Russian President Vladimir Putin holds bilateral meetings with world leaders ahead of a Shanghai Cooperation Organization summit; US President Joe Biden sees donor support wane following his debate failure; and the UK is unlikely to change its Russia policy after its general election. These stories topped Thursday’s newspaper headlines across Russia, according to TASS News Agency.
Izvestia: Putin takes meetings with world leaders
Russian President Vladimir Putin met with six foreign leaders to talk trade and economic cooperation ahead of a Shanghai Cooperation Organization summit in Kazakhstan’s capital of Astana. Many sensitive issues, including the Ukrainian crisis, were discussed behind closed doors. Putin’s talks with Turkish leader Recep Tayyip Erdogan and Chinese President Xi Jinping drew the most attention, Izvestia writes.
The Ukrainian crisis has recently become an important topic of Russia-China dialogue. In June, China and Brazil called for a peace conference that would involve both Russia and Ukraine. "China is interested in resolving the Ukraine crisis in order to showcase its leadership in global affairs," Yekaterina Zaklyazminskaya, senior researcher with the Center for World Policy and Strategic Analysis at the Russian Academy of Sciences’ Institute of China and Modern Asia, explained.
Trade and economic ties remain an important issue for Moscow and Beijing. Cooperation is complicated by Western restrictions and secondary sanctions, which pose a threat to Chinese banks and companies. "There are solutions, it’s just that no one is talking about them," Pavel Kuznetsov, vice president of the National Coordination Center for International Business Cooperation, pointed out. According to him, these include the use of small, less prominent banks, payments through intermediary countries and barter deals.
As for Putin’s meeting with Turkish President Recep Tayyip Erdogan, the parties touched upon cooperation in the nuclear energy sector and bilateral trade. Ukraine also got a lot of attention but these issues were mostly discussed in private. "The conflict in Ukraine negatively impacts Turkey both economically and politically. Although a member of the North Atlantic Alliance, Ankara is trying not to spoil its ties with Moscow, shying away from real military assistance to the Ukrainian army. This is certainly leading to greater pressure on the Turkish authorities from both domestic supporters of the West, and Washington, London and Brussels," oriental studies expert Murad Sadygzade said.
All in all, despite the existing difficulties, the Astana talks have made it clear that key regional players are willing to maintain dialogue with Moscow, the paper notes.
Media: US donors pivot as Biden's debate performance sparks concerns
Donors plan to increase support for Democratic candidates in the congressional elections, potentially reducing funding for President Joe Biden’s re-election campaign, Vedomosti writes, citing US media outlets. The move comes amid growing concerns about Biden’s ability to win the November presidential vote, especially after his less than stellar performance in the first presidential debate with Donald Trump on June 28.
Democrats appear to be preparing for a Trump victory, turning their attention to strengthening their positions in the legislature, Dmitry Kochegurov, senior researcher at the Russian Academy of Sciences’ Institute for US and Canadian Studies, explained. Winning a majority in the House of Representatives and maintaining control of the Senate will allow them to block Trump’s policies on many tracks.
A decrease in funding will not significantly harm the Biden campaign at this point, Pavel Dubravsky, head of Dubravsky Consulting, noted. The political strategist explains that money plays a critical role in Congressional campaigns, but in the presidential race, what matters most is the candidate’s brand. For Biden, a weakened public image is far more damaging than any funding dip.
According to the Axios media outlet, donors haven’t made a final decision yet about redirecting large amounts of funds, awaiting new poll results to gauge the impact of Biden’s debate performance on his ratings.
Just a couple of weeks ago, Biden’s withdrawal from the election looked improbable as it would have been akin to conceding the White House to the Republicans, Viktoria Zhuravlyova, head of the Center for North American Studies at the Russian Academy of Sciences’ Institute of World Economy and International Relations, told RBC. However, with a growing number of democrats advocating for a change and the liberal press promoting the idea of replacing Biden, it is evident that such sentiments are gaining considerable support, including financial backing.
Izvestia: UK unlikely to change Russia policy after general election
The United Kingdom is holding its general election on July 4, with 650 seats in the lower house - the House of Commons - up for grabs. Experts believe that the Conservative Party, which has been in power in the UK since 2010, will lose its majority, Izvestia notes.
Pundits point out that British Prime Minister Rishi Sunak called the election for the mid-summer holiday season, a political strategy aimed at reducing voter turnout. However, analysts believe that despite these maneuvers, the Labor Party will ultimately take control of the country’s parliament, ending the 14-year conservative rule.
"Most experts think the Labor Party will win in a landslide," Professor Igor Kovalyov, first deputy dean at the Higher School of Economics’ Department of World Economic and International Politics, pointed out. According to him, the Conservative Party is clearly in a very difficult situation.
University of Kent Professor Richard Sakwa also sees no chance for the Conservative party. He says that the only question now is the size of the Labor majority. It’s absolutely clear that the Conservatives have campaigned poorly and have nothing to offer voters, the expert said. The country is headed towards a new Labor government, which will remain in power for the next five years barring any unforeseen events, Sakwa noted.
If the Labor Party achieves success, Britain’s economic policy could see some changes in terms of a more active industrial policy and a focus on green energy, Sakwa added.
Meanwhile, experts don’t expect London to radically change its foreign policy. Its relations with Moscow should not be expected to improve. "Nothing will change with regard to the Ukraine issue because there is full consensus on that among virtually all major political forces in the United Kingdom. Only fringe parties voice some disagreement," Kovalyov emphasized.
Nezavisimaya Gazeta: Emerging markets watch as ruble gains ground in June
The Russian ruble turned out to be the strongest currency among emerging markets in June, leaving the South African rand and the Chinese yuan in the dust. In the past month, the ruble strengthened against the US dollar by about 4%, Nezavisimaya Gazeta writes.
However, some experts view this situation as more of a negative than a positive. One theory suggests that the Russian budget needs the ruble exchange rate to range between 95 and 100 rubles per dollar, while the current rate stands at 88 rubles. Besides, despite all the talk about the US currency being toxic, it is the ruble to dollar exchange rate that the Russian budget is based on.
"The dollar-ruble rate changed after sanctions were imposed on the Moscow Exchange, and may not have reached equilibrium yet," Vladimir Klimanov, director of the Presidential Academy’s Center for Regional Policy, pointed out. In addition, there’s a common belief that the ruble is overvalued so there will be a correction in its price, the expert said. He expects that the ruble may weaken after August, which is "always a difficult month for the Russian economy."
Tsifra Broker analyst Natalia Pyryeva explains that on the one hand, oil prices remain at a comfortable level. But on the other hand, the oil market situation may change for the worse. "This is why we don’t rule out that for the sake of fiscal stability, the ruble will have to be weakened," Pyryeva noted. Still, in her words, the situation looks rather positive at this point.
Meanwhile, some experts interviewed by the newspaper have come to the conclusion after assessing economic trends and the government’s rhetoric that the macroparameters used for projecting the federal budget (including the currency rate) may soon require conceptual rather than just quantitative adjustments. That said, they will have to be adjusted in terms of the currency that is set as a reference for calculations.
Kommersant: Crypto miners eyeing Africa
Ethiopia is attracting crypto miners from around the world. Recently, Russian company BitCluster opened a data center in the African country. However, most Russian crypto mining companies have no plans to enter Ethiopia in the near future. Although electricity there is cheaper than in Russia, there are high risks of power outages and political instability, Kommersant writes.
BitRiver, Russia’s biggest crypto mining company, is currently focused on domestic activities, even though it is "following the situation in Ethiopia and maintains constant contact with its partners in the country." According to BitRiver’s estimates, Ethiopia’s computing capacity for crypto mining purposes stands at 400-420 MW, and the country is firmly among the five global leaders in the market (with Russia being in second place).
Today, Ethiopia is a major cluster for crypto miners, Ubit CEO Timofey Grigorenko pointed out. Chinese crypto miners are particularly active in the country as Beijing has banned cryptocurrency trade and mining in order to control financial risks and reduce power consumption.
Meanwhile, Russia is working on a law to regulate crypto mining, also considering increasing electricity prices for this kind of activity. In such a situation, Russian crypto miners may find it beneficial to relocate their business to other countries, including Ethiopia, TerraCrypto founder Nikita Vassev said. Basically, Ethiopia has good potential for the development of crypto currency mining due to cheap and relatively stable electricity supplies, OXLY Development Director Danatar Atadzhanov noted.
However, businesses may face specific risks in Ethiopia. Those stem from possible power disruptions, political instability and the threat of terrorism, particularly along the borders with Eritrea and South Sudan, Vassev explained.
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