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Press review: Houthis ready to confront wary US and EU sanctions to hit Russia-China trade

Top stories from the Russian press on Thursday, February 22nd

MOSCOW, February 22. /TASS/. Yemen’s well-armed Houthis are ready for a protracted showdown with the US-led Western coalition in the Red Sea; the latest round of European sanctions threatens future deliveries of electronic components to Russia; and Russian Foreign Minister Sergey Lavrov is wrapping up his three-nation Latin American tour by attending a G20 summit in Brazil. These stories topped Thursday’s newspaper headlines across Russia.


Izvestia: Yemen’s well-armed Houthis geared up for protracted conflict with wary US

The Yemen-based Houthi rebels from the Ansar Allah movement are ready to engage in a protracted conflict with the Western coalition led by the US, even for a scenario in which the war between Hamas and Israel in the Gaza Strip lasts for years, Nasr Al-Din Amer, deputy director of Ansar Allah’s Information Department, told Izvestia. That said, Washington has acknowledged the Houthi’s robust military capabilities and compared the scale of combat to World War II. As a practical matter, dragging out the process of achieving a ceasefire in the embattled Palestinian enclave means Washington will be deprived of the option to serve as the main security guarantor in the region. Additionally, the EU Council declared the launch of its own operation to protect shipping in the Red Sea.

US Navy Vice Admiral Brad Cooper, deputy commander of the US Defense Department’s Central Command (CENTCOM), said in an interview with CBS that World War II was the last time the US Navy participated in combat of this scale and intensity.

Indeed, Ansar Allah’s military advantage lies in the cost of the projectiles and drones they launch at commercial and military vessels, Murad Arefi of the Sana'a Center for Strategic Studies told Izvestia. "Intensive launches from the grouping have cost the US too much. The Houthis have a lot of room for maneuver, given the area of the Red Sea and Arabian Sea. They know the terrain well and are well-armed by Iran. The same goes for intelligence data," the expert said.

According to Arefi, at first, the West was banking on decreasing the group’s military potential but with time it has become clear that this is no simple task.

That said, the Ansar Allah movement issued assurances that European vessels will not be targeted by its projectiles and drones.

"We will not strike the ships of the European coalition if they won’t make any aggressive moves against Yemen. If the EU attempts to hinder us in fulfilling our tasks, where we are helping the Gaza Strip and blocking [Israel], then we will consider it as meddling in our domestic affairs," Nasr Al-Din Amer said.


Kommersant: Europe’s latest sanctions threaten supplies of electronic components to Russia

The EU’s latest round of anti-Russian sanctions, its 13th sanctions package in just under two years, may encompass major Chinese distributors of electronic components and a manufacturer of printed circuit boards that are purportedly working with Russia. Lawyers noted that until now the EU has not dared to introduce any restrictions against Chinese enterprises, as opposed to the US, but market players have managed to circumvent such measures by changing their operating patterns. Experts think that issues related to paying for supplies via Chinese banks are much more serious.

The 13th package of EU sanctions against Russia may blacklist Chinese distributors and electronics manufacturers such as Guangzhou Ausay Technology, Shenzhen Biguang Trading and Yilufa Electronics. The EU suspects them of helping Russia to circumvent existing sanctions while purchasing banned technologies for weapons. AFP, citing sources, says that companies from Turkey, Sri Lanka, Serbia, Thailand and Kazakhstan may also be blacklisted. The EU is slated to approve the sanctions package on February 24.

Mergen Doraev, a partner at the EMPP law firm, stresses that "until now, the EU has not dared to introduce sanctions against Chinese enterprises." "Previously, such threats emanated only from the US, which, for example, introduced trade restrictions against Zhongxing Telecommunications Equipment Corporation (ZTE) and even brought criminal charges, because ZTE management was developing measures to circumvent sanctions in order to deliver American equipment to Iran. However, it is still unclear whether the potentially sanctioned entities are major companies or if this is about so-called ‘dummy companies,’ expressly created to execute such trade transactions," he added.

The lawyer doubts that the EU is ready to introduce sanctions against truly well-known, heavyweight Chinese tech companies. "Under current conditions, the Europeans do not need a trade war to boot, this is rather simply about sending a signal in order to demonstrate to China the [EU’s disapproving] stance on the issue of expanding military and technical cooperation with Russia," he explained.

Currently, the growing problem is not trade but financial logistics, asserted Ivan Pokrovsky, director general of the Electronics Developers and Manufacturers Association (EDMA). "Overall, currently the situation around restricting financial logistics is close to critical with Russian companies experiencing difficulties with paying for supplies from China. It is necessary to find a solution to this problem," he said. The expert confirmed that those sanctions that simply limit deliveries of some products do not represent any serious threat. "We have already learned to overcome them," he explained.


Vedomosti: Russia’s top diplomat wraps up Latin American tour with G20 summit in Brazil

Having visited Cuba and Venezuela, Russian Foreign Minister Sergey Lavrov arrived in Brazil on February 21 for a G20 foreign ministers’ summit in Rio de Janeiro. The event’s agenda includes the reform of the UN, IMF and World Bank.

The summit is being attended primarily by each country’s top diplomat, but China and India sent deputy foreign ministers Ma Zhaoxu and Vellamvelly Muraleedharan, respectively, to represent them.

The Chinese authorities, by sending a deputy instead of Chinese Foreign Minister Wang Yi, who also serves as director of the Chinese Communist Party Central Committee Foreign Affairs Commission Office, demonstrated that they prefer to deal with geopolitics, the Ukrainian conflict and the global economy separately as standalone issues, Igor Denisov, a senior research fellow at the Institute of International Studies at Moscow State Institute of International Relations (MGIMO University), explained. He reiterated that Beijing has repeatedly stressed its view that the G20 is an economic forum and, thus, it is inappropriate to discuss the Middle East and Ukraine conflicts on this platform. The first session of the meeting in Rio de Janeiro is supposed to discuss the G20’s role in addressing international tensions and Wang’s participation would have indicated a recognition by Beijing of the importance of this format, which would have contradicted the stance of the Chinese leadership, Denisov explained.

According to Valdai Discussion Club Program Director Oleg Barabanov, the G20 does not have much potential to resolve international disputes. "Initially this format was created as a meeting point of Western countries and the Global South. In order to discuss global issues, the West has the G7, while developing countries have BRICS. The G20 experience shows that the participants, as a rule, discuss issues at the lowest common denominator or coordinate their interests," he explained.


Vedomosti: US again wields veto to block UN Security Council resolution on Gaza ceasefire

On February 20, US Ambassador to the UN Linda Thomas-Greenfield once again exercised Washington’s veto in the UN Security Council to doom a draft resolution on a ceasefire in the Gaza Strip. The draft, introduced by Algeria, was supported by 13 out of 15 Security Council members, with the UK abstaining. The US is promoting its own alternative resolution, Reuters said.

Washington’s proposal urges for the first time calling a temporary ceasefire in the Gaza Strip. It also points to the unacceptability of Israel’s potential offensive on the city of Rafah in southern Gaza, where hundreds of thousands of Palestinians have taken refuge, as well as the need to release hostages and lift all obstacles to the delivery of humanitarian aid. However, Reuters reported that the US is in no hurry to put its alternative draft resolution up to a vote.

The chances that Israel, under international pressure and due to the UN resolution, will refrain from proceeding with its operation in Rafah are rather slim, said Andrey Zeltyn, senior lecturer at the School of Asian Studies at the Higher School of Economics (HSE University). The uber-hawkish government of Prime Minister Benjamin Netanyahu is not listening to other players, as it doggedly continues to pursue its militarist policy course. Additionally, in the modern reality, the UN Security Council has morphed into a declarative body. According to the expert, it simply has no leverage over Israel and Netanyahu will act as he sees fit. As for the refugees, they always get the short end of the stick in such situations.

Israel will continue combat operations even if the US resolution is approved, concurs Lyudmila Samarskaya, a researcher at the Center for Middle Eastern Studies of the Russian Academy of Sciences’ Primakov Institute of World Economy and International Relations (IMEMO RAS), because even a temporary ceasefire is unacceptable for Israel. There are no fundamental differences with regard to military actions within the Israeli war cabinet, but there may be a split with regard to methods and priorities. That said, the entire Israeli leadership is determined that combat operations conclude with nothing short of a clear-cut victory over Hamas.

The administration of US President Joe Biden has its hands tied by longstanding political obligations with regard to Israel, said Andrey Kortunov, research director of the Russian International Affairs Council (RIAC). As a result, the US cannot impose on Israel any ceasefire draft agreements that Tel Aviv itself is not ready to accept, the expert concluded.


Izvestia: Russian parliament readies response measures to confiscation of assets in Europe

Russia’s legislative branch is debating how to respond to the EU’s plans to confiscate frozen Russian assets. The Federation Council, or upper house of parliament, sent the Finance Ministry a proposal to develop a mechanism for seizing foreign assets blocked in Russia, Federation Council Deputy Chairman Nikolay Zhuravlyov told Izvestia. Meanwhile, in the lower house, State Duma Financial Markets Committee Chairman Anatoly Aksakov told the newspaper that he is familiar with the Federation Council’s initiative and understands its necessity. According to him, with the threat of Russian assets being confiscated, it is possible to adopt various versions of response measures.

One of the options for seizing funds is via imposing higher income taxes on Russian assets, noted lawyer Artyom Kasumyan at Delcredere. The authorities would confiscate income due to non-residents only in the event that the EU actually takes the step of confiscating Russian assets held by EU-based securities depositories, Dmitry Lesnov at Finam stressed. That said, a baselessly high tax rate or the introduction of additional taxes may be considered as an indirect expropriation, which is prohibited under most of Russia’s bilateral investment agreements, Kira Vinokurova, a partner at law firm Pen & Paper, clarified.

Moreover, the EU is talking about seizing the income of the Central Bank of Russia, which is not deemed a private entity from the point of view of international law, Kasumyan explained. In this case, any restriction on foreign investors’ property rights may not be a completely reciprocal measure. "By all appearances, if a mutual seizure of assets begins, the climate for exchanging assets will become even more unfavorable," the lawyer noted.

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