Page 52 - bne monthly magazine June 2024 Russian Despair Index

52 I Southeast Europe bne June 2024
• Investigate and implement
strict penalties on violators: EU/
G7 countries must investigate shipments from Turkish ports
to deduce any violations on the transshipment of Russian oil products. In case of violations, entities must be sanctioned and served with bans and penalties. Enforcement agencies should have the power to board vessels, check certification documents that show evidence of the oil’s origin and chemically test it to determine whether the commodity contains oil originating from Russia. Tankers with falsified statements of the fuels’ origin should be treated as smuggling with all the related
legal consequences. This includes
the arrest of ships at sea and their confiscation.
• Lower the price cap on products:
The coalition must also lower the price cap of oil products which are currently above the market price. Lowering the price cap would be deflationary and force Russia to produce and export more volumes of refined products to make up for the loss in revenue. Lowering the price cap to $35 per barrel for premium products and $25 per barrel for low-value products would cut the Kremlin’s revenues from seaborne oil products by 68% (€3.3 bn per month).
• Remove transfer pricing loopholes: Regulatory authorities such as
customs and tax agencies must also ensure that Russian companies do not use transfer pricing schemes to increase profits made from oil sold in different markets, and especially ensure that the proceeds from
such transfer pricing cannot reach the Russian government. Creative transfer pricing schemes allow vertically integrated Russian oil companies to sell crude oil or refined products at artificially low prices so that they can extract a profit from selling on the wholesale market
at much higher prices abroad (in countries such as Turkey). The profit out of the price difference is then moved to an offshore-registered subsidiary to avoid paying taxes
in Russia.
China to intensify relations with Serbia after President Xi's landmark visit to Belgrade
bne IntelliNews
Beijing’s diplomatic engagement with Serbia has entered a new phase after Chinese President Xi Jinping's visit to Belgrade on May 7-8.
Serbia, one of just three nations on Xi's European tour, is poised to deepen ties with Beijing, with a statement from Xi and his Serbian counterpart Aleksandar Vucic talking of a “shared future” for the two countries.
The visit included the signing of 29 agreements aimed at bolstering legal, regulatory, and economic cooperation between the two nations.
Serbia is set to become the first European country in years to enter into a free trade agreement with China, slated to take effect on July 1.
Xi's decision to prioritise Serbia in his European tour reflects the country's strategic significance to China. Alongside Hungary, Serbia has been a steadfast supporter of China's Belt and
www.bne.eu
Road Initiative (BRI), positioning itself as a pivotal partner in China's infrastructure agenda across Asia and Europe.
"Serbia became China's first strategic partner in Central and Eastern Europe eight years ago, and it becomes the first European country with which we shall build a community with shared future," said Xi during the visit.
The discussions between the two leaders covered a wide range of topics, including bilateral cooperation, the BRI, China's engagement with Central and Eastern Europe, and international and regional affairs. The two parties reached a broad consensus on these matters, affirming their commitment to deepening mutual cooperation.
"The two sides agreed that Serbia
and China foster strong traditional friendship, intensive cooperation in specific areas, fruitful coordination on a multilateral level, and the development of bilateral relations has
broad perspectives," said the Serbian presidency in a statement.
Looking ahead, both countries expressed readiness to capitalise on the new phase of development of the BRI, with a focus on expanding cooperation in various sectors, including economy, trade, investment, technology and innovation.
On the political front, the two presidents expressed mutual support for each other's territorial integrity. Specifically, Belgrade made clear that it sees Taiwan as part of China, while Beijing considers Kosovo as part of Serbia.
Xi's visit took place on the 25th anniver- sary of the 1999 accidental Nato bomb- ing of the Chinese embassy in Belgrade, an incident that prompted widespread condemnation and an apology from then US president Bill Clinton.
Serbia's alignment with China's Belt and Road Initiative has cemented its position as a key partner for China