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Wagner Group founder Yevgeny Prigozhin speaks next to the bodies of what he says are Wagner fighters killed in Ukraine.
As Wagner backs down, the battle for Bakhmut continues
On Sunday, Yevgeny Prigozhin, owner of the Wagner Group mercenary force fighting for Russia in Ukraine, suddenly reversed his threat of withdrawing from the eastern city of Bakhmut after Moscow reportedly promised to send more bullets. In an expletive-laden video last week, Prigozhin had threatened to pull out entirely if the Russian military continued to starve them of ammo and other equipment.
Prigozhin, a hardcore nationalist who loves to pick public fights with top Russian generals and the defense minister, had given May 9 as the final deadline before "licking our wounds." But it's unclear whether the significance of the date — it's when Russia celebrates victory over Nazi Germany in World War II — alone compelled the Kremlin to patch things up with Prigozhin. (On Monday, Russian airstrikes pummelled Kyiv and other Ukrainian cities on the eve of Victory Day.)
Russia’s military might have been uneasy about Prigozhin handing over Wagner's positions to men loyal to Chechen warlord Ramzan Kadyrov, another Vladimir Putin ally with forces fighting in Ukraine. And more importantly, after all the bloodshed that's gone into the battle for Bakhmut, the last thing Putin wants is to make it easier for the Ukrainians to retake the city when it starts its much-touted spring counteroffensive.
A pair of glasses with blood on them in the aftermath of deadly shelling in Kostiantynivka, Ukraine.
What We’re Watching: Russia hits eastern Ukraine, Finland's election results, UBS-Credit Suisse probe, European leaders prepare for Xi meeting
Russia’s defense chief says more ammo is on the way
At least six Ukrainians were killed Sunday in the eastern city of Kostyantynivka as Russian forces continued their onslaught on the nearby city of Bakhmut in hopes of occupying the entire Donetsk region in the Donbas.
The attack on residential buildings in the industrial city comes as Russian forces in eastern Ukraine appear increasingly depleted and desperate – and unfolded just days after President Vladimir Putin announced a spring conscription, confirming that 147,000 more soldiers will be called up this month in anticipation of a fresh Ukrainian offensive.
Later on Sunday, a prominent Russian nationalist and military blogger was killed when a St. Petersburg cafe was hit in a targeted attack. Russian authorities have since arrested a woman, reportedly an anti-war activist, who – records show – spent time in jail for participating in an anti-war protest.
It’s clear that Russia’s defense establishment is jittery: In recent days, Defense Minister Sergei Shoigu addressed Russia’s depleting ammo reserves, telling high-ranking military officials that “necessary measures are being taken to increase” stockpiles.
This comes after the British military announced that Russia’s failure to make advancements in Bakhmut was largely due to artillery ammunition shortages that are causing Russian forces to ration their rounds, which hardly sounds like a winning military strategy. Still, it remains unclear exactly how Moscow is planning to rapidly increase its stash of short precision weapons.
Crucially, the Washington-based Institute for the Study of War reported in recent days that amid stagnation on the battlefield, a reshuffle amongst Russian senior commanders could soon be in the cards.
Finland’s election results
Finland’s left-wing millennial PM Sanna Marin has narrowly lost a nail-biter election. In what has long been deemed a three-way race, Petteri Orpo's National Coalition Party has scraped ahead – only just – with 20.8%, compared to 20.1% for the nativist Finns Party and 19.9% for Marin’s Social Democrats.
Marin conceded defeat, while Orpo, a former finance minister, said that Finland’s commitment to Ukraine would remain unchanged. Finland’s imminent joining of NATO featured only indirectly during the campaign, largely because it isn’t a very controversial topic in Finland, where around 80% of people support bloc membership. For more on what was at stake in this election, see our explainer here.
Crucially, like many countries dealing with economic stagnation due to COVID and the war in Europe, bread-and-butter issues dominated the campaign trail. Still, it wasn’t all bad news for the Social Democrats: While Orpo’s NCP won 48 seats in the 200-seat parliament, a gain of 10 seats, SDP also gained three seats, finishing with 43 – though Marin’s left-of-center coalition partners shed seats.
Orpo will take the first crack at forming a coalition government and will become the Nordic country’s next PM, but post-election bargaining will take time.
Swiss prosecutors investigate UBS-Credit Suisse merger
Weeks after UBS, Switzerland's largest bank, clinched a deal to buy embattled Credit Suisse for $3.5 billion, Swiss prosecutors say they are investigating the massive merger.
Led by the attorney general, the probe will focus on alleged criminal acts by government officials, regulators, and bank execs at both institutions that hastily crafted the agreement to try and calm the markets. You'll likely remember that Credit Suisse’s value plummeted after the bank, Switzerland's second largest, disclosed major internal problems amid broader turmoil in the global banking sector.
Indeed, politicians from across Switzerland’s political spectrum have raised concerns that the government erroneously used emergency powers to extend financial guarantees to UBS at taxpayers’ expense.
What’s more, international critics say the merger – whereby UBS’s balance sheet could now come out to a whopping $5.5 trillion – could drive UBS' risk tolerance through the roof because it’ll be way too big for the Swiss government to let it collapse.
The deal is also very unpopular in Switzerland. Most Swiss – 75% of those polled – say they are against the merger, fearing it will create a banking behemoth with its own set of rules.
Separately, starting on April 11, the Swiss parliament will hold a special session focused on the merger that could lead to a formal commission of inquiry. But for now, the merger is going full steam ahead, with reports that UBS could slash 36,000 jobs in the near term.
European heavyweights head to Beijing
Two European leaders are headed to Beijing this week for talks with President Xi Jinping, and the meet-and-greet could not come at a more awkward time in EU-China relations.
European Commission President Ursula von der Leyen and French President Emmanuel Macron will meet with Xi on Wednesday in a bid to convey that European ties with China are contingent on Beijing backing away from his mate Vladimir Putin.
In a sign of the EU’s current thinking on China, von der Leyen last week gave a scolding 40-minute speech where she accused Beijing of “becoming more repressive at home and more assertive abroad.” And in a move that likely infuriated both Moscow and Beijing, she claimed that China is using Putin’s apparent international isolation to gain leverage with Russia. Unsurprisingly, China hit back, saying the EU chief’s speech had “no coherence” and was in part aimed at appeasing the United States.
Macron, facing a dumpster fire of a political situation at home, has said that the aim of the trip is to present a united European front against China’s “no-limits” friendship with the Kremlin.
Still, both sides will likely tread carefully in order to preserve their respective economic interests, with daily two-way trade in goods coming in at a whopping €1.9 billion ($2 billion).__________________
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Reporter for U.S. newspaper The Wall Street Journal Evan Gershkovich, detained on suspicion of espionage, leaves a court building in Moscow, Russia March 30, 2023.
What We’re Watching: Moscow’s muscle flex, Bolsonaro’s return, Lasso losing his grip
Russia nabs US journalist
A Wall Street Journal reporter apprehended by Russia’s notorious Federal Security Bureau in the city of Yekaterinburg Thursday has appeared in court in the Russian capital on espionage charges, which the Journal has dismissed as bogus.
Evan Gershkovich, who works out of the Moscow bureau for the New-York based outlet and earlier this week penned a bombshell feature on how sanctions are hurting the Russian economy, was on a reporting trip when he was seen being escorted into an FSB van in scenes reminiscent of the Soviet era. Indeed, he’s the first US journalist to have been arrested by Russian authorities since Ronald Reagan was in the White House. The Committee to Protect Journalists has demanded his immediate and unconditional release.
The Kremlin claims that the 31-year-old reporter was “collecting state secrets” on behalf of the US government. But many analysts say this is likely an attempt by President Vladimir Putin to flex his muscles and gain some leverage amid reports that Russia is stalling in Ukraine, with one US general claiming that ongoing fighting in Bakhmut is a “slaughter-fest” for Moscow.
Putin may be looking to secure some sort of trade deal with the US, like he did last fall when Washington agreed to swap WNBA star Brittney Griner, held in a Russian prison, for Viktor Bout, a Russian citizen and notorious arms dealer held in US custody since 2008. But Griner was held for the lesser offense of possessing a small amount of weed oil. Espionage is a whole other ballgame.
We’ll also be watching to see whether US media outlets now respond by pulling reporters out of Russia. After all, the US State Department has urged all US citizens to leave the country fearing a situation just like this.
Bolsonaro back in Brazil
Brazil’s far-right former President Jair Bolsonaro ended his self-imposed exile in Florida on Thursday, returning home to lead the opposition against his archenemy, leftist President Luiz Inácio “Lula” da Silva. After losing the election to Lula last autumn, he never conceded and skipped town instead of attending the inauguration. Lula was confirmed on New Year’s Day, and a week later Bolsonaro supporters stormed government buildings in the capital in Brazil’s own Jan. 6.
Lula must now decide whether to try to put Bolsonaro behind bars or ban him from politics — both of which could backfire because the former president remains hugely popular among his base. He should know: Lula was imprisoned for corruption in 2018, only to retake the presidency a few years later. Bolsonaro faces a litany of investigations, and while his advisors downplay the risk of him being jailed, the threat of legal action could mobilize his fans.
Bolsonaro’s return comes at a tricky time for Lula. While his approval ratings are higher than Bolsonaro’s, Lula campaigned on eradicating poverty but is struggling to pull the country out of an economic slump. He’s also been tussling with the central bank over high-interest rates, which he says is hurting the poor.
Will Lasso get lassoed?
Ecuador's constitutional court has given the go-ahead for parliament to pursue impeachment proceedings against President Guillermo Lasso over his brother-in-law’s alleged involvement in corruption and drug trafficking. This is only the first step in the process, but once it gets to the legislature, Lasso is in serious trouble: He's widely unpopular, and the opposition likely has enough votes to oust him.
If that happens, there are three possible scenarios. First, the conservative Lasso could step down and call a snap election, with the left-wing party of former President Rafael Correa a clear favorite. The embattled president could also let VP Alfredo Borrero take over, although he’d struggle to finish Lasso's term without making big political concessions and spending money Ecuador can't afford.
But the most likely — and dangerous — option is that Lasso challenges his removal by dissolving parliament before he’s impeached and rules by decree until a fresh election, as the Andean nation's constitution allows him to do. That outcome would trigger "chaos on the streets and maybe even a constitutional crisis," says Eurasia Group analyst Risa Grais-Targow.