Friday, February 29, 2008

Obama Hasn't Done His Foreign Affairs Homework

Two snapshots of opinion from Barack Obama and Serbian foreign minister Jeremic open up an interesting split of views and facts about Kosovo.

During the Cleveland debate with Hillary Clinton on 27th February, Obama was asked by Tim Russert the NBC journalist the following question about Medvedev, the prospective new Russian President -

RUSSERT: He's 42 years old, he's a former law professor. He is Mr. Putin's campaign manager. He is going to be the new president of Russia. And if he says to the Russian troops, you know what, why don't you go help Serbia retake Kosovo, what does President Obama do?

OBAMA: Well, I think that we work with the international community that has also recognized Kosovo, and state that that's unacceptable. But, fortunately, we have a strong international structure anchored in NATO to deal with this issue.

We don't have to work in isolation. And this is an area where I think that the Clinton administration deserves a lot of credit, is, you know, the way in which they put together a coalition that has functioned.

OBAMA: It has not been perfect, but it saved lives. And we created a situation in which not only Kosovo, but other parts of the former Yugoslavia at least have the potential to over time build democracies and enter into the broader European community.

But, you know, be very clear: We have recognized the country of Kosovo as an independent, sovereign nation, as has Great Britain and many other countries in the region. And I think that that carries with it, then, certain obligations to ensure that they are not invaded.

The key to Obama's reply was that the international community supports Kosovan independence. He uses the actual words -

....the international community... has recognised Kosovo.

Directly relevant to this, Jeremic, the Serbian foreign minister wrote the following in the International Herald Tribune on the same day -

On Feb. 17, the Serbian province of Kosovo, which has been under United Nations administration since 1999, unilaterally declared independence from my country.

This illegal act has, unfortunately, been recognized by the Bush administration and some European countries including Britain, France and Germany. Others in Europe - including Greece, Romania and Spain - have withheld recognition, as have most other leading global and regional players, including Brazil, China, Egypt, India, Israel, Russia and South Africa.

As things stand, the number of countries that will recognize an independent Kosovo will plateau at around 40, leaving it unrecognized by a vast majority of the close to 200 members of the United Nations.

Full article HERE

It looks as if Barack Obama is wrong about the US having the support of the international community, as Jeremic points out.

In fact, if that is to be the basis on which US foreign policy will be decided under Obama, then the US will soon be siding with Russia and Serbia, and not the EU.

Is it really worth falling out with Russia and offending the international community again, as the US has done over Iraq? Kosovo will soon be an area where Obama could make political headway against the Republicans as he is doing over Iraq. He should start by looking carefully at exactly where the rest of the world stands on Kosovo. He might be in for a surprise judging by his rhetoric.

See Serbia Wins World's Sympathy

UPDATE - Al Jazeera English Version quotes Russian Foreign Minister Lavrov who seems not to want to be in conflict with the US - in these terms -

Hillary Clinton, a leading contender to succeed Bush, stumbled for Medvedev's name in Tuesday's presidential debate before coming up with, "Medvedev - whatever".

Nevertheless, she said Medvedev was someone "who Putin can control, who has very little independence, the best we know".

Relations between the US and Russia have become strained recently over a number of issues including missile defence.

HEADING - Open and 'constructive'

Lavrov told Al Jazeera that Russia has always been open and "constructive" about its foreign policy intentions and that "many of these problems [with the US] seem to us artificial."

"There is not necessarily a misunderstanding [of Russia], but an inertia of the cold war logic which was to a large extent based on containing Russia," Lavrov said.

"None of Russia foreign policy is designed to combat US. Of course the US is the dominant player in world affairs, it's an objective fact.

"But at the same time recent history has shown, in Afghanistan, in the Middle East that no one power can resolve regional and international problems on its own, whatever powers it possesses."

Full Al Jazeera article - HERE

Is there a message here? Would Russia be hinting at an alliance to help the USA in the Middle East and Afghanistan? Such an alliance would greatly assist NATO which is getting overstretched, especially with French and German unwillingness to fight. Russia hardly wants a Taleban victory on her Southern border, encouraging any of her Moslem satellites into a confident hostile posture.

Of course the US would have to meet Russian foreign policy objectives, such as reaching a negotiated settlement over Kosovo.

Obama had better get up to speed if his policy of negotiating with difficult regimes is to start bearing fruit. With the passing of Bush, there could be some very interesting deals to be done.

McCain is unlikely to find a rapprochement with Russia. This from Reuters -


The Arizona senator, long critical of Putin, had harsh words for the Russian leader on February 15.

"I think that Mr. Putin is trying to restore the old Russian empire. Obviously he is perpetuating himself in power in Russia virtually indefinitely by this setup of having basically a protege, someone who is doing his bidding as president while he serves as the prime minister," McCain said.

"We knew the puppet show was going on, we just didn't know who the puppet was."

Obama, this is surely your opportunity to move relations with Russia onto a better footing. Reuters full article HERE

Thursday, February 28, 2008

February Lousy Month For EU

The BBC reports today on how the US has signed a bilateral visa-free travel deal with the Czech Republic, going over the heads of Brussels. The EU has not provided the US with the enhanced security it requires in identifying the risk profile of travellers, while the Czech Republic is willing to do so. The EU is threatening to override this arrangement, but it looks likely to take effect regardless.

Only the week before, the EU and the US tried to back Kosovan independence, but this seems to have been substantially blocked by Russian involvement. The EU has withdrawn its officials from Northern Kosovo shocked by the intensity of the Serb reaction. Talks are scheduled for the NATO meeting in April, where Russia intends to renegotiate what's being planned by the EU.

Being ignored and overridden by two superpowers in a fortnight is not all that good for the EU's prestige. On top of the scandal of the expenses of MEPs, and the problems coming to bear on the ratification of the Lisbon Treaty in the British Parliament with Lib Dem walk-out and Labour rebels still trying for a referendum, all in all the EU hasn't had a great month.

PICTURED. Czech Topolonek negotiating directly with George W. Bush over the heads of the EU.

The NHS Needs Reform

This commentary on the National Health Service by the Prime Minister in waiting was published today -

We are living under the illusion that healthcare in this country is free, but this is not the case. We collect huge amounts of taxes to fund this healthcare system and everyone is paying for their health from their own pockets.

We end up with a situation where we take money from people to pay for their healthcare but then tell them that they cannot choose their doctor, cannot choose their treatment and cannot choose what to be treated for. We assign them to a local doctor, medical centre or district hospital and tell them that, like it or not, they have to go there, have to wait their turn in the long queues, even if the service is rude and the treatment inadequate.

Our healthcare system has combined the worst elements of the State system and the biggest problems of a market-based healthcare system and it offers people no alternative. This is not the fault of our doctors; this is the system that the state has established.

It is absolutely clear that the state must make it possible for people to choose their own medical centre, their own doctor and insurance company. The money the state collects from citizens in the form of taxes and fees should go to doctors only through the patients, through the provision of quality service to these patients, and not through local healthcare administration officials or on the basis of funding estimates.

The legal possibility should exist for uniting all of these different sources of money coming from state and private funds into one channel. It should not matter which medical centre a person chooses — municipal, federal, private, in his home town or in some other place — what matters is that this is his money and therefore his right to choose. . . .

These words and more from Dmitri Medvedev, the Russian Prime Minister in waiting from today's International Herald Tribune, on the subject of Russia' national health service. His comments have a strangely familiar ring to them, don't you think.

Tuesday, February 26, 2008

Sub Prime Losses Grow Towards $1 Trillion

I blogged in my post How Big Are Sub Prime Losses? that the official estimate being repeated on news bulletins that the sub-prime mortgage crisis will be valued at around $400 billion dollars could be on the optimistic side. There were 2,000,000 foreclosures in 2007. Lehman Bros forecast that this would fall to about 1,000,000 for 2008 and 2009. It is therefore not a good sign that 2008 has begun with a 57% increase in foreclosure notices, and a 90% increase in actual foreclosures.

From the BBC website today - "Dollar Falls To Record Low" HERE

US foreclosures up 57% in January

The number of homes receiving a notice was up in 30 states
The number of homes facing foreclosure in the US rose 57% in January compared with the same month of 2007.
Exactly 233,001 homes received at least one notice about overdue payments last month, compared with 148,425 in January 2007, US property site RealtyTrac said.

There was a 90% increase in the number of houses being repossessed by banks compared with January 2007.

The forecasts made that sub-prime mortgage losses going to be limited to a manageable $400 billion are based on the Lehman Bros estimate of 4,000,000 houses being foreclosed total. If the price of houses continues to fall back from around 12 times average earnings to nearer the usual level of 6 times average earnings, there will be at least 15 million homes with negative equity. It would not be impossible for nearer 10 million homes to be foreclosed when all is said and done, triggering losses of $1 trillion.

If 2008 sees a 50% increase rather than a 50% decrease in foreclosures to 3,000,000 from 2,000,000 homes in 2007, the actual losses will be up to $500 billion by the end of 2008 alone.

The only way losses on this scale can be absorbed by the world's financial system, is if the Sovereign Wealth Funds from China, Japan and the Middle East continue to buy share issues from the bankers who hold these losses such as Citibank, Merrill Lynch, UBS and so on. (UBS has already declared $20 billion in write-offs, but has another $88 billion in exposures to sub-prime risky assets).

They have funds well in excess of the $1 trillion required. If they continue to shore up the world's banking system, as is essential if the world is to avoid a banking crisis to follow the mortgage crisis, the world will be a very different place by 2012 with Asian and Middle Eastern government owned funds controlling many of the largest financial organisations in the western world, which will owe their very survival to them.

There is every indication that such owners will be more hands-on than the previous pension fund owners of these banker's shares. Sovereign Wealth Funds will be less interested in running hazardous levels of risk-taking. The world's money will move from unfettered speculation on property and so on, in the west (at least) and more towards longer-term growth, lower risk, more sensible deployment. It will be good for share prices worldwide that people working, thinking and planning longterm will be better rewarded than the quick buck hedge fund speculators who made the running in the last decade.

Politicians too are talking of a return to a more strategic approach to the future. Blair and Clinton rode on the property and consumer booms claiming the credit. Obama says he wants to end the wastefulness and ensure that resources are more efficiently used. It would not be difficult to raise the standard of effectiveness, that is for sure., and the Sovereign Wealth Funds are likely to be one of the key agents that achieve this cultural shift.

The West will benefit from the mentality of Sovereign Funds as well as the actual money being crucial for their bankers' economic survival. Cameron in the EUK could start usefully talking about a more efficient deployment of resources than has been achieved by Labour since 1997. The basis of future competitiveness is today's planning, just as today's losses are the result of a lack of planning by those in control before, like Britain's Northern Rock debacle, for example.

We don't know if Obama's as good a manager as he claims he is (although he does seem to have more of a business brain than he's being given credit for judging by his taxation measures promoting employment and investment), but at least he's getting the message right. That's a good start. America cannot afford to keep losing too many $1 trillion.

UPDATE - From IHT 26th Feb 2008 - house prices falling at 20% per annum in the USA
A leading index of home prices in 20 U.S. cities fell 9.1 percent in December from a year earlier. Using a three-month moving average, the index, the Standard & Poor's/Case-Shiller, is falling at an annual pace of more than 20 percent. The index tracks repeat sales of single-family homes; it does not include condominiums. It fell 8.9 percent in the final quarter of 2007, the steepest drop in its 20-year history.

And Bank Of England Fears Largest Ever Peacetime Liquidity Crisis HERE (Daily Telegraph 27th February 2008)

Sovereign Wealth Funds Are Winning Respect

Sovereign Investment Funds are stalking the planet. They are Chinese, Japanese, Middle Eastern and they control trillions of dollars. In the last ten years, the Asian and other trade surpluses wound up as funds in the control of the governments of the exporting nations. This money was used to buy government bonds in countries from where the export surpluses were being generated - Europe, North America, especially the USA.. This kept the importing countries' currencies strong, and ensured their export orders kept growing.

The flood of cheap money that travelled across the globe from east to west kept two booms going. In the East it was the manufacturing of the goods. But in the west it was property. The easiest way for western democratic governments to translate the wall of money buying up their Treasuries at low rates of interest into political advantage, was not to increase government expenditure and spend all the money that way, but to pass on the bounty to consumers to fund property booms. These in turn have enabled consumers to keep buying the Asian goods that were seeking a market, which caused the funds to become available in the first place. It was the most perfect example of global 'you scratch my back. I'll scratch yours' ever conceived. But these decade long flows of goods and money are suddenly changing in character.

The difference now is that the exporting countries are using less of their trillions to fund western property and consumer booms. After ten years these are running out of steam. The 'consumer' currencies are no longer on the rise, and the financial returns of the 'carry trade' (where people borrowed at low interest in yen and leant the funds in e.g. NZ dollars or Sterling) are lessening or reversing. While the losses accumulated by the granting of 'non-performing' loans - the 'sub prime mortgage' crisis and the credit crunch fill the news, the system which drove the world's growth for the last ten years is gliding to a halt. The wind is no longer in its sails.

But the end of one party is merely the beginning of the next. The funds which were in effect leant to the US government and others by buying Treasuries, are still coming to the West but they are now coming in a different guise, and with a different strategic objective. This time, the funds are being used not to fund consumer booms, but to buy businesses.

The property booms of the last decade will be looked back on as an opportunity where many made their fortunes, or missed out on making one, and when western countries had a unique opportunity to develop their housing and infrastructure while money was cheap. The next phase will see the same wall of money coming in, but this time it is looking for a higher return that it was receiving from buying government bonds. In that search, it will be developing another part of the economy - the financing of business.

The Sovereign Funds are buying big businesses in the West, either strategic investments such as ports, shipping or mining, or taking slices out of hedge funds and big banks needing to fund their sub-prime losses. So few westerners are interested in holding equities, as these are viewed as risky and less attractive than the 'sure' returns to be had from property, that while property is valued at historically very high levels, businesses and shares are today valued at historically low levels.

The hedge funds especially have been caught out by the sub-prime crisis and have been distress-selling shares, trying to get back into cash. Financial sector profits are collapsing as a direct result, and the Sovereign Funds, seeing a once in a lifetime opportunity are moving in and cleaning up. The prospect is that after another ten years with business investment as the focus of Sovereign funds, property markets will become less inflated, and business investment will generally become more attractive.

While the initial Sovereign Fund forays will be into large strategic organisations, as the trend establishes, the market for shares of all kinds will be affected by the virtuous influence of large sums of money desiring to own businesses. Western economies will run better if people can raise money more quickly to fund business expansion, and the unhealthy total reliance of our economies on endless consumption and property price rises will be at an end. There will be more highly paid jobs, a wider spread of opportunities, and a feeling that it is worth investing and planning long term once more.

The earth will flatten. Business will become a stronger and more influential force in society. The role of government and easy returns from speculation will become less. It will be a more thinking, less bureaucratic and positive society. Ownership will matter more, as Asian and other foreign influences override the Marxist tendencies which have become so established in Western societies, reducing our effectiveness. There will be a return of respect for owners, as their willingness to invest will be crucial in turning the world away from a depression. It's about time.

Regulators are beginning to realise the opportunities that Soveireign Wealth Funds might offer. In the IHT today (International Herald Tribune) -

Officials in Europe and the United States have argued that, so far, the funds are proving mostly beneficial, especially since they have helped re-capitalize major banks, including Citigroup, Merrill Lynch and UBS, in the wake of losses linked to the U.S. mortgage market.

Still, European officials are hedging their bets.

José Manuel Barroso, president of the European Commission, said Monday that if the low-key approach of devising a voluntary code proved ineffective, the EU would draft laws that could block investments from the funds.

"We will not propose European legislation," Barroso said during a speech in Oslo, "though we reserve the right to do so if we cannot achieve transparency through voluntary means." Barroso said an agreement on the code should be wrapped up by the end of the year.

McCreevy, whose job is to enforce EU rules on the free movement of capital, said that Brussels took "a very liberal view" of the funds, especially since they had not shown any signs so far of interfering in the banks that they had invested in. "But I am political enough to recognize that there are those fears out there," he said.

Still, McCreevy said that if Europe acted first by devising new ways to restrict investment, it risked retribution in countries that have the funds, including places like Russia and China, where European companies are active.

"Inevitably there will be a tit for tat response," McCreevy said.

"We should be very, desperately cautious about how we proceed here," McCreevy said, emphasizing that the code of conduct needed to come first.

The European reaction to sovereign wealth funds has been mixed, but McCreevy lauded what he called a "more balanced debate" than last summer, when Germany set off alarm bells in Brussels by announcing plans to create a new system for reviewing sovereign fund investments.

Though the EU's founding treaty enshrines the general right to free movement of capital, member states can adopt measures controlling the movement of capital from third countries under limited circumstances.

McCreevy said that the German proposal, still being written in Berlin, was "nothing as restrictive as we thought it would be eight months ago." But he said he would reserve judgment until he saw the fine print.

At that time, German officials named specific sectors, including energy, banking and telecommunications, where they might review or block investments. But current drafts do not name specific areas, and have been carefully crafted to avoid objections from the EU.

Monday, February 25, 2008

EU Withdraws From Northern Kosovo

From Mark Mardell on the BBC Euro Clog, which is still desperately trying to put a positive spin on the EU's disastrous intervention in the Balkans-

Kosovo Lights Up The EU, he writes -

..the European Union is here, or at least will be, in force. The 2,000-strong police and justice mission will arrive to keep and eye on police, judges and government: its real mission to stamp down on corruption and make sure the Serbs are protected.
The EU's Special Representative, a Dutch diplomat, will be the ultimate authority here.

That poor bloke is Pieter Feith, pictured.

The truth is that Pieter Feith, far from ordering his 2000 strong force of administrators to hurry over to Kosovo to take the reins, has already been forced into withdrawing all EU personnel from Kosovo's northern areas. There have been a series of hand grenade attacks, which have only been reported on Al Jazeera, and it is only a matter of time before one of these attacks kills an EU employee.

The International Herald Tribune, still not quite getting the situation, expresses a certain amount of exasperation at Serbian resistance. Today's report titled 'Serbs' Kosovo protests to widen across Europe' ends with the sentence -

An EU Representative, Pieter Feith, said Saturday that he had recalled his staff from Kosovo's restive north. without any details given, or any indication that Feith is meant to be in control of the whole country. It seems the US is just as much in denial about the seriousness and the impossibility of the situation that has been created, as the Europeans.

The BBC is beginning to report the Kosovo crisis is more realistic terms on its main website after initially attempting to present the Independence of Kosovo as a done deal, ignoring Russia's threat of military action, which the BBC did not report at all. This was however reported on CNN.

The tone of the BBC's latest report on Kosovo is beginning to acknowledge that the tensions arising from the EU's hasty backing for Albanian Kosovan independence is not going to the cake walk it first appeared last week. The EU imagined initially that the prospect of EU membership would be enough of a carrot to neutralise Serbian resistance. It reads -

Correspondents say that, with Mr Medvedev the favourite to win next month's presidential election in Russia, the high-powered nature of Russia's delegation is a sign of the strength of the country's backing for Serbia.

He and Mr Lavrov are scheduled to hold talks with Serbian President Boris Tadic and Prime Minister Vojislav Kostunica.

"Do support for the Kosovo Albanian side alone, contempt for law for the sake of so-called 'political expediency', and indifference to the fate of 100,000 Serbs who... are effectively being driven into a ghetto, not amount to flagrant cynicism?" Russia's foreign ministry asked in a statement on Sunday.

The statement followed a comment by US Assistant Secretary of State Nicholas Burns, who accused Russia of aggravating tensions over the Kosovo issue.

Border posts row.

Also on Monday, Belgrade government ministers are due to visit Serbian communities in Kosovo to press their message that Belgrade still regards Kosovo as its own.

Serbs have turned against those who recognise the new Kosovo.
Serbian Minister for Kosovo Slobodan Samardzic will lead the delegation.

But reports suggest Mr Samardzic will be denied entry until he apologises for comments seemingly condoning violence.

Mr Samardzic described the burning down of two border posts on 19 February by crowds of Kosovan Serbs as "legitimate" acts.

With worldwide support for the EU being far less forthcoming than was hoped, with many key countries withholding recognition until the situation clarifies, and with Russia and Serbia showing strong and active resistance, Russia'a ambassador to the UN even mentioning willingness to enforce United Nations resolution 1244 by force, at one point, but since backing down, it is quite clear that the EU's anticipated arrival in Kosovo is going to become delayed, and bogged down.

In Picture, Kosovan Serbs Hold Up Placards Of Vladimir Putin in Mitrovica.

With tension building by the day, it seems likely that there is a humiliating climb-down on its way from the EU.

This from Russia's Interfax News Agency (picked up by me from Al Jazeera) -

An aide to Putin on Saturday described Western recognition of Kosovo as a loaded gun waiting to go off, the Interfax news agency reported.

"With Kosovo now the gun has been cocked and no one knows when and where the shot will ring out," said Anatoly Safonov in an interview with the Russian news agency.

UPDATE - At last, one member of the MSM has got the picture - Melanie Phillips in The Spectator - "Is this crazy or is this crazy?"

If the EU is forced to climb down over Kosovo by Russia in alliance with Serbia, it will suddenly make Turkey's accession to the EU seem a lot more desirable to the Brussels elite.

UPDATE - Monday 25th February. The BBC's Diplomatic Correspondent tries to put the stand-off with Russia into the context of worsening US-Russian relations, and asks what can Russia reasonably do? The BBC sees this as a choice of direction which Russia will have to take -

Russia is clearly weighing up its options. It must balance its desire to maintain reasonably cordial relations with its business partners in Europe with its new assertiveness abroad.

The diversity of its disputes with Washington suggests that Russia-US relations are not going to get better any time soon; certainly not before a new president is installed in the White House in January 2009.

Russia's objective interests seem to be diverging from those of the West even as its economic linkages in the energy sector become ever more important.

In which direction will Russia choose to go; towards compromise or confrontation? How it responds to the diplomatic test of Kosovo could begin to reveal part of the answer.

The International Herald Tribune, OTOH gives a plausible analysis of Putin's involvement in Kosovo as follows -

In Bucharest, Putin could choose softer language, but in the view of one NATO analyst, he will go on seeking to split the organization on whether it should accept Ukraine and Georgia as applicants for membership.

Putin seems to think that the alliance, overwhelmed by its Russia/Kosovo and Afghanistan concerns, can be pushed into taking a pass.

FROM AL JAZEERA 26th February


Medvedev's visit was also marked by the signing of deal between Gazprom, the Russian state gas company, and its Serbian counterpart Srbijagas.

The two companies have formed a joint company for the construction of an underground gas reservoir and pipeline to pump Russian gas to western Europe.

In a January article titled "Gas in Exchange for Kosovo", Russian newspaper Kommersant said that Belgrade had effectively secured Russia's support on Kosovo by agreeing to the energy deals on easy terms.

Serbia argues that Kosovo's secession violates UN Security Council resolution 1244, which put the disputed province under UN administration while retaining Serbian sovereignty.


Parallel with EU's Cyprus intervention.

Sunday, February 24, 2008

Our Enemies Will Tell Us Who Our Friends Are

Helen on eureferendum2 does not think much of the reaction on the blogosphere to Kosovan independence, saying it is worse than that of the MSM. She may well be right, but at least bloggers commented that Russia at one point threatened military action to achieve a little respect for its position of defending UN Resolution 1244. Th BBC has yet to mention the fact on its website, and presumably that means on its news bulletins too.

I find it surprising in her analysis that she doesn't emphasise the penetration of Kosovo by Islamic extremists, and the future danger this holds for Europe and the US. Serbia has committed appalling war crimes, but Serbs have also been the victims too. It can be hard to apportion blame onto nations for how they behave in war. Surely more relevant to the future is to what extent a nation will support or not support the long-term critical threat to the West posed by Islamic extremism. Serbia is going to make a far better ally in that regard as will Russia and China, the two countries Helen also likes to allude to as morally inferior in her piece, than Kosovo.

After WW2 the Americans quickly allowed Germany to move away from her evil past, as German stability was needed to provide a bulwark against the Soviet threat. Serbia too could be a useful ally to the West, if the war on terror descends to another level, which unfortunately it almost must.

Helen is guilty, I believe of allowing moral sentiment about human rights to decide where her geopolitical loyalties lie, rather than the West's future self interest and survival. The requirements of survival when faced with a deadly enemy can often be to form alliances with less than desirable regimes. China and Russia may be abusers of human rights and they are, but they don't represent a direct threat to the West at this stage, and they are equally concerned that the Islamists don't destroy their societies. Maybe the West has something to learn from them, about facing down enemies, and choosing alliances not for their political correctness, but for their effectiveness.

The EU and the US are in danger of becoming hopelessly idealistic in a world where power does not necessarily oblige such sentiments. Fighting terror requires realpolitik, not political correctness.

That said, in my post Serbian Wins The World's Sympathy I list out the countries expressing sympathy and support for Serbia, (apart from Russia and China), which have not been reported in the MSM. India. Canada. Philippines. Indonesia. Sri Lanka. And those who advise caution before backing Kosovan independence. Japan. Korea - and many others.

The MSM have particularly failed to give an accurate picture within Europe where Holland has been extremely cautious advising that there is no need to rush the decision. This also has barely been mentioned. And the countries that are against recognising Kosovo such as Spain, Greece, Cyprus, Bulgaria and Romania are rarely mentioned as a full list.

If my commentary on geopolitical affairs is not considered to be of the highest standard available, I would be the first to admit that I work from a different perspective to many, and form my own views based on little depth of knowledge or experience, other than doing business in Russia and Central Europe and having exposure to these and other parts of the world through trade links.

Using sources other than MSM reveals information that is not being disseminated by the primary channels, and this also enables a different pattern to be formed. Only by googling 'India Kosovo' did I find out that India is not supporting Kosovan independence, for example and for most of the others that I found, it was by the same method.

My business knowledge is maybe of a higher standard than my geopolitical, and in that regard, I should award myself a pat on the back for recommending folks to buy gold in December at GBP 412 an ounce. The return is approaching 20% in two months, I said the price would surge to GBP 500 in the new year and I was spot on. I guess I can't be wrong about everything!

Helen says that the international structures such as the UN and the EU could be due for a change. The ones we have were defined by the world as it emerged from WW2. I guess the new structures that form eventually will be defined by the threats the world faces now. I think that once the enemy declares itself a little more forcefully, and no doubt they will, the structures that will be needed to meet the threat will form spontaneously. Somehow I think the position of the Serbs and the Russians will suddenly achieve higher status, than many commentators, MSM or blog ascribe to them today.

Human rights objectives will still be important to humankind, but survival must inevitably have a higher priority.

Saturday, February 23, 2008

Is Russia A Threat?

My last post highlights EU naivety about Russia, where MEPs often refer to Vladimir Putin as their 'partner'. As Gerard Batten MEP UKIP says (in the video clip in that post) in November 2007, Russia is hardly an appropriate partner for the EU, becoming, not a democracy as was until recently still hoped for, but a totalitarian dictatorship where 300 journalists have been murdered and political opponents are imprisoned. As a result the hoped for 'partner' is becoming something less than ideal.

The question then arises - is Russia becoming a threat?

That question breaks down into two parts - what capability for the military projection of power does Russia possess?

And second, how likely would Russia be to use what it has to gain geopolitical advantage?

A Swedish consultancy carried out a detailed survey of Russian military capability in 2005, showing how it had a conscript army capable of carrying out an internal or defensive role, combined with a professional army of about 150,000, which had the capability to be deployed on offensive operations anywhere on the Eurasian land mass.

The primary problem faced by the Russian military was to upgrade its weapons to a higher level, and in 2005 when the report was written, it was thought that it would take Russia about ten years to play catch-up to western standards of military equipment. In 2005, however, it was not foreseeable that Russia's income would rise as fast as it has done in the last three years with high energy prices. And it was possibly not expected that Russia would spend quite such a high proportion of its government income on 'defence' as it is doing. Russia is spending half of all its government revenues on its military capabilities, compared with a mere 1.8% in the UK.

Russia will be increasing its output of aircraft, it claims to around 5800 planes a year by 2025 or about 15% of world output, of which a significant share will be military in nature. While pilots were frequently unable to carry out meaningful exercises three years ago, due to lack of funds, this is now certainly not the case.

Liam Fox the Conservative Shadow Secretary For Defence wrote about Russia's growing military capability in The Times like this in July 2007 -

Two weeks ago Russia announced its intention to annex a 460,000-square mile portion of ice-covered Arctic. Scientists claim that the area, on which Russia has audaciously set its sights, may contain an estimated 10 billion tonnes of gas and oil deposits. While this ridiculous claim has no legitimate legal basis, the West must take threats like this from Russia seriously.

Russia is rivalling Saudi Arabia as the world’s largest oil producer and is estimated to have the world’s largest natural gas supplies with 1,680 trillion cubic feet - nearly twice the reserves in the next largest country, Iran. If military might and nuclear weapons formed the core of Soviet cold war power, Russian elites view its energy resources as the basis of its power now.

Russia has demonstrated that it will use its energy resources to promote a broader foreign policy agenda. This was illustrated when Russia reduced gas supplies to the Ukraine as part of a bilateral dispute and when it doubled the price of gas to Georgia in 2005.

Russia’s petrodollars are financing a $189 billion overhaul of its armed forces between now and 2015. They will purchase more than 1,000 new aircraft and helicopters, 4,000 new tanks and armoured vehicles and a new submarine fleet.

See the full article - Energy The New Cold War - HERE

When you think that the UK army has less than 400 main battle tanks, you realise that Russia' rearmament is aiming to create a military superpower. No doubt Russia's equipment will be of the latest and best specification, with costs of production, design etc being a small fraction of what they are in Britain.

Russia has always shown herself a highly technically capable nation when it comes to producing weapons or sending up space missions, and the amount of money being spent on weapons and their development by Russia now and in the next couple of years could well leave her able to carry out offensive campaigns by land, sea and air anywhere it wishes in the Eurasian land mass, even rivalling the firepower of the US Army, Navy and Air Force.

2008 is probably too soon for Russia to be able to carry out the kind of threat she is making to use military strength to ensure that her views over Kosovo are 'treated with respect', but somewhere between 2010 and 2015, the threat from Russian military power and Russia's ability to challenge NATO will become very real.


It is hard to make such a prediction, but there would be little point in developing such awesome military power unless it was to be used either for military purposes, attack or defence, or in the support of games of brinkmanship.

For example, from comments made this week by the Russian Ambassador to the UN threatening that military action would be taken to back up Russia's position as regards Kosovo, if these forces had already been available for Russia to deploy, one could imagine that the temptation of hitting back against the EU, and in support of Serbia in some way, would have been irresistible.

The EU has precious few military resources at its disposal. Those it does have are supplied by countries which have shown a remarkable unwillingness to incur casualties. France and Germany, for example will not permit their troops in Afghanistan to be sent into the more dangerous areas like Kandahar or Helmand. There is going to be a huge imbalance of military power and willingness to use it between the EU and Russia in a few short years. In any negotiation over territory or resources it seems almost inevitable that Russia will use the leverage that a powerful military will bestow on them, to the disadvantage of the EU and the US, if they allow Russia to do so.

Russia feels humiliated by the loss of so many of her former satellites into the western sphere of influence, and she is concerned that those remaining under her influence might also be lost. The Ukraine voted for the Orange Revolution, and that threatens to cut Russia off from the Crimea and her Black Sea Port at Sevastopol.

There are tensions all along her southern flank with Moslem states, especially Chechnya which has descended into a brutal suppression. And Russia must longer term, be concerned by potential aggression from China with her exploding population and economy, combined with shortage of land, food, water and commodities.

The EU is the least threatening to Russia in military terms, but is possibly the most threatening to Russia in political terms. The pull of democracy and of growing wealth, and the desire of ex-Communist populations to be allowed to travel and trade with Western countries and operate across the globe is strong enough to destabilise the remainder of Russia' empire. Even Serbia, Russia's oldest ally in Central Europe, is giving in to the temptation of joining up with the future.

Unless Russia can be brought in to join the democratic free world or at least be seen as part of the Christian world, her humiliation, and isolation can only get worse, bringing her to the point where she will want to strike back in some way, if she can. Her claims to be taking over the oil rich Arctic region will be far more serious when backed up by military power, as would Russia's attempt to bring the EU back to the negotiating table over Kosovo. The years of her renewed military strength cannot be all that far away.

As democracy fades away inside Russia, and the recent hopes that Russia will at last become democratic are dashed, the trend for government to become increasingly brutal, and for extremist political parties to grow unfettered by the Kremlin is clear (see the video clip above). All in all it reminds one of Germany between the wars. Humiliated by the loss of the Cold War, Russia is descending into brutality and extremism, and like Germany did, wants to have a rerun of the earlier contest, but this time to win it.

The West is performing in exactly the way it did in the 1930s. The EU and the US are in complete denial as to the failure of the democratisation process in Russia, the growing military threat, and the growing political threat. Just at the moment that the West needs to be rearming and building up its defences, it is instead allowing them to approach the point of near collapse (NATO is in disarray with key countries unwilling to actually fight), providing Russia with the opportunty to take some easy revenge and set back the course of progress in Central Europe.

Russia should not be made into an enemy, however. Russia should be seen as an ally in the war of terror, which is the primary threat facing the non-Moslem world. But with the West backing the wrong side in Iraq (Saddam and the Baathists were a secular regime, and there was no need to rush into an invasion in 2003) and in the Balkans (the Serbs are the Christians and not supporters of international terrorism, and there was no need to rush into recognising Kosovo's independence), Russia is being driven into a posture of hostility.

Any strategic vision of how to deal with an increasingly threatening world must include the point of view that Russia, Serbia and secular Middle Eastern countries like Iraq, as it was, are potential allies. The EU is burning up the security that an alliance with Russia could provide, by rushing to support Kosovan independence, and tinkering inside the Ukraine. I am all for humanitarian and democratic gestures, but when they are in diametric opposition to the strategic interests of your own side, such things will just have to wait.

It would be far more sensible for the West to stop humiliating Russia as early as possible and bring her in as a secure ally if at all possible. It was not worth falling out with her over Kosovo, for example.

As well as doing everything possible to prevent Russia from becoming an enemy, the EU should also secure its peace with Turkey by advancing her status as a member of the EU, and take every opportunity to build her into a strong alliance. With these two vast and militarily powerful countries securely on board, the fight against extreme Islamism across the globe will be a little nearer a successful completion.

Let's hope that Barack or McCain have the strategic vision that George Bush and the EU so clearly lack.

Friday, February 22, 2008

EU Hopelessly Naive About Russia

Violent protests in both Belgrade and Mitrovica in Kosovo yesterday by Serbs have been met with impatient threats to Serbia of a slowing down of the building of ties by the EU, and the progress towards the promised Stabilisation and Association Agreement, which would open up eventual EU membership to Serbia. In any rational scenario, such threats would count for a lot and persuade Serbs to abandon violent protest and abide by the EU's decision to recognise Albanian Kosovo's independence from Serbia.

The riots though are the actions of only 1000 people at most in Belgrade. The Serbian government may not be able to easily stop them as a determined minority can always register their disapproval with violent actions. There will always be enough Serbs around to carry out violent actions in such circumstances.

The EU clearly believes that reason will win the day, and if there were no other extraneous factors, it is possible that they would succeed. From the BBC

EU foreign policy chief Javier Solana said continued violence would harm efforts to improve ties.

We received assurances from Prime Minister Kostunica that there would not be a repeat of this episode and we will hold him to that, said a
US state department spokesman.

"The embassies have to be protected, and that is the obligation of the country," Mr Solana told reporters when arriving for an EU meeting in Slovenia.

"Things will have to calm down before we can recuperate the climate that would allow for any contact to move on the Stabilisation and Association Agreement."

That agreement, a preliminary deal on EU-Serbia links, was reached last year, but the EU has said it will not sign it until Belgrade co-operates fully with the UN war crimes tribunal for the former Yugoslavia.

The EU was ready to sign an interim trade deal with Belgrade, but Serbian Prime Minister Vojislav Kostunica blocked the move earlier this month.

The EU clearly feels that it holds the whip hand, but the EU has made one serious miscalculation. It has not taken into account the determination of Vladimir Putin to influence the situation.

Today Russia considerably upped the anti by making explicit a threat to engage in military action over Kosovan independence. The BBC website does not carry this, but CNN is running the story as its lead, as follows -

from CNN

Russia has not ruled out using force to resolve the dispute over Kosovo's declaration of independence from Serbia if NATO forces breach the terms of their U.N. mandate, Moscow's ambassador to NATO warned on Friday.

"If the EU works out a single position or if NATO steps beyond its mandate in Kosovo, these organizations will be in conflict with the U.N., and then I think we will also begin operating under the assumption that in order to be respected, one needs to use force," Dmitry Rogozin said, in comments carried by Russia's Interfax news agency.

If the US thinks that calling on another NATO bombing campaign will be enough to neutralise Serbian opposition to Kosovo's declaration of independence, as its fallback position if things get out of control, it might have to consider a very different scenario to the last time that happened, where Russia was acting as part of the UN alliance.

Russia this time is proposing to take military action to enforce United Nations Resolution 1244, and force the US and EU into line, who they claim are in breach of the UN Resolution, which guarantees Serbian sovereignty over Kosovo.

This confrontation is getting nastier by the day. The problem is that the EU is playing economics while the Russians and Serbs are playing with thoughts of military force. The EU and the US had better get to the negotiating table with Russia over this as a matter of urgency, or they could soon be facing a humiliating military situation.

Russia has also another option for putting pressure onto the EU, of course, cutting off the gas supply. Gerard Batten MEP UKIP spoke to the EU Parliament in November 2007 pointing out that the EU's attitude to Russia was hopelessly naive. See him speaking in the video clip above. His words could be prophetic.

UPDATE from International Herald Tribune - February 22nd 2008. Russian official denies that Russia will use military force over Kosovo.

In Washington, Nicholas Burns, U.S. under secretary of state for political affairs, on Friday called on Russia to repudiate a suggestion from one of its officials that Moscow may need to use military force to earn respect after Western governments recognized Kosovo, The Associated Press reported.

Burns called the comments by Russia's envoy to NATO, Dmitri Rogozin, "highly irresponsible" and also criticized Russia's strong language condemning the recognition of Kosovo's independence by the United States and some European countries.

In his remarks, according to The AP, Rogozin said Russia might need to use military force, but then later spoke in more conciliatory terms, saying that Moscow would not get involved in any armed confrontation over Kosovo.

$100 Oil Puzzles BBC

It shouldn't, according to Canadian Randy Johnson, Country Chairman of Chevron Oil in The Philippines, who I met yesterday at the Philippine Business Leaders Forum. His presentation was principally about bio-fuels, bio-diesel and ethanol, though his introduction gave some interesting stats about the oil market. Current worldwide consumption is 85 million barrels a day, up from 75 million barrels a day 10 years a go. Maximum production capacity is 90 mbd.

The cushion of about 5 mbd is vulnerable, however to both supply interruption and increase in demand. The World Bank expects the world's energy demand to double between 2005 and 2030, and oil demand to increase by 50% within 15 years. Reserves are concentrated to a very large extent in Saudi Arabia and Iran, both of which control reserves between 100-160 billion barrels. Second tier countries such as Qatar, Kuwait, Iraq and Venezuela only have around 20-25 billion barrels.

Randy also mentioned another factor - that oil industry costs both upstream and downstream had increased in the last 30 months by no less than 64%. He did not go into the detail of that statistic, but clearly shipping rates have soared, and security issues have put pressures on the industry. Yesterday there was, coincidentally a huge explosion at a Texas Oil refinery.

Looking at the bigger picture of world security, within which all markets have to function, there is little to reassure. Pakistan, with the assassination of Benazir Bhutto, is left with a progressively disintegrating democracy, as violence becomes the currency of power. This puts further pressure onto Afghanistan, where the few countries doing the real fighting, Canada, Australia, UK and especially the US are tiring of the unwillingness of the Europeans in the Afghanistan NATO force, especially France and Germany to do their fair share. NATO, the organisation that has guaranteed the peace of Europe since 1945, is being brought into crisis by the unwillingness of the Europeans to pull their weight. What would a bigger military crisis do to NATO's cohesion, one wonders? The memory of war is too distant in Europe, after so many years of peace, that no one there seems to understand the need to keep the world safe any more.

The United Nations, another critically important organisation for maintaining international law, and reducing the risks of war, has also been dealt a blow, by the EU's backing the Unilateral Declaration of Indpependence by Kosovo's majority Albanians. UN Resolution number 1244, issued in 1999, recognises that Kosovo is a part of Serbia, and yet the EU, backed by the US has decided to override the UN and back Kosovo's independence. When the world's most powerful countries decide to ignore the rule book, and undermine the principle guardian of peace in the world, it is a highly significant event.

It was almost comical, if it wasn't so tragic, to read the UN complaining to Serbia after the US and other Embassies were attacked yesterday in Belgrade in these terms....

BBC website

in New York, the UN Security Council condemned what it called "mob attacks" on US and other embassies in Belgrade. In a unanimous statement, the council recalled the inviolability of diplomatic missions under international law

If they want to enforce the law on the Serbs, then they should also be doing the same to the US and the EU.

It was the US and the EU which abandoned international law by declaring Kosovo independent in breach of the UN Resolution. Maybe no one told them that the principle of the Rule Of Law means that the law applies to everyone or no one. It is not good for the world that the EU is so casual about degrading the institutions on which peace, and the law on which it is based, depend.

The BBC might not be able to see it, but when events of this kind occur, markets react. Germany, France, the US and Britain above all should have a vested interest in maintaining peace and stability in their region and they are acting unwisely in that regard. The EU's hasty recognition of Kosovo is the event above all which has demonstrated that the current batch of world leaders are not capable of handling the challenges the world is facing.

The US elections in November are looking more hopeful, with McCain having long experience and much wisdom about international events. But it looks more likely that, in Novemeber 2008 it will be the relatively unknown Barack Obama, on whom world leadership will come to depend. Until markets see some convincing and capable leadership from somewhere around the globe, they will nervously keep raising the prices of commodities such as oil.

UPDATE - Russia Threatens Use Of Force Over Kosovo

from CNN

Russia has not ruled out using force to resolve the dispute over Kosovo's declaration of independence from Serbia if NATO forces breach the terms of their U.N. mandate, Moscow's ambassador to NATO warned on Friday.

"If the EU works out a single position or if NATO steps beyond its mandate in Kosovo, these organizations will be in conflict with the U.N., and then I think we will also begin operating under the assumption that in order to be respected, one needs to use force," Dmitry Rogozin said, in comments carried by Russia's Interfax news agency.

Thursday, February 21, 2008

Two Crises Seek A Resolution

Blogging will be light for a while. I apologise to readers and am disappointed myself. Unfortunately there is a problem with the new batch of allergy vaccine I have received from the UK. I am reacting to it getting various unpleasant symptoms, and I've been advised to stop using it subcutaneously.

The only problem is that without a daily jab, the allergies become sensitised again, and I am starting to suffer from extreme fatigue as I had when I got seriously sick two years ago when I stopped work.

Sitting down and writing on a PC is not a good thing to be doing in this state. I have to spend a lot more time now on my diet, and getting exercise every couple of hours to keep the metabolism functioning as well as I can. I will blog as and when I can, but it looks like I will have to fly back to the UK to test as to what's happened, or if I'm lucky I could go to Singapore where there is a highly reputable allergy testing hospital.

Those that think this all sounds a likely tale and a good excuse for a lazy blogger, and who are sceptical about allergies, let me tell them that, for many, allergy vaccines are a life saver, taking stress off the nervous system, allowing hearts to recover from serious arhythmias, stomachs from disorders and numerous other forms of primary organ failure. It ain't no joke.


That said, I notice that the Serbs are winding themselves up over Kosovo's Independence Declaration with mass rallies this week. The whole nation is having a day off. Rail travel is free to those taking part in demonstrations.

The EU has set itself on a collision course with Serbia. I have little doubt that Serb will-power will prove stronger than that of the EU, in any protracted confrontation. The EU and the UK would do well to listen to the peaceful demonstrations of the Serbs, and engage in negotiations now, and not leave it until the situation has deteriorated.


Read an American journalist describing how Albania and Kosovo became the key Islamic state in Europe, and that they are a primary link in the worldwide Islamic terror threat. It leaves you feeling that, as in Iraq, the US has been backing the wrong side. In Iraq once the US backed the Sunnis, Al Quaeda has been progressively driven out.

In the Balkans Al Quaeda are riding supreme.

Wednesday, February 20, 2008

Fill In The Gaps History Test For George Bush

Here is an online history test from the Education Forum for George Bush and anyone else who thinks Kosovo independence is a good idea.

Test yourself HERE

I wonder what percentage George Bush would get in this test.

If the link doesn't work, here is the text. and here is the link to copy and paste into your address bar which does work -

The murder of Franz Ferdinand in is accepted by historians as the immediate WHAT? of World War One though serious trouble - long term causes - had been brewing for sometime.
On June 28th 1914, the heir to the Austrian Empire, Franz Ferdinand, was visiting Sarajevo, the capital of WHERE? .
Bosnia was in the very south-east corner of the Austrian empire and some people there wanted to be independent from Austria and set up their own state which could run itself.

Franz Ferdinand had been warned that his visit could provoke WHAT? but he ignored this advice and visited Sarajevo regardless. As was common at the time, he travelled in an open topped car.
There had been trouble at the start of his royal tour of Sarajevo when another car in his entourage was hit by a grenade and an Austrian officer had been injured. Clearly, Sarajevo was a WHAT? place to be.

However, Franz Ferdinand wanted to demonstrate that his family was in control of Sarajevo and to have stopped the tour would have been seen as a sign of WHAT? by those who did not want Bosnia and Sarajevo ruled by the Austrians.

Franz ordered that his route through Sarajevo be changed at the last minute as he wanted to see the injured officer in hospital. Unfortunately, his driver did not fully WHAT? his instructions and got lost.

Stopping to check where he was, the driver attempted to reverse out on to the main street. By bad luck, he stopped right by a man called Gavrilo WHO? . He was a member of the WHAT? Hand Gang which wanted to rid Bosnia of Austrian rule. He had also been behind the grenade throwing and was now trying to disguise himself among the many people who lined the streets fearing the police might arrest him.

Not believing his luck, Princip pulled out the WHAT? he had on him and shot Franz and his wife. Both died as a result.
There was also a photographer at the scene and he captured scenes that were printed throughout the world.

But how did this murder of an unpopular man lead to war?

A country called WHAT? was blamed by Austria for this murder. Serbia was near to Bosnia and it had encouraged the Black Hand Gang and given the gang weapons. What did Serbia want out of this? She hoped that both herself and Bosnia would WHAT? to form a new Balkan state.

Austria decided that Serbia must be punished and planned to invade her. Serbia called on her old friend WHO? to help her. Now the alliance/entente came in to play. One country from each was involved on opposite sides. The situation could only get worse.

Serbia would have been easy for Austria to crush. Russia was a different issue. She had a huge WHAT? and Austria would not have coped with a Austro-Russian war. Austria called on WHO? for help. The German government agreed to this and their response provoked the French government.

However, unknown to anybody other than the German government, the German army had created a plan called the WHAT? Plan. Schlieffen was a senior German army officer and he believed that the German army was superior to any army in Europe but that it could not fight a war on two fronts - France and Russia.

However, he calculated that the vast Russian army would take 6 weeks to get itself organised - called mobilisation - and that in that time, the Germans could attack the WHAT? , beat them and then send their army across Europe to fight the Russians. The German High Command accepted this plan. But it had one problem. It relied on what the French or WHO? did and the actions of one would provoke a German response and not the other way round. In other words, the Germans had to react to a situation as opposed to controlling it.

When the French called up her army, the Germans had no choice but to carry out the Schlieffen Plan - it had to. This plan involved an attack on France via WHERE?.

WHO? had given Belgium a guarantee that if anybody attacked her, Britain would attack the attacker.
Therefore, within weeks of the murder at Sarajevo, five out of the six countries that had signed the two treaties were on the verge of war.

On August 4th, 1914, Germany invaded Belgium. Britain declared on Germany. France and Russia supported Britain. Austria supported Germany. Only WHO? did not get involved - yet.
Every country concerned was convinced that the war would last only from August to Christmas 1914. No-one envisaged the WHAT? of trench warfare.

(Text adapted from the excellent historylearningsite

Tuesday, February 19, 2008

Serbia Wins World's Sympathy

The International Herald Tribune explains that the task of getting Kosovo recognised by the world is crucial if the EU is to make Kosovo's declaration of independence stick. While some countries like Australia have quickly fallen into line and declared recognition, others are delaying their decision, and are expressing strong sympathy for Serbia.

The initial optimism and celebratory mood about Kosovo inside the EU is already gone, as violence is now a daily occurrence in Kosovo with EU and UN property natural targets. It is only luck so far which has prevented any human casualties.

Reports from around the world also show that the EU's attempts to achieve Kosovan recognition are likely to be met with firm diplomatic resistance. Russia and China have taken against Kosovo's independence imediately as reported in the BBC. But what is not being reported in the West so far is the growing and significant opposition to what they have done in many other countries.

The EU is saying that they expect that in 4 to 5 months time, things will look very different, and that countries that have expressed doubts will begin to fall into line. In fact the opposite is happening. As the reality of what the EU has done hits home around the globe, opposition to the EU and sympathy to Serbia is growing.

Take India. The Hindu 19th February

NEW DELHI: With battle lines drawn over Kosovo declaring full independence from Serbia, India is actively considering its stand and appears tilted towards the view taken by Russia, China and some European countries.

“We have taken note of the unilateral declaration of Independence by Kosovo. There are several legal issues involved in this declaration. We are studying the evolving situation,” said the Foreign Office. India pointed out that recognition was given to a country with a defined territory (which is in dispute with respect to Kosovo), a duly accepted government (the Kosovo administration is interim) which has control over an area of governance (not so on Kosovo’s case).

“It has been India’s consistent position that the sovereignty and territorial integrity of all countries should be fully respected by all states. We have believed that the Kosovo issue should have been resolved through peaceful means and through consultation and dialogue between the concerned parties,” added the Foreign Office, leaving little doubt about India’s sympathies.

JAPAN too is sounding most cautious despite its desire not to offend its key ally, the United States:

The Japanese government is planning to recognize Kosovo which declared independence from Serbia on Sunday, but wants to show "consideration" to Serbia which has been against such moves, Chief Cabinet Secretary Nobutaka Machimura said Monday.

"Basically, we will carefully determine whether Kosovo will meet Japan's criteria for recognizing states," the top government spokesman told a press conference. But he also stressed that Japan has traditionally maintained "good relations" with Serbia and "a certain level of consideration is required there." Government sources have said prior to Kosovo's declaration of independence that Japan intends not to immediately recognize Kosovo because Tokyo wants to maintain good relations with Serbia and does not want to anger Russia, Serbia's ally.

This South African news site '24 hours' gives its summary of the situation as follows -

A significant minority in the 27-nation EU - Cyprus, Greece, Romania, Slovakia and Spain - oppose recognising Kosovo.

Others like Malta and Portugal would prefer Kosovo's future be decided at the UN Security Council.

Czech President Vaclav Klaus warned that Kosovo's independence could unleash a domino affect in Europe.

"Some parties in other states could realise that they do not feel completely at ease within a big state in which they are now," he said in a television interview.

As if on cue, the breakaway Georgian regions of South Ossetia and Abkhazia immediately seized on Kosovo's break, saying they would ask Russia and the UN to recognise their independence, Russia's Interfax news agency reported.

"In the near future Abkhazia will appeal to the Russian parliament and the UN Security Council with a request to recognise its independence," self-declared Abkhaz President Sergei Bagapsh was quoted as saying by Interfax.

Some states see Kosovo as setting a dangerous precedent for other separatist movements.

The Sri Lankan government, which is battling separatist Tamil Tiger rebels, warned Kosovo's declaration could set an "unmanageable precedent" and was a violation of the UN charter.

The foreign ministry said it "could set an unmanageable precedent in the conduct of international relations, the established global order of sovereign states and could thus pose a grave threat to international peace and security."

Others are reluctant to recognise Kosovo because of their close ties to Serbia.

Government spokesperson Ivica Bocevski told AFP: "Whatever decision we are going to take, we will take care of the interests of our citizens, as well as the state and national interests of Macedonia."

Many others around the globe, seeing the international splits developing are preferring not to take up any position on Kosovo, like Korea for example. The Korea Times -

Seoul officials said that it would be better for Korea to remain neutral over such a sensitive world issue in terms of national interest.

They added the Kosovo issue will take time to get settled in the international community.

The Philippines and Indonesia also are expressing concern that then EU's Kosovo decision will energise their own separatist movements.

If Serbia can keep the majority of countries from recognising Kosovo, either by persuading them to leave the matter well alone as Korea is doing, or with them openly backing Serbia's position, it will defeat the EU. It has to be said that defeat for the EU's first post-Constitution foreign policy initiative, Kosovan independence, is looking likely to end as a total fiasco. Unfortunately it also looks likely to be the cause of many unnecessary human casualties.

Canada has failed to recognise Kosovo as it is concerned that the move is creating the possibility of a major east-west split.

On such a crucial question, and with worldwide concerns growing by the day, surely a discussion in the British Parliament is called for. The Conservatives should, by now be expressing an opinion about this. This is not a subject where sitting on the fence is advisable. It will show up pretty quickly who knows what they are doing and who doesn't.

UPDATE - even in Germany there is unease at the EU's support of Kosovan independence...

A leading lawmaker of the co-governing Social Democratic Party (SPD) warned of the global implications of the anticipated independence declaration of the Serbian breakaway province of Kosovo, the daily Frankfurter Rundschau reported Saturday .
"I have doubts about the legitimacy of such a step, in terms of the international law. It is difficult to justify such a secession," said the deputy chairman of the foreign affairs committee in the German Parliament, Hans-Ulrich Klose.
If this was the basis for the self-determination right of an ethnic group, we would "open the pandora's box," he added.

Other ethnic groups may feel encouraged to follow the model of Kosovo, the MP pointed out.

An American Who Understands Foreign Policy

From, this former US ambassador to UN John Bolton gives an informed version of what should be happening in Kosovo. If McCain wins the Presidency, Bolton would probably end up as US Foreign Secretary. That makes me a big McCain supporter. After listening to foreign policy nonsense throughout the Bush and Clinton years, there is definitely hope for a better future if people if this quality rise to the top in the US. The world is entering a dangerous phase and needs someone like this in control.

Kissinger. Half Right Is Not Enough.

Europe has emasculated its nation states. Correct. Their power has gone. Henry Kissinger has at least got that bit right. See Richard North's Half Way House. But he still lives in the hope and expectation that there will be anther half to the story, when the parts of the broken nation states begin to give their loyalty to a powerful central government in Brussels.

Identity to nation states is being replaced, however not with loyalty to the EU, the role of which is not understood or, in many cases even much known about. Loyalties are splitting downwards to local regions.

Power has, for a while gone to the centre, but identity and loyalty are fracturing. If the EU tries finally to grab the identity for itself and its central role, it will find that it is already too diffuse to recapture.

It is more likely that when the EU finally declares itself as the powerful centre of Europe, it will attract hostility from competing regions,each of which will be jealous of any favours granted to others - as with Kosovo.

The structure that was meant to iron out conflict between nation states, has instead ensured that a myriad of regions will be jockeying for advantage one against the other. Commercial competition by nations will be replaced by political power play by regions. It is not a recipe for a peaceful future.

It took centuries to build nation states. They played the role well of suppressing regional rivalries. Their destruction will ensure the fracturing of Europe back into the dangerous petty local rivalries that, in the past triggered wars. In the Balkans especially, rivalry is not petty.

The balkanisation of Europe is being not so gradually achieved, not because it is good for Europe but because it is precisely the aim of the EU. No wonder they are so hasty to start the splitting up process, regardless of legality and consequences. Only coherent nations states would have the strength to withdraw from the EU. The sooner they are split up, the sooner the EU's power and longer term survival, it believes will be guaranteed.

Without any political identity, or central loyalty, the EU is banking on one thing to hold its empire together - the economic benefits of membership. To a Serbia or a Slovakia these are great at this stage of their development. Access to markets, the right to visas and so on.

But to a highly developed nation, such as Britain, the loss of the ability to manage its own affairs is proving less and less attractive. Countries inside the Euro are experiencing extreme stress, from property boom and busts, high exchange rate, and high inflation for example. Many are beginning to count the costs of their membership.

Internationally, the EU is progressively undermining NATO as in Afghanistan, and the UN as in Serbia. Its economic performance, relative to other parts of the world is woeful.

Henry Kissinger might soon find that he needs a lot more than phone numbers to put all the pieces back together again. It's hardly surprising. Bureaucracies are rarely anything other than incompetent, corrupt, self-serving entities that suck all the life and wealth out of their subject peoples.

It's time Henry Kissinger faced up to the realities.

Monday, February 18, 2008

The Rule Of Law Ends

See the report on the discussions on Kosovo by EU Ministers from the BBC today and think about these words-

'Kosovo, the ministers agreed, was a unique case and did not call into question international legal principles, such as territorial integrity.'

And so with the stroke of a pen, all previous principles of international law as to the how territory can be gained or lost, which has maintained relative peace in the world for over 60 years, are swept away.

Is this the Brave New World? Laws apply to all, it seems, except the Bureaucracy that creates them.

The EU now believes itself so powerful and certain to succeed, that it can ignore the structures of the post-war world, the United Nations and eternal constitutional principles such as the Rule of Law.

By the EU's Kosovo decision, the world has been moved into a dangerous new era, where law no longer applies, and where democratic accountability is practically non-existent. The EU will no doubt pay the price for its arrogance in time, but so too will thousands of innocent people, not only in Kosovo but in many places in the world where all that lies between hope and oblivion is the force of international law, and the influence of democracies to pressure regimes to observe civilised standards.

In Kosovo the EU has crossed The Rubicon. It is not marching on Rome, but over a constitutional precipice.

Kosovo Is Serbian

To counter the EU/US propaganda being out out across the world's media, why not look at some from the other side?

There was no mention in the world's media of two explosions taking place yesterday except on Al Jazeera, one in Belgrade and on in Mitrovica in Kosovo. The first was in a Slovenian shopping centre (Slovenia holds current EU Presidency), and the second in the building about to be the EU's headquarters.

There was no mention in the world's media that the Netherlands have come out against the declaration of independence by Kosovo, saying that they believe the action is being taken too hastily.

After watching these two videos, I can see why Holland might be of that opinion. So could anyone who's been allowed to know what is really the situation in Kosovo and Serbia. The EU has rushed into a quagmire from which it will find it hard to extract itself. This could be the EU's version of Iraq.

See CNN Report HERE

Serbia will be threatened with slow accession to the EU for any non-cooperation. That is why the EU thinks it will get away with what it is doing.

But If Russia and China give full support to Serbia as expected, and if the UN and the EU are divided, which they undoubtedly are, then the whole project could become so divisive that the pressures to re-start with a different approach will build. The un-granting of 'independence' (in truth Kosovo is being set up as a colony of the EU with little independence at all) will trigger troubles amongst the Albanian population.

EU arrogance has really started a proper mess this time, which will take a lot of undoing.

Saturday, February 16, 2008

EU Destabilises Europe

>REPORT FROM International Herald Tribune. 16th February 2008.

The EU remains divided over Kosovo, and diplomats said that it would be hard to get several countries - including Spain, Greece, Romania, Bulgaria, Slovakia and Cyprus - to sign the EU declaration Monday.

Some of these countries fear that Kosovo's unilateral declaration will spur secessionist movements in their own territories. Others are worried that the UN provides the basis of for peace and stability for Europe and the world, and that this linchpin of world peace is being undermined, especially the principle that territory cannot be gained and lost except by United Nations Resolutions.

Even with the EU's internal splits, however diplomats said the EU was preparing to give final approval for an 1,800-strong police and judicial mission that will help Kosovo's government administer its new country after the United Nations leaves........

How will 1800 officials and policemen adequately replace the far higher numbers of NATO troops that will be leaving, one wonders?

The high risk strategy being engaged in by the EU to deprive Serbia of Kosovo which has been Serbian territory since the Middle Ages, makes more sense when it is seen as part of a deliberate EU policy to destabilise not only Serbia but also its own member states.

The EU will only acquire power finally over its member states once it has successfully dismembered them. Kosovo is the EU grabbing an opportunity to set a precedent.

What will be the effects?


At the same time as upsetting Spain and Greece which have their own problems with difficult minorities, the destabilisation is also providing Putin with just the excuse he's been looking for to destabilise his neighbours - especially Georgia which seceded from the Russian Federation, trapping many Russians inside its territory. Serious commentators doubt that Putin will actually carry out the threat he is making for real, but he is clearly itching to register his disapproval of Kosovo being taken from the Serbs in some way, if he can.

The IHT article continues....

Russia suggested Friday that Kosovo's expected independence declaration would affect its policy on two separatist regions in Georgia, but stopped short of saying it would recognize the breakaway provinces, The Associated Press reported from Moscow.

"The declaration and recognition of the independence of Kosovo will doubtless have to be taken into account as far as the situation in Abkhazia and South Ossetia is concerned," the Foreign Ministry said in a statement.

The statement, released after Foreign Minister Sergey Lavrov met with the pro-Russian regions' leaders, did not say how Russian policy toward the provinces might change.

Moscow formally supports the territorial integrity of Georgia, but has granted Russian citizenship to most residents of Abkhazia and South Ossetia and has warned the West that recognizing Kosovo would add legitimacy to their independence claims - with the implicit threat that Moscow could recognize them.


Whatever the moral case for helping Kosovans to break away from Serbia over time, is there really a case for undermining the stability of many other parts of Europe, and territories inside Russia, ignoring international law at the same time? Kosovo is stipulated by a UN Resolution to be Serbian territory, so the EU in recognising an independent Kosovo, will be in breach of it.

And if the situation becomes highly unstable at some point, where is the EU army that's ready to police the trouble spots needlessly pushed into crisis. The Serbians are unlikely to engage in open warfare again, providing targets for NATO"s bombers. But low level terrorism is a distinct possibility.

Trouble has already started in Belgrade, although you wouldn't know anything about it if you watch CNN and the BBC, or read British newspapers. See thisreport from al-jazeera.

An explosive device has gone off in a shopping centre in Belgrade (the centre has Slovenian connections, and the Slovenians have backed Kosovo's declaration of independence) and another mall has been evacuated..

The blast came a day after a right-wing group, chanting names of Bosnian Serb war crimes fugitives, disrupted a show by Kosovo Albanian artists in the city. Nationalists are angry that Kosovo, Serbia's medieval heartland, is expected to secede within days.

Also reported on Al-jazeera on February 15th was another explosion which was ignored by the BBC and all other western media - this time aimed at the EU's headquarters in Kosovo....

Serbia has urged the UN Security Council to oppose Kosovo's declaration of independence, saying it will do everything to stop the secession short of using violence.

The call came as the council held an extraordinary meeting on Thursday to discuss the future of the province.

Highlighting the tensions in the region over the province's intention to secede, Serbian police reported an explosion on Thursday in a northern border town divided between Serbs and Albanians (Mitrovica).

Police said early reports show that the explosion in Mitrovica was near the site earmarked as the base of the future European Union mission.

as the film clip from Al Jazeera shows, the attack was directly on the EU's intended headquarters building.

Of the EU's 27 countries, 7 are not in support of what the EU is doing in Kosovo. Those countries are Spain, Greece, Cyprus, Slovakia, Romania, Bulgaria plus one other yet to be identified by me. Here we have the Lisbon Constitutional Treaty in action, where only a majority of EU countries is now needed to commit the EU to foreign policy adventures.

What the hell is Britain doing supporting an illegal act which undermines the United Nations, and threatens peace in The Balkans? Would David Cameron like to ask Gordon Brown about this in Parliament?

READ THE SERBIAN VIEWPOINT - that as in Afghanistan America has backed the wrong side HERE

OR READ THE BRUSSELS JOURNAL - an all the likely negative consequences which will flow form the granting of Kosovan independence, written by an American. -

For all this, the United States should not accede to Kosovo’s independence. The reasons present themselves:

* Kosovo is not politically ready. A would-be state with a pervasive internal culture of violence and persecution is a disaster-in-waiting. Imagine, for example, granting statehood to the Gaza Strip: its political culture would make a mockery of the very term, and the fiction demanding co-equal status between it and, say, France would ill-serve all concerned. Until Kosovo can function as a reasonably inclusive democracy with reasonable guarantees for its minorities, and have regular, peaceful transfers of power, it does not merit statehood. The province, for many reasons, is simply not there yet.

* Kosovo is not culturally ready. The campaign of brutalization against non-Albanian and non-Muslim minorities has been addressed at length here. Suffice it to say that this is not a polity ready for just self-governance; and suffice it to say that we ought not be a party to cultural erasure.

* Kosovar independence would generate instability elsewhere. The old Wilsonian idea that a geographically-bounded majority population deserves its own sovereignty dies hard. In this decade, with American foreign policy predicated more than ever on quasi-Wilsonian principles, it is especially formidable. It is also a recipe for disaster: with the United States engaged in two wars in multiethnic states, to explicitly affirm this precedent in Kosovo invites more serious problems and bloodshed elsewhere. With Kosovo independent, what grounds do we have for dissuading the independence aspirations of the Kurds, the Pashtuns, the Baluchis, the Assyrians, the Arab Shi’a, et al.? Furthermore, what prevents Russia from seizing upon this precedent to cause trouble in the Caucasus and Moldova? (They say they won’t — for now — but why give them the leverage?) Contra the rhetoric of some neoconservatives, we ought not be in the business of redrawing borders, nor sponsoring particular ethnic groups for their own sake.

* Kosovar independence would reverse progress in the Balkans. Memories are short, but in the 1990s, the Balkans were a cauldron of bloodshed and horror. If they are peaceful now, and if Sarajevo has a tourist industry, there is nothing inherent or irreversible about this. Since the last Balkan war in 1999, Serbia has modernized, liberalized, and moved toward the European Union; Bosnia has been, if divided, at least quiescent; and we’ve not seen Albanian irredentism cause an international crisis apart from an abortive 2001 insurgency in Macedonia. Kosovo independence threatens all this: the imminent declaration of independence has already damaged Serb-EU relations; the rationale for the existence of the Federation of Bosnia and Hercegovina fades dramatically if the three parts believe they may simply separate; and Albanian irredentism receives a massive boost. The history of the Balkans in the past century has been the history of nations either pursuing irredentist aims, or reconciling themselves to abandoning those claims. Albania, with claims against each of its neighbors — Serbia, Montenegro, Greece, and Macedonia — is also the only Balkan nation with a shot at making good on significant portions of them. Kosovar independence is thus the worst of all possible worlds for the Balkans, in reviving one source of Balkan instability in a resentful Serbia, and with the Albanians rewarding precisely the sort of irredentist sentiment that has repeatedly plunged the peninsula into savage war.

* Kosovar independence would further strain the US-Russian relationship. This relationship is already under sufficient pressure thanks to Vladimir Putin’s decision to reclaim much of the old Soviet-era paranoia and tension as Russia’s own. This is, to be sure, mostly Russia’s own doing — but it defies reason to assume that the United States ought to therefore aggravate it further. The American relationship with Russia is self-evidently more important and enduring than the American relationship with Albania, to say nothing of Kosovar Albanians. The Russians have warned us repeatedly of their profound reservations over Kosovar independence: in being sensitive to their sensitivities, we lose nothing, and stand to gain in the long run.

So much for what ought to happen: what will happen?

This is regrettably easy to predict: on Sunday, February 17th, 2008, Kosovo will declare its independence. Many if not most of the remaining Serbs will migrate to Serbia proper. Some Serbs will stay and try to force a partition of the province; this will swiftly degenerate into violence as the Kosovar Albanian government seeks to extend its writ to the full territory it now claims. The NATO forces in place will be forced to act as the gendarmerie of a sovereign state, or to oppose that state in its quelling of Serb resistance. Neither are good options. Within Serbia, the citizenry will ask themselves what exactly rapprochement with the West has brought them and theirs.

Within the coming few years, the issue of Kosovo’s political union with Albania will come to the fore, and this will draw in Greece at minimum, and Turkey and Russia at worst. From benign if cruel stasis, the Balkans will again remind us why the word is also an adjective.

And we Americans will feel quite blameless about it, no doubt.