Press review: US to base missiles in Germany and West pledges to boost Kiev's air defenses

Top stories from the Russian press on Thursday, July 11th

US Secretary of State Antony Blinken and German Foreign Minister Annalena Baerbock

MOSCOW, July 11. /TASS/. US announces it will station missiles in Germany; West resolves to buttress Ukraine's air defenses; and China takes issue with EU probe into its market practices. These stories topped Thursday's newspaper headlines across Russia.

Kommersant: US to station long-range missiles in Germany

On Wednesday, the White House announced a move to "begin episodic deployments of the long-range fires capabilities of its Multi-Domain Task Force in Germany in 2026, as part of planning for enduring stationing of these capabilities in the future." These will include SM-6 and Tomahawk missiles, as well as hypersonic weapons, the White House said as it explained that "exercising these advanced capabilities will demonstrate the United States’ commitment to NATO and its contributions to European integrated deterrence."

While the White House mentioned long-range fires capabilities, the specific systems it listed are intermediate-and short-range missile systems. The United States has not deployed such ground-based capabilities in Europe since the 1980s. According to Der Spiegel, Washington and Berlin discussed this issue in strict secrecy, while Germany insisted that the new US systems be placed exclusively on German soil.

According to Professor Yevgeny Buzhinsky of the Higher School of Economics (HSE), the permanent deployment of such US systems in Europe will put an end to the Russian moratorium. "While the US has few such systems for now, and it has been deploying them in Europe and Asia as part of field testing, by 2026, it may well increase their production and start deploying them en masse across the globe," the expert told Kommersant. However, any repeat of the dual NATO solution of the Cold War era to limit these kinds of weapons will not work this time around, he warned, citing technological, political and even psychological reasons.

The move does not come as a surprise to Dmitry Stefanovich, a researcher with the Center for International Security at the Russian Academy of Sciences’ Institute of World Economy and International Relations and co-founder of the Vatfor project. He associates the reference to Typhon and Dark Eagle army missile systems in the announcement with the US’ withdrawal from the INF Treaty. And he, too, draws parallels with the Cold War. However, he doubts that Washington will play out a similar scenario successfully against two very different adversaries, namely Russia and China, given the latest military, political, economic and social developments globally. All in all, none of this will enhance anybody’s security.

Vedomosti: US pledges five long-range air defense systems to Ukraine at NATO summit

The United States, Germany, Romania, Italy and the Netherlands will soon provide Ukraine with four US-made Patriot systems and a Franco-Italian SAMP/T surface-to-air missile system. Also, the allies agreed to channel $1 bln in support of Ukrainian air defenses and reaffirmed their intention to allocate 40 bln euros ($43.3 bln) in military aid within the next year, US President Joe Biden announced in opening remarks at the summit in Washington.

Vedomosti: China launches probe after EU questions Beijing's market practices

On Tuesday, the Chinese Ministry of Commerce launched an examination into whether the European Union’s investigations of Chinese companies amount to trade barriers. The Chinese probe will last until January 10, 2025.

Specifically, the EU is looking into Chinese manufacturers of rail cars and locomotives and Chinese enterprises participating in European wind energy projects. The Chinese authorities will probe into this as well as EU activity in the solar energy market.

China remains the European Union’s key trade partner. In 2023, China-EU trade amounted to $782.9 bln, with Chinese exports to European countries reaching $500 bln and imports standing at $281.7 bln.

Formally, both China and the EU say they plan to conform to WTO norms in their economic conflict, Sergey Tsyplakov, professor with the Department of the Global Economy at the Higher School of Economics, explained to Vedomosti. Beijing’s investigations, including in response to the EU’s anti-dumping probe, are a bargaining chip that China can retract should it reach a compromise with Brussels, he said. And then China could cancel its probe as easily as it launched it, the expert concluded.

According to Vladislav Belov, director of the Center for Country Studies at the Russian Academy of Sciences' Institute of Europe, China’s behavior in terms of economic policy is exclusively market-driven, and as regards the EU policies, subsidies to European businesses have been available for some time. And when it comes to competition, China, for one, has long outpaced Europe in EV production, as evidenced by Germany’s engineering community, the expert said. He believes that in running its probes, China is trying to give an asymmetric response to EU restrictions, therefore he sees China and the EU teetering on the brink of a trade war.

Nezavisimaya Gazeta: Russia needs more non-oil revenues in its coffers

The State Duma has approved amendments endorsed by the government to reform the country’s tax system and senators have given their go-ahead for the overhaul, too. The Finance Ministry has calculated that the tax reform will bring an additional around 8 trln rubles ($90.5 bln) to the budget in the next three years. These will be primarily non-oil revenues, the Accounts Chamber told Nezavisimaya Gazeta. Meanwhile, oil revenues have risen to make up one-third of the budget and so far, the growth of oil and gas revenues has outpaced the increase in revenues from other sectors by a wide margin.

Russia’s non-oil revenues rose by almost 27% year-on-year to reach around 11.4 trln rubles in the first half of 2024 ($129 bln). And oil revenues reached almost 5.7 trln rubles ($64.5 bln), exceeding last year’s level by around 6%, mostly "due to a rise in Russian oil prices," the ministry explained. Therefore, in January-June 2024, oil and gas revenues amounted to nearly a third of all revenues.

Vera Kononova, deputy head of a department at the Institute for Complex Strategic Studies, said the soaring oil and gas revenues are currently due to the low base effect in 2023, when oil and gas revenues plunged. While higher budget revenues, including from oil and gas exports, are a net positive, oil prices and commodity revenues have been too unstable to rely on them alone, especially in the current situation, experts say.

Vladimir Klimanov, director of the Presidential Academy’s Center for Regional Policy, argues that while the federal budget still relies heavily on oil money, the move to increase the personal and corporate income taxes "paves the way to prioritizing the non-oil sector again, starting from 2025."

Izvestia: Russia, China to discuss building nuclear reactor on Moon

Russia and China will discuss building a nuclear reactor as part of their International Lunar Research Station (ILRS) on July 12, Izvestia has learned.

The proposed nuclear reactor will work on highly enriched nuclear fuel and it will be installed on the lunar surface remotely. The use of highly enriched nuclear fuel will make it possible to reduce the size and weight of the reactor, Vladimir Reshetov of the Moscow Engineering Physics Institute (MEPI) told Izvestia.

"A modular reactor that can be assembled on the lunar surface should perhaps be developed," he said. "At that, the reactor should be assembled and commissioned in an automated mode so as not to put humans, or mission participants, at risk," he continued. According to the researcher, Russian specialists are currently working on similar solutions in exploring the Arctic.

"The future of cosmonautics lies with nuclear-power technology for sure. Equipment and technology consuming quite significant amounts of energy will inevitably be used in space exploration, therefore, this will require powerful batteries that do not depend on sunlight," Space Research Institute Director Anatoly Petrukovich said. According to him, a powerful source of energy will be needed on the Moon, including to support long-term human missions.