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Opinion: Russia for the Russians?

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vladimir-putin-glassesBy Sir Andrew Wood, Associate Fellow, Russia and Eurasia Programme, Chatham House
President Putin has turned up the volume since his return to the Kremlin in May 2012 in proclaiming Russia’s peculiar national virtues and traditions.

Wrapping oneself in the flag is a familiar way in many countries of buttressing a leader’s support, not least when that leader fears it to be under threat. Vladimir Putin and his colleagues are not untypical in combining Russian-centred rhetoric − through emphasis, for example on the role of the Russian Orthodox Church − with the parallel claim that Russia has an abiding tradition of respect for minority cultures within its borders. The result overall has been to put over a message more flattering to Russian ethnic sensibilities than to those of other national groups.

The question now is how far Putin has lost control of this ambivalent agenda. The three main features of the past year and a half have been the Kremlin’s attempts to sustain the status quo through suppression of criticism or opposition, the further emasculation of autonomous institutions including by sidelining the government  under Prime Minister Dmitry Medvedev, and the effort at retrenchment into a quasi-Soviet ‘Eurasian’ past. All three strands are intended to provide for short term safety for the ruling group but come at the expense of Russia’s longer term stability and prosperity. Hence a widespread sense in Russia of doubt as to the future, and outside it, of a perceived need felt particularly in other ex-Soviet states to resist too close an embrace by Moscow.

The rioting and looting on 13−14 October following the murder of a Russian national in the Moscow district of Western Biryulyovo, allegedly by an Azeri national, reflected this wider unease as much as it did the inter-ethnic tension that focused Russian reactions on that particular day. Had the police been trusted or capable they would have been able to deal with an individual murder. In the event, they lost control and resorted to rounding up as many of the actual or potential victims of Russian revenge assaults on persons of ‘non-Russian appearance’ as they could find. It was telling too that the authorities made no attempt to frustrate the 4 November Russian March −  that march included a number of 'extremists' in anyone’s language.

The Biryulyovo district, as a typical repository of the conservatively minded electorate on which Putin has come to rely, returned a heavy majority to Mayor Sergei Sobyanin at the September Moscow elections. Putin and his colleagues will have been reminded by the disorder in mid-October that this electorate is nonetheless volatile, and that its trust in the authorities, whether local or federal, is limited at best. Putin himself still has high poll ratings – after all, who else is there? – but the polls also show that once particular questions as to policies and prospects are put to voters, they reflect a growing gap between the ruling group and the population at large. Given the way that the president’s say has grown since May 2012 into becoming the ever clearer driver of the system – or brake on it for that matter – that too is a verdict on Putin’s record and present standing.

The poorer urban Russians are more directly affected by other ethnic groups living among them than their better off counterparts. Those other groups of course include fellow citizens from for instance the Northern Caucasus as well as immigrant workers from the rest of the former Soviet Union – who are poor too, and typically, uneducated as well. It makes no difference when it comes to attacks on 'people of non-Russian appearance' whether these are Russian citizens or not. The number of such incidents has grown over recent years, but seem to be the work of violent gangs rather than organized political forces – so far.

The issue of the relationship between ethnic Russians and others has nevertheless moved steadily up the political agenda. Nationalist groupings are part of both the opposition, systemic or non-systemic, and those making up the regime. ‘No more money for the Caucasus’ has been one of Alexei Navalny’s more effective slogans. The Biryulyovo riots, the police raids on persons suspected of being illegal immigrants, and the 4 November Russian March all increased the focus on nationalist concerns.

But rhetoric is cheap, and realistic action hard to envisage, putting the governing authorities in a bind. Their focus has been on the question of illegal immigrants, not inter-ethnic relations as such. Putin has conveyed sympathy for the feelings of Russians, but for compelling practical reasons has not endorsed ideas for visa systems, whether for the country as a whole or Moscow in particular. Closing down the Biryulyovo market at the centre of the October troubles was an instinctive but not too persuasive reaction. Talk of introducing face recognition cameras for immigrants sounded resolute but that was all.

The truth is that Russia’s rulers have no answer to a set of questions that may well increase in their destructive force, not least given the way that the country’s economic prospects have darkened. Buying off trouble is no longer the option that it was. The authorities’ instinct will most likely be to deal with ethnic challenges by coercion, with non-Russian inhabitants their preferred targets.

Economy

EU approves €2.9 billion in state aid for battery project attracting €9 billion

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The Commission has approved, state aid of up to €2.9 billion in funding for an ‘Important Project of Common European Interest’ (IPCEI) to support research and innovation in the battery value chain. The twelve EU countries involved will provide public funding expected to unlock an additional €9 billion in private investments.

The project, called “European Battery Innovation” was jointly prepared and notified by Austria, Belgium, Croatia, Finland, France, Germany, Greece, Italy, Poland, Slovakia, Spain and Sweden.

Executive Vice-President Margrethe Vestager, in charge of competition policy, said: “For those massive innovation challenges for the European economy, the risks can be too big for just one member state or one company to take alone. Today's project is an example of how competition policy works hand in hand with innovation and competitiveness. With significant support also comes responsibility: the public has to benefit from its investment, which is why companies receiving aid have to generate positive spillover effects across the EU.”

When Vestager was asked if companies from outside the EU, such as Tesla, could benefit from this funding she said that this was possible and showed that the EU was committed to open strategic autonomy and welcomes non-EU firms when they have the right projects.

The Vice-President for Foresight, Maroš Šefčovič, said: “The Commission has given its green light to a second important project of the common European interest in the field of batteries. Technology is vital for our transition to climate neutrality. The figures show what an enormous undertaking this is. It involves twelve member states from North, South, East and West, injecting up to €2.9 billion euros in state aid in support of 46 projects designed by 42 companies, which in turn will generate three times as much private investment. "

The project will cover the entire battery value chain: extraction of raw materials, design and manufacturing of battery cells, recycling and disposal. It is expected to contribute to the development of a whole set of new technological breakthroughs, including different cell chemistries and novel production processes, and other innovations in the battery value chain, in addition to what will be achieved thanks to the first battery IPCEI.

 

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coronavirus

EU urges AstraZeneca to speed up vaccine deliveries amid 'supply shock'

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The European Union has urged AstraZeneca to find ways to swiftly deliver vaccines after the company announced a large cut in supplies of its COVID-19 shot to the bloc, as news emerged the drugmaker also faced supply problems elsewhere, write and

In a sign of the EU’s frustration - after Pfizer also announced supply delays earlier in January - a senior EU official told Reuters the bloc would in the coming days require pharmaceutical companies to register COVID-19 vaccine exports.

AstraZeneca, which developed its shot with Oxford University, told the EU on Friday it could not meet agreed supply targets up to the end of March, with an EU official involved in the talks telling Reuters that meant a 60% cut to 31 million doses.

“We expect the company to find solutions and to exploit all possible flexibilities to deliver swiftly,” an EU Commission spokesman said, adding the head of the EU executive Ursula von der Leyen had a call earlier on Monday with AstraZeneca’s chief Pascal Soriot to remind him of the firm’s commitments.

A spokesman for AstraZeneca said Soriot told von der Leyen the company was doing everything it could to bring its vaccine to millions of Europeans as soon as possible.

News emerged on Monday that the company faces wider supply problems.

Australia’s Health Minister Greg Hunt told reporters AstraZeneca had advised the country it had experienced “a significant supply shock”, which would cut supplies in March below what was agreed. He did not provide figures.

Thailand’s Health Minister Anutin Charnvirakul said AstraZeneca would be supplying 150,000 doses instead of the 200,000 planned, and far less than the 1 million shots the country had initially requested.

AstraZeneca declined to comment on global supply issues.

The senior EU official said the bloc had a contractual right to check the company’s books to assess production and deliveries, a move that could imply the EU fears doses being diverted from Europe to other buyers outside the bloc.

AstraZeneca has received an upfront payment of 336 million euros ($409 million) from the EU, another official told Reuters when the 27-nation bloc sealed a supply deal with the company in August for at least 300 million doses - the first signed by the EU to secure COVID-19 shots..

Under advance purchase deals sealed during the pandemic, the EU makes down-payments to companies to secure doses, with the money expected to be mostly used to expand production capacity.

“Initial volumes will be lower than originally anticipated due to reduced yields at a manufacturing site within our European supply chain,” AstraZeneca said on Friday.

The site is a viral vectors factory in Belgium run by the drugmaker’s partner Novasep.

Viral vectors are produced in genetically modified living cells that have to be nurtured in bioreactors. The complex procedure requires fine-tuning of various inputs and variables to arrive at consistently high yields.

“The flimsy justification that there are difficulties in the EU supply chain but not elsewhere does not hold water, as it is of course no problem to get the vaccine from the UK to the continent,” said EU lawmaker Peter Liese, who is from the same party as German Chancellor Angela Merkel.

The EU called a meeting with AstraZeneca after Friday’s (22 January) announcement to seek further clarification. The meeting started at 1230 CET on Monday.

The EU official involved in the talks with AstraZeneca said expectations were not high for the meeting, in which the company will be asked to better explain the delays.

Earlier in January, Pfizer, which is currently the largest supplier of COVID-19 vaccines to the EU, announced delays of nearly a month to its shipments, but hours later revised this to say the delays would last only a week.

EU contracts with vaccine makers are confidential, but the EU official involved in the talks did not rule out penalties for AstraZeneca, given the large revision to its commitments. However, the source did not elaborate on what could trigger the penalties. “We are not there yet,” the official added.

“AstraZeneca has been contractually obligated to produce since as early as October and they are apparently delivering to other parts of the world, including the UK without delay,” Liese said.

AstraZeneca’s vaccine is expected to be approved for use in the EU on Jan. 29, with first deliveries expected from 15 February.

($1 = €0.8214)

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Brexit

Brexit butchers EU trade for Scottish beef producers

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Brexit has dealt a blow to Andrew Duff’s business. His burgeoning sales of high end Scottish beef to Europe are on hold because his business is too small to navigate the post-Brexit customs border for now, writes .

The 32-year-old had been on the verge of expanding the family business, using his social media marketing skills to promote the rare beef that has been reared on farms across the Scottish lowlands and borders for centuries.

Instead his Macduff business is now one of thousands across Britain that lack the financial firepower to throw at the myriad health checks, customs declarations and higher logistics costs that are required to export goods into the European Union.

“With these customers it takes years to build the relationship and get them on board, and it can take seconds to lose,” said Duff, whose clients include an award-winning butcher in Germany and a Michelin-starred restaurant in Belgium.

“Luckily January is a quiet month. Come February, March, if the situation is still the same then it could be problematic,” he told Reuters.

Far from the dire warnings of clogged ports and tailbacks that preceded the departure, Brexit so far has seen factories and fishermen unable to complete paperwork and get the goods off their yard. Many still do not know which forms need completing. Different couriers give different answers.

The government has said it is helping businesses deal with the “teething problems”. It has urged exporters to make sure their paperwork is in order and said it will give 23 million pounds ($31 million) to fishermen who have lost sales due to delivery delays.

Prime Minister Boris Johnson argued that Britain would be free to trade globally once it had cast off the shackles of the EU. But his pursuit of a relationship that enables Britain to set its own rules means those firms trading with Europe face a full customs border.

Hardest-hit are the small companies that built up during Britain’s 47-year membership of the world’s biggest trading bloc to sell often low-priced product that was couriered at speed across the continent.

Almost half of 2018’s 76 billion pounds in exports to the EU from small and medium sized enterprises came from firms employing fewer than 9 people.

Where a huge meat or fish producer can fill one truck with one product and complete one set of customs paperwork, Duff sources top quality cattle from a selection of farms.

His goods - bone-in pieces from Shorthorn and Luing breeds - are sent on a truck carrying products from other suppliers, a process known as groupage.

Now a vet-approved health certificate is required for each firm’s goods, meaning potentially up to 30 per truck. One fish exporter said he needed over 400 pages of export documentation for one EU-bound lorry. One error can block delivery.

Duff’s transport company have said they are struggling as it is to help big customers, so groupage must wait.

He is also worried about prices, knowing that he cannot absorb all the costs of customs declarations, longer logistics times and the health certificates.

Logistics bosses believe Brexit could force a shake-out in trade. Truck volumes between Britain and the EU were on average down 29% in the first 20 days of the year, according to data firm Sixfold. Logistics groups say some trucks are returning empty to Europe to avoid export paperwork. Prices are rising.

One of those caught up in the bureaucracy is Sarah Braithwaite, who worked 16-hour days to build a horse feed firm that until 1 January was selling into 20 European countries.

This month her stock has failed to get to Europe or been rejected by customers over unexpected customs bills and taxes. Her Forage Plus has halted European orders - making up to 30% of her sales - and is refunding £40,000 to customers.

Braithwaite says her business is too small to build a presence in Europe to overcome the new barriers. “The trade that we’ve got now wouldn’t support the cost of setting all that up,” she said.

Both she and Duff are hopeful that exports can resume once the new system has bedded in but nerves are frayed. In desperation Braithwaite called the UK government for help.

The message she got back: ring the French embassy.

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