All the US confusions between Ukraine, China and Iran
Goals and moves of the Biden administration on Ukraine, China and Iran. The analysis by Federico Punzi, director of Atlantico Quotidiano
If the Kremlin appears to have underestimated Kiev's political and military resilience, and the Western response, the White House appears to be underestimating the consequences of the economic war on Russia, nor to have adequately prepared it from a diplomatic point of view, despite being aware of by months of Russian aggression plans on Ukraine.
The US administration certainly deserves credit for a quick and ambitious response from NATO and for keeping the European allies together, putting Germany and France back in line. Results by no means taken for granted, but not sufficient given the global implications of the ongoing clash.
Leaving the European bubble, few countries have followed the US, the UK and the EU on the road to sanctions against Russia. Not all NATO countries have joined it either: Turkey has not adopted any sanctions against Moscow, but has at least provided the Ukrainians with its precious drones. Nor is Israel. Apart from Beijing, from which more or less explicit support for Moscow was foreseeable, as we will see later at the center of Washington's concerns in these hours, not even the rest of the BRICS – India, Brazil and South Africa – have adopted sanctions, choosing a position neutral.
How did prof. Anna Bono on Atlantico Quotidiano , the resolution condemning the Russian aggression at the UN General Assembly was passed by a large majority of the member countries, but among those who were against, abstained and absent, countries that account for 55 percent of the population did not support it world.
But the Biden administration's biggest failure is in the Middle East. In fact, it did not manage to obtain from OPEC an increase in oil production, which would have helped to cool the tensions on the markets, particularly alleviating the suffering of the economies of the Old Continent, and the United Arab Emirates, resisting US pressure, abstained in the UN Security Council on a resolution condemning the Russian invasion. As we reported a few days ago , during the Ukrainian crisis, President Biden was not even able to speak with the leaders of Saudi Arabia and the United Arab Emirates, Mohammed bin Salman and Mohammed bin Zayed, who refused to accept his calls, while they spoke several times with both Putin and Zelensky.
Riyadh invited Chinese President Xi Jinping to visit the Kingdom in May and a few days ago, in an interview, the crown prince said he "doesn't care" if President Biden misunderstood him and warned that reducing investments Saudis in the US, which amount to 800 billion dollars, is an option, while cooperation with China is also growing in the military field. As reported by the Wall Street Journal , citing Saudi advisers and officials familiar with US intelligence, Saudi Arabia has imported sensitive missile technology from the Chinese military and is producing its own ballistic missiles. "Alliances change in the Middle East and Washington's regional partners seek new economic and security ties," noted the WSJ.
Not surprisingly, given that the first thing the Biden administration did once it was in office was to cool relations with the Gulf monarchies, deny them support in Yemen, suspend military supplies, and turn to Tehran again to strike a new deal on the its nuclear program.
Another warning came yesterday, via the Wall Street Journal : "Saudi Arabia is in talks with Beijing to price some of its oil sales to China in yuan ". "A move that would dent the dominance of the US dollar on the global oil market and mark another step towards Asia for the world's largest crude oil exporter." In fact, talks with Beijing for oil contracts valued in yuan have been going back and forth for six years, recalls the financial daily, but this year they have accelerated, as the Saudis are increasingly resentful of the disappearance of the ten-year period. US commitments to Kingdom security: "The Saudis are angered by the lack of US support for their intervention in the civil war in Yemen and the Biden administration's attempt to strike a deal with Iran on its program nuclear power "and" said they were shocked by the hasty withdrawal from Afghanistan last year ".
On the other hand, the terms were clear: no security, nothing exclusive to the dollar. As the WSJ recalls: "The Saudis have been trading oil exclusively in dollars since 1974, under an agreement with the Nixon administration that included guarantees on the security of the Kingdom".
"China – continues the newspaper – buys more than 25 percent of the oil exported by Saudi Arabia and, if valued in yuan, these sales would increase the status of the Chinese currency, leading it on the road to becoming a global reserve currency". Thus, two of the world's top oil exporters would trade their exports to China in yuan: Russia and Saudi Arabia.
In Atlantico Quotidiano we had already outlined the risks for the dollar "privilege" of the sanction to Russia that Musso called "end-of-the-world ", or rather the freezing of the foreign reserves of the Russian Central Bank. It is not something that can happen overnight, but the process of de-dollarization of the global economy may have been triggered. As Fed Governor Jerome Powell explained to Congress, the dollar is a global reserve currency “because we have free movement of capital in a rule of law and we have inflation under control over a long time average. So that the dollar retains its value and therefore our markets are the most liquid and it is the place where people want to be ”. In short, it must be a very attractive place for those who have to deposit large amounts of reserves and no other large economy can have the free movement of capital and the rule of law and the low inflation that the US has. But to some extent the sanctions on Russia undermine these certainties (free movement of capital, the rule of law, low inflation), putting the dollar's reserve status at risk: "Slowly – concludes Musso – the renminbi could become the dollar by half of the world: that half that no longer trusts the Fed and the ECB who have frozen dollars and euros in Russia ”.
"Is America's exorbitant privilege – the almighty dollar as the world's leading reserve currency – threatened?" Asked Andy Kessler of the Wall Street Journal three days ago, warning that "China and Russia may work to take away from America its exorbitant privilege ”and that America“ should not risk the dollar's reserve currency status ”.
The relationship between the Biden administration and Riyadh has started very badly, with the accusations against the Crown Prince for the Kashoggi case, but it has continued worse: Washington has removed the Houthis, the Yemeni rebels who are waging a war by Tehran's proxy against Saudi Arabia and the Emirates, from the list of terrorist organizations and ignored their drone attacks on the two countries, all in order not to annoy the Iranians and pave the way for the new agreement on the nuclear program.
In order to reach an agreement with Iran, in the midst of the war in Ukraine and the economic war on Russia, the Biden administration offered Moscow an escape from sanctions: "We have had written guarantees from the United States that sanctions will not affect cooperation. with Iran in the nuclear sector, including the Bushehr power plant. They are included in the text of the agreement itself on the resumption of the JCPOA ”, explained Russian Foreign Minister Lavrov.
Vladimir Putin granted "an Iran-based hub to evade sanctions," according to the Foundation for Defense of Democracies.
The Biden administration's policy in the Middle East seems to be to reward enemies – Iran and Russia – and punish their friends, the Gulf monarchies, who understandably react by seeking other allies for their security, China and Russia itself.
While the prices of raw materials are breaking all records, China is trying to take advantage of the war in Ukraine and the difficulties of Russia under sanctions by approaching all "non-Western" exporters of raw materials – primarily Russia – to offer them a new reference currency, the yuan, and dethrone the dollar as a global reserve currency.
A very suspicious coincidence has intervened in these hours to further stress the supply chains. For two years, China has reported zero Covid deaths and a ridiculously low number of cases. Now, suddenly, over 5,000 new cases and the decision to lock down important cities and key hubs of the supply chains that power the Western economy…
The seven-hour meeting in Rome between US national security adviser Jake Sullivan and the Chinese Communist Party's foreign officer Yang Jiechi, in Washington's intentions, served to put Beijing in front of its responsibilities. China has so far held an ambiguous position on the conflict in Ukraine, declaring itself in favor of a diplomatic solution but "understanding" Putin's reasons and failing to conceal the axis with Moscow, sealed in a world view with the gas agreement signed at the Olympics Beijing winter.
By revealing to the allies that China would be ready to provide military aid to Russia, Washington tries to push Beijing out of its facade neutrality, one way or another, warning it that if it chooses the axis with Moscow it will find a compact West. and there will be an economic and ideological clash between democracies and dictatorships. Decoupling is a new division of the world into two blocks, which we do not consider to be a bad outcome in itself, as long as the West is ready to face it – but we will talk about that in a future article.
But what message does Beijing reach instead from the agreement with Moscow and Tehran on Iranian nuclear power? While the US warns China that there will be "significant consequences" if it helps Russia evade sanctions, it is the US itself that allows the Russians to evade them.
Political scientist Walter Russell Mead gets to the heart of the matter:
“The Biden administration's approach to great-power diplomacy has completely failed. After a year of unsuccessful attempts to park Russia or keep it away from China, it is attempting the same strategy in reverse, now hoping to detach China from Russia. But Beijing won't help Biden out of kindness.
The Biden administration's hope of being able to pursue its interests in global issues such as disarmament, human rights and climate change, even as economic and ideological pressure on the two major Eurasian powers increases, has also proved illusory. Between the Russian invasion of Ukraine and China's massive accumulation of nuclear and conventional weapons, hopes for arms control are fading. Russia's request to review the agreement on the Iranian nuclear program while safeguarding its participation from the sanctions relating to Ukraine underlines the difficulty of simultaneously addressing and involving the revisionist powers ”.
"Biden's climate agenda has collapsed into total inconsistency," writes WRM again, as the president searches for oil and gas all over the world, courting Maduro and being rejected by the Saudis.
The effects of the sanctions on Russia “are helping to fuel the inflation of commodity prices by increasing financial uncertainty. The economic turmoil is likely to further restrict the administration's options in the coming months, while undermining its political position.
“Our ability to influence the behavior of others depends much more on our geopolitical power than on the purity of our hearts and the nobility of our goals,” concludes Russell Mead. A warning that echoes that of Mrs. Thatcher: "our way of life, our vision, is not ensured by the justness of our cause, but by the strength of our defense."
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/mondo/tutte-le-confusioni-usa-fra-ucraina-cina-e-iran/ on Sat, 19 Mar 2022 07:32:28 +0000.