RUSSIAN FEDERATION SITREP 17 July 2014

BRICS. When I first saw the expression BRIC, it seemed just a catchy name for an incidental grouping. But something is emerging. Emerging, I believe, largely in response to Washington’s actions. After so many governments overthrown followed by the insouciant unconcern for the consequences (Libya is the paradigm), absolutely inexplicable (except to the direst conspiracy theorist) actions like supporting jihadists in one place and fighting them in another, more and more countries are coming to two conclusions. The first is that Washington is the cause of most of the world’s instability and that, under present management at least, it simply cannot be trusted or relied on. And, some wonder who’s next for a “colour revolution”. So the BRICS evolve: from a cliché, into a loose association, into a economic and political player. And not an insignificant player: the two most populous countries, two UNSC members, three nuclear powers, significant conventional military power, one economy the biggest or soon will be, three more in the top ten. Not insignificant at all. Yesterday they took another step against the Bretton Woods arrangement, which many see as the foundation of Washington’s power, establishing a Development Bank and reserve currency pool. Their own World Bank and IMF. Early days to be sure, much can go wrong but a step towards a rather different power structure.

DIVISIONS. Washington issues more sanctions, but Europe lags. (Maybe I’m missing something, but the European Council conclusion sounds like the square route of nothing). Who would have thought, 20 years ago, that Ukraine would become so important.

UNIPOLAR WORLD. Failed says Putin; tranquillity says the White House.

LOURDES. The Soviets built a SIGINT base in Cuba in 1962. Putin, at Washington’s request, closed it in 2002. It is about to be re-opened. Perfect illustration of Putin’s trajectory from thinking that cooperation with Washington was possible to realising that it isn’t.

QUOTE OF THE DAY. From a Lugansk militia fighter: “The western regions twice overthrew the government, without consulting us; and so we thought – live however you like, and we will build our life the way we like. And that’s when you came and started killing us.”

UKRAINE. The ceasefire agreed to by representatives from Russia, France, Germany and Ukraine never happened: Poroshenko either does not have the power to deliver or was lying. Another attempt is being made to revivify it. But the problem remains: who is in charge in Kiev? Fighting continues: the resistance’s loss of Slavyansk was compensated for by the destruction of a Kiev column. Kiev seems to have just suffered a major defeat near Lugansk with another coming: a substantial force is pinned at the border and may be close to surrender or annihilation. In short, the resistance is more than holding its own. There are now about half a million refugees in Russia, predominantly women and children. Indiscriminate bombardment of civilian areas is not, as one would expect, winning Kiev much support in the east; neither is conscription in the west. Is Moscow helping? Certainly with the refugees but in other ways? After months of false assertions from NATO and Washington, duly re-typed by the MSM, there is no real evidence of significant flows of weapons or soldiers. I can believe that Moscow is helping surreptitiously, perhaps with targeting information and some weapons, but I have no problem believing that the resistance gets most of its weapons from Soviet-era dumps, deserting Ukrainian conscripts and captures. I remain convinced that Moscow is trying to build a consensus for a diplomatic solution, but that becomes less probable every day. Terrible atrocity stories are starting to appear. The English speaking MSM coverage is mostly one-sided and worthless but there are exceptions like The National Interest and The Nation where one can avoid the mechanical reproduction of Kiev handouts.

RUSSIAN ISOLATION. Still not so lonely. The head of France’s central bank: “A movement to diversify the currencies used in international trade is inevitable.” (A response to the Paribas fine: you’d think Washington was trying to drive away its allies). Putin is having a successful visit to Latin America and the BRICS summit. The Indian Navy is coming for an exercise. Russian businessmen are joining the board of a major Italian company. But, most striking of all, the US Department of Commerce says US exports to Russia reached a new record of US$1.25 billion in May.

© Patrick Armstrong Analysis, Ottawa, Canada (http://www.russiaotherpointsofview.com/ http://us-russia.org/)