Losing Iceland

The ravage left by the Icesave debacle still frustrates relations between Iceland and the United Kingdom and the Netherlands. The latter two insist that the island nation repay the four billion euros which they spent compensating consumers who nearly lost all their savings last year when the Iceland bank went under. Although the country’s parliament, the Althing, which is actually the oldest of its kind in the world, decided that the money must be repayed, President Olafur Ragnar Grimsson has vetoed their bill. Four billion euros is a lot of cash for a country of 300,000 people. In fact, it amounts to a third of their yearly GDP. A referendum March 6 will decide the confrontation between president and parliament. Read more “Losing Iceland”

Future Arctic Battleground

Global warming is rapidly changing the Arctic landscape. In the summer of 2008, for the first time in recorded history, the polar icecap retreated far enough to allow shipping north of Eurasia and North America; by 2013, these sea routes are expected to be completely ice free during the summer.

The region promises more than shortcuts for international shipping however. The Arctic is estimated to contain about 13 percent of the world’s undiscovered oil and so much as 30 percent of the world’s undiscovered natural gas. Together this represents 22 percent of all untapped but technically recoverable hydrocarbons. Over 80 percent of these resources lie offshore. No wonder then that nearby countries are only too eager to make the high jump into the cold.

There are some complications: energy prices need to be high enough to make production in such an extreme environment economically viable. To make matters worse, some Arctic coastal states have not settled on the regulatory standards for development yet which is especially hampering Norway.

It isn’t stopping the Russians from more or less trying to annex the Pole for themselves of course. Gazprom has partnered with the Norwegian company StatoilHydro in the Russian Arctic and hopes to bring the enormous Shtokman field in the Barents Sea on stream by 2013. The field holds enough gas to provide the whole of the United States with electricity for six years!

Russia made its designs on the Arctic abundantly clear in August 2007 when it planted its flag on the seafloor of the North Pole. In good Cold War fashion, it subsequently began patrolling the Arctic once again with bombers and warships while Moscow invested more than a billion dollars in the expansion of the port of Murmansk which is supposed to double its capacity by 2015.

Whence all the fuss? As former Director of the FSB and current secretary of the Russian Security Council Nikolai Patrushev stated last year: “The Arctic must become Russia’s main strategic resource base.” This, perhaps, to compensate for waning influence in Central Asia.

Russia isn’t the only interested Arctic state. In 2008 Canada held its greatest military exercise ever conducted in the region and the country is spending $40 million on scientific research that is meant to bolster its Arctic claims. Together with Denmark, Norway and the United States, Canada in part contests the Russian pretenses but Russia doesn’t shred from threatening with war over ownership of the giant untapped oil and gasfields. Indeed, it has already shown itself quite willing to violate Canadian airspace just to make a point.

The United States remains strangely silent when it comes to the Pole. Earlier this year, in Foreign Policy, Scott G. Borgerson called upon Washington to take on a more active stance in the Arctic but only recently did Secretary of State Hillary Clinton speak on the issue.

With Canadian-Russian aminosity flaring up, the Pole “is an area that we have to pay real attention to,” said to Clinton, “but it’s not an area that I get called about by reporters or have to answer questions about at the White House yet.” Most opinion- and policymakers do not seem to be aware yet of the great possibilities, and the great dangers, that the melting of the Arctic will provide. It’s about time the United States get involved nevertheless, if only to prevent the Arctic from indeed becoming a future battleground.

Russian Bear Still Roaring

“The bear still has teeth,” notes Robert D. Kaplan, writing for The Atlantic. The Obama Administration’s decision to scrap the Eastern European missile defense system has left some former Soviet satellite states at the mercy of Moscow once again — or at least, that’s how they see it.

Understandably, some Poles and Czechs reacted to Obama’s announcement with outrage. They’ve backed the United States in most of the wars and deployments of the past decade. Now their reward turns out to be continued exposure to the designs of Russia.

Moreover, the Nazi-Soviet Non-Aggression Pact of 1939 “still sends shivers down the spines of Poles,” according to Kaplan, because they fear an economically powerful but energy-dependent Germany joining forces with the military powerful Russia. Poland has no geographical barrier to protect itself against such an unholy alliance while it is exactly for the sake of having barriers that Russia is resistant to the pro-Western course of many Eastern European governments.

There is little threat of actual invasion, that much Kaplan admits, but Russia has other methods at its disposal: “organized crime networks, intelligence operations, and constant intimidation.” Besides, no matter how Westernized countries as Poland and the Czech Republican may have become, “Russians will always be able to operate there more easily than most Westerners, because of their related Slavic languages.”

So why is the United States letting this happen? Because it needs Russia’s help — “to put pressure on Iran, to help us with supply routes into Afghanistan, and, perhaps, to balance against China.” But Russia is far from a reliable partner. It maintains its own agenda with regard to Iran which it does not want to upset and enflame Islamic extremism on Russia’s fringes. And with China, Russia sits in the Shanghai Cooperation Organization and in the informal BRIC alliance along with Brazil and India. It seems unlikely that Russia will ever definitively pick the American side in its struggle against either, present and future, antagonist.

Is it worth to risk the allegiance of Eastern Europe in order to please Russia then? Yes. Because as much as losing that allegiance would hurt Washington, making an enemy out of Russia once again would be all the more devastating.

A New START

Pressing the “restart” button — that is how the Obama Administration, literally, initiated its policy toward Russia after the cool Bush and Putin years. Now, in an interview with Fox News, National Security Advisor Jim Jones suggests that the president might win another foreign policy success on one of the very issues dear to him: nuclear proliferation.

“All of the dialogue is encouraging, they’re positive,” said Jones about the negotiations that are going on in Geneva, Switzerland these days. Russia and the United States are attempting to draft an arms control deal to replace the existing START agreement that expires new Saturday. “We’re down to the last few paragraphs and sentences.”

That is good news for Obama who hopes to have a new treaty signed by the time he heads for Oslo, Norway next week to pick up his Nobel Peace Prize. The reduction of nuclear weapons is said to be the subject of his acceptance speech.

The current START and SORT treaties limit both the number of nuclear and conventional weapons that Russia and the United States may possess. Still each maintains nuclear arsenals of thousands of warheads. The United States is estimated to have about 10,000 warheads of which 2,623 are operational. The Russian number more ambiguous: it said to have 4237 warheads operational in 2007 but this might be an exaggeration. There is no doubt however that the country has between 8- and 10,000 of such weapons in storage. (For comparison, the world’s third nuclear state, France, maintains about 300 warheads operational.)

The Geneva negotiations focus only on the operational warheads but its goal is more ambitious than any agreement signed between the former Cold War adversaries so far: both intend to cut their arsenals of operational warheads to between 1,500 and 1,675 within the next seven years. Should such an agreement come about, President Obama can boast an enormous step forward in the fight against proliferation.