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July 2007 Country Archive


Gaza’s legal status is that of an autonomous region, the autonomy (from Israel) is limited although Israel has moved out its military and administration officials. It occupies 140 sq miles on a narrow strip of land between Egypt and Israel with a million plus inhabitants. After a coup de main, the Hamas religious armed faction expelled the Fatah secular forces (now ‘retired hurt’ to the West Bank) and may even declare an Islamic republic. But whether or not that takes place, the shortlived collaboration between the two factions is over and as a consequence, there has been a rolling back of any prospect of a two–state solution to the region’s problems. The appointment of Tony Blair to act in some way as an honest broker is a positive move, even if it is not obvious how he or anybody else can mend the broken Palestine situation. If Palestine’s West Bank government moves forward to a comprehensive cessation of violence with Israel, and is able to offer peace and the two-states solution to the electors of Gaza inviting their support, then that would be a positive way through. But Islamists, having gained control anywhere, are not known for returning to the open democratic election route. Gazastan with Shariah law, is another option, and may not be a great distance away. Remembering the disillusion throughout Palestine with Fatah’s politicians, which as we predicted before the time, swept Hamas into power throughout the whole territory, it cannot be dismissed that a new election throughout Palestine including the West Bank and Gaza, could repeat that electoral success. Then we would be looking at the western and Israeli nightmare of a ‘Palestan’. 

SYRIA this month looks also at the so-frequent outrages in Lebanon and asks who, if anyone, is the puppet-master. Obviously with armed and fanatical bands roaming the land, it is not always necessary to look for a directing intelligence. But the bombing of the UNIFIL party with six deaths was clearly professionally planned and executed. We know that it is customary before even any dust settles to blame SYRIA, but too often logic is strained to see what they could possibly gain, as opposed to what they certainly would lose, in some such outrages. As ever, we are aware, as every one should be of provocateurs, and now have small confidence in what Washington claims, as it is clear that their factions even in government, have different agendas. 

Frozen dollars have been truly flushed around the system thanks to RUSSIA’s intervention, which has put the decommissioning of the Yongbyon nuclear reactor firmly back on centre stage. Many would say these have been wasted years – and worse, where NORTH KOREA developed and demonstrated their A-bomb when the kind of deal now seemingly acceptable, was broadly what was available in Clinton’s time. So seven years of macho-neocon huffing and puffing, gave the affronted N.Koreans the time and incentive to show what they had got (which they did not have then). We offer a full description of where matters currently lie. 

With discernible progress on the North Korean front and a real prospect of the de-escalation that the world seeks from Pyongyang, IRAN swims into focus as the principal global unfinished business. IRAN’s position was always more complex than North Korea’s, some details of which it may be worth re-considering. It is a theocracy, so ultimately beyond rationality, which would be problem enough! It is also on these grounds able to summon up from its fanatical supporters, a level of sacrifice at the service of the state, as was exemplified by the human-bomb and human mine-sweeper volunteers, during the war against IRAQ. In addition, its theocracy is that of an heretical branch of Islam (ie not of the Sunni majority), and therefore the focus for hatred of equally fanatical Moslems of another sectarian stripe. It is big - with a 70 million population. Not an Arab state, but with many such as its neighbours, all apart from IRAQ having much smaller populations. There are age-old suspicions between them. IRAN sponsors its often violent co-religionists in non-Shia states – IRAQ and the Lebanon are prime examples. Saudi and the Gulf States fear Iranian influence on their own Shi’ite minorities. IRAN also neighbours war-torn AFGHANISTAN and nuclear- armed PAKISTAN, as well as NATO member TURKEY, an ancient adversary for regional dominance in western Asia, but now no longer. 

The international dispute coalesces around IRAN’s drive to create a nuclear industry. They claim this is for peaceful nuclear power generation, which they are entitled to do under the non-proliferation treaty, of which IRAN is a signatory. There is wide-spread suspicion however that their real aim is to have their own military nuclear deterrent (which they deny), and that they would attempt to use this to become the regional power. The principal reason the dispute has lasted so long, is that the USA under Bush Cheney would have nothing to do with a diplomatic solution. Hang tough, as with North Korea, has been the driving US foreign policy during their tenure, and has got precisely nowhere. Our monthly Update describes something of the effect of the relatively light economic sanctions, imposed by the US and UN to date. We are of the view that for a nation whose citizens in large numbers, are prepared to strap on explosive vests and dive under opposing tanks, economic sanctions will not cause hardships sufficient for them to force the real leadership, the mullahs, into making the level of concessions required. 

It is true that currently there is outrage in IRAN from car-owners unable to get newly rationed petrol, but this is as much at the incompetence that has allowed this major oil producing nation to have to import its petroleum from some sixteen other nations, due to a failure to invest in refining plants. Rationing is a collateral effect of the expected increase in sanctions, when the government realized their vulnerability to these imports becoming blocked. Unpopular though they knew it would be, rationing is their first defensive move to avoid total gridlock. Whilst Iranians as a whole are somewhat weary of the inefficiencies of so many years of a priest–run theocracy, it would be fatal to think that they are about to rise up, as Washington ‘regime–change’ theorists might want to believe. The citizens only have to look across the border at the civil war raging in IRAQ’s cities and towns and they will not opt for that. 

Taking a lead from the N. Korean experience, entering intensive negotiations, perhaps allowing the enrichment of nuclear fuel to a level required by a civilian program, in return for the acceptance of close oversight by the UN agencies, is what is now needed. 
Quite apart from the dangers for the world of the confrontation with their (oil producing) Arab neighbours, another highly dangerous element here is that due mainly to the belligerent style of the Iranian president – Israel, threatened by him with annihilation – can and will intervene militarily at any point they believe that their national survival requires this. In such complex circumstances, the judgment of history is likely to condemn the government of a so-called enlightened nation who would not negotiate, but rely solely on threats of war, or bringing the most stringent economic pressure on a proud and ancient people, whose leaders have already proven their ability to maintain national unity and to rally their citizens. 

PAKISTAN is a nation in crisis, increasingly the breeding ground of fanatical religious killers, and given the implications, this is also the world’s crisis. These fanatics are absolutely unafraid of destroying the whole human race if they had access to the weaponry to do so, and would say that God had told them to do it. It is highly relevant that at the same time as having a subversive religious industry, PAKISTAN is also a nuclear-armed nation – the only Islamic power so to be, and whoever controls the government, necessarily has that resource. So if an Islamist coup were at any time to succeed, there really would be a rogue nuclear power for the world to contend with, and one with a destructive, even self-destructive theology, driving them on to a first strike, or to receive one. A NORTH KOREA or even an IRAN would look comparatively like second division problems indeed. 

The civilian leaders thus far in the nation’s statehood have been primarily interested in corruptly acquiring great wealth, and furthering the interests of their own tribe/clan/ family. These are not the people who can make a modern culture take root, and start and lead the hard slog back of the moderates against the extremists. 
Most commentators agree that President-General Musharraf’s survival in office is dependent on the support of the army, and in the sense that no other agency of the state can shift him, that has to be true. We seek to give a balanced review of the nation’s policies and problems, both of its successes and failures in our reports, and this month is no exception. But we cannot help but compare the PAKISTAN of Musharraf, with that of his civilian predecessors, and we are sure that the armed forces in Pakistan must do the same thing.

Essentially, within the 153 million population, there is a powerful and resilient core of Islamic fanatics who have taken fully on board the 7th century teachings of the prophet Mohammed, as interpreted by fundamentalist religious teachers. They start from the premise that nothing else is necessary in life, except following these instructions. The method is through the shariah law which embodies them. This is a wholly dedicated group and having trained in PAKISTAN’s madrassas, their blinkered graduates travel to many other countries than PAKISTAN. They seek to overthrow any government - their own, or of other countries who do not submit to the shariah law, and in pursuit of this call themselves jihadists. As we have seen in IRAQ and Palestine, in New York and London, immature individuals, blinded by fanatical zeal not only destroy themselves in the process of mass murder, but do this simply for the news value of killing civilians, going about their ordinary lives. 

As a nation, its hostility given and received in equal measure has been with INDIA with whom it has had four wars since independence in 1947. These have been wars that with historical hindsight should not have been fought, fundamentally over territorial squabbles. They were exacerbated by the same Islamic fanatics described, keeping the fires of hatred burning, and destroying the chances of reasonable men finding reasonable solutions to their quarrels. 

In this potent mix of fanaticism and hatred, Musharraff came in like a breath of fresh air. He has captured more Al Qaeda operatives than all other nations put together, as a result of which there have so far been at least three full scale attempts at his assassination. He reversed the whole anti-India ethos, which had been building up towards another war, which now is on neither nation’s agenda. None of his civilian or military predecessors have had either the vision or the authority to do that – the importance being that PAKISTAN’s problems are internal not external, and good relations with the giant neighbour to the south, allows Islamabad to concentrate on what is truly important.

And that is to find the political means of getting the nation away from religious extremism in favour of supporting and sustaining religious moderates. From turning the widespread religious impulse away from the arena of the political program. In short, to fast-forward this nation fourteen hundred years away from the mores of the 7th century, into those of the 21st. 

Musharaff, the son of a foreign service family, spent several years of his boyhood living in Turkey. He is fully aware of what Kemal Ataturk did and what had to be overcome to bring TURKEY from a similar slavishness to an equally archaic Islam, into its present day status as an important secular state. Ataturk had the decided advantage of being a national hero, because of his war leadership against the Greek army invading a TURKEY at a low ebb, following WWI defeat by the allies. Musharraf does not have quite that cachet, although he could not have become his nation’s military leader without a distinguished military record. But he has enjoyed the respect of his military colleagues, given which he can continue with seeking the modernisation of the country. That is what for his nation and the world’s sake, urgently needs to be done! 

It may be a matter of waiting for the changing of the guard in Washington in eighteen months time, or if the European NATO members bring matters to a head, possibly before that, but the present policies are not working and show little sign of doing so. Something must be done and soon, because there are altogether inadequate western armed forces in place, to subdue the armed opposition to the Kabul government. Even where there is no fighting, peace is patched up by ‘understandings’ with local warlords and chieftains, who are allowed by the famous Nelsonian blind eye to prosper mightily from the cultivation of the opium poppy, in return for which, to keep some kind of peace. 

Simply put, the opposition to the Karzai government, seen by Afghans as a western appointee, is not going to go away. AFGHANISTAN is not a cohesive ‘natural’ nation formed by geography, or driven by some common purpose. It has never been that, except in sharing the common purpose of expelling invaders - foreign troops - which it has done relentlessly, before reverting to customary tribal wars - for centuries a way of life. One major insoluble problem for the NATO troops already there, is simply that they ARE foreign troops. Certainly they are there to support the civil power, and at the invitation of the domestic government – but that of course is what the Russians said in their time. Some of those Afghans at least, who are fighting against the western troops are really in their minds, doing just what their ancestors have done so effectively for generations past. 

To massively expand the armed presence in the country would certainly for a time, damp down the opposition forces arrayed against NATO. But every indication is that the political will does not exist to send more young men to their fate for an indefinite period, where there is no clear-cut objective other than to leave a viable democratic Afghan government in place. This looks increasingly unreal. Again, given the experience of Afghan politicians and their governments since the removal of the Taleban, the indications are that viability and democracy will be mutually exclusive - after the western forces eventually move out. It holds now, because of the concessions made to regional leaders who will be there after the westerners have left. But centralised power does not exist outside Kabul city limits, even with foreign subsidies and foreign troops, so what chance after they have gone? Our view is that whatever went before, a stalemate has been the outcome and a political solution is now necessary. 

The clear cause was 9/11. The object of the military intervention into an ongoing civil war, was not to bring democracy to this unfruitful ground – that was a neo-con dream, but simply to pursue al Qaeda, capture their leaders and to expel and punish their hosts, the Taleban. It has been apparent that the Taleban is not only a movement, but a collective name for fighters from certain large tribal areas with a strong adhesion to Islam, which is absolutely standard throughout this country. Many also call themselves or are described, by the respected title of mujahadeen - freedom fighters. Within such a large grouping, there are relatively moderate leaders, with whom business could be done. Of course Karzai and no doubt the US Embassy and others, specifically the Pakistanis, have been making soundings for quite a time. Once again, the time has come to give diplomacy its chance. 

We give an account of what has happened, that has put the conviction of the Libyan spook Abdelhasset Ali Mohmed al-Megrahi up for review by the Scottish Appeals Court, following the Scottish Review Commission’s recommendation to that effect. Although it would be premature to anticipate the outcome, publicity has already been given to the ‘flimsy’ nature of the evidence that convicted him. The criminal justice system will re-examine what it needs to, but it is not too soon to consider the implications IF he were to be found to have been wrongly convicted. In short it would be an unbelievably difficult mess, and those responsible for what should follow will have their work cut out to repair the damage. If it was not this convicted Libyan, was it another member of their clandestine services? Was it nothing to do with LIBYA, and if so who then could have been guilty of this horrible crime? IRAN is mentioned, as is SYRIA – we look at these possibilities, but what evidence can be found now, indeed then, since the hypothesis that it was a Libyan exploit was the one which was followed, after looking at all and any evidence to the contrary, implicating any other quarter.

$10 million per family was agreed as compensation to the families, much of which has been paid. Will LIBYA be asking for that back?

Colonel Ghadaffi, a western hate-figure if ever there was one, will be seeking restitution of his character for the flat-out demonisation he received at the time of the conviction. There remains the ever- present concern that because the evidence might not stand up to the closer scrutiny of the appeals court, and that this particular operative may have been wrongly convicted, it does not in itself mean that LIBYA's clandestine agencies were not responsible – only that there is inadequate proof of that. It can be expected that LIBYA will make the most of all of this when defending their wrongful imprisonment of the six Bulgarian nurses and the Palestinian doctor on absurd charges of deliberately infecting children with the AIDS virus. 

It is a reflection on the state of affairs in IRAQ that finally, years after the US invasion, the first new oil well dug by a foreign company (Norway’s DNO), is scheduled to go onstream for the international market. But, and this is an Iraqi ‘but,’ operating as DNO do in the Kurdish autonomous region, Baghdad refused to grant access to the export pipeline, so that the 15,000bpd output will have to be exported by truck. Why, you might ask? The cynic might imagine that the pipeline is needed to transport the ‘rip-off oil’ the proceeds of which lines ministerial and other pockets; or maybe simply the right palms have not been greased. This new well will produce only the equivalent of 1% of total Iraqi production, so it doesn’t look good for when some serious quantities come on stream. 

We describe the present state of the Iraqi oil industry and of the oil law which has caused concern amongst Vice President Cheney’s oil buddies. The Iraqi lawmakers seem to be objecting to its bias in favour of US companies – who would have thought that? The head of the CIA was sent to Baghdad to tell Prime Minister Maliki that the passage of this bill is of the utmost importance to Washington. Yes, we would have thought that!

As our SLOVAKIA piece explains, Vladimir Meciar is being tipped for a comeback. He was one of the ‘awful three’ former communist leaders of their newly democratized countries in nineties Europe, who when that happened hadn’t got ‘the message’ - the other two being Aleksander Lukashenka who still rides high in BELARUS, and the late unlamented Slobodan Milosevic of SERBIA. In other words, having changed their political label to some species of ‘socialist’ or ‘democratic socialist,’ they continued to behave like the autocrats they had always been. With the exception of Lukashenka, who was until recently nurtured by Moscow, their electorates finally overthrew them at the ballot box. Since then Meciar has played the political game by the rules in opposition, and with his party’s elected lawmakers was readmitted to government as a junior partner in the current ruling coalition. He is regarded as a significant player again in SLOVAKIA and the man to watch. 

TAJIKISTAN this issue describes how in the years following the collapse of the USSR the USA first advanced across a wide swathe of central Asian territories in the post Soviet decade, as numerous newly independent nations responded positively to the call for military co-operation from the US, in helping to set up their bases – right up to the borders of China. After the 9/11 outrage, with a new urgency, the process accelerated alongside the military intervention in AFGHANISTAN. We describe this, and then how piecemeal, and again within only a few years, the process became unravelled, went into reverse – and continues that way. RUSSIA can be seen to be the big winner, since most of the central Asian nations involved in the basing agreements, reverted to Moscow’s sphere of influence whilst the stars and stripes has had to be lowered at base after base . 

POLAND this issue, explains the position taken by the Polish and Lithuanian Prime Ministers together with other Baltic colleagues, on the topic of Russian supplies of oil and gas to Europe. At an energy forum in ESTONIA, the Estonian PM spoke sagely in saying that, “It is simply not rational to place over-reliance on Russian gas” – that overall dependence on Russia’s energy systems “involves high levels of risk”. There is also a substantial critique of the sub-sea ‘Nordstream’ Baltic pipeline, to convey Russian gas direct to Germany, cutting out intermediate countries, As we point out, recent developments have cast doubt on RUSSIA’s reliability as an economic partner generally, not just with respect to gas. RUSSIA is simultaneously conducting several politically motivated commercial ‘wars’ against former helot and satellite states of the USSR. Currently, agricultural produce and wine embargoes against MOLDOVA and GEORGIA, interdiction of meat imports from POLAND; cutting off crude oil supplies by pipeline to LITHUANIA; and most recently the cyber war launched from RUSSIA with at least some level of complicity of the authorities there, against ESTONIA

But POLAND achieved fame or notoriety in June, with its stand on voting in the new European treaty that replaces the unloved constitution. Now, it is true, everybody knows that POLAND is a player and not to be taken for granted. But at the same time it has strengthened its existing reputation of NOT being ‘communitaire’, the essential cement in combining such a big collection of disparate sovereign states. It may have influenced events, but it has lost friends. Not the least of these will be several outsider nations, much further back in the ‘acquis’ procedures, hoping to come inside - including SERBIA, ALBANIA, MACEDONIA, MONTENEGRO, BOSNIA- HERZEGOVINA. It is true that CROATIA’s ‘acquis’ preparations are already well advanced which gives them hope of becoming the first of this group to be admitted. TURKEY, the really high profile candidate, is now snagged by the new French president’s overt opposition to their membership, and the complications of Cyprus. The Polish ‘victory’ has been that the EU has put back the key changes to its voting system until 2014. The original plan, now scuppered by the Poles, was that by simplifying the voting system, the entry of new aspirant nations would be simplified. The implication now for these aspiring members, is that their entry is far from assured, certainly at any time soon.

The European Union’s Nabucco 3,300 kms pipeline project (for which finance has not yet been agreed), to bring central Asian supplies of gas without going overland through RUSSIA, has been cleverly upstaged by the Southstream pipeline, a Gazprom / ENI (the Italian natural gas company) signed deal, to bring an equivalent amount of Russian gas to broadly the same destination. It becomes more and more obvious whatever the fate of Nabucco, that Europe’s need (for geopolitical reasons), to avoid being energy dependent on Russia, means that it would eventually need to look to IRAN, (the current number-one geopolitical problem country), but already with a gas pipeline through to Turkey. IRAN is the only other supplier nation in this theatre of operations with massive natural gas reserves to spare. It is true that TURKMENISTAN with large reserves is a wild card, but for supplying gas to western markets, it is on the ‘wrong’ side of the Caspian Sea. Its immediate future at any rate, seems compromised by contractual commitments to RUSSIA, which exerts considerable leverage there, and to China. The EU currently looks to be a distant fourth contender for any major share in TURKMENISTAN’s reserves, behind a long-mooted PAKISTAN-INDIA pipeline to cross AFGHANISTAN

President Putin’s many achievements in office do not include a triumphant foreign policy. It is hard to think who his friends or allies might be on the international stage. China’s friendship is a matter of convenience for each of them. Its sole purpose is to seek to contain US global hegemony engulfing either or both. Considering RUSSIA’s immediate neighbours, a majority are in a state of bad or unsatisfactory relations with Moscow, as can be seen by reference to this months reports for any of them. That does not apply to Norway or Finland, with whom relations are ‘correct’, certainly not hostile, but one could hardly call them friends and allies of Moscow. KAZAKSTAN is cordial enough, but the government there is very careful to maintain equally good relations with the west and the far east. It is certainly actively engaged in various schemes (see ‘CANAL’ below), to ensure real and continuing economic independence from Moscow. Mongolia, “an egg between two rocks,” is of necessity friendly, just as it is to its other giant neighbour, China.

Moscow has not chosen the path of conciliation with those closest neighbours that were former satellites. The three Baltics, LATVIA, LITHUANIA and ESTONIA, are each for reasons we explain, deeply unhappy with RUSSIA. POLAND is actively hostile, dredging up ancient enmity, but particularly provoked by its giant neighbour, for political reasons placing a ban on importing Polish meat. BELARUS, until recently the only FSU State which had transferred its helotry entire, from the USSR to RUSSIA, has surprisingly been flatly rejected recently, presumably as being too much of a dead weight. UKRAINE is deeply divided by its pro- and anti-Russian parties and looks like remaining that way. Little love is lost with MOLDOVA and GEORGIA, both former long-term exporters to RUSSIA, indeed one might say that they historically were RUSSIA’s vintners and market gardeners, all supplies of which RUSSIA has banned for punitive reasons on spurious grounds. In addition Moscow has sponsored and supported breakaway ‘republics’ within their internationally recognized frontiers, indeed two such, in the case of GEORGIA

Membership of the post-Soviet ‘rival’ to the CIS, the GUAM combination includes, along with AZERBAIJAN, (whose report this month gives an account of the GUAM summit held in Baku), UKRAINE, MOLDOVA and GEORGIA. This means that oil- producing AZERBAIJAN is allied with those other three FSU all-union republics, with the least cause to adhere to Moscow’s line on …anything. It was their common ground to see the FSU creation of the CIS as a thinly disguised extension of Russian imperialism. Whilst none of these states knew that they were about to become fully independent (nether did anyone else) in early 1991, the soviet republican bosses discovered that no longer were they to be in charge of ‘their’ republic only at the pleasure of an expensively maintained patron on the Central Committee in Moscow, and decided to keep it that way. 

No one had demanded independence, not a shot had been fired, nor a protester arrested, but over a weekend the USSR ceased to be, leaving fifteen slightly dazed successor states. Out of this, the GUAM collection coalesced for different reasons, which remain valid. AZERBAIJAN saw its future in supplying oil and gas to the west but needed western know-how to revive its exhausted oil patch. To get to western markets Baku collaborated with GEORGIA, to build the pipelines outside of Russia’s ability to turn off the taps. GEORGIA had every reason to resent Moscow who had sponsored the breakaway territories of South Ossetia and Abkhazia; and whose clandestine agencies moreover, had mounted two attempts to assassinate the then Georgian president, which fortunately failed. Wretchedly poor MOLDOVA similarly saw Moscow sponsoring a breakaway of its main industrial region of Transdnester. Like the others above, it is ethnically non-slav and only came to be in the Soviet Union as a result of wars and Stalin’s depredations. 

UKRAINE is of course slav and of a closely related ethnicity to the Russians. Arguably they were the foundation of the historical Russian state until in medieval times, power moved away from Kievan Princes to the Dukes of Muscovy. But UKRAINE itself, chopped and changed by numerous wars, has a western half, which had witnessed its former communist neighbors POLAND, the CZECHS; the Baltic states; SLOVAKIA – and had wanted some of the western prosperity and lifestyle and – yes the democracy, that they witnessed there. It’s eastern half is much more ethnically Russian than Ukrainian, but both halves were equally wary of RUSSIA’s policy of recreating the Slav parts of the FSU, and turned down that reunion option in a referendum. As powerful a reason as any other was that memories were still fresh of the Soviet invasion of AFGHANISTAN, seen in the UKRAINE as Russian imperialism, together with the impact of the first Chechen war, a clear example of colonialism. The point is that many Ukrainian enlisted men in the soviet army had died or been maimed in AFGHANISTAN, The Ukrainians with no territorial ambitions, jibbed at supplying their young men to once again be cannon fodder for Russian expansionism. That was their perception of the ‘CIS Military Committee,’ which the GUAM states declined to join - seen to be turning back the clock by pooling the FSU states’ armed forces under the operational control of Moscow. 

Since then of course, in UKRAINE came the Orange revolution, and a divided nation. But even though one powerful party aligns with Moscow, that is not the same as assuming that they want to be reunited. It does not take much digging below a shallow surface, to realize that politics in UKRAINE have a great deal to do with who is making the money, which has long been synonymous with political power in Kiev, but it IS in Kiev! For the politicians, having been subject to Moscow power-holders for all of their earlier careers in Soviet days, it would be retrograde now to play second-fiddle to Moscow, when they can conduct their own orchestra, however out-of-tune. 

It has been a mixed month for SERBIA. After a false start, the new government was immediately faced with the prospect of this severance of KOSOVO from the territory of SERBIA. The last redoubt of YUGOSLAVIA had no option earlier but to stand by and see the departure of MONTENEGRO – a cruel cut. Having tried and failed to dominate the FYR they have witnessed one-by-one, the departure of SLOVENIA, CROATIA, BOSNIA-HERZEGOVINA; and MACEDONIA before that of MONTENEGRO. Kosovo however was a province of SERBIA, rather than a republic of the Yugoslav Federation, and on that ground they are not giving way. The good news for them was that RUSSIA has declared that they will veto any solution for Kosovo that does not meet the needs of SERBIA. Why is RUSSIA ‘mixing- in’ one may enquire? We propose some possibilities and no one should be surprised that money comes into it. The post-communist phenomenon is not the craving for democracy, so much as the zeal for unrestrained capitalism, red in tooth and claw. But Russian politicians know that the appeal of being the traditional protector of this or of any other smaller Orthodox state, plays well with the Russian electorate. After ‘the vicious NATO attack on Serbia’, as it was represented in the Russian media, without mentioning the horrors that their client state had heaped upon the Kosovars, there is residual support for their leadership in backing the Serbs, just as there is residual prejudice in RUSSIA against the ethnic Albanian Moslems (“like the Chechens”, the malignancy goes). 

But leaving this problem for inevitably much more discussion in the future, SERBIA is also now concentrating on not ‘missing the boat’ this time, by setting a course of joining the EU. As we describe their prospects they look quite reasonable, and EU negotiators clearly intend to milk this for all it is worth, towards getting a settlement on the UN solution for Kosovo. However the recent EU treaty negotiations described here in our Update on POLAND, tells how in order to get agreement for the new voting system, its implementation will be delayed until 2014. As this is the voting system that was hoped to ensure easier passage for those applicant nations on the outside, striving to gain admittance, the whole process looks like being further delayed which will do nothing for solving the Kosovo problem. 

Kosovo has the potential – it has all the elements of fear, hatred and revenge – to bring back ethnic violence to the Balkans, big-time. The danger this time is not the government in Belgrade, but the Serbian irregulars, giving themselves names like ‘Tigers,’ under the command of violent criminals that carried out the worst of the atrocities in CROATIA and BOSNIA. Aiming at the soft targets of women, children and isolated communities they tended not to fight, but to murder, rape, plunder, burn and depart. That of course would bring about revenge on isolated Serb communities and a ratcheting-up of the crisis. Thus it must be of primary importance to proceed with caution and perseverance. 

KAZAKSTAN is not hostile to Moscow, but makes it very clear that it considers itself sovereign in fact, and not just in theory. It has fostered good relationships throughout the west, which it sees not only as its source of investment and technology, but also as by far its most important long-term market. In addition it maintains good relations with China, its giant neighbour to the east.
It is of course greatly stimulated by its massive hydrocarbon reserves and swelling funds in foreign direct investment. What formerly seemed the biggest drawback – its geographical isolation, has proven to be a strength. It was remote enough not to feel its giant neighbours, RUSSIA and China, breathing down its neck during the post-soviet chaos, as it found ways of exploiting its enormous mineral assets to its own advantage, rather than to any Moscow-driven Russian ‘Empire,’ (which was what the early CIS was looking like). 

Its president has made strong overtures to his Turkic neighbours, including TURKEY itself, within a pan-Turkic organization, which is one direction in which, over time, it might travel. But startling (in its originality), and fascinating news, is the suggestion that the time may have come to build a canal between the Caspian and the Black Sea, presumably through AZERBAIJAN and GEORGIA , which we review in this months report. We consider that the arguments described for the canal are as powerful and as logical as were the cases in their time for the great predecessors, the Suez and the Panama canals. The implications for the west are profound as they are for RUSSIA, which for so long has monopolised egress of Kazak products (it is said that KAZAKSTAN contains every mineral known to man), and the exports of other central Asian nations. 

Our Belarus Update analyses why these two pariah states got together, as we reported in the last issue, when the world was somewhat surprised to see IRAN’s fire-eating President Ahmedinejad, ‘a long way from home,’ on an official visit to Minsk. 
Crazy? If so, crazy like a fox! Considering the event objectively it is our view, as we explain, that it was a shrewd move where both states have found a way that serves their purposes, to make a path through the hostile crowd that surrounds them. 

Democracy has strangely never thrived in this large, mainly Christian outpost in Asia, except in a peculiarly eccentric way, where the vote, which regularly takes place, is accompanied by murder and violence on a massive scale. One reason that this is repeated over and over again, is that it is the very forces of administration and law with the military in support, that seem to be the main perpetrators of the violence. That “power is money and money is power, and this is the natural order of things”, is a proposition few would argue with in this archipelago. This month’s report describes and analyses the major senatorial elections recently held, and looks at what can be expected now that the final results and the cost in human terms, are being counted . 

‘Supping with the devil’ one is advised under the old saying, “it is wise to use a long spoon”. UZBEKISTAN although in population terms the largest by far of the FSU ‘Stans, has been amongst the least well-endowed, along with their tiny Kyrgyz and Tajik neighbours, where oil and natural gas are concerned. KAZAKSTAN is of course a giant in this context, mostly with vast new reserves discovered since the years of its thralldom within the USSR. Isolated TURKMENISTAN (which as we have observed before is, if not at the end of the world, then only a short bus-ride away), has the world’s third or fourth largest gas reserves. But UZBEKISTAN in terms of reserves of either oil or gas is not in any comparison with either of them and is pressed to produce enough for domestic consumption. For Tashkent this energy poverty is particularly hard, because both in Soviet days and in those of the Tsar, it was the actual regional capital of what used to be called ‘Turkestan,’ with the other ‘Stans capitals being merely dusty, unimportant, provincial towns. It is entirely possible that UZBEKISTAN may yet discover important gas reserves for export and if that were to happen, the competition between RUSSIA and CHINA to control them would surely hot up. In this issue we describe the ‘long spoon’ difficulties so far for the Uzbek authorities and indeed for China, in seeking to establish a firm foundation to this energy trade. 


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