re: Latest Updates: Russia-Ukraine Conflict

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The struggle to deliver on promises to provide Leopard 2 tanks for use against Russian forces has exposed just how unprepared European militaries are.


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Some nations have discovered that the tanks in their armory don’t actually work or lack spare parts. Political leaders have encountered unanticipated resistance within their own coalitions, and even from their defense ministries. And some armies had to pull trainers out of retirement to teach Ukrainian soldiers how to use old-model tanks.


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Of course some nations have delivered, or at least announced that they will,” Germany’s defense minister, Boris Pistorius, said at the Munich Security Conference this month. “But others have not done that.” “That is what I’m a bit shocked about,” he added. “Clearly there were some nations — and I will never name names here — but we had some nations that preferred to hide behind Germany. To say: We would love to, if we were allowed. But when we allowed it, they didn’t do anything.”


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For years, the United States has been nagging Europe to increase military spending, and in 2014, after Russia grabbed Crimea, NATO members agreed to spend 2 percent of GDP by 2024. Yet even today, by current NATO estimates, only nine of the alliance’s 30 members are spending that much, while a 10th is close. Thirteen countries, including Germany, were spending around 1.5 percent of their G.D.P. or even less.


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Spain, which has 108 Leopard 2A4 tanks, early on sought German permission to offer some of its vehicles to Ukraine. Now it has discovered that many of them are in poor condition and need refurbishment that could take weeks or months. On top of that, one of the prime minister’s coalition partners, the leftist Podemos party, is closer to Russia and has been resistant to offering more support for Ukraine.

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@EuromaidanPR
Military training will start in Transnistria from tomorrow, March 1, - the "Ministry of Defense" of the unrecognized republic reports.
The reason is allegedly possible provocations from Ukraine.
#UkraineHolds

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Spain, which has 108 Leopard 2A4 tanks, early on sought German permission to offer some of its vehicles to Ukraine. Now it has discovered that many of them are in poor condition and need refurbishment that could take weeks or months. On top of that, one of the prime minister’s coalition partners, the leftist Podemos party, is closer to Russia and has been resistant to offering more support for Ukraine.

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Moscow has jettisoned longstanding concerns about giving China too much leverage over its economy

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Russia’s economy, restricted from Western financial networks and the U.S. dollar, has embraced a burgeoning alternative: the Chinese yuan.

Energy exporters are increasingly getting paid in yuan. Russia’s sovereign-wealth fund, a war chest to support government spending burdened by battlefield costs in Ukraine, is using the Chinese currency to store its oil riches. Russian companies have borrowed in yuan, also known as renminbi, and households are stashing savings in it.

The Chinese currency’s rise inside Russia deepens ties between two countries that have long rivaled each other for global influence but have grown closer amid shared discontent with the West. It also serves China’s long standing but mostly frustrated campaign to make the yuan a more prominent feature of global finance and commerce.

Moscow has jettisoned concerns about giving China too much leverage over its economy, said Alexander Gabuev, a senior fellow at the Carnegie Endowment for International Peace.

“Now it’s the only rational choice for Russia and for Putin,” Mr. Gabuev said. “If depending on renminbi is the lifeline that helps you to be less exposed and less dependent on hostile currencies, then you take this route.”

A spokesperson for the Russian Ministry of Finance said the yuan is “taking an increasingly important role” in its sovereign-wealth fund, which doubled the share of yuan it can hold to 60% in December. The ministry started selling yuan in January to plug its widening budget deficit.

The share of Russian exports paid for in yuan rose to 14% by September, according to data from the central bank. That is up from 0.4% before the start of the war.

Spokespeople for China’s central bank didn’t respond to a request for comment.

Russia began cutting its dependence on the dollar in 2014 after its annexation of Crimea. By 2018, as the U.S. imposed additional economic sanctions, the country began to sell its holdings of U.S. Treasury bonds and explore trade in rubles and other currencies.

De-dollarization went into overdrive, and widened to include the euro, last year. Western countries froze some $300 billion of Russia’s foreign reserves and banned some of its banks from the SWIFT messaging system that underpins most global payments in response to Russia’s invasion of Ukraine.

Russians don’t face an outright ban on using dollars or euros, and non-sanctioned banks continue to do business in foreign currencies.

Booming trade between Russia and China added to the yuan’s appeal. China has become a major buyer of Russian oil that is shunned by the West, while Russia has grown more dependent on China for semiconductors and other technology.

Russian companies have also turned to the yuan and issued bonds in the Chinese currency worth the equivalent of more than $7 billion last year, according to Refinitiv data. In recent weeks, the yuan-ruble was often the most traded currency pair on the Moscow Exchange based on daily volume.

Aluminum giant Rusal was the first company to issue yuan bonds inside Russia last August, and other commodity exporters like oil firm Rosneft followed. Most trade with China and can use yuan raised for everyday business, for example to pay invoices.

Bistrodengi, a Russian lending platform, started selling yuan bonds last year despite not doing any business in the Chinese currency. The company’s chief finance officer, Yakov Romashkin, said borrowing in yuan was far cheaper than rubles. Its bonds offer a coupon rate of 8% instead of the 19% that it likely would have had to pay to borrow in rubles.

The Russian broker that arranged Bistrodengi’s previous ruble bond offerings ran the deal, and buyers were predominantly individual Russian investors, he said. It swapped the yuan back into rubles.

Mr. Romashkin said there were technological hiccups. Some brokers weren’t fully set up to sell yuan securities, with some displaying incorrect information about Bistrodengi’s bonds, he said. Some didn’t allow investors to buy bonds using their app, instead requiring trades be done over the phone.

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“When people see the ruble is getting weaker and weaker, they don’t care about the yield, they just want to save their money,” she said.

While still in its early days, some see Russia’s yuan use as a test case in a debate that has long captivated the financial world: Will the yuan eventually rival the dollar as the world’s dominant currency?

But building the infrastructure to circumvent the dollar-based financial system built up over decades is slow, difficult and expensive, said Eswar Prasad, a professor at Cornell University and former head of the International Monetary Fund’s China division.

China launched a cross-border payments system known as CIPS in 2015 that has been billed as an eventual competitor to the 50-year-old SWIFT network. But its system hasn’t yet been widely adopted by other countries, according to Mr. Prasad. Instead, Russian and Chinese banks rely on networks of local branches and correspondent banks to process transactions without SWIFT. The Russian central bank this month set up an international settlements department it said would focus on expanding settlements in national currencies.

While Russia’s use of the yuan doesn’t mean the end of dollar supremacy, it may usher in the beginning of a more fractured system that could ultimately blunt the U.S.’s ability to use financial sanctions as a weapon, said Daniel McDowell, a professor at Syracuse University who recently wrote a book on the topic.

“The more countries you force to find those alternatives,” Mr. McDowell said, “effectively what you’re going to do is increase economies of scale and experience in those areas.”

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????Rheinmetall is cooperating with ????DefSecIntel to provide to ???? SurveilSPIRE, which consist of mobile surveillance towers with day and night-capable camera equipment, autopiloted mini drones and a control system.
Delivery has already commenced - Reuters

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Your BTR-82A only has a 30mm cannon to attack a dug-in position? No problem - this Ru BTR-82A suppresses a Ua solider defending a trench (w/ what looks like a grenade launcher) whilst an infantryman fires rounds of RPG-26. The Ua infantryman does an admirable job holding out.

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My point is that official US policy is now that Crimea is going to have to be, at a minimum, demilitarized. There were people in here arguing with me a few days ago and saying that there's no way that Russia is going to give up that base.

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Russia’s economy, restricted from Western financial networks and the U.S. dollar, has embraced a burgeoning alternative: the Chinese yuan.

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