Page 60 - bne_March 2021_20210303

60 Opinion
bne March 2021
MOSCOW BLOG:
Kremlin lays out new rules of the game for post-Trump relations
Ben Aris in Berlin
What just happened in Moscow? The European Union's top diplomat Josep Borrell was sitting in a room with Russian Foreign Minister Sergei Lavrov in a highly anticipated meeting in the Russian capital, when in the course of the meeting Russia announced it was expelling three diplomats from Germany, Poland and Sweden.
Borrell has been slated for what has been seen as a disastrous trip, where he failed to threaten Russia with more sanctions in response to the decision to jail Alexey Navalny, who was sentenced to 2.8 years in prison just two days earlier.
He also suggested that the EU would buy the Sputnik
V vaccine, which is increasingly being seen as a success following a peer reviewed paper in Britain’s The Lancet after it was universally lambasted during the trials stage. Indeed, the EU has already launched the certification procedure for the drug in the middle of January – another PR victory for the Kremlin.
And in general his message was one of accommodation and the search for a middle ground. That has led to comparisons with Neville Chamberlain's meeting with Hitler in the run-up to WWII.
What is going on here is that in the first weeks following the departure of US president Donald Trump, everyone is laying out their positions for the post-Trump era. And Russia just laid out its position: it made it very clear that it will no longer brook any interference in what it considers to be domestic affairs (and for the purposes of diplomacy it considers Belarus to be a domestic affair as well).
This hardening of the Kremlin’s line is bound to lead to new clashes.
"While we fully respect Russian sovereignty... the European Union considers issues related to the rule of law, human
www.bne.eu
Russian President Vladimir Putin clearly feels comfortable enough to stand up to the West and has laid down his new rules of the game in the post-Trump world: Russia will no longer tolerate any meddling in its domestic affairs.
rights, civil society and political freedom are central to our common future,” Borrell said. Lavrov’s answer was to expel three diplomats while Borrell was talking.
Borrell went to Moscow in the hope of creating at least a pragmatic basis for EU-Russia relations in the post-Trumpian era. Russia has responded by setting the bar to zero: no co-operation, no compromise, no tolerance of any criticism of its domestic affairs, and it has put the onus on the EU to back off if it wants anything from Russia.
Post-Trump world
New beginnings are a chance for making big changes. Trump was not just the worst president in US history; the real problem was he was totally incompetent and entirely unpredictable.
That meant there was no diplomacy. Everyone was left to wing it, reacting to the damage Trump did as he careened from
one disaster to the next train wreck: trade wars, visa bans, detaining immigrants' children, ignoring the coronavirus [COVID_19] pandemic, treaty withdrawals and so on. The last four years have been a diplomatic nightmare.
And this unpredictability had serious economic consequences. As chief economist at Renaissance Capital Charlie Robertson pointed out in the bne IntelliNews cover story “Brighter Days”, foreign direct investment (FDI) into the US during Trump’s reign led to a strengthening dollar as major companies eschewed cheaper emerging market bases and moved their factories back home, afraid of the consequences of the break-out of a Trumpian trade war that could wreck their investments.
That is expected to change now, and a net $1bn a day will begin to flow out of the US into other markets as before, which will lift emerging markets and at the same time weaken the dollar in the next few years, which is also good for EMs.