Eurasia Press & News
Even as the world is grappling with the horrendous effects of the year-long Ukraine war, Russia and the United States seem determined to keep the ball rolling—apparently in an unrelenting cold war mode.
Does this strategic scenario suggest the revival of what Richard Rosecrance once called the “Napoleonic imperium”? It is certainly a problematic conceptualization in a world system dictated by both security and the economy—that too in a multipolar mode. This has also risky security implications for a nuke-based world order. However, Rosecrance himself argued elsewhere that “the essential problem for countries seeking to enhance both security and the economy is that success in one may involve a trade-off that entails failure in the other.” This surely applies to Russia, China, the U.S., and the European Union, and the Ukraine war is a reminder to all key actors of the present international dispensation. Many, however, believe that the ‘Putin imperium’–with all its infirmities—does not have a long future given the inherent defects in Moscow’s power genetics.
Yet, the war gets underway in Ukraine amid prognoses of global recession and meltdown. There are also no indications of contending parties getting back to the negotiating table. Rather the general mood seems to be in favour of exacerbating the conflict, with declarations of further mobilization. Moscow, for instance, was reported to have plans to deploy as many as half a million troops in Ukraine for a major offensive. Though Kremlin denied such reports, many countries refused to buy such disavowals given the history of Moscow’s ‘denial and denigration.’
While reports of Russian mobilization were in the air, U.S. President Joe Biden rushed to Kyiv and promised West’s unflinching support to Zelensky. He said that “the United States has built a coalition of nations from the Atlantic to the Pacific to help defend Ukraine with unprecedented military, economic, and humanitarian support – and that support will endure.” The support obviously included “delivery of critical equipment, including artillery ammunition, anti-armor systems, and air surveillance radars.”
In fact, the White House has already catalogued the entire quantum of support provided to Kyiv. This included the anti-armour and anti-air systems (like the 8,000 Javelin and 1,600 Stingers), the artillery and ammunition (such as the 160 howitzers and 38 High Mobility Artillery Rocket systems), the air defense systems and counter-drone capabilities, the armoured capabilities (including 109 Bradley infantry fighting vehicles and tanks), more than one million rounds of artillery ammunition, more than 100,000 rounds of 125mm tank ammunition, and 100,000 rounds of small arms ammunition, helicopters, Unmanned Coastal Defense Vessels, and counter-UAV systems and equipment. Washington also worked with European partners and Ukraine, and launched the Ukraine Defense Contact Group—a coalition of 50 partner nations that has enhanced coordination of security assistance to Ukraine. Also, “members of this group already committed $50 billion security assistance, including nearly 700 tanks and thousands of other armoured vehicles, more than 1000 artillery systems, more than two million rounds of artillery ammunition, more than 50 advanced multiple rocket launch systems, and anti-ship and air defense systems.”
In a speech in Poland, Biden said:
America, Europe, a coalition of nations from the Atlantic to the Pacific — we were too unified. Instead of an easy victory he perceived and predicted, Putin left with burnt-out tanks and Russia’s forces in disarray. He thought he’d get the Finlandization of NATO. Instead, he got the NATOization of Finland—and Sweden. He thought NATO would fracture and divide. Instead, NATO is more united and more unified than ever—than ever before. He thought he could weaponize energy to crack your resolve—Europe’s resolve. Instead, we’re working together to end Europe’s dependence on Russian fossil fuels. He thought autocrats like himself were tough and leaders of democracies were soft. And then, he met the iron will of America and the nations everywhere that refused to accept a world governed by fear and force.
Russian President Vladimir Putin quickly retorted. In his address to the Federal Assembly, Putin said that the “responsibility for inciting and escalating the Ukraine conflict as well as the sheer number of casualties lies entirely with the Western elites and, of course, today’s Kiev regime, for which the Ukrainian people are, in fact, not its own people. The current Ukrainian regime is serving not national interests, but the interests of third countries.” He went on rationalising the invasion of Ukraine saying that it was done “to ensure the security” of the country and “to eliminate the threat coming from the neo-Nazi regime.”
Putin further said:
We were open and sincerely ready for a constructive dialogue with the West; we said and insisted that both Europe and the whole world needed an indivisible security system equal for all countries, and for many years we suggested that our partners discuss this idea together and work on its implementation. But in response, we received either an indistinct or hypocritical reaction, as far as words were concerned. But there were also actions: NATO’s expansion to our borders, the creation of new deployment areas for missile defence in Europe and Asia – they decided to take cover from us under an ‘umbrella’ – deployment of military contingents, and not just near Russia’s borders.
Putin also stressed that “no other country has so many military bases abroad as the United States. There are hundreds of bases all over the world; the planet is covered with them, and one look at the map is enough to see this.” He said that the “whole world witnessed how they withdrew from fundamental agreements on weapons, including the treaty on intermediate and shorter-range missiles, unilaterally tearing up the fundamental agreements that maintain world peace.”
But a significant statement from Putin also sent shock waves across the world. He said that Russia would suspend its participation in New START (New Strategic Arms Reduction Treaty), the last major remaining nuclear arms control treaty with the United States. According to him, Russia was “not withdrawing” from the treaty, but would “return to its implementation” as soon as “it understands how nuclear arsenals of the United Kingdom and France will be taken into account. Apart from that, Russia will prepare for possible nuclear tests, but won’t be the first one to conduct them.” This statement does not augur well for the world. The U.S. and NATO are obviously annoyed by this. Many fear that this would trigger nuclear arms race with unending consequences for Europe and the entire humanity.
Do Sanctions Work?
There are claims and counterclaims regarding the outcome of western sanctions imposed on Russia. The U.S. and more than 30 allies and partners imposed the largest set of sanctions and export control actions on Moscow. The U.S says that these measures were “disrupting Russia from accessing critical inputs and advanced technologies — undercutting its ability to fund and fight its unjust war.” Washington was reported to have put in place “more than 2,000 sanctions listings and more than 375 export control Entity Listings, including major state-owned enterprises and third-country actors supporting Russia’s war machine.” It also imposed sanctions on Moscow’s major financial institutions and put restrictions on military and industrial goods that could support Russia’s defense industrial base.
According to the U.S., this has resulted in a situation wherein Russia was “forced to turn to rogue regimes to try to source weapons and equipment because of their inability to make enough parts to resupply Putin’s war at home.” Besides all this, the U.S. Congress “revoked Russia’s permanent normal trade relations status—removing Russia’s privileges in international trade and increasing tariffs on hundreds of Russia products imported into the United States.” Washington says that these sanctions and export controls “will cut even deeper into Russia’s economy as time progresses.” It also noted that these economic measures were “specifically designed to shield low-and middle-income countries from their impact — including protecting the exports of food, allowing the provision of humanitarian assistance, and carving out agriculture, medicine, and energy payments from our sanctions.”
Russia, on the other hand, disclaimed all such statements. Putin said that the West was “fighting Russia on the economic front to make Russian citizens suffer, but it hasn’t succeeded anywhere and won’t manage to do this. In contrast, “the initiators of sanctions are punishing themselves.” He said that “the Russian authorities won’t ruin the economy for the sake of developing the defense sector.. We have everything to ensure security and create conditions for the country’s steady development.” Putin claimed that the “Russian economy and management system proved to be more stable than projected in the West.”
According to Vladimir Milov, such arguments are ‘misguided’ and the reality is that the Russian economy was being affected significantly. Elina Ribakova, an economist with the Institute of International Finance (IIF), says that Russia “used excess energy revenues to build up a ‘special piggy bank.’ She noted that “preparation, along with a skilled response by Central Bank officials, helped control the immediate financial crisis from the sanctions, allowing Russia to hold on to more than $250 billion in foreign reserves.” Yet, according to the report, the International Monetary Fund estimated that Russia’s economy “will shrink by 3.4% this year, instead of growing by about that much in 2022 as expected before the war.” Others also forewarned that “there would likely be a bigger drop if it wasn’t for oil and natural gas sales, which make up about half of the government’s budget.”
However, the market scenario of the Russian oil and gas revenues may soon change. In September, Moscow decided to cut off most of the natural gas flows to Europe. On the top of it, European Union imposed a ban on most Russian oil imports, besides a price cap on Russian oil. It may be noted that Europe was Russia’s largest customer in oil and gas. It is true that China, India, and Turkey—with their substantial imports of oil from Russia— ease off the burden of loss. However, the question is how long can Russia afford exporting oil in discounted prices to these countries?
There are other reports that the Russian economy is already experiencing “tangible setbacks.” A review by the Yale School of Management says that more than 1,000 global firms have stopped operations or withdrawn from Russia completely. It also says, “the fleeing businesses take with them capital investment, technology and expertise.” Russia’s manufacturing sector has been hit by a decline in imports of western-made components. This was felt in Russia’s rail and auto manufacturing sectors where production has declined by half.
International agencies like the World Bank, IMF and OECD noted that “2022 was a bad year for the Russian economy.” It was estimated that in 2022, Russia’s GDP declined “by at least 2.2% in the best-case scenario and by up to 3.9% in the worst-case scenario.” It is also predicted that the Russian economy will continue to shrink in 2023. Its GDP has been forecast to drop by 5.6% in the worst-case scenario (OECD) or by 3.3%, according to the World Bank. Last year, both the World Bank and the IMF estimated that Russia’s trade in goods and services declined significantly and it will continue so in the current year also. Can Putin hide these glaring facts of decline and chaos in the Russian economy?
Humanitarian Crisis
Since the Russian invasion of Ukraine last year, millions of people have been affected, inside the war-ravaged country and beyond. According to UN agencies, the situation remains desperate amid inexorable shelling of civilian targets and infrastructure. The UN Office for the Coordination of Humanitarian Affairs (OCHA) appealed for substantial funding to continue lifesaving mission to help 11.1 million of the 18 million people who needed humanitarian assistance inside Ukraine.
The UN refugee agency (UNHCR) is also seeking major funding to help Ukrainian refugees in 10 host countries: Bulgaria, Czech Republic, Estonia, Hungary, Latvia, Lithuania, Moldova, Poland, Romania and Slovakia. The UNHCR head said that in the year since Russian army crossed the border on 24 February 2022, civilian infrastructure in Ukraine had continued to come under constant attack, leaving nurseries “flattened and old people living in cellars because of the danger of bombing.” “The Ukraine refugee crisis—displacement crisis—remains the largest in the world, clearly,” the chief said. “Almost six million estimated internally displaced people. Plus, the refugees in Europe who have registered for temporary protection are close to five million now, 4.8 million. But we know that there’s many more that have not,” he added.
Amid reports that violence is escalating, the UN estimated that more than 7,000 civilians have been killed in Ukraine in the last year, with 12,000 injured. “This is almost certainly a low estimate,” UNHCR chief said. The UN migration agency, IOM, said that “the scale of destruction in the south and east has been massive—so much so that one senior UN humanitarian worker with the agency told UN News in an interview, that some towns “don’t even exist anymore.”
The upshot of the continuing war is clear enough. It is no longer a European war. The fallout of the war is felt far and near, across the world amid the impending recession. Worse still, the poor countries in the Global South will be badly affected with worsening exchange relations and unequal distribution of resources in the global economy. No war in human history has helped save the world from its inevitable disaster. Both Russia and the United States must relook at their ‘strategic hunt’ in different theatres of conflict. However, the success of a stable international system demands prudence (practical wisdom) in diplomacy, rather than brinkmanship and headstrong gamesmanship.
