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Donald Tusk, the chairman of the Civic Platform (PO) opposition party, surrounded by party members, speaks during a press conference in Krakow.
EU drops democracy dispute with Poland
After six years of acrimonious disputes with Warsaw over allegations that the Polish government was rolling back democracy and eroding the rule of law, Brussels is now dropping the issue.
The spat began under the previous Polish government, which was controlled by the right-wing nationalist Law and Justice Party. It introduced judicial reforms that the top EU court ruled had curbed judicial independence. The EU imposed fines, partly blocked access to European budget funds, and initiated sanctions that could have jeopardized Poland’s EU voting rights.
The standoff was complicated by the fact that even as Warsaw squabbled with Brussels over domestic issues, Poland took a lead in supporting Ukraine in its fight against Russia, a major EU foreign policy priority.
Burying the hatchet. The European Commission said Monday that in light of changes made by the centrist Polish government of Donald Tusk, which was elected last year after a season of deeply polarizing campaigns, it would drop the claims, confident that “today marks the opening of a new chapter for Poland.”
That leaves Hungary, governed by the proudly “illiberal” Viktor Orbán, as the only EU country still facing sanctions over rule-of-law violations.
A newspaper shows Chinese President Xi Jinping and Russian President Vladimir Putin Shaking Hands
Will the EU sanction Chinese companies for skirting Russian sanctions?
Going after companies for evading Russian sanctions would make it harder for EU-made, dual-use products, such as drones or semiconductors, to find their way to Russia through third countries that still do business with Moscow like Turkey. It would also be an about-face for Brussels, which five years ago cried foul when the Trump administration slapped similar sanctions against EU firms trading with Tehran after Washington walked away from the Iran nuclear deal.
The sanctions would also open a can of worms with Beijing at a moment of increasingly fraught EU-China relations. But the package needs signoff from all 27 EU members, and we all know how cozy Emmanuel Macron has become with Xi Jinping lately …
The Graphic Truth: How is Russian oil selling?
Russian oil has been selling at a massive discount since the war in Ukraine began last February, which has been a double-edged sword for the Kremlin. On the one hand, it brings in some much-needed revenue and makes Russian crude an attractive buy at a time of global inflation. On the other hand, selling at a discount means selling at a loss in revenue to a dwindling number of buyers. Adding to Russia’s woes, on Dec. 5, the EU instituted an embargo on Russian crude shipments at sea, leading to a massive drop-off in exports across the board, even to markets it depends on in Asia — chiefly China, India, and Turkey. The G7, Eu, and Australia also placed a $60 per barrel cap on Russian oil, so the discount is likely to remain in place as Russia tries to ship over long distances to Asia. We look at the discount for Russian crude today vs. when Russia invaded Ukraine, and how much each of Russia’s top three customers has been buying since the war began.
Russia may cut off Europe's gas; sanctions will hold
Ian Bremmer shares his insights on global politics this week on World In :60.
Will Russia cutting gas sanctions to Europe lead to the EU lifting sanctions?
I don't see it. I've got to tell you, I do think that Russia will cut all of the gas to Europe by winter. It's where their leverage is, but let's keep in mind these are EU sanctions unanimously supported by all EU member states. That means that individual countries that don't like them don't suddenly break from the EU. Would have to come to that agreement. They're not going to. We've gone through seven rounds now. It's quite something. I do think you could see individual European countries start trying to pressure the Ukrainians to get to the negotiating table. Maybe even accept some loss of territory, which the Ukrainians will be very loathe to do. We'll watch that carefully. But the sanctions, the sanctions are not going away. They're not going away at all.
Does Russia purchasing arms from North Korea show that sanctions are working?
Well, I mean first, this is declassified information from the United States from the CIA, but I wouldn't yet say that we have hard evidence that it is definitely coming from North Korea. So this is a claim that's being made by the US government right now. But look, it's clear that the Russians are using armaments in the field that are very old and that are not working very well and are not up to snuff with what NATO is providing the Ukrainians right now. It's also clear that the Russians have been trying to get a lot of military support from China, and they failed because the Chinese do not want to be tarred with the same brush and the same sanctions brush. Go back to the last question, as the Russians have. Who does that leave? Rogue states like Iran and North Korea. So yeah, I definitely think it shows that sanctions are working.
What changes will the new Prime Minister Liz Truss bring to the United Kingdom?
Well I mean, in the early days, they are facing the worst economic challenges of the entire G7. They have not been engaged in stockpiling energy for the winter. They don't get any energy really from Russia at this point, but they're facing the same supply chain challenges and price challenges that all the other countries are, and they are not set up for. So she's going to put through a 100 billion pound deal to effectively reduce the costs on consumers right now that they're going to have to pay back. They're also planning on reducing corporate tax. I mean, it's a solidly pro-business agenda. Within the realm of the Conservative Party, not surprising in the UK, but the economics from a fiscal perspective are going to be very challenging indeed, with more money going to the people and less money coming into the corporate government coffers. You're going to see less government, but at a time when people are demanding more, government's going to be interesting to watch how that goes. The good news is that she's not going to be interested in pushing too hard on Northern Ireland right now. They don't need a big problem with the EU on top of everything else they're dealing with that. That gets kicked down the road at least a bit.
Russia's weapon: blocking Ukraine grain exports
Carl Bildt, former prime minister of Sweden shares his view from Bratislava, Slovakia.
What's going to be the effect of the EU sanctions on Russian oil exports?
Well, that's going to be somewhat dependent on what happens primarily with oil price. If the oil price were to go up, then in spite of exporting less quantities, Russia will probably earn more money. If the oil price goes down or stays stable, they will be able to gain less, especially since they will have to export at significant discount prices to the people that are ready to buy their oil. So remains to be seen, but a significant step.
Is there any prospect for really releasing all of the grain for the world markets from Ukraine, that Russia is blocking?
It doesn't look very good. Russia is saying "well, well, well, we can lift the blockage of the Black Sea, but that's only if you lift all of the sanctions on us", so they're playing hardball. But effectively, they are now using the restrictions on grain and other products coming out of Ukraine as a weapon against the rest of the world. And that is of course affecting a lot of people. Different studies say that we have perhaps up to 400 million people, in the poorer part of the world, that's going to be very hardly hit by these particular aspects of the brutal Russian aggression.
- Russia's war in Ukraine is starving the world ›
- Will Putin eat the world's bread? - GZERO Media ›
- War of the Sunflower Superpowers - GZERO Media ›
- The Graphic Truth: Cereal killer — wheat prices amid Ukraine crisis ... ›
- Europe's oil sanctions and a shifting Russian war narrative to come ... ›
- Putin improves his hand in Ukraine - GZERO Media ›
A guide to the EU’s lukewarm Russian oil embargo
After months of diplomatic wrangling, it seemed this week like the European Union had finally made a big breakthrough in its effort to punish President Vladimir Putin for attacking Ukraine. Oil prices soared, and gas hit new highs after Brussels announced that it had reached an agreement to phase out Russian oil imports by the end of the year.
But the agreement also includes a slate of carve-outs and caveats that could dilute the bloc’s effort to decapitate the Kremlin’s war machine.
What’s in the deal?
The agreement includes a ban on all seaborne Russian oil imports by the end of the year. That covers about two-thirds of the bloc’s total crude imports from Russia – the remaining third comes via pipeline. And since Germany and Poland have pledged to voluntarily ditch oil brought in by pipeline as well, some 90% of Russian imports to Europe would be shut off by the end of the year.
Moreover, it also appears that the EU is set to ban insurance providers from covering tankers carrying Russian oil anywhere in the world. Given that British and other European companies dominate the marine insurance industry, this move will significantly undercut Russia’s ability to offset its losses by selling more oil to Asia.
What’s not in the package?
Part of the reason it’s been so hard to reach a deal is because of opposition from three landlocked EU member states: Hungary, Slovakia, and the Czech Republic. (Slovakia, for instance, gets almost 100% of its oil from Russia.) Hungary's PM Viktor Orbán, who is buddies with Putin, drove the hardest bargain and was most vocal in his refusal to sign onto a Russian oil embargo. He argued that such a move would be economically catastrophic for his country, which depends on Russian pipelines for 65% of its oil. Because the sanctions package requires unanimous approval from EU member states, the holdout would have killed the entire project.
To save face and avoid an embarrassing admission that it couldn’t strike a deal, Brussels capitulated to Budapest’s demands this week, saying that it will continue to allow imports via pipelines and will work out the precise end date for that exemption later.
Despite the obvious disconnect, both Brussels and Budapest are claiming victory. The EU has touted the deal as a triumph for European unity and the maximum pressure campaign against Moscow. Orbán, on the other hand, wrote on Facebook that “an agreement was reached. Hungary is exempt from the oil embargo!” This carve-out only accounts for 10% of Russian exports to the EU. Still, it means that Moscow will be able to continue shipping at least some exports to Europe.
Deferring thorny decision-making never works out well for the sprawling EU. “Agreeing on ending the exclusion of Russian oil delivered via pipelines will not be easy,” says Emre Peker, a Europe Director at Eurasia Group.
“It could take a few months, and even when a deal is done the extended phase-outs as proposed are likely to survive,” he says. So, can the EU still inflict significant pain on Russia if pipelines remain online? Peker says that will only be possible if “Brussels can forge consensus on curtailing Russia’s ability to export crude elsewhere” around the world.
Will Russia feel the pain?
The ban will undoubtedly hurt Russia. Losing two of its biggest crude importers – Germany and the Netherlands – is a big loss. Still, Asia continues to guzzle Russian oil, with China, the largest single purchaser, accounting for almost a third of all Russian crude exports, and South Korea accounting for roughly 7%. What’s more, Europe had already paid Russia 21 billion euros ($22.3 billion) for oil in the first few months since Putin invaded Ukraine. That’s a lot of money for Moscow’s ongoing war machine.
And even when things get rough, Russia can still sell oil for a discount. Notably, two mammoth economies – China and India – have opted not to join the West’s sanctions campaign against Russia. India, for its part, received more than 24 million barrels of Russian oil last month, up from about 3 million in March. China is also trying to make the most of a crude bargain.
What’s at stake for the West?
Indeed, while the insurer ban will make it much harder for Russia to sell its oil, it will also likely keep prices higher, revealing the extent to which Western states are willing to inflict pain on their own constituencies – even as inflation reaches record highs throughout the Eurozone – to punish Russia.
In adopting a hardline anti-Russia stance, EU member states also risk backlash at home where not everyone is on board with the plan: 62% of Slovaks, for instance, oppose ditching Russian oil. As energy prices continue to rise – and a deepening cost of living crisis sweeps the continent – European governments could be risking the revival of a fiery populist wave.
This comes to you from the Signal newsletter team of GZERO Media. Subscribe for your free daily Signal today.
Migrants walk towards the Bruzgi-Kuznica Bialostocka border crossing in an attempt to cross the Belarusian-Polish border in the Grodno Region, Belarus November 15, 2021.
What We’re Watching: EU vs everyone, Austria vs the unvaccinated, India vs smog, Barbados vs real world
The EU targets "everyone!" The EU on Monday unanimously agreed to impose fresh sanctions on "everyone involved" in bringing migrants to the Belarus-Poland border, where a diplomatic and humanitarian crisis continues as thousands of asylum-seekers shiver in makeshift camps. Brussels says Belarusian dictator Alexander Lukashenko has deliberately created this crisis to strike back against existing EU sanctions that were imposed in response to his sham re-election last year and his hijacking of a RyanAir flight this summer. Reports show that Belarus loosened visa restrictions for migrants — largely from Iraq — to serve as a transit point for migrants hoping to cross the EU border to apply for asylum. Details of the new sanctions aren't yet decided, but they are likely to target political officials, travel agencies, and airlines. Lukashenko has vowed to fight back, but he won't cut off the Russian gas flows that traverse his country on the way to Europe — Vladimir Putin quickly slapped down that possibility after Lukashenko raised it over the weekend. The question remains: will EU sanctions change Belarus' behavior?
Austria's lockdown of the unvaccinated. Beginning Monday, unvaccinated Austrians will be required to stay in their homes for all but essential outings or face a fine of 500 euros ($572). The move comes as Austria suffers one of the highest rates of new COVID infections in Europe. The country currently has a vaccination rate of 65 percent, which lags behind most of Western Europe but exceeds levels in Eastern Europe, which is experiencing an even harsher wave of the virus. The Austrian measures will last for 10 days and be enforced by police spot checks. The unvaccinated were already prohibited from entering restaurants, but the government says the additional restrictions are necessary to boost vaccination rates and head off a crunch at ICUs. Critics — including the right-wing Freedom Party — say the policy is discriminatory and violates Austria's constitution.
A different sort of lockdown in India. India's Supreme Court called on Monday for an immediate lockdown of Delhi, the country's capital. But this time, the threat to public health comes not from COVID but from the toxic smog that regularly pollutes the city's air. The Delhi government has pronounced itself "ready to take steps like complete lockdown," while calling on the governments of neighboring regions to do the same. There will be no in-person classes in schools this week, government officials will work from home, and private businesses are urged to do the same. The city's many construction sites will also remain shut down for three days. Delhi suffers from the exhaust produced by millions of vehicles, crop-stubble burning by farmers, coal-fired plants on the outskirts of town, and the open burning of garbage. By some measures, India is home to 13 of the world's 14 most polluted cities, and in 2019 air pollution was blamed for more than a million deaths.
Metaverse diplomacy. What happens if you run into trouble when visiting a foreign country? You call your embassy or consulate, of course. But what if you're in the Metaverse, a catch-all phrase for the virtual and augmented reality world Mark Zuckerberg wants you to spend a lot of time in? Well, you're in luck if you're a citizen of Barbados, the first country to open an actual embassy in this virtual world. The tiny Caribbean island nation plans to build and purchase digital "land," offer e-visas to visit virtual Barbados, and develop virtual transport to move avatars to and fro. What this all means in the real world is unclear, but crypto bros are very excited about it, and we don't want to burst their bubble.
Belarus president exploiting migrants to pressure EU on sanctions
Carl Bildt, former Prime Minister and Foreign Minister of Sweden, shares his perspective from Europe:
What's the nature of the migration crisis between Belarus and Poland?
Well, it's not a migration crisis, really. It's a question of the weaponization of the misery of people. Lukashenko wants to, sort of, exert pressure on Poland and on the European Union because of the sanctions that are imposed upon him for his undemocratic behavior. And that is importing miserable people from the Middle East, flying them into Minsk, probably at great expense to them, and then effectively forcing them over the border to Poland. That has to be stopped, and a number of measures are underway to do that. It's really an unacceptable way of exploiting people.
What's going to be the effect of Vice President Kamala Harris' visit to Paris?
Well, everyone goes to Paris. There's been a lot of effort to smooth over tensions between Paris and Washington, after the Australia submarine, messy handling of that particular deal. I think it will succeed. I think relationship between Paris and Washington are better than they look at the moment.