Xi

On the Road to United Eurasia

gc2smFrom the keyboard of Pepe Escobar
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putin xi2

Originally published in Russia Insider on July 5, 2016

 


Whenever President Vladimir Putin stresses Russia’s "all-embracing and strategic partnership" with China, one can hear the proverbial howls of anger emanating from the neocon/neoliberalcon axis in the Beltway.

As he met Chinese president Xi Jinping in Beijng this past Saturday, Putin even allowed himself an understatement; "To say we have a strategic cooperation is not enough anymore. This is why we have started talking about a comprehensive partnership and strategic collaboration. Comprehensive means that we work virtually on all major avenues; strategic means that we attach enormous inter-government importance to this work."

Why understatement? Because this really ventures way beyond a stream of business deals.

Deals, of course, matter; in Beijing, China and Russia advanced 58 projects worth $50 billion. These include a $6.2 billion loan from Beijing to build the 770 km-long high-speed railway between Moscow and Kazan and $12 billion in loans to build an LNG plant in the Russian Arctic.

Russian Railways, Russian investment company Sinara Group, China Railway, and Chinese CRRC will also invest in a plant in Russia to build 100 high-speed trains, designed for the Moscow-Kazan high-speed railway. The railway inevitably will be connected to the future, $100 billion, high-speed expansion of the Trans-Siberian between Moscow and Beijing.

It goes without saying, this is all part of an essential node of the New Silk Roads. And as if this was not enough, in a further, graphic instance of geoeconomic interpolation, Russia and China’s central banks are setting up a yuan clearing mechanism in Russia.

The inter-connectivity bonanza

Putin and Xi met for the 15th time just after Xi concluded a three-nation Eurasia tour – Serbia, Poland and Uzbekistan – where, alongside Foreign Minister Wang Yi, he explicitly laid down the bridge between the New Silk Roads, or One Belt, One Road (OBOR), as they are officially referred to in China, and the development of the Shanghai Cooperation Organization (SCO).

Not by accident China has now also struck a "comprehensive strategic partnership" with Serbia, Poland and Uzbekistan – on the way to weaving a broad "China-Europe strategic partnership" in parallel to the development of the SCO.

This already translates into projects such as the Hungary-Serbia railway; the Pupin Bridge on the Danube River in Belgrade; the expansion and upgrading of a power plant in Kostolac; what Beijing calls the China-Europe freight train service (from eastern China to Duisburg in Germany and also Madrid); the Kamchiq Tunnel in Uzbekistan; and last but not least the massive China-Central Asia natural gas pipeline system.

No wonder Xi keeps stressing the "inter-connectivity" theme over and over gain, as economic corridors are being built at breakneck speed, and the China Railway Express all the way to Europe – although not yet on high-speed rail – is already a go.

So there was plenty to talk about at the 16th SCO Council in Tashkent. Plus, the acceleration of full membership to both India and Pakistan; next year will be Iran’s turn.

What this translates to in practice is the amalgamation of the New Silk Roads/OBOR; the Eurasia Economic Union, EEU (as Putin stressed in the St. Petersburg forum); the SCO; financing mechanisms such as the Asia Infrastructure Investment Bank (AIIB); and the overarching Russia-China strategic partnership.

No wonder a certain Sultan Erdogan was watching all this in Ankara with trepidation, and decided to make a move. Erdogan’s attempt at a rapprochement with Russia involves not being hopelessly sidelined in this OBOR/EEU/SCO amalgamation. Turkey cannot afford to be alienated from Russia; the Turkish Stream gas pipeline will be essential to consolidate Ankara’s position as a key energy crossroads towards Europe. At the same time, Ankara must imperatively position itself as a key hub in OBOR.

With India and Pakistan, and later Iran, as full members, the SCO will be able, in the medium term, not only to interface with OBOR on all sides (via the China-Pakistan Economic Corridor, CPEC, and also the Indian investment in the Iranian port of Chabahar); but also to be the key player in brokering a solution to the Afghan drama, something that the Americans and NATO would never be able to accomplish. Russia and China have always insisted that Afghanistan needs an Asian solution.

Lean, clean and green

Almost simultaneously to the Putin-Xi meeting in Beijing, and also not by accident, the AIIB turbo-charged its operations.

The AIIB started doing business only six months ago, with 57 founding member countries and $100 billion in committed capital.

It’s scheduled to invest $1.2 billion in 2016. Once again with trademark understatement, Chinese Finance Minister Lou Jiwei said, "the AIIB needs to establish its comparative advantage", profiting from «lessons of developing countries' years of development».

The board approved its first four deals, worth $509 million, with three projects co-financed with the World Bank, the Asian Development Bank (ADB), the United Kingdom Department for International Development and the European Bank for Reconstruction and Development. They refer to a slum renovation in Indonesia and highways in Pakistan and Tajikistan. A power grid upgrade in Bangladesh will be solely AIIB financed.

And this is just the beginning. The head of AIIB may be Chinese, Jin Linqun (he has promised a "lean, clean and green" AIIB), but one of the five vice presidents is British, Daniel Alexander. Beijing holds 30% of the initial capital but has only 26% of voting power. India holds 7.5% and Russia 5.9%, followed by Germany and South Korea. This is a real multipolar project.

Almost simultaneously to the AIIB in action, Russia and China’s foreign ministers signed a declaration supporting the role of international law, stressing sovereign equality of states; non-interference into internal affairs; and peaceful resolution of disputes. Considering the recent historical record, not exactly The Empire of Chaos’s cup of tea.

Commenting on Brexit, Boris Titov, the Kremlin’s small business ombudsman, ventured, "it’s not long until a united Eurasia – about 10 years". Considering the slowly but surely interpenetration of OBOR, EEU, SCO, AIIB, the NDB and the solid Russia-China partnership inside the G20, that’s more than feasible.

In Beijing, Putin and Xi did discuss their common position in the upcoming G20, only three months away in China; that’s where the real action is, not the G7. Compare it also with NATO’s upcoming warmongering summit in Warsaw; that’s what the West has to "offer" the global South.

In a nutshell; the option to a united Eurasia is chaos. And there’s no question the Empire of Chaos will stop trying to sow chaos. Expect Beijing ordering 1,000 heavy transport aircraft from Russia and Russian ships possibly spotted sooner or later in the South China Sea to add to those perennial howls of anger in the neocon/neoliberalcon galaxy.


PepePepe Escobar  is an independent geopolitical analyst. He writes for RT, Sputnik and TomDispatch, and is a frequent contributor to websites and radio and TV shows ranging from the US to East Asia. He is the former roving correspondent for Asia Times Online. Born in Brazil, he's been a foreign correspondent since 1985, and has lived in London, Paris, Milan, Los Angeles, Washington, Bangkok and Hong Kong. Even before 9/11 he specialized in covering the arc from the Middle East to Central and East Asia, with an emphasis on Big Power geopolitics and energy wars. He is the author of "Globalistan" (2007), "Red Zone Blues" (2007), "Obama does Globalistan" (2009) "Empire of Chaos" (2014),and "2030" (2015), all published by Nimble Books. 

Hot off Brexit, Vladimir Putin goes to China

gc2smFrom the keyboard of Pepe Escobar
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Putin Xi

Originally published in RT on June 24, 2016

 


As the whole planet attempts to digest the implications of Brexit, the real heart of 21st century action once again shifts to Beijing, where President Vladimir Putin on Saturday pays a visit to Chinese President Xi Jinping.

Business will include clinching a $6.2 billion high-speed rail deal; increased supply of Russian wheat to China – by building a Trans-Baikal grain terminal; and steps towards deeper military cooperation. They are already cooperating on an engine that will power the new Russia-China airliner.

Everything connected to the Russia-China partnership spells out Eurasia integration. It starts with the New Silk Roads, a.k.a. One Belt, One Road (OBOR), which will progressively interplay with the Eurasia Economic Union (EEU), as Putin emphasized at the St. Petersburg forum. It involves the expansion of the Shanghai Cooperation Organization (SCO); the immediate future of BRICS, including the New Development Bank (NDB); projects to be financed by the Asian Infrastructure Investment Bank (AIIB); and Russia-China coordination inside the G20.

OBOR and the EEU naturally merge as Eurasia will be slowly but surely fashioned into a massive emporium – an interlocking trade and infrastructure network stretching from Russia’s Far East and the Chinese east coast to Western Europe, including the Middle East and Africa on the way.

Geopolitically, the expansion of OBOR-EEU is Eurasia’s response to the lame duck Obama administration-peddled Trans-Pacific Partnership (TPP), which excludes both Russia and China. Xi Jinping has visited Central Asia and Eastern Europe recently – from Serbia to Uzbekistan – selling OBOR. Moscow, considering its influence over Balkan states, will add extra support.

One just needs to look at some numbers to gauge the power of the multi-pronged Chinese offensive. Beijing is rolling out up to $100 billion to the NDB; between $50 billion and $100 billion to the AIIB; $40 billion to the Silk Road Fund; $40 billion to the China-Pakistan Economic Corridor (CPEC). These multilateral financial investments will roll out in stages – and can be easily paid out of the yearly surplus in cash of Beijing's myriad current operations.

Additionally, Beijing has as much as a $4 trillion pile of cash to be used at the discretion of Xi and the collective leadership. This is the reality – not the usual US ‘Think Tankland’ blabbering about China’s imminent implosion. Compare it with the Fed printing so many new US dollars, about $60 billion a month, as the US would have a really hard time committing to any possible financial investment (apart from war) in the $100 billion range.

Supply chain geopolitics, anyone?

Beijing and Moscow inevitably would have come to the conclusion that their strategic partnership creates leverage and thus increases its value as it translates into multi-vector supply chain geopolitics.

‘Pipelineistan’ – with those humongous 2014 Siberian deals – is an essential node of the whole package, as Russia will ensure the supply of natural gas to China bypassing the dreaded Strait of Malacca, which Beijing well knows the US Navy could easily block at will. The interpenetration also translates, for instance, into Gazprom offering CNPC a stake in the monster Vankor gas field.

Moscow for its part does not need to rely exclusively on the West for foreign investment – on top of it controlled/sanctioned by Washington. Chinese investment will be key, as under OBOR-EEU synergy, Russia should be well on its way of developing its full potential as a global supplier of energy and agriculture and a privileged transit corridor across the whole of Eurasia.

Russia may even profit from climate change. Few may know that Russia – with permafrost fast retreating – is warming up faster than any other nation. That opens the vista of new fertile soils that could allow poultry and fish to be exported to – where else – China. Not to mention torrential amounts of freshwater. Chinese companies are buying large stakes in Russian fertilizer companies such as Uralkali as well as becoming partners of Singapore-based companies to go all out into food processing in Russia.

Contrary to what US ‘Think Tankland’ never ceases to parrot, the Russia-China strategic partnership goes way beyond a mere supply-demand alliance of convenience. Were the Kremlin to take the fateful decision, Chinese companies could certainly rebuild creaking parts of Russian infrastructure in only a few years.


PepePepe Escobar  is an independent geopolitical analyst. He writes for RT, Sputnik and TomDispatch, and is a frequent contributor to websites and radio and TV shows ranging from the US to East Asia. He is the former roving correspondent for Asia Times Online. Born in Brazil, he's been a foreign correspondent since 1985, and has lived in London, Paris, Milan, Los Angeles, Washington, Bangkok and Hong Kong. Even before 9/11 he specialized in covering the arc from the Middle East to Central and East Asia, with an emphasis on Big Power geopolitics and energy wars. He is the author of "Globalistan" (2007), "Red Zone Blues" (2007), "Obama does Globalistan" (2009) "Empire of Chaos" (2014),and "2030" (2015), all published by Nimble Books. 

Iran- the New China?

iran_china_afp.jpg_1718483346 gc2smOff the keyboard of Pepe Escobar
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iran_china_afp.jpg_1718483346 Iranian President Hassan Rouhani and Chinese President Xi Jinping | Photo: AFP

Originally published in TeleSur on January 29, 2016


If Iran successfully engages in a Chinese-style economic development program it would further enhance its geopolitical status and significance.

It’s currently quite a toss-up when it comes to naming the hardest working man in geopolitical business: Chinese President Xi Jinping or Iranian President Hassan Rouhani.

Their paths cross last week in Tehran in spectacular fashion as Xi and Rouhani clinched a crucial strategic partnership. The two nations agreed to increase bilateral trade to $600 billion over the next decade. Geostrategically, as I pointed out, that was a master class.

Beijing regards Iran, not only in Southwest Asia but across Eurasia, as the essential hub for countering Washington’s much-advertised “pivot to Asia,” centered on U.S. naval hegemony. No wonder Xi made it clear that Iran is to be accepted as a full member of the Shanghai Cooperation Organization (SCO) as early as this year.

A strategic partnership implies Beijing’s full support for the Iranian economic/political/diplomatic renaissance across the arc spanning the Persian Gulf to the Caspian – and beyond. The arc also happens to span all the crucial New Silk Road maritime and land routes that are vitally important for the global projection of the Xi-coined Chinese dream.

And then, only a few days later, Rouhani was in Rome in a warm closed door meeting with Pope Francis after clinching $17 billion in multiple deals.

This frantic post-sanction activity only enhances, in perspective, the absurdity of the Washington-manufactured Iranian nuclear crisis. Geopolitical realism, from Europe to Asia, cannot ignore a nation placed in the intersection of the Arab, Turk, Indian and Russian worlds, underscored by its role as privileged entry and exit point to the vast Caucasus-Central-Asia ensemble, which also includes Afghanistan.

Geostrategically, as the ultimate Eurasian crossroads, Iran is unbeatable, linking the Middle East, Caucasus, Central Asia, Indian subcontinent and Persian Gulf; between three seas – Caspian, Persian Gulf and Sea of Oman; relatively close to the Mediterranean and Europe; and on the doorstep of Asia.

Xi did not have to talk explicit politics in Tehran as he was suffice to clinch deal after deal to impress his point. The long-term trend, inevitably, is for China’s One Belt, One Road vision to bridge the gap toward a Sino-Russian leadership across Eurasia, which translates practically into the progressive sidelining of the British-American imperial continuum. Meanwhile, Italy and France, during Rouhani’s European tour, kept themselves busy playing catch-up.  

When Khamenei Becomes Deng

The frantic post-sanction Iranian scene at least punctures the previous, relentless Western demonization and lays out the bases for   economic development in just about every sphere. The Islamic Republic of Iran has faced a tremendous handicap for the past 36 years – something that would have broken any less-resourceful society.  

Sanctions over the past 10 years cost Iran at least 480 billion euros; that’s roughly one full year of Iranian GDP. In a world not ruled by the usual suspects of financial oligarchy, Tehran would have grounds to take Washington to court with a vengeance.  

As for the “Iranian aggression” meme – which, by the way, still persists – that’s a lousy imperial joke. Iran spends 3,9 percent of GDP on defense; compare it with 10.3 percent for the House of Saud oil hacienda. In total, Iran spends seven times less on defense compared to the Gulf petro-monarchies, which cannot subsist without their mostly U.S., British and French weaponizing.  

The road ahead for Iran will be bumpy. Serious problems include corruption, bureaucratic incompetence, and economic sectors reserved to special interests or barred from foreign investment. Sections of the power elite – like the bonyads (religious foundations) and the pasdaran (the IRGC) are not exactly prone to relinquish their grip on vital sectors of the national economy. The economic opening of Iran will inevitably accelerate the social transformation of the country.  

What happens next will largely depend on the crucial, upcoming February elections – which will yield a new Majlis (Parliament), and a new Assembly of Experts in charge of choosing the next Supreme Leader.

Iran is a unique geopolitical case – where a republic derives its legitimacy, simultaneously, from Islam and universal suffrage. This may not be your classic Western parliamentary democracy, but at the same time it’s not some sort of crude authoritarianism of Saudi Arabia. A quite complex system of checks and balances is in place, involving the presidency, the Parliament, the Council of Guardians, the Assembly of Experts and different bodies such as the Discernment Council and the National Security Council.

Supreme Leader Ayatollah Khamenei has made it very clear he will pay close attention to cultural, political and security consequences of an economic opening that could enfeeble the revolutionary ideology of the Islamic Republic. What’s certain is that the Supreme Leader – as an arbiter – will preserve the careful balance of political forces in Iran.  

This means, in practice, that Team Rouhani won’t be allowed to draw unlimited political capital from the economic opening, while at the same time the social and cultural transformation of the country won’t be synonymous to a Western cultural invasion.

The Vienna nuclear deal clinched last summer was no less than a seismic geopolitical event in Iran. Internally, it sealed a consensus between the Tehran state machine and the majority of the population, which wanted Iran to become a “normal” nation again.

Now comes the hard part. The most probable scenario spells out an Islamic Republic of Iran engaged in a Chinese-style economic development program. Sort of a Persian “get rich is glorious” remix, under strict political control.

This begs the question: are we ready for the new Supreme Leader role as the Iranian Deng Xiaoping?


Pepe Escobar is an independent geopolitical analyst. He writes for RT, Sputnik and TomDispatch, and is a frequent contributor to websites and radio and TV shows ranging from the US to East Asia. He is the former roving correspondent for Asia Times Online, where he wrote the column The Roving Eye from 2000 to 2014. Born in Brazil, he's been a foreign correspondent since 1985, and has lived in London, Paris, Milan, Los Angeles, Washington, Bangkok and Hong Kong. Even before 9/11 he specialized in covering the arc from the Middle East to Central and East Asia, with an emphasis on Big Power geopolitics and energy wars. He is the author of "Globalistan" (2007), "Red Zone Blues" (2007), "Obama does Globalistan" (2009) and "Empire of Chaos" (2014), all published by Nimble Books. His latest book is "2030", also by Nimble Books, out in December 2015. He currently lives between Paris and Bangkok. Follow him on Facebook: https://www.facebook.com/pepe.escobar.77377

Putin and Xi rock da house

Xi Jinping, Vladimir Putingc2smOff the keyboard of Pepe Escobar
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Xi Jinping, Vladimir Putin

Originally published in Asia Times on September 25, 2015

 


Pope Francis may be the rock star. But once again, the real heart of the action is all about Russia and China — those prime “threats” to Exceptionalistan, according to the Pentagon.

Where’s Benjamin’s Angel of History when we need him? His gaze is now certainly focused on the home of the brave. Francis may have brought the House down in DC, but it’s Xi Jinping who really rocked da house in the West Coast, while Putin gets ready to be crowned the new King of New York. Who’d imagine that the New Great Game in Eurasia could be so fun?

Calling Frank Underwood

Even before Putin talked new world order geopolitical business at the UN, China’s Xi Jinping was talking Silicon Valley business with, well, the whole Silicon Valley elite. It’s all in the photo, delightfully deconstructed by the South China Morning Post.

This is where the action is — much more than in what Xi may have discussed with Obama; cyberspace piracy, spying, new Japanese laws on defense, the environment. China needs top IT to turbo-charge not only the internal market but also key nodes of the New Silk Roads.

Even Facebook was allowed to bow to the Red Emperor. Mark Zuckerberg, in suit and red tie, talked to Xi for less than a minute, in Mandarin, at Microsoft’s campus. Side by side was none other than a smiling Lu Wei – who controls China’s Great Firewall, which blocks, among others, Facebook. As a priceless aside, here’s Internet-alert Lu Wei calling all and sundry to “sail into the future with mutual benefit and win-win.”

Xi and Putin

 

 

Xi and Putin

Barely blinking while he bought 300 Boeings for lunch, Xi’s real howler in the West Coast was his House of Cards gambit.

Referring to Beijing’s massive crackdown on graft, he said, “We have punished tigers and flies … It has nothing to do with power struggles. In this case there is no House of Cards.”

Non-biased China hands all interpret the anti-corruption campaign as essentially a clean up of the Chinese Communist Party (CCP) so it may continue to rule ad infinitum. It’s the party, stupid. So obviously there’s a “hard rain’s gonna fall” component, because resistance from powerful interest groups is immense.

The irruption of House of Cards was predictable. Much more than a nod to Netflix, this was about China. According to GlobalWebIndex, no less than over 200 million Chinese have been using VPNs to get to Netflix and watch the season 3 of House of Cards on streaming video.

Frank33Millions among these are Beijing residents, comfortably middle class; and that includes a lot of Party heavyweights – such as the head of the anti-corruption committee, Wang Qishan, a huge fan of Frank Underwood. Check out this priceless  Global Times piece showing how House of Cardsheavily draws from Sun Tzu’s The Art of War.

On top of it, season 2 of House of Cards was already China-intense, featuring cyber-war, the South China Sea and currency manipulation. Sharp Chinese viewers inevitably compared factional fighting in Washington with Beijing’s anti-graft campaign, which, so far, has nailed 80,000 functionaries, at least 90 high-caliber politicians and 30 PLA generals. China Daily didn’t measure its words — stating that House of cards represents a “mirror” of these Chinese functionaries.

Xi knew exactly who his audience was when he invoked US soft power — tremendously popular in China — to send a message. And he also knew that even when the American system is critically eviscerated — as in House of Cards — the fascination quotient of US soft power remains unbeatable. If you can’t beat them, join them. Why not instrumentalize House of Cards as Beijing deploys its own version of The Art of War?

Start spreading the news…

And now, live from New York, it’s Putin The Great.

Last week on Asia Times we saw how if there’s going to be some solution to the Syrian tragedy, it’s all Putin’s fault. (Not) reacting to it, the Obama administration remained mired in its proverbial bewilderment – or perplexity.

Finally, the White House was forced to announce that the coin finally dropped on Obama, and he will talk to Putin on the sidelines of the UN General Assembly.

Right on cue, a senior adviser to Bashar al-Assad started spinning that the US and Russia had reached a “tacit agreement” on ending the mess in Syria.

Quick recap. Putin started it all by refusing “Assad must go” as a prerequisite for peace negotiations. Then he turbo-charged the military build up in Latakia; proverbially, once again, neither the Pentagon nor the White House ever saw it coming.

So this is what Putin accomplished even before Obama saw the light and decided to talk:

1) Forget about a Libya-remixed NATO war on Syria. 2) Forget about a Sultan Erdogan-driven no-fly zone over areas controlled by Damascus. 3) Out with the old world order. This is how the emerging new world order should work, and Russia is also driving it.

Putin’s speech on Monday at the UN General Assembly will be about “the joint struggle against terrorism” (as branded by TASS). One should expect abundant apoplexy, much more than perplexity, all across the Washington/New York axis.

Foreign Minister Sergey Lavrov, last Sunday on Russian TV, already clarified the themes at the heart of the speech; the unipolar world order, and the absolute necessity of the “joint struggle against terrorism,” which” must be waged without double standards.”

Lavrov was very sharp when referring to” unilateral coercive measures” — and not only as far as Russia is concerned. In his own words:

“Nowadays, you know, our Western partners, primarily, under the influence, perhaps, of American mentality, are losing in general the culture of a dialogue and the culture of achieving diplomatic solutions. The Iranian nuclear program was a bright – and even very bright – exception. In most other cases – in conflicts that continue to flare up in the Middle East, in North Africa – they try to resort to measures of military intervention, as was the case in Iraq and Libya, in violation of UN Security Council decisions, or to resort to sanctions.”

Expect Putin to talk about all of it in detail. But the showstopper will be, predictably, Putin on Syria. In Lavrov’s words:

“We have declared that we will be helping the Syrian leaders, as we help the Iraqi leaders, or the leaders of other countries who are facing the threat of terrorism. And our military-technical cooperation pursues exactly these objectives. Of course, the supplies of arms [by Russia], they have been going on, they are going on [now] and they will continue. Their [supplies] are inevitably accompanied by our specialists that help put the according equipment up, help to train Syrian [military] personnel to handle these weapons and there are absolutely no mysteries and no secrets [in all of this].”

cardsAnd yes, Putin will call the usual suspects — from Turkey to the GCC petrodollar gang — to help Assad “without indoctrinations or double standards” in the fight against ISIS/ISIL/Daesh. And he will demonstrate how the refugee crisis was not created by Assad, but by the fake “Caliphate.” As far as these refugees from the Sykes-Picot-smashed Middle East are concerned, it’s up to the EU to deal with them. In Lavrov’s words:

“Russia has been fulfilling all her obligations under the international conventions. All those who fall under the category of refugees, we take in, and we will take into the Russian Federation, sometimes even going beyond the criteria that is applied. I refer to the refugees from Ukraine, there are about one million [in Russia]. We sympathize with our European neighbors with regard to the problem that they have been facing, and I believe that they will solve it [on their own].”

Last but not least, Putin will make it very clear Russia never again will be fooled into signing dodgy documents such as UNSC Resolution 1973, which legitimized R2P in 2011 via that legendary “no-fly” zone over Libya, with the corollary of NATO bombing the country into a wasteland run by militias. No wonder deranged R2P groupie Samantha Power wants to kick Russia out of the Security Council. Who needs a shoe-banging Khrushchev? Black (Apoplexy) Monday will definitely be a riot.


Pepe Escobar is the author of Globalistan: How the Globalized World is Dissolving into Liquid War (Nimble Books, 2007), Red Zone Blues: a snapshot of Baghdad during the surge (Nimble Books, 2007), and Obama does Globalistan (Nimble Books, 2009).

How China and Russia Are Running Rings Around Washington

Off the keyboard of Pepe Escobar
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Published in Russia Insider on July 24, 2015

A massive overview of all the recent exciting developments on the Eurasian landmass
An alternative to the US-led world order is definitely taking shape and at a lighting pace – giving Washington the creeps


Let’s start with the geopolitical Big Bang you know nothing about, the one that occurred just two weeks ago. Here are its results: from now on, any possible future attack on Iran threatened by the Pentagon (in conjunction with NATO) would essentially be an assault on the planning of an interlocking set of organizations – the BRICS nations (Brazil, Russia, India, China, and South Africa), the SCO (Shanghai Cooperation Organization), the EEU (Eurasian Economic Union), the AIIB (the new Chinese-founded Asian Infrastructure Investment Bank), and the NDB (the BRICS’ New Development Bank) – whose acronyms you’re unlikely to recognize either.  Still, they represent an emerging new order in Eurasia.

Tehran, Beijing, Moscow, Islamabad, and New Delhi have been actively establishing interlocking security guarantees.They have been simultaneously calling the Atlanticist bluff when it comes to the endless drumbeat of attention given to the flimsy meme of Iran’s “nuclear weapons program.”  And a few days before the Vienna nuclear negotiations finally culminated in an agreement, all of this came together at a twin BRICS/SCO summit in Ufa, Russia – a place you’ve undoubtedly never heard of and a meeting that got next to no attention in the U.S.  

And yet sooner or later, these developments will ensure that the War Party in Washington and assorted neocons (as well as neoliberalcons) already breathing hard over the Iran deal will sweat bullets as their narratives about how the world works crumble.

The Eurasian Silk Road

With the Vienna deal, whose interminable build-up I had the dubious pleasure of following closely, Iranian Foreign Minister Javad Zarif and his diplomatic team have pulled the near-impossible out of an extremely crumpled magician’s hat: an agreement that might actually end sanctions against their country from an asymmetric, largely manufactured conflict.

Think of that meeting in Ufa, the capital of Russia’s Bashkortostan, as a preamble to the long-delayed agreement in Vienna. It caught the new dynamics of the Eurasian continent and signaled the future geopolitical Big Bangness of it all. At Ufa, from July 8th to 10th, the 7th BRICS summit and the 15th Shanghai Cooperation Organization summit overlapped just as a possible Vienna deal was devouring one deadline after another.

Consider it a diplomatic masterstroke of Vladmir Putin’s Russia to have merged those two summits with an informal meeting of the Eurasian Economic Union (EEU). Call it a soft power declaration of war against Washington’s imperial logic, one that would highlight the breadth and depth of an evolving Sino-Russian strategic partnership.

Putting all those heads of state attending each of the meetings under one roof, Moscow offered a vision of an emerging, coordinated geopolitical structure anchored in Eurasian integration. Thus, the importance of Iran: no matter what happens post-Vienna, Iran will be a vital hub/node/crossroads in Eurasia for this new structure.

If you read the declaration that came out of the BRICS summit, one detail should strike you: the austerity-ridden European Union (EU) is barely mentioned. And that’s not an oversight. From the point of view of the leaders of key BRICS nations, they are offering a new approach to Eurasia, the very opposite of the language of sanctions.

Here are just a few examples of the dizzying activity that took place at Ufa, all of it ignored by the American mainstream media. In their meetings, President Putin, China’s President Xi Jinping, and Indian Prime Minister Narendra Modi worked in a practical way to advance what is essentially a Chinese vision of a future Eurasia knit together by a series of interlocking “new Silk Roads.”

Modi approved more Chinese investment in his country, while Xi and Modi together pledged to work to solve the joint border issues that have dogged their countries and, in at least one case, led to war.

The NDB, the BRICS’ response to the World Bank, was officially launched with $50 billion in start-up capital. Focused on funding major infrastructure projects in the BRICS nations, it is capable of accumulating as much as $400 billion in capital, according to its president, Kundapur Vaman Kamath.

Later, it plans to focus on funding such ventures in other developing nations across the Global South – all in their own currencies, which means bypassing the U.S. dollar.  Given its membership, the NDB’s money will clearly be closely linked to the new Silk Roads. 

As Brazilian Development Bank President Luciano Coutinho stressed, in the near future it may also assist European non-EU member states like Serbia and Macedonia. Think of this as the NDB’s attempt to break a Brussels monopoly on Greater Europe. Kamath even advanced the possibility of someday aiding in the reconstruction of Syria.

You won’t be surprised to learn that both the new Asian Infrastructure Investment Bank and the NDB are headquartered in China and will work to complement each other’s efforts.

At the same time, Russia’s foreign investment arm, the Direct Investment Fund (RDIF), signed a memorandum of understanding with funds from other BRICS countries and so launched an informal investment consortium in which China’s Silk Road Fund and India’s Infrastructure Development Finance Company will be key partners.

Full Spectrum Transportation Dominance

On the ground level, this should be thought of as part of the New Great Game in Eurasia. Its flip side is the Trans-Pacific Partnership in the Pacific and the Atlantic version of the same, the Transatlantic Trade and Investment Partnership, both of which Washington is trying to advance to maintain U.S. global economic dominance.

The question these conflicting plans raise is how to integrate trade and commerce across that vast region. From the Chinese and Russian perspectives, Eurasia is to be integrated via a complex network of superhighways, high-speed rail lines, ports, airports, pipelines, and fiber optic cables.

By land, sea, and air, the resulting New Silk Roads are meant to create an economic version of the Pentagon’s doctrine of “Full Spectrum Dominance” – a vision that already has Chinese corporate executives crisscrossing Eurasia sealing infrastructure deals.

For Beijing – back to a 7% growth rate in the second quarter of 2015 despite a recent near-panic on the country’s stock markets – it makes perfect economic sense: as labor costs rise, production will be relocated from the country’s Eastern seaboard to its cheaper Western reaches, while the natural outlets for the production of just about everything will be those parallel and interlocking “belts” of the new Silk Roads.

Meanwhile, Russia is pushing to modernize and diversify its energy-exploitation-dependent economy. Among other things, its leaders hope that the mix of those developing Silk Roads and the tying together of the Eurasian Economic Union – Russia, Armenia, Belarus, Kazakhstan, and Kyrgyzstan – will translate into myriad transportation and construction projects for which the country’s industrial and engineering know-how will prove crucial.

As the EEU has begun establishing free trade zones with India, Iran, Vietnam, Egypt, and Latin America’s Mercosur bloc (Argentina, Brazil, Paraguay, Uruguay, and Venezuela), the initial stages of this integration process already reach beyond Eurasia.

Meanwhile, the SCO, which began as little more than a security forum, is expanding and moving into the field of economic cooperation. Its countries, especially four Central Asian “stans” (Kazakhstan, Kyrgyzstan, Uzbekistan, and Tajikistan) will rely ever more on the Chinese-driven Asia Infrastructure Investment Bank (AIIB) and the NDB.

At Ufa, India and Pakistan finalized an upgrading process in which they have moved from observers to members of the SCO. This makes it an alternative G8.

In the meantime, when it comes to embattled Afghanistan, the BRICS nations and the SCO have now called upon “the armed opposition to disarm, accept the Constitution of Afghanistan, and cut ties with Al-Qaeda, ISIS, and other terrorist organizations.”

 Translation: within the framework of Afghan national unity, the organization would accept the Taliban as part of a future government. Their hopes, with the integration of the region in mind, would be for a future stable Afghanistan able to absorb more Chinese, Russian, Indian, and Iranian investment, and the construction – finally! – of a long-planned, $10 billion, 1,420-kilometer-long Turkmenistan-Afghanistan-Pakistan-India (TAPI) gas pipeline that would benefit those energy-hungry new SCO members, Pakistan and India. (They would each receive 42% of the gas, the remaining 16% going to Afghanistan.)

Central Asia is, at the moment, geographic ground zero for the convergence of the economic urges of China, Russia, and India. It was no happenstance that, on his way to Ufa, Prime Minister Modi stopped off in Central Asia.

Like the Chinese leadership in Beijing, Moscow looks forward (as a recent document puts it) to the “interpenetration and integration of the EEU and the Silk Road Economic Belt” into a “Greater Eurasia” and a “steady, developing, safe common neighborhood” for both Russia and China.

And don’t forget Iran. In early 2016, once economic sanctions are fully lifted, it is expected to join the SCO, turning it into a G9. As its foreign minister, Javad Zarif, made clear recently to Russia’s Channel 1 television, Tehran considers the two countries strategic partners. “Russia,” he said, “has been the most important participant in Iran’s nuclear program and it will continue under the current agreement to be Iran’s major nuclear partner.” The same will, he added, be true when it comes to “oil and gas cooperation,” given the shared interest of those two energy-rich nations in “maintaining stability in global market prices.”

Got Corridor, Will Travel

Across Eurasia, BRICS nations are moving on integration projects. A developing Bangladesh-China-India-Myanmar economic corridor is a typical example. It is now being reconfigured as a multilane highway between India and China. Meanwhile, Iran and Russia are developing a transportation corridor from the Persian Gulf and the Gulf of Oman to the Caspian Sea and the Volga River. Azerbaijan will be connected to the Caspian part of this corridor, while India is planning to use Iran’s southern ports to improve its access to Russia and Central Asia. Now, add in a maritime corridor that will stretch from the Indian city of Mumbai to the Iranian port of Bandar Abbas and then on to the southern Russian city of Astrakhan. And this just scratches the surface of the planning underway.

Years ago, Vladimir Putin suggested that there could be a “Greater Europe” stretching from Lisbon, Portugal, on the Atlantic to the Russian city of Vladivostok on the Pacific. The EU, under Washington’s thumb, ignored him. Then the Chinese started dreaming about and planning new Silk Roads that would, in reverse Marco Polo fashion, extend from Shanghai to Venice (and then on to Berlin).

Thanks to a set of cross-pollinating political institutions, investment funds, development banks, financial systems, and infrastructure projects that, to date, remain largely under Washington’s radar, a free-trade Eurasian heartland is being born. It will someday link China and Russia to Europe, Southwest Asia, and even Africa. It promises to be an astounding development. Keep your eyes, if you can, on the accumulating facts on the ground, even if they are rarely covered in the American media. They represent the New Great – emphasis on that word – Game in Eurasia.

Location, Location, Location

Tehran is now deeply invested in strengthening its connections to this new Eurasia and the man to watch on this score is Ali Akbar Velayati. He is the head of Iran’s Center for Strategic Research and senior foreign policy adviser to Supreme Leader Ayatollah Khamenei. Velayati stresses that security in Asia, the Middle East, North Africa, Central Asia, and the Caucasus hinges on the further enhancement of a Beijing-Moscow-Tehran triple entente.

As he knows, geo-strategically Iran is all about location, location, location. That country offers the best access to open seas in the region apart from Russia and is the only obvious east-west/north-south crossroads for trade from the Central Asian “stans.”

Little wonder then that Iran will soon be an SCO member, even as its “partnership” with Russia is certain to evolve. Its energy resources are already crucial to and considered a matter of national security for China and, in the thinking of that country’s leadership, Iran also fulfills a key role as a hub in those Silk Roads they are planning.

That growing web of literal roads, rail lines, and energy pipelines represents Beijing’s response to the Obama administration’s announced “pivot to Asia” and the U.S. Navy’s urge to meddle in the South China Sea. Beijing is choosing to project power via a vast set of infrastructure projects, especially high-speed rail lines that will reach from its eastern seaboard deep into Eurasia. In this fashion, the Chinese-built railway from Urumqi in Xinjiang Province to Almaty in Kazakhstan will undoubtedly someday be extended to Iran and traverse that country on its way to the Persian Gulf.

A New World for Pentagon Planners

At the St. Petersburg International Economic Forum last month, Vladimir Putin told PBS’s Charlie Rose that Moscow and Beijing had always wanted a genuine partnership with the United States, but were spurned by Washington. Hats off, then, to the “leadership” of the Obama administration. Somehow, it has managed to bring together two former geopolitical rivals, while solidifying their pan-Eurasian grand strategy.

Even the recent deal with Iran in Vienna is unlikely – especially given the war hawks in Congress – to truly end Washington’s 36-year-long Great Wall of Mistrust with Iran. Instead, the odds are that Iran, freed from sanctions, will indeed be absorbed into the Sino-Russian project to integrate Eurasia, which leads us to the spectacle of Washington’s warriors, unable to act effectively, yet screaming like banshees.

NATO’s supreme commander Dr. Strangelove, sorry, American General Philip Breedlove, insists that the West must create a rapid-reaction force – online – to counteract Russia’s “false narratives.”

Secretary of Defense Ashton Carter claims to be seriously considering unilaterally redeploying nuclear-capable missiles in Europe.

The nominee to head the Joint Chiefs of Staff, Marine Commandant Joseph Dunford, recently directly labeled Russia America’s true “existential threat”; Air Force General Paul Selva, nominated to be the new vice chairman of the Joint Chiefs, seconded that assessment, using the same phrase and putting Russia, China and Iran, in that order, as more threatening than the Islamic State (ISIS). In the meantime, Republican presidential candidates and a bevy of congressional war hawks simply shout and fume when it comes to both the Iranian deal and the Russians.

In response to the Ukrainian situation and the “threat” of a resurgent Russia (behind which stands a resurgent China), a Washington-centric militarization of Europe is proceeding apace. NATO is now reportedly obsessed with what’s being called “strategy rethink” – as in drawing up detailed futuristic war scenarios on European soil. As economist Michael Hudson has pointed out, even financial politics are becoming militarized and linked to NATO’s new Cold War 2.0.

In its latest National Military Strategy, the Pentagon suggests that the risk of an American war with another nation (as opposed to terror outfits), while low, is “growing” and identifies four nations as “threats”: North Korea, a case apart, and predictably the three nations that form the new Eurasian core: Russia, China, and Iran.

They are depicted in the document as “revisionist states,” openly defying what the Pentagon identifies as “international security and stability”; that is, the distinctly un-level playing field created by globalized, exclusionary, turbo-charged casino capitalism and Washington’s brand of militarism.

The Pentagon, of course, does not do diplomacy. Seemingly unaware of the Vienna negotiations, it continued to accuse Iran of pursuing nuclear weapons. And that “military option” against Iran is never off the table.

So consider it the Mother of All Blockbusters to watch how the Pentagon and the war hawks in Congress will react to the post-Vienna and – though it was barely noticed in Washington – the post-Ufa environment, especially under a new White House tenant in 2017.

It will be a spectacle. Count on it. Will the next version of Washington try to make it up to “lost” Russia or send in the troops? Will it contain China or the “caliphate” of ISIS? Will it work with Iran to fight ISIS or spurn it? Will it truly pivot to Asia for good and ditch the Middle East or vice-versa? Or might it try to contain Russia, China, and Iran simultaneously or find some way to play them against each other?

In the end, whatever Washington may do, it will certainly reflect a fear of the increasing strategic depth Russia and China are developing economically, a reality now becoming visible across Eurasia. At Ufa, Putin told Xi on the record: “Combining efforts, no doubt we [Russia and China] will overcome all the problems before us.”

Read “efforts” as new Silk Roads, that Eurasian Economic Union, the growing BRICS block, the expanding Shanghai Cooperation Organization, those China-based banks, and all the rest of what adds up to the beginning of a new integration of significant parts of the Eurasian land mass. As for Washington, fly like an eagle? Try instead: scream like a banshee.


Pepe Escobar is the author of Globalistan: How the Globalized World is Dissolving into Liquid War (Nimble Books, 2007), Red Zone Blues: a snapshot of Baghdad during the surge (Nimble Books, 2007), and Obama does Globalistan (Nimble Books, 2009).

China’s silky road to glory

Off the keyboard of Pepe Escobar
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THE ROVING EYE

Map-New_Silk_Road

Originally published in Asia Times on November 14, 2014
Discuss this article here in the Diner Forum.

If there were any remaining doubts about the unlimited stupidity Western corporate media is capable of dishing out, the highlight of the Asia-Pacific Economic Cooperation (APEC) summit in Beijing has been defined as Russian President Vladimir Putin supposedly “hitting” on Chinese President Xi Jinping’s wife – and the subsequent Chinese censoring of the moment when Putin draped a shawl over her shoulders in the cold air where the leaders were assembled. What next? Putin and Xi denounced as a gay couple?

Let’s dump the clowns and get down to the serious business. Right at the start, President Xi urged APEC to “add firewood to the fire of the Asia-Pacific and world economy”. Two days later, China got what it wanted on all fronts.

1) Beijing had all 21 APEC member-nations endorsing the Free Trade Area of the Asia-Pacific (FTAAP) – the Chinese vision of an “all inclusive, all-win” trade deal capable of advancing Asia-Pacific cooperation – see South China Morning Post (paywall). The loser was the US-driven, corporate-redacted, fiercely opposed (especially by Japan and Malaysia) 12-nation Trans-Pacific Partnership (TPP). [See also here.)

2) Beijing advanced its blueprint for “all-round connectivity” (in Xi’s words) across Asia-Pacific – which implies a multi-pronged strategy. One of its key features is the implementation of the Beijing-based US$50 billion Asian Infrastructure Investment Bank. That’s China’s response to Washington refusing to give it a more representative voice at the International Monetary Fund than the current, paltry 3.8% of votes (a smaller percentage than the 4.5% held by stagnated France).

3) Beijing and Moscow committed to a second gas mega-deal – this one through the Altai pipeline in Western Siberia – after the initial “Power of Siberia” mega-deal clinched last May.

4) Beijing announced the funneling of no less than US$40 billion to start building the Silk Road Economic Belt and the 21st Century Maritime Silk Road.

Predictably, once again, this vertiginous flurry of deals and investment had to converge towards the most spectacular, ambitious, wide-ranging plurinational infrastructure offensive ever attempted: the multiple New Silk Roads – that complex network of high-speed rail, pipelines, ports, fiber optic cables and state of the art telecom that China is already building across the Central Asian stans, linked to Russia, Iran, Turkey and the Indian Ocean, and branching out to Europe all the way to Venice, Rotterdam, Duisburg and Berlin.
T768776_01Now imagine the paralyzed terror of the Washington/Wall Street elites as they stare at Beijing interlinking Xi’s “Asia-Pacific Dream”way beyond East Asia towards all-out, pan-Eurasia trade – with the center being, what else, the Middle Kingdom; a near future Eurasia as a massive Chinese Silk Belt with, in selected latitudes, a sort of development condominium with Russia.

Vlad doesn’t do stupid stuff
As for “Don Juan” Putin, everything one needs to know about Asia-Pacific as a Russian strategic/economic priority was distilled in his intervention at the APEC CEO summit.

This was in fact an economic update of his by now notorious speech at the Valdai Club meeting in Sochi in October, followed by a wide-ranging Q&A, which was also duly ignored by Western corporate media (or spun as yet more “aggression”).

The Kremlin has conclusively established that Washington/Wall Street elites have absolutely no intention of allowing a minimum of multipolarity in international relations. What’s left is chaos.

There’s no question that Moscow pivoting away from the West and towards East Asia is a process directly influenced by President Barack Obama’s self-described “Don’t Do Stupid Stuff” foreign policy doctrine, a formula he came up with aboard Air Force One when coming back last April from a trip to – where else – Asia.

But the Russia-China symbiosis/strategic partnership is developing in multiple levels.

On energy, Russia is turning east because that’s where top demand is. On finance, Moscow ended the pegging of the rouble to the US dollar and euro; not surprisingly the US dollar instantly – if only briefly – dropped against the rouble. Russian bank VTB announced it may leave the London Stock Exchange for Shanghai’s – which is about to become directly linked to Hong Kong. And Hong Kong, for its part, is already attracting Russian energy giants.

Now mix all these key developments with the massive yuan-rouble energy double deal, and the picture is clear; Russia is actively protecting itself from speculative/politically motivated Western attacks against its currency.

The Russia-China symbiosis/strategic partnership visibly expands on energy, finance and, also inevitably, on the military technology front. That includes, crucially, Moscow selling Beijing the S-400 air defense system and, in the future, the S-500 – against which the Americans are sitting ducks; and this while Beijing develops surface-to-ship missiles that can take out everything the US Navy can muster.

Anyway, at APEC, Xi and Obama at least agreed to establish a mutual reporting mechanism on major military operations. That might – and the operative word is “might” – prevent an East Asia replica of relentless NATO-style whining of the “Russia has invaded Ukraine!” kind.

Freak out, neo-cons
When Little Dubya Bush came to power in early 2001, the neo-cons were faced with a stark fact: it was just a matter of time before the US would irreversibly lose its global geopolitical and economic hegemony. So there were only two choices; either manage the decline, or bet the whole farm to consolidate global hegemony using – what else – war.

We all know about the wishful thinking enveloping the “low-cost” war on Iraq – from Paul Wolfowitz’s “We are the new OPEC” to the fantasy of Washington being able to decisively intimidate all potential challengers, the EU, Russia and China.

And we all know how it went spectacularly wrong. Even as that trillionaire adventure, as Minqi Li analyzed in The Rise of China and the Demise of the Capitalist World Economy, “has squandered US imperialism’s remaining space for strategic maneuver”, the humanitarian imperialists of the Obama administration still have not given up, refusing to admit the US has lost any ability to provide any meaningful solution to the current, as Immanuel Wallerstein would define it, world-system.

There are sporadic signs of intelligent geopolitical life in US academia, such as this at the Wilson Center website (although Russia and China are not a “challenge” to a supposed world “order”: their partnership is actually geared to create some order among the chaos.)

And yet this opinion piece at USNews is the kind of stuff passing for academic “analysis” in US media.

On top of it, Washington/Wall Street elites – through their myopic Think Tankland – still cling to mythical platitudes such as the “historical” US role as arbiter of modern Asia and key balancer of power.

So no wonder public opinion in the US – and Western Europe – cannot even imagine the earth-shattering impact the New Silk Roads will have in the geopolitics of the young 21st century.

Washington/Wall Street elites – talk about Cold War hubris – always took for granted that Beijing and Moscow would be totally apart. Now puzzlement prevails. Note how the Obama administration’s “pivoting to Asia” has been completely erased from the narrative – after Beijing identified it for what it is: a warlike provocation. The new meme is “rebalance”.

German businesses, for their part, are absolutely going bonkers with Xi’s New Silk Roads uniting Beijing to Berlin – crucially via Moscow. German politicians sooner rather than later will have to get the message.

All this will be discussed behind closed doors this weekend at key meetings on the sidelines of the Group of 20 in Australia. The Russia-China-Germany alliance-in-the-making will be there. The BRICS, crisis or no crisis, will be there. All the players in the G-20 actively working for a multipolar world will be there.

APEC once again has shown that the more geopolitics change, the more it won’t stay the same; as the exceptional dogs of war, inequality and divide and rule keep barking, the China-Russia pan-Eurasian caravan will keep going, going, going – further on down the (multipolar) road.

 

Pepe Escobar is the author of Globalistan: How the Globalized World is Dissolving into Liquid War (Nimble Books, 2007), Red Zone Blues: a snapshot of Baghdad during the surge (Nimble Books, 2007), and Obama does Globalistan (Nimble Books, 2009).

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