Doc's Talk: Russia's Masterstroke: Bailing Out Cyprus

Tuesday, June 26, 2012

Russia's Masterstroke: Bailing Out Cyprus

Peter Martino

Cyprus is a prey Russia has long been eyeing, both as a substitute for Syria, and as a permanent naval base for the Russian fleet in the Mediterranean.

What a fine mess the Europeans have made with their deluded dream of a common European currency for 17 countries with different languages, cultures, traditions and economic systems. As a result of the experiment with the euro, almost all countries along Europe's southern rim are on the brink of bankruptcy. One of them is Cyprus. It, too, urgently needs a bailout. This week, the Cypriotic government needs €4bn to recapitalize the country's second largest bank.

Cyprus, however, is in a comfortable position. The other beggars are forced to accept bailout from the European Union in exchange for diminished national sovereignty, EU imposed austerity measures and direct supervision from Brussels over their budgets and economies. Cyprus, however, has an alternative. "We have other options," the Cypriotic Finance Minister Vassos Shiarly recently told journalists in Nicosia. Economists expect that to keep Cyprus afloat, it will need between €25 and 50bn in the coming years. Nicosia, however, is resisting pressure from the other EU countries to take a first bailout package worth as much as €10bn.

Cyprus does not want to accept the strings attached to the European offer. The Cypriotic alternative is called Russia. Last December, Moscow already gave Nicosia a bilateral loan of €3bn. Eager, since the era of Peter the Great, to acquire a strategic foothold in the Eastern Mediterranean, Russia is now offering even more. And with President Demetris Christofias of Cyprus happy to accommodate his friend Vladimir Putin, there is no doubt that Nicosia will turn to Moscow rather than to Brussels.
Christofias is a Communist – he is, in fact, the only Communist leader in the European Union – and, under the EU's rotating chairmanship, he will be chairing the EU meetings from July 1^st until the end of the year.

As pointed out earlier in this Gatestone column, if Russia steps in, the strategic situation in the entire Eastern Mediterranean could change. Russia stands to gain most out of the eurozone crisis. Cyprus is a prey which it has long been eying. If Moscow loses Syria as its ally, it needs Cyprus as a substitute. Bailing out Nicosia is a bargain price to acquire a permanent naval base for the Russian fleet in the Eastern Mediterranean.

Cyprus is said to be so high on Russia's priority list that President Putin himself is currently dealing with the €4bn loan request from Nicosia. The interest charged by the Russians is 4.5%, which is far better than Cyprus can get anywhere else. The financial risk for the Russians is limited. There is every chance that Cyprus will be able to repay their bilateral loans fairly soon. Nicosia hopes to start exploiting the huge gas reserves off the Cypriotic coast in the coming decade. With Russian help, it might even be able to exploit these gas fields within the next five years.

The gas fields are an additional reason why Cyprus is a good long-term investment for the Russians. But there are many other reasons. The Russian presence in Cyprus is already very strong. Cyprus is a favourite holiday resort for the Russian middle and upper classes. It could easily become a Russian Florida. Some 50,000 Russians – mostly retirees – are already living permanently on the island. They are attracted by its climate and by the cultural affinities with the Cypriots, who, like the Russians, are Orthodox Christians. Cyprus is also used by Russians as an offshore banking center. This, too, is why the Russians will do their best to support the Cypriotic banking system.

A Russian deal is a win-win situation for both Russia and Cyprus. As soon as Russia has acquired a solid foothold on Cyprus, the third largest island of the Mediterranean Sea, it will be able to drop Assad, thereby reducing the current diplomatic tensions between Washington and Moscow over Syria. Cyprus, on the other hand, welcomes Russian backing: its intention to exploit the gas fields has merely led to tensions with Turkey. With the Russian bear behind its back, it will be easier to deter the Turks. The pro-Turkish attitude of the EU authorities in Brussels has long angered the Cypriots.

Few regions in Europe have the importance of Cyprus. Situated on the doorstep of both North Africa and the Middle East, the island has been of strategic importance since ancient times. From Cyprus, the Russians will be able to reach the whole area surrounding Israel. Russia, an ally of Syria, has never been a close friend of Israel. This might change once Assad is toppled. Although the Russian bear has interests rather than friends, is in dread of anything resembling a democracy, and always on the prowl for its next lunch, the presence in Israel of many Jewish immigrants of Russian origin may lead to a slight rapprochement between Jerusalem and Moscow. If Russia, as a result of its interference in Cyprus, becomes involved in a quarrel with Turkey, this, too, might lead to superficially better, if unreliable, relations with Israel. The animosity between Israel and its NATO ally Turkey has been rising lately. There is little doubt that Putin, during this week's visit to Israel, will discuss not just Syria, Iran and Turkey with the Israeli leadership, but also Russia's growing involvement in Cyprus.

If Cyprus proves to be better off with Russia's financial, political and strategic backing than Greece with the assistance of the European Union, the close relations between the Greeks and the Cypriots might convince Greece that it, too, should turn to Moscow rather than to Brussels for financial and economic help. A strategic realignment in the Eastern Mediterranean and the Middle East might then be in the offing. If the EU and NATO keep regarding the pro-Islamic government in Turkey as their preferred ally, before they know it they might be confronted with an alliance of Russia, Cyprus and Greece – a strong Christian-Orthodox axis against the Turks. And whom would this alliance target after that?

Comment: The relationship between one's debt and its ability to conduct rationale and effective foreign policy is clear. America, with its massive debt puts herself in a most weak position. America's energy policies also place her in a position to not move to support stability in regions far away from her shores. For example, the gas field find in the Mediterranean is an energy game changer in this part of the world. It also established a new flash point for violence-Israel's gas filed find is being challenged by this same group-Cyprus is "next door" to Israel and if you don't think military action is going to be avoided than you are naive as the summer days are long. Russia wanted back in as a "player", everyone is cooperating-even we in Israel are playing the "game"-Putin arrived two blocks from my home in Netanya yesterday for a "ceremony"-really now why do you think he agreed to do this?

No comments:

The IDF’s Minorities in Numbers and Pictures

In honor of IDF Diversity Week, we present diversity through numbers and pictures. Each year, more and more Muslims, Christians, Druze, Bedouin and immigrants from around the world take on the responsibility of defending Israel.

MUSLIMS:

Muslim Arab Israelis are not required to draft in the IDF, but there are many who volunteer. In 2013, there were over 200 Muslims serving in the IDF and over 300 in the reserves.

Bedouins:

Bedouins are nomadic Muslims who were in Israel when modern borders were set in place and are now considered Israeli citizens. They are not required to draft but a growing number choose to enlist. In 2012, there were over 1,400 Bedouin Muslim soldiers doing regular IDF service and almost 1,500 in the reserves.

Read more:http://www.idfblog.com/2014/02/27/truth-idf-numbers-pictures/#more-34027

Are you aware that in 2013, Middle class taxes go up-significantly?

In January of next year, the federal income tax rate for middle-class taxpayers is scheduled to rise from 25 percent to 28 percent, and the payroll tax is scheduled to rise from 13.3 percent to 15.3 percent… This drives the marginal tax rate based on the aforementioned three taxes to 48.12 percent. Add in state and local property, corporate, excise, and other state and local taxes, and the percentage of each additional dollar that is taxed hovers around 50 percent… When half of each additional dollar earned is taxed away, taxpayers experience a disincentive to start businesses or expand existing ones. This leads to fewer jobs being created.

Why is HAMAS Inside Tampa Schools?

Clare Lopez

Kelly Miliziano, who teaches history classes at Steinbrenner High School in the Tampa, Florida area apparently thinks it’s perfectly OK to invite a senior official of a HAMAS-affiliated organization into her classroom to discuss Islam with her students. According to local media reports, not only has this been going on for years, but in spite of the civil and criminal proceedings that could result from such reckless negligence, the Hillsborough County school superintendent, Mary Ellen Elia, and the chairman of the school board, Candy Olson, also expressed approval for students under their responsibility to be exposed repeatedly to guest speaker, Hassan Shibly, who is the Executive Director for the Council on American-Islamic Relations (CAIR) in the Tampa area.
More...

Did You Know... Ignoring the Call to Islam will Bring Jihad

‘Conquest through Da’wa [proselytizing] that is what we hope for. We will conquer Europe, we will conquer America! Not through sword but through Da’wa.’
-- Yousef al-Qaradawi , Muslim Brotherhood spiritual leader The Arabic word ‘Da’wa’ means the “call to Islam.” But do not think that Da’wa is the same thing as an invitation to an optional holiday event. The classical Islamic doctrine of jihad mandates that enemies must be given the opportunity to convert to Islam or pay the jizya tax before it is permissible to attack them.
Clare M. Lopez

Who is being discriminated-facts tell the truth

Religious bias

Hate crimes motivated by religious bias accounted for 1,409 offenses reported by law enforcement. A breakdown of the bias motivation of religious-bias offenses showed:

65.4 percent were anti-Jewish.
13.2 percent were anti-Islamic.
9.5 percent were anti-other religion, i.e., those not specified.
4.3 percent were anti-Catholic.
3.8 percent were anti-multiple religions, group.
3.3 percent were anti-Protestant.
0.5 percent were anti-Atheism/Agnosticism/etc.

http://www.fbi.gov/about-us/cjis/ucr/hate-crime/2010/narratives/hate-crime-2010-incidents-and-offenses.

On March 31, 1977, the Dutch newspaper Trouw published an interview

with PLO executive committee member Zahir Muhsein. Here's what he said:

"The Palestinian people does not exist. The creation of a Palestinian state is only a means for continuing our struggle against the state of Israel for our Arab unity. In reality today there is no difference between Jordanians, Palestinians, Syrians and Lebanese. Only for political and tactical reasons do we speak today about the existence of a Palestinian people, since Arab national interests demand that we posit the existence of a distinct "Palestinian people" to oppose Zionism.

For tactical reasons, Jordan, which is a sovereign state with defined borders, cannot raise claims to Haifa and Jaffa, while as a Palestinian, I can undoubtedly demand Haifa, Jaffa, Beer-Sheva and Jerusalem. However, the moment we reclaim our right to all of Palestine, we will not wait even a minute to unite Palestine and Jordan."

In March 1977, Zahir Muhsein, a PLO executive, said:

"The Palestinian people does not exist. The creation of a Palestinian state is only a means for continuing our struggle against the state of Israel for our Arab unity. In reality today there is no difference between Jordanians, Palestinians, Syrians and Lebanese. Only for political and tactical reasons do we speak today about the existence of a Palestinian people, since Arab national interests demand that we posit the existence of a distinct Palestinian people to oppose Zionism."

"For tactical reasons, Jordan, which is a sovereign state with defined borders, cannot raise claims to Haifa and Jaffa, while as a Palestinian, I can undoubtedly demand Haifa, Jaffa, Beer-Sheva and Jerusalem. However, the moment we reclaim our right to all of Palestine, we will not wait even a minute to unite Palestine and Jordan."

The Arab Apartheid

Ben-Dror Yemini
In 1948, the Arab countries refused to accept the UN partition proposal and they launched a war of annihilation against the State of Israel which had barely been established. All precedents in this matter showed that the party that starts the war - and with a declaration of annihilation, yet - pays a price for it. Between 550,000 and 710,000 Arabs fled because of the war and a larger number of 850,000 Jews were expelled or fled from Arab countries (the "Jewish nakba").
Population exchanges and expulsions were the norm at that time, occurring in dozens of other conflict points and affecting about 52 million people. In all the population exchange precedents that occurred during or at the end of an armed conflict, there was no return of refugees to the previous region, which had turned into a new national state.
Only the Arab states acted completely differently from the rest of the world. Instead of assimilating the refugees, they crushed them despite the fact that they were their coreligionists and members of the Arab nation - instituting a regime of apartheid. So the "nakba" was not caused by the actual dispossession, which had also been experienced by tens of millions of others. The "nakba" is the story of the apartheid, oppression, abuse and denial of rights suffered by the Arab refugees at the hands of the Arab countries. (Maariv)

International Law and Military Operations in Practice - Col. Richard Kemp

"Islamist fighting groups study the international laws of armed conflict carefully and they understand it well. They know that a British or Israeli commander and his men are bound by international law and the rules of engagement that flow from it. They then do their utmost to exploit what they view as one of their enemy's main weaknesses. Their very modus operandi is built on the correct assumption that Western armies will normally abide by the rules, while these insurgents employ a deliberate policy of operating consistently outside international law. "

Lost Historical Moments

What Rabin’s last Knesset speech really said:repudiation of a Palestinian state

Rabin ruled out a fully sovereign Palestinian state :

“We view the permanent solution in the framework of State of Israel which will include most of the area of the Land of Israel as it was under the rule of the British Mandate, and alongside it a Palestinian entity which will be a home to most of the Palestinian residents living in the Gaza Strip and the West Bank. We would like this to be an entity which is less than a state, and which will independently run the lives of the Palestinians under its authority.”

Rabin ruled out a total withdrawal from Judea and Samaria and thus a return to the pre-June 1967 borders :

“The borders of the State of Israel, during the permanent solution, will be beyond the lines which existed before the Six Day War. We will not return to the 4 June 1967 lines.”

Rabin ruled out withdrawing form the Jordan Valley:

“The security border of the State of Israel will be located in the Jordan Valley, in the broadest meaning of that term.”

Rabin ruled out uprooting settlement blocs, like the Gush Katif bloc in Gaza (which was subsequently uprooted by former Prime Minister Ariel Sharon):

“The establishment of blocs of settlements in Judea and Samaria, like the one in Gush Katif.

AND

Rabin ruled out removing any settlement before coming to a full peace agreement with the Palestinians:

“I want to remind you: we committed ourselves, that is, we came to an agreement, and committed ourselves before the Knesset, not to uproot a single settlement in the framework of the interim agreement, and not to hinder building for natural growth.”

Rabin insisted on Israel retaining full security control of the borders with Egypt and Jordan, contrary to Israel’s relinquishment of the Philadelphia Corridor on the border with Egypt:

“The responsibility for external security along the borders with Egypt and Jordan, as well as control over the airspace above all of the territories and Gaza Strip maritime zone, remains in our hands.”

Correcting Oslo Myths-Part 2

3) Kuttab laments that the post-1993 Oslo process resulted in a Palestinian Authority "whose ministers and legislators are not guaranteed passage between Gaza and the West Bank ...."

Before free passage or other perquisites, PA leaders were obligated, among other things, to eliminate the terrorist infrastructure in the West Bank and Gaza Strip, end anti-Israeli, antisemitic incitement in schools, mosques, and communications media, and resolve all outstanding issues through peaceful negotiations. They met none of these commitments, sometimes bolstering terrorism and greatly increasing incitement.

4) Kuttab complains that under Oslo the PA got "lightly armed police ---- but no real sovereignty over the land or contiguity between our communities in Gaza and the West Bank."

Oslo agreements repeatedly were revised, regardless of Palestinian non-compliance, until the authorized number of police grew from 8,000 to 40,000. Though they were to be the only armed forces in the territories, Israeli estimates early in the second intifada put the number of gunmen - police, "security services," terrorists, and armed gangs - at 85,000. Their armament reportedly included not only heavy machine guns and rocket-propelled grenades, but also anti-tank and anti-aircraft missiles.

Sovereignty was to be negotiated in the envisioned 1998 "final status" talks - after a five-year period of confidence-building. Palestinian leadership chronically undermined the process. Palestinian terrorism made the 1993 - 1998 Oslo period more deadly for Israelis than the 15 years preceding it.

The United States doesn't have contiguity between the lower 48 states and Alaska and Hawaii; territorial contiguity between the West Bank and Gaza Strip - that is, through the 20 miles of Israeli territory between them - was never promised and would destroy Israeli contiguity.

5) "Palestinians have been made to endure hundreds of checkpoints in the West Bank, an eight-foot wall deep in our territories, and tight Israeli control over borders."

The security barrier is not "deep in Palestinian territories," but rather encompasses less than 8 percent of Judea and Samaria, and is mostly a fence, rarely a wall; the land in question is not "our [Palestinian] territories" but disputed territory to which, according to the authors of U.N. Security Council Resolution 242, Jews as well as Arabs have claims; and there are no international borders, only the 1949 armistice lines with Jordan. Under 242, borders remain to be negotiated. As for checkpoints - like the security barrier and "tight Israeli control" - Palestinian Arabs precipitated these measures themselves. No terrorism and there would be no fence or tight Israeli control and few checkpoints - like before the first intifada.

Correcting Some Oslo Myths

1) In Oslo "Israeli, Palestinian and other world leaders promised that ... Palestinian sovereignty would be solidified."

No, they didn't. The 1993 Declaration of Principles and subsequent Oslo agreements outlined a process by which final status negotiations about the West Bank and Gaza Strip would be reached. The process required an end to anti-Israel terrorism and incitement and a commitment to peaceful negotiations. The PA, Fatah, Hamas, Islamic Jihad, the Popular Front for the Liberation of Palestine, and other terrorist groups, sabotaged the process from the start.

2) "The reality is that, in defiance of U.N. Security Council Resolution 242, which states that it is inadmissible to occupy land by force, Palestinian territories are still under foreign military occupation."
Wrong again. Resolution 242 (1967) does note "the inadmissibility of the acquisition of territory by war." It also affirms the right of every state in the area "to live in peace with secure and recognized boundaries free from threats or acts of force." There were no "Palestinian territories." Jordan occupied the West Bank, Egypt controlled Gaza. Israel did not have "secure and recognized boundaries," so retention of some of those territories was possible under 242. Israel is not a "foreign" military occupier in the West Bank but, pending final negotiations, the lawful military administrator as a result of a successful war of self-defense.

Doc's Talk