Ukrainian President Pyotr Poroshenko has announced the end of martial law declared on November 26 in the wake of the Kerch Strait naval standoff. When announcing this move, he noted that the so-called “Russian threat” had not gone away, adding that it was necessary to remove the restrictions in order to hold the presidential election on March 31, 2019. Kommersant’s sources in Moscow and Kiev have confirmed that the issue at hand is not solving any military tasks during that period. The Ukrainian leader tried to point to other achievements, claiming that Western partners are ready to step up pressure on Moscow.
According to Poroshenko, Europe will now recognize the need to consider a new package of sanctions over Russia’s actions in the Sea of Azov.
“Pyotr Poroshenko has achieved the desired result. He responded to the Ukrainian sailors’ arrest the way he should have responded, mobilized his voters and united them around himself. Besides, he did not cancel the presidential election and plans to hold it on time, which makes him look like a politician who is ready to defend his point of view in the eyes of voters. However, from a military standpoint that move did not look very reasonable. That concerns both its imposition and completion,” Director of the Kiev-based Institute of Global Strategic Vadim Karasev told the paper.
On the other hand, Konstantin Skorkin, an expert at the Carnegie Moscow Center, believes that the imposition of martial law was a belated step, “considering that the conflict in Ukraine has been going on for four years, so citizens’ response was rather negative.” “However, the establishment of a new Ukrainian church has sparked more enthusiasm, and Poroshenko can indeed score additional points thanks to that,” the expert said.
The European Union takes its cues from Washington’s stance on many issues, even to the detriment of its own interests, Russian Permanent Representative to the EU Vladimir Chizhov told Izvestia.
That concerns, in particular, the fate of the INF deal, he stressed. “Europeans realize that the collapse of that important element of the nuclear nonproliferation regime will have negative effects in the global dimension and in terms of security for EU members. However, the EU’s stance on the INF Treaty, just like on many other pressing international issues, is inconsistent, which stems from its ‘habit’ to rely on America’s approach, often to the detriment of their own interests,” he stressed.
“In spite of the calls for rescuing the accord, most EU members voted against the Russia-initiated project…at the UN General Assembly. Only four EU members, specifically, Austria, Ireland, Cyprus and Malta, had enough courage to abstain,” the Russian diplomat said, adding that Europeans have actually “given Washington the green light to quit the deal.”
Moscow is ready to discuss any concerns and irritants, which have an adverse effect on relations between Russia and the European Union and calls on Brussels to follow suit, Chizhov went on to say. “However, Western politicians sometimes tend to seek the limelight and promote themselves at the expense of Russia or want to divert attention from their own problems,” he explained.
Commenting on the West’s sanctions, the Russian envoy emphasized that unilateral Western restrictions weren’t able to achieve the desired effect. “They have failed to force Russia to change its foreign policy focusing on its own economic and political priorities or undermine Russian citizens’ trust in government institutions or trigger a dramatic economic decline thus containing the development of its capacities,” he said.
Beijing’s refusal to reach a deal on settlements in national currencies before the end of this year is related to political factors, primarily, its reluctance to jeopardize trade negotiations between Beijing and Washington, Kommersant writes citing its own sources. There are also some purely market factors among them, like the possibility of triggering capital flight, which China is currently countering. However, Russian First Deputy Prime Minister Anton Siluanov assured the paper that the agreement would be signed later and “in a different format.”
Most experts and government officials interviewed by Kommersant stressed that the key reason behind the disruption of these talks is China’s unwillingness to irritate the US amid complex negotiations over the ongoing trade conflict. “From Washington’s standpoint, China’s agreement with Russia would look like it’s helping Moscow evade sanctions. Besides, China needs time to tweak the final document more to its benefit,” said a source in Moscow familiar with the course of the talks.
Alexander Knobel, Director of the International Institute of International Economics and Finance at the Russian Foreign Trade Academy, has a similar point of view. “Beijing is trying to gain Washington’s favor. On December 13, for the first time since the beginning of the trade war, China purchased a large consignment of soya from the US and temporarily cancelled the decision to raise tariffs on US-made cars.”
For his part, Head of the Asia-Pacific Program at the Carnegie Moscow Center Alexander Gabuyev pointed out that China feared capital flight through Russia. “Currency control in Russia is much weaker than in China. If Chinese businesspeople had an opportunity to freely use their currency here, they could withdraw funds to offshore accounts, and Beijing is vigorously fighting that,” he explained.
Brent oil prices began rising again on Wednesday showing an 8.6% increase (as of 21:35 Moscow time on December 26). Nevertheless, it has lost about 40% of its value in the fourth quarter of this year, Izvestia writes. Russian Economy Minister Alexander Novak earlier said that, if necessary, Russia and OPEC could hold an extraordinary meeting to stabilize the situation. However, the Russian economy has not been profoundly affected by the falling prices. On the contrary, it was able to benefit from the current situation and lower gasoline stock exchange prices.
The market is sending conflicting signals, Vladimir Feigin, Director of the Institute for Energy and Finance, told the paper. According to the expert, one of the concerns could be that Washington, which is interested in low oil prices, will exert pressure on its exporting allies so that they do not reduce production. The US is pursuing a consistent policy in this sphere, the expert said. On the one hand, it advocates low oil prices thus affecting the interests of its oil producers, and, on the other, it imposes sanctions on Iran. This state of affairs, of course, affects the behavior of financial market players, where oil prices are determined.
By all accounts, the decline in oil prices came as no surprise to the Russian government, according to Alexandra Suslina, a fiscal policy expert at the Moscow-based think tank Economic Expert Group. Russia’s Economic Development Ministry, Energy Ministry and Central Bank earlier noted that such a scenario was possible, the economic analyst noted. Therefore, one should not expect this to spark any changes in the national economic strategy for the coming three years, she added.
On the other hand, Vasilisa Baranova, an analyst with the ACRA analytical credit rating agency, does not think the current level of prices is suitable for Russia’s economy. In her view, if oil prices stand at about $50 per barrel in the near future, the economic growth rate in Russia could slow down.
The Russian Health Ministry has drafted a new policy proposal to counter tobacco consumption for 2019-2030, RBC writes. The goal of the plan is a successive reduction in the usage of tobacco by 2050 and, after that, a possible gradual withdrawal of tobacco products from circulation.
According to the Health Ministry’s latest available statistics, 30.9% of Russians, or more than 40 million people, are smokers. The ministry hopes that this number will drop to a mere 5% by 2040. Its short-term objective is to reduce the number of smokers by 5 percentage points to 25% by 2025.
One of the measures proposed by the Health Ministry is preventing the circulation of new forms and types of tobacco products, including those consumed by heating tobacco. Today, there are two such products in the market, including IQOS made by Philip Morris International.
This is a disputable proposal, since the new products have potentially lower health risks, the paper quotes Georgy Soustin, Director of Corporate and Legal Affairs at Imperial Tobacco, as saying. At the same time, legislation in some countries encourages smokers to switch to new products.
Meanwhile, the Russian Health Ministry stressed that the government should take steps to prevent the sale of illegal tobacco products. According to the Nielsen analytical agency, their share in the market grew from 4.5% in 2017 to 8.4% in the third quarter of 2018.
The illegal market has grown seven-fold over the past four years, due to which the budget will lose about 50 bln rubles ($726 mln) in exercise duties in 2018 alone, Sergei Golovko, Vice President for Corporate Affairs and Communications in Russia at JTI (Japan Tobacco International) said earlier.
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