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Russia and Greece consider collaborating to circumvent Western sanctions by Carol J. Williams Los Angeles Times, June 21 <http://www.latimes.com/world/europe/la-fg-greece-russia-europe-20150621-story.html> As Russia and Greece each endure strained relations with the rest of Europe, their leaders have been pondering how they might collaborate to sidestep their Western neighbors' sanctions and censure. With his Balkan nation on the brink of economic collapse, Greek Prime Minister Alexis Tsipras on Friday paid his second visit in less than three months to Russian President Vladimir Putin to sign a lucrative pipeline construction deal and, presumably, to discuss what European Union member Greece might do to ensure that Russia receives relief from sanctions when current ones expire next month. Kremlin officials denied that Tsipras asked for financial aid during his meeting with Putin on the sidelines of the annual St. Petersburg International Economic Forum. But two senior officials had said before the meeting that Moscow was open to considering a loan to help Athens avert default on bailout obligations due to international creditors. In his address to the annual gathering of multinational chief executives and Russian oligarchs, Tsipras blamed the misguided European Union policies for the Greek economic crisis. "The EU should go back to its initial principles of solidarity and social justice," Tsipras, a former communist, said in lambasting austerity measures imposed on Greece in exchange for its $270-billion bailout, mostly financed by EU colleagues. "Ensuring strict economic measures is leading us nowhere. The so-called problem of Greece is the problem of the whole European Union." Tsipras cast Greece as a ship navigating troubled waters as it faces a June 30 deadline for a $1.8-billion loan payment that it can't cover without borrowing more. Athens' creditors are refusing to provide additional cash until the far-left government, which took power in Greece in January, comes up with a credible plan to straighten out domestic finances. "We are now in the middle of a great storm," Tsipras told the St. Petersburg gathering. "But we are a seafaring nation that knows how to navigate through storms and is not afraid of heading to new seas and reaching new harbors." The quest for new refuge sounded to many like an appeal for a Russian loan to help Athens with the looming debt payment. But Kremlin spokesman Dmitry Peskov told journalists that Tsipras made no appeal for direct financial aid during his meeting with Putin. The Greek leader did go home with a $2.77-billion deal to get in on Russia's impending mega-project to reroute natural gas deliveries to Western Europe through Turkey, bypassing Ukraine, where many of Moscow's pipelines are routed. Relations with Ukraine have deteriorated severely since Moscow's seizure of the Crimean peninsula last year and its support for pro-Russia separatists occupying two large regions of eastern Ukraine. Greece and its major lenders — the International Monetary Fund, the European Central Bank and the European Commission — have been deadlocked in talks aimed at drafting a new plan for reducing the staggering debt carried by Athens. The latest negotiating session, on Thursday, ended with no progress toward an agreement and harsh words from the creditors over Athens' failure to bring new proposals to the table. The fruitless meeting in Luxembourg lasted less than an hour, and its failure to break a weeks-long impasse prompted the European Union to call an emergency summit for Monday night to discuss ways to avert fiscal implosion in Greece — or how the remaining Eurozone states can guard against damage to their own economies if the currency union suffers its first dropout. Greeks have already begun pulling their euros out of Greek banks, with at least $3.4 billion worth withdrawn last week, the Greek news site ekathimerini.com reported. The run on deposits prompted the Bank of Greece to appeal to the European Central Bank on Friday for a $3.95-billion emergency liquidity infusion to ensure that banks can open Monday. Russia is suffering its own economic crisis because of sanctions imposed by the European Union and the United States over its aggression in Ukraine. The Russian economy has also been hit hard by the past year's sharp drop in the price of oil, on which the Kremlin depends for more than half of its annual budget. Any Russian assistance to Greece could pay off for the Kremlin, though, as Athens might be persuaded to withhold approval of a planned extension of sanctions when the current ones expire next month. Under European Union rules, all 28 member nations have to approve such actions, and Tsipras has been harshly critical of the sanctions that have triggered Russia's retaliatory boycott of European food exports. Washington fears losing Greece to Moscow by Geoff Dyer in Washington Financial Times, June 21 <http://www.ft.com/cms/s/0/3f0bb524-1823-11e5-8201-cbdb03d71480.html> Throughout the prolonged showdown between Greece and its creditors, the Obama administration has largely sat on the sidelines, issuing the occasional warning about the potential economic impact of a default. But with Greece now on the verge of bankruptcy, the US is also beginning to worry about the political fallout from a deeper crisis and the potential for Russia to gain increased influence over a Nato member. As Washington tries to maintain a united western front in support of sanctions on Russia over Ukraine, a Greek default could provide Moscow an opportunity to sow new divisions among America’s European allies. “You can easily see how geopolitically this would be a gift to Russia,” says Sebastian Mallaby at the Council on Foreign Relations. “You do not want Europe to have to deal with a Greece that is a member of Nato but which all of a sudden hates the west and is cosying up to Russia.” Greece was regarded as a frontline state against the advance of Soviet-backed communism during the cold war. Its EU accession in 1981 is one factor that cemented its identity as a western democracy, something that was deepened 20 years later with the adoption of the euro. For some months, the administration of President Barack Obama has been quietly urging Germany and other EU members to try to find a way to resolve the stand-off with Greece. While economic considerations have been at the forefront, diplomats say the EU’s position on Ukraine has also been part of the conversation. The visit by Greek prime minister Alexis Tsipras to St Petersburg late last week served as a reminder of the current Greek government’s political ties to President Vladimir Putin’s Russia and showed its willingness to look towards Moscow at moments when the dispute with international creditors is at its most intense. The Russia trip also prompted new speculation that Moscow might be willing to lend substantial financial assistance to Athens, although this prospect is played down by analysts in Washington given the scale of the economic problems Greece would likely face if it were to default. “It is not as if Russia has a lot of money to throw around,” says Thomas Wright at the Brookings Institution in Washington. “Russia is not a huge potential export market, it is not a new economic option that did not exist for the Greeks before the crisis.” Instead, the worry is that the prolonged economic instability that could result from a default would deepen the political hostility towards the rest of Europe among the Greek electorate, opening an opportunity for Russia to boost its sway in the country. Throughout the Ukraine crisis, Moscow has been working to weaken support in the EU for sanctions, which require unanimous backing from the bloc’s 28 members. It has pushed to encourage pro-Russian political sentiment in Hungary and southeastern Europe, partly through its energy diplomacy. Angela Merkel, the German chancellor, last year warned about Russia’s designs in the region. Her worry about the geopolitical ramifications of a Grexit is one consideration that separates her from Wolfgang Schäuble, her hardline finance minister. Obama administration officials insist the EU remains committed to the sanctions on Russia over Ukraine. “We still believe that Europe remains united against Russia and what they’re doing,” says John Kirby, state department spokesman, when asked about the potential impact of a Greek default. “I think coming out of the G7 you saw a lot of unity in Europe for continued sanctions against Russia and the possibility for increased sanctions to further isolate Russia.” Julianne Smith, a former Obama administration official now at the Center for a New American Security, says the showdown over Greece plays into a broader Washington concern about the effectiveness of the EU at a time when the UK is also planning a referendum about its own membership. “Washington is worried about both the Grexit and Brexit situations,” she says. “Both situations are a distraction at a time when we need Europe to show a lot of leadership.” Instead, the result of the succession of crises is “likely to provoke a period of navel-gazing” among Europe’s leaders. Putin meets with Tsipras, says Russian pipeline project should help Greece pay its debt by Sandy Macintyre and Nataliya Vasilyeva Associated Press, Minneapolis StarTribune, June 19, 2015 <http://www.startribune.com/greece-signs-deal-with-russia-to-build-gas-pipeline/308384571/> ST. PETERSBURG, Russia — Russian President Vladimir Putin said after Friday's talks with Greek Prime Minister Alexis Tsipras that a prospective Russian natural gas pipeline should help Greece service its debt, but the Kremlin said the question of direct Russian financial aid to Greece was not discussed. Speaking of the pipeline deal at a meeting with top executives of global news agencies, including The Associated Press, which began nearly three hours behind schedule at around midnight, Putin said he saw no support for the Greeks from the EU. "If EU wants Greece to pay its debts it should be interested in growing the Greek economy ... helping it pay its debts," he said. "The EU should be applauding us. What's wrong with creating jobs in Greece?" Greece is struggling to reach a deal with its creditors for new loans that it needs to avoid defaulting on debt payments at the end of the month. Without the bailout, Greece could be headed for bankruptcy or an exit from the 19-nation eurozone. Tsipras' visit gave rise to speculation that the Greeks may be seeking Russian loans — and ahead of the talks, Putin's spokesman said Russia would consider a loan if the Greeks asked for one. "We would do this because they are our partners and this is a normal practice between countries who are partners," spokesman Dmitry Peskov told The Associated Press. But when Tsipras met with Putin at the sidelines of a major economic forum in St.Petersburg, the possibility of a loan wasn't discussed, Peskov told journalists. Instead, they spoke about "the necessity of developing investment cooperation." Russia and Greece signed a deal Friday to build an extension of a prospective gas pipeline that would carry Russian gas to Europe through Turkey. Russia promised Greece hundreds of millions of dollars in transit payments yearly if it agreed to build the pipeline. Construction of the pipeline is expected to start next year and be completed in 2019. Russian Energy Minister Alexander Novak said Russia and Greece would be equal partners in the project, with Russia's half owned by the state bank VEB. The talks were held after both leaders addressed investors and Russian government officials at Russia's biggest annual economic forum. . . . On Thu, Jun 18, 2015 at 8:46 PM, Dayne Goodwin <[email protected]> wrote: > Greece's Tsipras heads to Russia for some love . . . _________________________________________________________ Full posting guidelines at: http://www.marxmail.org/sub.htm Set your options at: http://lists.csbs.utah.edu/options/marxism/archive%40mail-archive.com
