prepared to engage in talks with Kiev at a venue in a Western country; Belarusian President Alexander Lukashenko sought to expand bilateral hi-tech trade links during his second visit to Beijing this year; and Berlin is looking to maintain and expand its export footprint in Latin American markets with its overtures to Brasilia. These stories topped Tuesday’s newspaper headlines across Russia.


Izvestia: Moscow willing to conduct talks with Kiev in Western venue

Russia is prepared to engage in talks with Ukraine, including at a venue in a Western country, a highly placed source told Izvestia. Last week, Hungarian Foreign Minister Peter Szijjarto said in an interview with the newspaper that Budapest is still willing to step in as a mediator to the Moscow-Kiev conflict. However, the Russian Foreign Ministry emphasized that neither Ukraine nor its Western allies have been willing to negotiate with Russia.

Rodion Miroshnik, the Russian Foreign Ministry’s special envoy for the crimes of the Kiev regime, told Izvestia that Kiev has been striving to assiduously follow Western directives to fight to the last Ukrainian. "Certainly, we appreciate Hungary’s desire to contribute to stopping the bloodshed, but mediation is only a tool for organizing negotiations. The key question remains: Who on that side is ready to conduct talks?" the diplomat said. Russia is still determined to attain its objectives in the special military operation through political and diplomatic efforts, he emphasized.

Since Russia launched its special op, a number of large countries have come forward to offer their services as a mediator for settling such a large-scale conflict. Thus far, Turkey has gained the most traction in its efforts. However, the Black Sea grain deal, which was signed in Istanbul in July 2022 under Ankara’s auspices, lasted only a year as Russia opposed extending it on July 17. In February, China put forward a 12-point peace plan for ending the conflict. In turn, in April Brazilian President Luiz Inacio Lula da Silva floated the idea of establishing an alternative to the G20 as a vehicle for holding talks on Ukraine. Indonesia and the Vatican have also voiced their own proposals, while news emerged in the summer that India and France were also working on initiatives to settle the conflict.

As for NATO, certain North Atlantic Alliance member states could conceivably step in to host talks or act as a mediator, said Bogdan Bezpalko, a member of the Russian Presidential Council for Interethnic Relations. However, those countries that are members of neither the European Union nor NATO stand a better chance in any scenario of being accepted as a mediator by all parties, he added. "Although Hungary and, perhaps, even Slovakia could mediate talks between Russia and Ukraine, from the point of view of modern international relations, it would make more sense to insist that a neutral country, say, India, took on that role," Bezpalko emphasized. "India, at least, carries some serious weight in international politics and has been neutral regarding the Ukraine crisis. And, [New Delhi] maintains relations with both Russia and the West," he noted.

Finally, a Middle Eastern country, or even a former Soviet republic, for example, Uzbekistan, could potentially serve as a mediator for achieving a peace settlement to the conflict, Bezpalko concluded.


Vedomosti: Lukashenko looking to expand hi-tech trade in second visit to Beijing this year

On December 3-4, Belarusian President Alexander Lukashenko was in China on his second visit this year. He held talks in Beijing with Chinese President Xi Jinping during what was his 14th official visit to Beijing since 1995. According to the BelTA news agency, the two leaders talked for almost four hours, or three times longer than planned.

However, neither Chinese nor Belarusian news agencies have yet reported on what specific agreements were reached by the leaders this time around. Following Lukashenko’s visit in early March, Belarusian First Deputy Prime Minister Nikolay Snopkov argued that the aggregate post-visit economic effect could have topped $3.5 bln. Chinese Ambassador to Minsk Xe Xiaoyong said earlier that bilateral trade reached $5.83 bln in January-August 2023.

Cooperation with China is extremely important for the Belarusian leadership, as Beijing remains a major trade partner for Minsk, said Vyacheslav Sutyrin, director of the Science Diplomacy Center at the Institute for International Studies at Moscow State Institute of International Relations (MGIMO University). But if bilateral trade stood at $5.8 bln in 2022, Belarus’ trade with Russia amounted to $43.5 bln in the same period. Minsk would like to increase its trade turnover with China, which has been somewhat lopsided, with Belarusian exports to China accounting for only $1.8 bln out of the overall trade figure of $5.8 bln, Sutyrin noted. While Belarus imports a lot of Chinese products, Minsk is primarily interested in expanding the innovation-driven, hi-tech component in trade relations as it has been trying to win more technological resources from China amid the good relations between the two countries, the expert concluded.

According to Alexander Lomanov, head of the Center for Asia-Pacific Studies at the Russian Academy of Sciences’ Institute of World Economy and International Relations, Belarus is one of only a handful of stable partners in Europe for China. Although other European countries have larger markets and more advanced technology, they are vulnerable to political shocks and subject to the overweening influence of the United States, which has insisted that they take a tougher stance toward China. Therefore, Beijing views stable, sustainable relations with both Russia and Belarus as lucrative and promising. While the recent situation around European security has been rather unfavorable, in the longer term the transit link from Belarus to Poland and beyond to Central and Western Europe will prove to be of critical strategic importance for China’s marquee Belt and Road Initiative, Lomanov continued. To China, Minsk matters in terms of establishing a land transit corridor and as a partner for manufacturing and investment cooperation, the expert said.


Izvestia: Berlin seeking to shore up footprint in LatAm market with overtures to Brasilia

Germany is seeking closer ties with Brazil after eight years of a diplomatic lull. German Chancellor Olaf Scholz and Brazilian President Luiz Inacio Lula da Silva, who share center-left political views, have held talks in Berlin amid the EU’s ambitions to hang on to the South American market for sales of European goods and to disrupt the unity trend within the BRICS bloc, the EU’s putative rival. In turn, the Scholz-Lula tete-a-tete gives the visiting Brazilian leader another opportunity to solicit support for signing a trade deal between South American trade bloc Mercosur and the EU.

Germany is an export-oriented country, and Berlin has particular interest in potential markets for sales of German goods amid growing problems in Germany’s economy, Bundestag (German parliament) member Eugen Schmidt, from the Alternative for Germany (AfD) party, explained to Izvestia. Also, Berlin is interested in economic cooperation with Brazil for political reasons, he added. "Germany’s interest in BRICS is explained by the desire to undermine unity inside an increasingly popular bloc. Cooperation with Brazil will grow in order to prevent this geopolitical grouping from rising to compete with the West," the politician said.

Among other things, Scholz and Lula discussed a trade deal between the EU and Mercosur member countries, namely Argentina, Brazil, Paraguay and Uruguay. Bolivia will join the bloc soon, as the Brazilian Senate approved its accession in late November.

"Germany is very much interested in such an agreement, as it will fix the rules of trade with Latin America," German political scientist Alexander Rahr told Izvestia. However, he doubted an EU-Mercosur agreement could be signed quickly. "The EU has numerous questions about liberal values, its vision of the economy and its own legal system, which differs from that in Latin America," he explained.

"Brazilian resources, such as green hydrogen and rare earth metals, attract Germany, which fears competition for the Brazilian market from China, the United States, Russia and other economies," Vladislav Belov, head of the Center for German Studies at the Institute of Europe of the Russian Academy of Sciences, told the newspaper.

Mercosur member countries are scheduled to convene a meeting in Rio de Janeiro on December 7.


Nezavisimaya Gazeta: Russia set to build its own analogue of Starlink

The Russian government has signed off on a telecommunications development plan for the period through 2035, Prime Minister Mikhail Mishustin announced at a meeting with his deputies on Monday. The premier said that promising mobile networks will be gradually introduced in Russia, with 5G base stations to be built in all major cities with a population of more than 100,000 inhabitants.

Among other things, Russia will upgrade its state-run fleet of satellites in geostationary orbit, with 19 spacecraft slated to be built and launched, Deputy Prime Minister Dmitry Chernyshenko said. The strategy would see Russia field a fleet of low-orbit satellites by 2030. It is worth noting here that work has been repeatedly postponed on building Russia’s own analogue of SpaceX’s Starlink satellite internet constellation. Former Roscosmos chief Dmitry Rogozin once said with confidence that Russia would start building such a system as early as in 2024, provided the necessary funds are available.

Meanwhile, Elon Musk’s SpaceX launched an additional 23 Starlink satellites into orbit last weekend. So far, SpaceX has put more than 5,400 satellites into orbit, of which 5,100 are currently functioning.

Experts explained to Nezavisimaya Gazeta why Russia currently stands a chance of successfully financing a new space program, even though the government failed to provide financing for a simpler project previously, when state coffers were more flush with cash. "We need both telecom networks and space reconnaissance," Ivan Andriyevsky, first deputy president of the Russian Union of Engineers and board chairman at the 2K engineering company, told the newspaper. "The interests of civilian and military communications experts may coincide, the more so since solving the two tasks together in a single spacecraft is not hard. Then the civil and defense budgets will be combined, and the program will be tackled," he said.

According to the expert, Russia needs to launch 100 to 200 satellites per year to increase the potential of its fleet of spacecraft. "Heavy and expensive, or ‘long-term’ satellites can be orbited, or else tasks can be mastered more quickly by installing smaller satellites in a single booster rocket," he said. "True, they will function for five to eight years only, after which the fleet will have to be renewed, but it’s important for us to tackle pinpoint tasks now," he concluded.


Vedomosti: Norilsk Nickel foresees palladium deficit in 2024

Nornickel predicts that the global shortage of palladium will remain next year, according to a global market review published by Russia’s largest miner on Monday. The company also made an upward revision to its forecasted palladium deficit for 2023, hiking the expected shortfall to 900,000 troy ounces from 200,000 troy ounces in May.

According to Nornickel, in 2023 global palladium production will decline by 2% to 6.4 mln ounces. This will mostly be due to an 8% reduction in production at its Nadezhdinsky plant in Norilsk to 2.6 mln ounces. The drop in Russia’s output, the company said, will be partially offset by South Africa, where production will rise 1% to 2.4 mln ounces.

Russia is the world’s largest producer of palladium and enjoys a share of nearly 40% globally. In 2023, palladium production volumes will plunge by 8-14% against 2022 to 2.41-2.56 mln ounces, Nornickel forecasts.

To Sergey Grishunin, managing director at the National Rating Agency, the estimate of a deficit of 900,000 ounces for 2023 looks way too high against the backdrop of falling metal prices. Amid lower prices, the production of secondary palladium will indeed shrink, but the total deficit will hardly exceed 200,000 ounces, the analyst argued. And next year, the shortage of the metal will grow to 50,000 to 100,000 ounces, with a larger deficit possible if South African producers fail to meet their production targets, he added.

According to Boris Krasnozhenov, head of securities market analytics at Alfa-Bank, palladium prices will hover around $1,000 per troy ounce in 2024 as South African companies will cut production and automakers will deplete inventories. The National Rating Agency sees palladium prices rising to $1,300-1,400 per troy ounce next year, while Dmitry Smolin, a senior analyst at the Sinara investment bank, expects palladium prices to hit $1,250 per ounce in 2024.

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