Beijing is unlikely to give in to Washington’s pressure over cooperation with Moscow; Russian military experts dismiss the notion of ATACMS as "wonder weapons" amid threats to the Crimean Bridge; and the Yemeni Houthis are all set to step up attacks if Israel storms the Gazan city of Rafah. These stories topped Saturday’s newspaper headlines across Russia, according to TASS News Agency.
Vedomosti: China unlikely to fold in face of US pressure over Russia ties
US Secretary of State Antony Blinken held meetings with Chinese President Xi Jinping and Foreign Minister Wang Yi in Beijing on April 26. Addressing a press conference after the talks, Blinken outright threatened Beijing over what Washington describes as China’s support for the Russian army, Vedomosti writes.
In its statements following the negotiations, China did not mention Russia. Xi used his usual friendly tone at his meeting with Blinken, saying that China and the US should be partners and not adversaries. Meanwhile, judging by the final statement, Blinken’s conversation with Wang was more confrontational. The latter warned against attempts to interfere in China’s domestic affairs, stifle its growth or cross its "red lines."
The US is already taking restrictive measures against China over its cooperation with Russia but now, it may impose both primary and secondary sanctions on companies, Lev Sokolshchik, researcher with the Center for Comprehensive European and International Studies at the Higher School of Economics, said. Restrictions against Chinese banks could be the most effective tool for Washington here, the expert noted, adding that domestic producers could also be targeted. The US continues a long-term trend of sanctions against China, but whether US President Joe Biden will ramp these efforts up before the US presidential election remains unclear.
Senior US and Chinese officials have made it a habit to talk nice at meetings, but afterwards, the Americans’ rhetoric turns negative, Yana Leksyutina, senior researcher at the Russian Academy of Sciences’ Institute of China and Modern Asia, pointed out. There is a high degree of conflict between the parties, but it has not turned into confrontation yet because China does not want that. According to the expert, the US is already tired of China’s "games" and is seeking to give the country a clear choice between ending close cooperation with Russia or facing significant sanctions pressure. "However, even faced with such pressure, Beijing is unlikely to fundamentally change its policy towards Moscow as the Chinese value consistency," Leksyutina concluded.
The Army Tactical Missile Systems (ATACMS) that the Ukrainian army has started to receive from the US make an attack on the Crimean Bridge a real threat but Russian air defenses are capable of protecting the peninsula, Permanent Representative of Crimea to the Russian President Georgy Muradov told Izvestia. By supplying long-range ATACMS missiles, Washington is taking its war against Russia in Ukraine to a new level, the politician stressed.
According to US officials, Ukraine has committed to targeting only Russia’s new regions and Crimea, refraining from using long-range weapons for attacks inside Russia. However, the US will restrain Kiev only by paying lip service, saying that it does not enable or encourage strikes on targets in Russia, Konstantin Blokhin, leading researcher at the Russian Academy of Sciences’ Center for Security Studies, noted.
Still, military experts believe that Kiev will use other weapons to attack infrastructure facilities in the Belgorod and Kursk regions, partly to avoid tensions with the US. "ATACMS will first and foremost be used in the south. Crimea, namely its military sites, airfields and the Crimean Bridge, are the key targets," military expert Gennady Alyokhin said. However, he is confident that first, Russian air defenses will be able to provide reliable protection to facilities in all areas. Second, the Russian Armed Forces are making demonstrable efforts to hit the logistics chain of arms supplies, with weapons mostly coming to Ukraine by road and rail.
"New missiles provided to the Ukrainian army will definitely not change the outcome of the military confrontation because ‘wonder weapons’ don’t exist and this is certainly not what ATACMS missiles are. Russia’s S-300, S-400 and Buk systems are surely capable of downing such missiles. The most advanced S-500 systems, whose deliveries to the air defense forces have already begun, will also be able to cope with targets like these," military expert Dmitry Kornev explained.
Izvestia: Houthis all set to step up attacks if Israel storms Rafah
The Yemeni Houthis will scale up attacks on Israeli targets if the Israel Defense Forces (IDF) launches an operation to storm the city of Rafah in southern Gaza, a spokesperson for the Ansar Allah (Houthi) movement told Izvestia. The movement also warned that countries cooperating with the Jewish state might also come under attack. Those apparently include the Arab nations that, according to the Houthis, maintain dialogue with Israel. However, experts are skeptical about the Houthis’ ability to inflict damage on Israel and its partners.
As many as 1.5 mln refugees have taken shelter in Rafah after being forced to leave the northern Gaza Strip due to military activities. An Israeli operation may worsen the already complicated humanitarian situation, and Israel seems to be well aware of the potential consequences of making a foray into Rafah. Plans for an assault on the city have turned into a political bargaining chip in talks with Hamas, which are being conducted through the mediation of Qatar, Egypt and the US. The Times of Israel newspaper reports, citing a source, that the country’s government is willing to reconsider plans to enter Rafah in exchange for a serious proposal on the return of hostages and a ceasefire.
Even if the Houthis do step up attacks once the IDF invades Rafah, the impact will be small, Grigory Lukyanov, a researcher with the Center of Arab and Islamic Studies at the Russian Academy of Sciences’ Institute of Oriental Studies, noted. "They can carry out strikes but if the number of ships in close proximity to their coast continues to decline and the [Western] coalition strengthens control in the Red Sea, chances are their activities will not produce serious results," the expert explained.
"Their arsenal is quite limited as it largely includes obsolete missiles and a certain number of drones from Iran. In fact, everything that is happening in the Gulf of Aden and the Indian Ocean is more like a PR stunt based on the Houthis’ desire to present themselves as an influential and serious force and promote the Yemeni movement’s brand in the Muslim world," Sergey Demidenko, a department head at the Institute for Social Sciences of the Institute for Social Sciences at the Russian Presidential Academy of National Economy and Public Administration, pointed out.
Vedomosti: Trump mulls punitive measures against countries ditching dollar in trade
Former US President Donald Trump’s economic advisers have floated the idea of punishing countries for abandoning the dollar in trade. Options are being considered to prevent members of the BRICS group from ditching the dollar, Vedomosti writes, citing US news outlets.
In his election campaign, Trump has repeatedly highlighted the danger of the dollar falling off as the world’s number one reserve currency. According to the media, Washington’s use of economic sanctions is one of the reasons why countries are reducing reliance on the US dollar. The freezing of and attempts to confiscate Russian assets are the most glaring example of this. Russian Foreign Minister Sergey Lavrov has recently said that Russia and China are close to abandoning the dollar in bilateral economic relations. Efforts to reduce the use of the dollar in trade were also discussed at a BRICS summit in August 2023.
The talk about potentially sanctioning anyone who rejects the dollar is just that at this point, and doesn’t imply any action, Yaroslav Lisovolik, founder of the BRICS+ Analytics company, said. As for the BRICS group, imposing restrictions now doesn’t make much sense because the creation of a single currency and a decrease in the use of the dollar are still only under discussion. As far as Russian-Chinese trade is concerned, it’s too late to try and push the two countries to use the dollar by making threats. Another thing to remember is that BRICS involves, to varying degrees, certain countries that the US sees as its partners and allies, namely India and Saudi Arabia. That said, no sanctions blow should be expected to be delivered to the group in general, Lisovolik noted.
Even if Trump’s advisers succeed in coming up with a way to impose sanctions on those moving away from the dollar, it will hardly make the US currency more attractive, Russian International Affairs Council Director General Ivan Timofeev emphasized. According to the expert, the initiative that is allegedly under discussion in Trump’s entourage is in vain because it will only strengthen some countries’ desire to reject the dollar.
Media: Russian market expects key rate to be reduced by year’s end
Russia’s Central Bank decided to keep the key rate at 16% at its April 26 meeting. However, the option of increasing the rate is still on the table, Central Bank Governor Elvira Nabiullina said, Izvestia notes.
The Central Bank stressed that combating rising prices requires a longer period of strict monetary policy. That said, the regulator raised medium-term expectations for the average key rate in 2024 from 13.5-15.5% to 15-16%. This means that the rate is unlikely to fall below 13.5-14.5% even by the end of the year, independent expert Andrey Barkhota explained.
The regulator also pointed out that the Russian economy was growing quicker than expected. The Central Bank significantly increased its 2024 forecast for GDP growth to 2.5-3.5%. The regulator sees this as a pro-inflationary factor, Promsvyazbank Chief Analyst Denis Popov noted. As a result, softening monetary policy has been put on the backburner, towards the end of the year, while the risks of the key rate remaining at the 16% level for all of 2024 have grown.
The regulator’s decision was widely expected, RBC writes, citing BCS World of Investments expert Mikhail Zeltser. "The rate of price growth in the economy is slowing down, according to weekly inflation data. The ruble is relatively stable," he said. In the expert’s view, this makes it possible for the Central Bank not to raise the key rate, but the bank is wary of any reduction because of the continued imbalance between the demand and supply for goods and services and a tense situation on the labor market, Zeltser added.
An RBC consensus forecast based on surveys involving 30 analysts from major banks and investment companies suggests that the Central Bank is unlikely to start reducing the key rate until July 2024. Experts also did not rule out that the rate could remain at the 16% mark until the end of the year and even be increased.
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