Friday, May 9, 2014
China's foreign ministry blamed the United States on Friday for stoking tensions in the disputed South China Sea by encouraging countries to engage in dangerous behavior, following an uptick in tensions between China and both the Philippines and Vietnam.
China this week accused Vietnam of intentionally colliding with its ships in the South China Sea after Vietnam asserted that Chinese vessels used water cannon and rammed eight of its vessels at the weekend near an oil rig.
The United States has called China's deployment of the rig "provocative and unhelpful" to security in the region, urging restraint on all sides.
Chinese foreign ministry spokeswoman Hua Chunying repeated that the waters the rig was operating in, around the Paracel Islands, were Chinese territory and that no other country had the right to interfere.
"It must be pointed out that the recent series of irresponsible and wrong comments from the United States which neglect the facts about the relevant waters have encouraged certain countries' dangerous and provocative behavior," Hua told a daily news briefing.
"We urge the United States to act in accordance with maintaining the broader picture of regional peace and security, and act and speak cautiously on the relevant issue, stop making irresponsible remarks and do more to maintain regional peace and stability," she added.
Tensions are also brewing in another part of the sea, with Beijing demanding that the Philippines release a Chinese fishing boat and its crew seized on Tuesday off Half Moon Shoal in the Spratly Islands.
Philippine police said the boat and its crew were seized for hunting sea turtles, which are protected under local laws.
Hua said the Philippines' actions were illegal as they had entered Chinese waters to seize the boat and its crew.
"We once more demand the Philippines immediately release them unconditionally ... China reserves the right to take further action," she said, without elaborating.
Manila says the Chinese boat was seized 60 miles off Palawan island, within a 200-mile (320-kilometre) exclusive economic zone declared by the Philippines.
The incident coincided with annual war games this week in the Philippines involving 5,500 American and Filipino soldiers and marines, focusing on maritime security.
Up in the northern Zambales coastline, Philippine and U.S. marines, in rubber boats, assaulted an isolated beach in a mock battle to test the combat readiness of the two oldest allies in Asia-Pacific region.
They also conducted a staff exercise focused on maritime security, responding to a simulated attack on a gas platform and pipeline in western Palawan island.
"We are only testing our contingency plans. This is purely simulations. We are not talking of any particular third country involved in the attack," said a senior Philippine naval officer, who declined to be named because he was not authorized to talk to the press.
China claims almost the entire South China Sea, rejecting rival claims to parts or all of the oil and gas rich waters from Vietnam, the Philippines, Taiwan, Malaysia and Brunei.
Last month, the Philippines and United States signed a new security pact allowing American forces wider access to local bases and to build storage facilities as part of U.S. President Barack Obama's "pivot" to Asia policy.
Obama, during a two-day visit to Manila, promised "ironclad" commitment to defend the Philippines, a former American colony, from external aggression.
Credit to Reuters
The US assistant secretary of state has warned Russia that the territory of the North Atlantic Treaty Organization (NATO) is inviolable, saying that every piece of it will be defended.
Victoria Nuland said Washington would like to see Moscow completely end its support for groups demanding more autonomy in Ukraine's east and south, and help disarm them.
In relevant remarks, she told the House Foreign Affairs Committee on Tuesday that the European Union and the United States are unanimously working on a new round of economic sanctions if Ukraine’s May 25 presidential election is disrupted by Russia.
“What we're doing this week is trying to develop this strong sectoral package on both sides of the Atlantic so that the Russians can see it, understand it, and understand its impact if they take further action to prevent these elections from happening,” Nuland said.
Meanwhile, European countries have given a preliminary go-ahead for broadening sanctions against Moscow. The sanctions target people, companies or organizations that have profited from Crimea’s reunification with Russia.
European foreign ministers will be meeting in Brussels on May 12 to discuss further sanctions. The bloc has already ordered visa bans and asset freezes for 48 people it accuses of threatening Ukraine’s sovereignty.
The EU expansion of sanctions coincided with a White House announcement that the US was imposing its third round of sanctions, targeting seven senior Russian officials and 17 companies linked to President Vladimir Putin's “inner circle.”
The Ukrainian crisis began last November when the country’s then president, Viktor Yanukovych, refrained from signing an Association Agreement with the European Union in favor of closer ties with Russia.
The refusal triggered months of unrest and clashes with the police, which finally led to the ouster of Yanukovych on February 23. He then travelled to Russia, where he was given sanctuary.
Credit to PressTV
Ukraine does not acknowledge the $3.5 billion debt for Russian gas deliveries earlier announced by Russian energy giant Gazprom, acting Ukrainian Energy Minister Yuriy Prodan said Thursday.
"We cannot accept the figure mentioned by Gazprom because Gazprom includes in this total some calculations that are based on an economically unsound price offered to Ukraine, about $500 per 1,000 cubic meters," Prodan told reporters in Kiev.
Gazprom said Wednesday that it has not received payments for deliveries of Russian natural gas to Ukraine in April, which brings Kiev’s gas debt to a total of $3.5 billion.
When asked about whether Ukraine was ready to switch to the advance payment system for its gas supplies to Russia, Prodan replied that his country was unable to do that.
Russian President Vladimir Putin said during his annual question-and-answer session on April 19 that Moscow was ready to tolerate Ukraine’s non-payment for Russian gas for another month, but then will switch to advance payments.
Ukraine’s state-run gas company Naftogaz was expected to transfer payments for April deliveries by May 7.
Ukraine refuses to recognize the new gas price of $485.50 per thousand cubic meters, although the sum is fully in line with the contract that the two states signed in 2009.
Kiev wants to buy Russian gas at the old price of $268.50 per thousand cubic meters, which was in place before Russia cancelled two major discounts starting April 1.
In December, Russia offered Ukraine a 25 percent discount from the original price of around $400. The deal was cancelled because of Kiev’s overdue gas bills.
Another discount of $100 per thousand cubic meters of gas was granted by Russia in return for the right to use the Sevastopol port in Crimea to host the Black Sea Fleet. It was annulled shortly after Crimea became a part of Russia in March.
Credit to RIA Novosti
The Kiev authorities’ special operation in southeastern Ukraine will continue regardless of the decision of the Donetsk People’s Republic to hold a referendum on the region’s status, a senior Ukrainian official said Thursday.
Andriy Parubiy, the Secretary of the Committee on National Security, said that according to the country’s laws, the DPR does not have the right to hold the vote.
“If [the date of the referendum] is going to be postponed or they announce the results of the referendum does not make any difference. The anti-terrorist operation will continue," Parubiy said during a press conference.
Russian President Vladimir Putin on Wednesday urged pro-federalization activists in southeastern Ukraine to postpone a referendum on self-determination to ensure the start of nationwide dialog.
Later in the day, presidential spokesman Dmitry Peskov described Putin’s proposal as "a step toward the Ukrainian people rather than a step toward the [interim government in] Kiev."
"If federalization activists in eastern regions of Ukraine decide to follow Putin’s advice and postpone the referendum, and Kiev, in its turn, stops its military operation and starts to launch the mechanism of dialogue, then it will take Ukraine out of the situation," he told the Slon.ru news website.
Pro-federalization activists in Ukraine’s Donetsk and Luhansk regions are to discuss the proposal on Thursday.
Early presidential elections were scheduled for May 25 in Ukraine after the country’s elected president, Viktor Yanukovych, was ousted late February following the so-called Euromaidan mass rallies in Kiev.
Citizens of the mainly Russian-speaking southeastern regions of Ukraine have refused to recognize the legitimacy of the country’s interim government and have announced referendums on self-determination in Donetsk and Luhansk regions, to be held on May 11.
Kiev’s current authorities have launched a special operation to crack down on the protesters, leading to violent clashes in major towns of southeastern Ukraine and dozens of casualties. Last Friday, 46 protesters were killed and over 200 were injured in the port city of Odessa.
Russia has repeatedly condemned Kiev’s military operation against the restive regions and urged an immediate withdrawal of Ukrainian troops, as well as the start of comprehensive national dialogue to de-escalate the situation in the crisis-hit country.
Credit to RIA Novosti
Gazprom has become the world’s biggest public company in terms of EBITDA, leaving Apple and ExxonMobil behind. In a separate development, the Rothschild Investment Corporation has been reported to be actively buying Gazprom shares.
At the end of April, Gazprom published its consolidated accounts for 2013. The figures show that in 2013 the company rose from third to first place in the world in terms of EBITDA (earnings before interest, taxes, depreciation and amortization), which grew by 22 percent to reach 2.01 billion rubles ($61.4 billion).
It is followed by China’s Petrochina ($57.78 billion), ExxonMobil ($57.48 billion), and Apple ($55.76 billion).
In terms of net profit, Gazprom is the world’s fifth largest company ($35.62 billion) and in terms of earnings, the 16th ($106.4 billion).
Experts polled by the business daily Vedomosti attribute Gazprom’s rise in EBIDTA to record-high gas supplies to Europe, which grew by 16.3 percent last year, while the company’s share of the market expanded from 26 to 30 percent.
At the same time, gas prices remained practically unchanged. Accounting for 40 percent of the company’s earnings, Europe is the main market for Gazprom, Sergei Vakhrameyev, an analyst with Ankorinvest, told Vedomosti.
Yet this rise in earnings has had no effect on Gazprom’s capitalization. Still undervalued, the company is not even ranked among the world’s top 100 companies. As of April 29, Gazprom was only in 110th place, with a capitalization of about $85 billion. By way of comparison, ExxonMobil’s capitalization on Apr. 29 stood at $436.08 billion, while that of the world’s most valuable company, Apple, at $511.74 billion.
Rothschilds investing in Gazprom
It is therefore unsurprising that Gazprom’s increasingly cheaper shares have provoked an increased interest from the Rothschild dynasty. In the first quarter of 2014, the Rothschild Investment Corporation increased its investment in Gazprom ADRs (American depositary receipts) sevenfold, to $1.7 million, according to the statement the corporation filed with the U.S. Securities and Exchange Commission.
“For a dynasty which has for many years been a symbol of wealth and power, this is not a significant amount. It is more of a signal that the situation on the Russian market may still improve,” an analyst with the brokerage firm FBS, Kira Yukhtenko, told Vzglyad newspaper.
In the first quarter of 2014, Gazprom shares fluctuated between 120 and 145 rubles ($3-4 at the current exchange rate). By way of comparison, after the 2008 crisis, the company’s stock lost 74 percent of its value and was priced at 84 rubles. Then the price began to rise and reached 247 rubles in 2011, after which it went down again.
Gazprom shares continue to be undervalued, Yukhtenko said. Their future value entirely depends on the West. If the West resorts to tougher economic sanctions against Russia, then everybody will suffer and Gazprom will feel the burn most keenly of all.
In that eventuality, the company’s shares may fall to $2, the analyst continued. “If tensions in Russian-Ukrainian relations ease, Gazprom shares will go back to 135 rubles (about $3.7) and will continue to rise further,” Yukhtenko concluded.
Credit to OSnet.daily
Russia will quadruple its arsenal of long-range precision delivery platforms in the next seven years to strengthen the country's strategic deterrent, Defense Minister Sergei Shoigu said Thursday.
"Taking into account the role and importance of long-range high-precision weapons in strategic deterrence, we are planning to quadruple by 2021 the number of carriers of high-accuracy weaponry," Shoigu said.
Igor Korotchenko, a leading Russian military expert, said that submarines, fighter jets and strategic bombers were all included as high-precision weapon platforms, and their total number would quadruple.
According to Korotchenko, the weapons systems include both diesel- and nuclear-powered submarines, as well as a range of aircraft including the Su-35 Flanker fighter, Su-34 Fullback fighter-bomber, Tu-50 (PAK FA) fifth-generation fighter and the Tu-160 Blackjack and Tu-95MS Bear strategic bombers.
Shoigu announced the plans while reporting on the results of the drills carried out earlier on Thursday by Russia's nuclear triad.
During the exercise, the Russian military test-launched a Topol (SS-25 Sickle) intercontinental ballistic missile from the Plesetsk launch complex in northwestern Russia.
Two Delta-class nuclear-powered strategic submarines from Russia’s Northern and Pacific Fleets also test fired ballistic missiles in the exercises.
And a Russian Tu-95 “Bear” strategic bomber launched six cruise missiles against ground targets.
Shoigu told Russian President Vladimir Putin, that the share of advanced missile systems in Russia’s arsenal will rise to 80 percent by 2016, and replace old models completely by 2021.
He praised the high degree of readiness of the Russian nuclear triad, demonstrated during the exercises.
The drill was overseen by Putin and observed by the presidents of Collective Security Treaty Organization member states Belarus, Armenia, Tajikistan and Kyrgyzstan.