Sunday, March 12, 2023

 

Putin’s African Dream -part 2

The Geopolitical Handbook offers an insight into a number of issues in the current Russia-African relations. It documents views and opinions on some aspects of the relations, and simultaneously tries to pose questions in relation to foreign players on the geopolitical fields in Africa. Admittedly, Africa has become competitive but still continues attracting external players to significant sectors.

In this context, Russia undoubtedly needs to adopt its approaches and mechanisms necessary for driving effective cooperation in order to take the relations to the next level in the new changing conditions of world politics and economics. What steps are needed to give a new impetus to bilateral economic relations? What are the key initiatives and competencies that can create a deeper strategic partnership between Russia and Africa?

Available here

Why the West Should Consider Some of Putin’s Claims


 
 MARCH 7, 2023
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As the grim one-year anniversary of Russia’s invasion of Ukraine neared last month, President Biden and Vladimir Putin gave competing speeches laying the blame for the tragedy at each other’s feet. The western press showed great analytical skill in breaking down Putin’s speech for falsehoods and half-truths. The same can’t be said of Biden’s speech. Although the western press fact checks and criticizes much of Biden’s domestic policy, mainstream journalists applaud rather than analyze his pro-war rhetoric. Accordingly, the BBC chided the Russian President by stating, “Truth was an early casualty of Mr Putin’s lengthy speech”, while praising Biden for his strong statement that autocrats only understand: “No, no, no!”

This type of white hat vs. black hat narrative makes for good copy and confirms western stereotypes.  If peace is going to prevail, however, a more nuanced examination of Russia’s response to US political and military meddling in Ukraine is needed. This should also include a more honest analysis of NATO expansion eastward and a sober look at the threat that far-right Ukrainian militias pose for Europe.

In this sense, it would be beneficial to lean on one of the main lessons former Secretary of Defense, Robert McNamara, outlined in Errol Morris’s 2003 documentary, The Fog of War. Regarding the peaceful resolution of the Cuban Missile Crisis, McNamara explained that it was essential for President Kennedy to empathize with the enemy. More specifically, McNamara urged that when confronting the enemy “[we] must try to put ourselves inside their skin and look at us through their eyes just to understand the thoughts that lie behind their decisions and their actions.” Taking this radical but simple step helped Kennedy and Khrushchev step back from the edge of nuclear annihilation. With rising tensions between the US and Russia again threatening the specter of nuclear Armageddon, Biden should consider McNamara’s advice.

This, of course, would demand that the US government and media objectively listen to some of Putin’s claims. Given the historic climate of mistrust between the West and Russia, this is an admittedly big ask. But when Putin outlines US involvement in the crisis that led to the Ukrainian Civil War, he is providing essential context that both Washington and western journalists leave out. Still, given the fact that in late 2013 John McCain was rallying the masses on Kyiv’s Maidan Square, it’s hard to deny US interference. Furthermore, a leaked 2014 conversation between State Department official, Victoria Nuland, and Ambassador to Ukraine, Geoffrey Pyatt, clearly highlights US kingmaking attempts in Ukraine. Is it too much to ask how this was perceived by Putin and the Russians?

Or how about Putin’s claims that the “Special Military Operation” is designed to de-militarize and de-Nazify Ukraine? Even before last February’s invasion, the US was responsible for 90% of Ukraine’s military aid, including lethally effective Javelin anti-tank missiles. As far back as 2014, Lt. General Ben Hodges, former commander of the US Army in Europe, stated that “First and foremost, U.S. military aid represents a physical manifestation of American support, which is essential.” Exposure to such facts, combined with knowledge of NATO expansion since 1991, might provide insight into how this threat is perceived by Russians.

Presented in this context, the question of who provoked the war in Ukraine could be seen in a new light.  Nearly ten years ago, the Associated Press’s Matt Lee pressed State Department Spokesman, John Kirby, precisely on this issue. “Is it not logical to look at this and say the reason that the Russian army is at NATO’s doorstep is because NATO has expanded rather than the Russian’s expanding? In other words, NATO has moved closer to Russia rather the Russian’s moving closer to NATO.” When Kirby responded that “NATO is not an anti-Russian alliance”, Lee countered, “[F]or 50 years it was an anti-Soviet alliance…Do you not understand how, or can you not even see how, the Russians would perceive it as a threat?”

Regarding denazification, prior to Russia’s invasion, the western press had reported assiduously on the rise of far-right militias within Ukraine’s military ranks. Numerous articles, many focused on the Azov Battalion, appeared in the GuardianBBC, and Reuters detailing the disturbing xenophobia and antisemitism espoused by these extremists. One particularly frightening investigation by Time correspondent Simon Shuster quoted militia members claiming that “We are Aryans and will rise again” and “Being tolerant to LGBT people, this not natural. This is brainwashing.”  On this note, Putin’s recent speech repeated that there is a fascist presence in Ukraine and that “the West will use anybody – terrorists, neo-Nazis – if they fulfill its aims” of fighting against Russia.

Shuster’s report takes on greater significance in light of increasing attacks by neo-Nazi groups worldwide. In 2018, The Guardian reported that the outgoing head of UK counter-terrorism policing, Mark Rowley, revealed that four far-right terror plots had been foiled in 2017 and extreme right groups linked to Ukraine were seeking to build international networks. Since the US has a history of allying with radical groups, it’s worth remembering the devastating consequences of such alliances. One might recall Zbigniew Brzezinksi, President Carter’s National Security Advisor, proudly claiming, “We created the mujahedeen”. Besides the short-term goal of driving the Soviets from Afghanistan, this “creation” also led to the emergence of the Taliban, the September 11 attacks and the ensuing US “War on Terror”. This is not to say that Ukraine will become a failed state like Afghanistan and fertile ground for neo-Nazi groups, but considering this possibility might shed light on Russia’s goal to denazify the Ukrainian military.

The war in Ukraine is the tragic consequence of Russian aggression. But trying to understand the reasons why the Russian government took the decision to invade might help defuse the conflict. Since the West’s current plan of escalation promises more destruction of Ukraine and its people, as well as the threat of nuclear holocaust, following McNamara’s advice and trying to see the conflict through Russian eyes, is an important first step toward negotiating peace.

Dana E. Abizaid teaches European History at the Istanbul International Community School.

Ukrainian 'boy on the bridge' turned army cook dreams of becoming professional chef

Sky News' Stuart Ramsay first met Serhiy Petrushenko when he was guarding a bridge by himself in Kyiv at the start of the war. Now the pair reunite, with Mr Petrushenko having changed both physically and mentally as a result of the ongoing war.


Stuart Ramsay
Chief correspondent @ramsaysky
Saturday 11 March 2023 

We'd been worrying about Serhiy Petrushenko, a 21-year-old boy we met guarding a bridge in central Kyiv completely on his own on the second day of the war.

He became an overnight sensation after our report, the interview was watched well over 50 million times on social media alone



When we spoke to him his fear was honest, visceral and compelling, and his concern for his family - whose village was already surrounded by Russian soldiers - was so vivid, even on film.

We've been thinking about him ever since.

Like so many people at the time, Serhiy thought that the Russians were coming, and he was going to die.

Within hours of our broadcast Sky News was inundated with people asking for more information.

And those messages of concern for the boy on the bridge, as we know him, continue today. So we asked the Ukrainian military if they could confirm he was alive and help us find him.

It took them over two months to track him down. To be fair, it's a tough ask in the chaos of war, but they did at least confirm he was alive.

This week I met Serhiy again, he's working as an army cook. We shook hands and later hugged.



To this day he can't really believe how he has become so well known, how hundreds of people still write to him every day, and how he has invitations to visit them after the war… from Finland to Hawaii.

"Hundreds of people, hundreds of people on social media text me every day. Every day they ask me about my family, how I am doing," he told me.

"I tried to reply to all the messages individually but in the end I just couldn't."

We met in a field kitchen next to the woods in the Kyiv region as he was preparing lunch for soldiers training for battle.

"The first time we met, I was not cooking at that time, but a few months ago, I came to where I belong, to the kitchen. And, for months I've been cooking for my soldiers in many places."

It's an unheralded job but incredibly important - soldiers can't fight if they are hungry.





It's also inspired him to dream. After the war Serhiy wants to travel to Italy, sample the cuisine, and maybe even train to be a professional chef.

He says he has grown up quickly over the last 12 months. "I feel older, and I look older since you met me," he said smiling and laughing.

We met at the start of the war by chance, to be honest.

On a whim we decided to film the many bridges that cross into the heart of Kyiv, and the pedestrian bridge we spotted as we drove by was perfect.

With his rifle in his arms, Serhiy walked towards us to ask us what we were doing. We explained and he said we could film but that he had to stay and watch us.

He was a nice kid, and as we finished filming, I asked without any expectation of agreement if we could interview him.

We didn't speak for long, but his story resonated with people around the world.

He seemed somewhat bemused as to what use he could actually be as he had only fired 16 rounds in his life.

That number is now between 50 and 60, he says. But he prefers cooking.

Serhiy's home village in the Sumy region was liberated by the Ukrainian forces after being taken by Russia, and he says his parents and grandparents are all well.

Serhiy Petrushenko speaking to his mother Lyudmyla Petrushenko

"I'm lucky that my family's fine. My relatives, my friends, they are fine. But when they occupied my village, some people got hurt, some people were killed."

Like many here, he is convinced Ukraine will win.

"People are very determined to defend the country… we will eventually push them [Russia] back to their borders, maybe even forward. Yeah, they will not win."


WORDS FROM SERHIY PETRUSHENKO'S MOTHER - LYUDMYLA PETRUSHENKO

Unfortunately, not everyone in Ukraine can watch Sky News, but my son's story was published on Facebook and people were saying to me 'Oh, that's your Serhiy all over the Internet!'

Like me, they were worried that he was there alone on watch.

We were worried then, and we still worry now because these days a rocket can land anywhere.

When I hear stories about strikes, I start crying out of worry for my son.

When we were under occupation at the start of the war it was terrifying. We live very close to the border, and I understood that at 4am the war started.

At 8am I went to the shop I was working at, and I saw a lot of Russian military vehicles on the road. It was so loud, and we were so scared. Tanks and armoured personnel carriers – we couldn't believe our eyes.

We stay in touch with our son all the time because we worry, and of course he worries about us too.

I miss him so much. You can't even imagine how much.

 


In truth I never thought Serhiy was really cut out for fighting and frankly, nor did he.

But he's not scared anymore and says he will keep feeding "his boys", as he calls the soldiers.

The boy on the bridge is a man now.
War in Ukraine: Why Bakhmut is the focus of one of the conflict's bloodiest battles

By Valerii Nozhin • Updated: 11/03/2023 -

A Ukrainian tank fires towards Russian positions on the front line near Bakhmut, Ukraine, Wednesday, March 8, 2023 - Copyright AP/Copyright 2023 The AP. All rights reserved.

Heavy and persistent fighting over the Ukrainian town of Bakhmut in the Donetsk region has lasted more than seven months. According to local authorities, 60% of the city has been destroyed. Both Moscow and Kyiv claim the other side has suffered heavy losses.

In February, Western observers began to speculate that Ukrainian forces might abandon the defence of Bakhmut, and focus instead on launching their own counteroffensives. But why is the battle for Bakhmut still raging on?
Is Bakhmut strategically important?

Russia's initial attacks on Bakhmut may have been part of a wider plan to encircle Ukrainian army units near Kramatorsk and Slovyansk, according to Western analysts.

Sustained shelling of the eastern city began in mid-May last year, followed by a series of battles for control of its roads.

Moscow's assault on the city is believed to have begun on 1 August. But just three weeks later, the offensive appeared to run out of steam, and between September and October, Ukraine conducted a successful counteroffensive in the Kharkiv region, before reaching the Russian border.

After that, Russian military commanders appeared to lose interest in Bakhmut. But by then, troops on both sides were already bogged down in stubborn battles for the city.

'It's hard to defend,' says Ukrainian soldier as the battle for Bakhmut intensifies

"Unfortunately, what happens, it's like Verdun, once a lot of people start dying for a place, it doesn't really matter. You've got blood capital already spent," explained Patrick Bury, Associate Professor at the University of Bath.

"And then because of that spend of blood it becomes politically significant. Once people start attacking and need a win, it takes on a whole little world of its own," he told Euronews.
What does Bakhmut mean for Moscow?

For Russia, Bakhmut is a theoretical opportunity to declare victory, to "compensate" for military setbacks suffered last year. Indeed, in December, Ukrainian and Western observers reported that Bakhmut had become Moscow's main target and that it had deployed significant manpower in a bid to capture it.

Russia's Defence Minister, Sergei Shoigu, called Bakhmut the key to a further offensive in the Donbas. But Western experts doubt that Russia will have the capacity to build on its success if the city is taken.

"The Russians haven't demonstrated that they're good at doing breakthroughs yet in the way that Ukraine has," Bury explained.

"The Russian logistics are pretty poor, right? So if they do break through, they'll be slowed down anyway by their logistical problems, which existed before this," he added.
What does Bakhmut mean to Kyiv?

For Ukraine, Bakhmut has become a symbol of heroic resistance. Kyiv points out that prolonged fighting near the city has pinned down many Russian troops, preventing Moscow from conducting offensive operations elsewhere while inflicting heavy losses in manpower and equipment on Russian forces.
A Ukrainian serviceman who recently returned from the trenches of Bakhmut smokes a cigarette in Chasiv Yar, Ukraine, Wednesday, March 8, 2023.
Evgeniy Maloletka/Copyright 2020 The AP. All rights reserved

NATO estimates that five Russians are being killed in Bakhmut for every Ukrainian casualty.

"What's really going on is the Ukrainians are using it as a defensive battle, basically a set-piece battle at this stage to inflict the highest amount of casualties on the Russian attackers at the lowest possible cost to themselves before unleashing a counter-punch or two against Russia at a time of Ukraine's choice and also a place of their choosing," Bury, told Euronews.

Prigozhin and Defence Ministry Conflict


Russia's battle for Bakhmut also includes a unique dimension. Yevgeny Prigozhin's Wagner PMC mercenaries have played a key role in Russia's quest for the city.

The businessman is, in fact, in open conflict with the leadership of the Russian armed forces, to the point of exchanging insults with the head of the General Staff Valery Gerasimov.

Handout photo taken from video released by Prigozhin Press Service on Friday, March 3, 2023, Yevgeny Prigozhin, the owner of the Wagner Group military company,
AP/PRIGOZHIN PRESS SERVICE

Experts claim Prigozhin's ambitions could be one factor as to why the battle for Bakhmut rages on.
Russian paramilitary Wagner group taking 'tactical pause' in Bakhmut
Ukraine war: Russia's Wagner Group claims full control of eastern Bakhmut districts

"It came to prominence when Wagner [...] really came to power and sort of said, 'we'll do this, we'll show you how to win. The Russian army is incompetent and we'll do it!' And then they throw everything at [it]," Bury told Euronews.

Now success or failure at Bakhmut could determine the fate of the PMCs and Prigozhin himself.
Head of Russia’s Wagner group suggests 'betrayal' may be behind lack of ammunition for his forces in Bakhmut

Yevgeny Prigozhin says group trying to figure out reason for delay in shipments

6/03/2023 
AA



The head of Russia’s Wagner mercenary group said Monday that he wrote a letter to the commander of Moscow’s “special military operation” in Ukraine on the need for ammunition for the group’s forces in the Ukrainian city of Bakhmut.

"On March 3, I wrote a letter to the commander of the grouping of the special military operation about the urgent need to allocate ammunition,” Yevgeny Prigozhin said on Telegram.

Prigozhin’s latest message came a day after he suggested a possible "betrayal" was behind delays in shipments of ammunition for the group’s forces in the fiercely contested city.

“Documents were signed on Feb. 22 in the evening and orders were given for shipment on Feb. 23, but most of the ammunition has not yet been shipped. For now, we are trying to figure out the reason -- the usual bureaucracy or a betrayal,” he said.

In a separate video message on the Wagner Orchestra Telegram channel Saturday, Prigozhin said the retreat of the group from Bakhmut would result in the collapse of the whole front, which he said “will not be sweet for all military formations protecting Russian interests."

Russia’s Defense Ministry denied claims of problems with the supply of ammunition, saying they were “nonfactual.”

The ministry said that all the demands of the units were fulfilled as soon as possible.

Prigozhin meanwhile said in a statement released late Monday on the social media account of his Concord catering company that a representative of the Wagner group was banned from entering the headquarters of the Russian army.

Noting that he wrote a letter to the commander of the troops of the Russian special military operation in Ukraine on Sunday to ask for the immediate allocation of ammunition, Prigozhin said: “At 08:00 a.m. on March 6, the entry card of the representative at the headquarters was canceled and he was banned from entering the unit headquarters.”

Bakhmut is a large transport hub through which Ukrainian troops in the Donbas are supplied with weapons, military equipment and ammunition. The city has almost been captured by Wagner, Prigozhin claimed Friday.
Pincered at sea, lobsters get new hope on land in UK

By AFP
Published March 7, 2023

Juvenile lobsters are kept in a segmented tray, to prevent them from eating each other - Copyright Natuna ministry of communication/AFP Handout
Sylvain PEUCHMAURD

The tiny lobsters are safe from predators — including each other — as they eddy in large white plastic tanks swirling with artificial currents.

In a few weeks’ time, as part of a conservation project, they will leave their small shed in the northeastern English port of Whitby for the open sea.

Whitby, whose dramatic abbey ruins were an inspiration for “Dracula” author Bram Stoker, is Europe’s third-largest lobster port.

Some 100,000 lobsters are landed each year, providing jobs for 150 people. Joe Redfern, who runs the Whitby Lobster Hatchery, hopes eventually to release the same number each year from his tanks.

“We want to make sure that the marine environment is protected and the lobster populations are conserved for the future,” the 31-year-old biology graduate told AFP.

Lobster pots are piled high on the quays of the port, but the crustaceans were once part of a much bigger fishing industry in Whitby.

The town’s mainstay catch of white fish has collapsed, a result of overfishing and climate change. Fishermen also blame European Union quotas, before Britain quit the bloc.

In the 1990s, there were about 30 big fishing boats in Whitby but by 2005, “there was only one”, according to Redfern, who has been a fisherman himself.

White fish such as cod and haddock have migrated to colder waters north. Some of the Whitby boats moved with them, relocating to the Scottish ports of Peterhead and Aberdeen.

“The guys that didn’t want to move, they had to migrate into shellfish,” said Jonathan Parkin, a 43-year-old Whitby fisherman.

– Mass die-off –


A new disaster struck Whitby fishermen from late 2021.

Lobsters, crabs and other crustaceans began dying off in huge numbers. The cause remains a mystery.

Locals suspect a government project to dredge for a new post-Brexit “freeport” in the Teesside region, to the north of Whitby.

They say the dredging has stirred up chemical pollutants in the seabed — a legacy of Teesside’s past as a centre of heavy industry.

But a government-commissioned study by independent experts said in January that it was “as likely as not that a pathogen new to UK waters” was the cause.

Plans for the hatchery began before the mass die-off. But Redfern said it could help “bring a bit of hope back into the communities” and show that “something can be done to start to rebuild”.

The project involves harvesting female lobsters, each carrying thousands of eggs, from the North Sea so that they can hatch safely.


– Cannibalism –


In the unforgiving open sea, the survival rate for lobster larvae is just one in 20,000, or 0.005 percent.

By allowing them to grow in a protected environment, Redfern hopes to increase that to 20 or 30 percent.

As they are fed and develop in their hatchery tanks, the larvae are separated when they reach the stage when, in the wild, they are likely to eat each other.

After two to three months, they are ready for the sea.

“Obviously when we release them, they won’t all survive, but what we’ve done is protect them over the larval stage, which is their most vulnerable period,” Redfern said.

The project raised more than £100,000 ($120,000) to get off the ground, from crowdfunding and corporate sponsorship.

Individual donors can sponsor a lobster and follow it until it is introduced into the sea.

The idea came from the Whitby fishing community, drawing inspiration from a similar project in Cornwall, southwest England.

“It’s massively, massively important,” said Parkin, who is involved in the project.

“We’re releasing future generations of lobsters for future generations of fishermen.”
Central Asia’s poorest farmers know the value of their land

Depleted land needs more water, which is already insufficient across much of Central Asia. 


A Kazakh shepherd in the steppe south of Aktobinsk. / Airunp, cc-by-sa 3.0

By bne IntelIiNews
 March 10, 2023


The soils of Central Asia yield far less meat, dairy and produce today than they did a few decades ago. While that is an undisputed driver of poverty, new research examining the relationship between poverty and soil management challenges the idea that the rural poor are shabby stewards of the land, and could foster novel approaches to soil restoration.

In a paper published this month, Alisher Mirzabaev of the University of Bonn and two Russian colleagues use household survey data from Kazakhstan, Kyrgyzstan, Tajikistan and Uzbekistan to examine the "vicious cycles between poverty and environmental degradation."

Mirzabaev has previously calculated that reduced crop yields, lower livestock productivity and increasing needs for costly inputs such as fertiliser and labour – all signs of land degradation – cost the Central Asian economies $6bn a year; the land was 4.8 times more productive in the early 1980s. Degraded land often needs more water, as well, to wash salts out of the topsoil.


But does poverty worsen soil degradation?

The poorest farming households, Mirzabaev and his co-authors found, are more likely to use their land sustainably, for example by reducing tillage (to cut down on fuel costs), diversifying and rotating crops. It stands to reason that farmers who are cash-poor have less money to spend on fuel and fertiliser and other environmentally unfriendly inputs: “Our results show that the poor households have adopted more SLM [sustainable land management] practices than their richer counterparts.”

SLM can be labour-intensive. But for the poorest farmers, who frequently live in rural areas with high unemployment, labour is often one thing they have in surplus.

This lack of alternative local work opportunities “reduces the opportunity cost of family labor, especially for women due to labor market inequalities, leading to increased allocation of family labor to farm production. From the view of land management, lack of non-farm employment opportunities may, thus, allow for the adoption of more labor-intensive SLM.”

In other words, the poorest farmers are putting more hours into tending the land by hand, doing less of the mechanised work that can deplete soils most rapidly.

The authors acknowledge their work could suffer a "survivorship bias," meaning that the farmers surveyed do not include those who have quit trying to farm depleted fields: "We are looking into the areas where land degradation has not trespassed the irreversibility points and thresholds beyond which no agricultural production is possible."

This article first appeared on Eurasianet here.
How cryptocurrency mining froze a Kazakh city

Any decent historical account of crypto mining should include an entry on the Ekibastuz GRES-2 coal-fired power plant. 
/ Mountins13, cc-by-sa 4.0

By Nizom Khodjayev in Astana March 8, 2023


To digital currency enthusiasts the term “crypto winter” speaks of a prolonged cryptocurrency bear market, but to Kazakhs in the know it will for ever be associated with the plight of a city hit by power outages during minus-30 degree Celsius weather.

Many media outlets and observers have in the past two years noted the quick rise and sudden death of Kazakhstan's crypto mining boom. The demise came under the weight of heavy government regulation made urgent by the country’s energy needs. The Central Asian nation saw its electricity grid over-strained by an influx of crypto prospectors, many of whom hurriedly moved on to Kazakhstan from China when Beijing introduced unsparing crypto crackdowns amid its own difficulties in various provinces with power shortages.

However, the news of the catastrophic city-wide power outage that hit Ekibastuz, in northeastern Kazakhstan’s Pavlodar Region, in late November—an outage that for many was not resolved until at least mid-December, with parts of the city’s power and heating systems still undergoing repairs to this day—was at first often contextualised as simply within the Kazakh government’s track record of such failures. There was no mention of crypto-mining.

Yet in hindsight, with the crypto surge over, it's clear that energy-thirsty crypto mining probably inflicted damage on Ekibastuz both before and after the boom.

The outage

As mentioned, the energy stoppage in Ekibastuz continued into December and, even after power was restored, at least 17 apartment buildings remained without heating. News items on repair works—namely, to the combined heat and power plant in Ekibastuz and to city homes damaged by the calamity—are still appearing to this day.


Cryptocurrency mining is renowned for being "energy thirsty"
 (Credit: Anita Evans Hunt, cc, MIT License).

After events in Ekibastuz, the authorities served warning that Astana could move to nationalise struggling energy firms. Politicians had been shaken by a full-blown crisis. President Kassym-Jomart Tokayev sacked the regional governor in charge of Ekibastuz, but likely only as a manoeuvre to redirect blame. And he instructed Prime Minister Alikhan Smailov to study the issue of nationalising problematic energy assets, according to a Facebook post from presidential spokesman Ruslan Zheldibay.

Kazakh authorities often attempt to take populist initiatives, such as with calls for nationalisations, to demonstrate the government’s apparent awareness of the issues. It’s all part of an attempt to divert responsibility from officials’ own roles in difficulties that have come to pass.

Kazakhstan’s ageing Soviet-era infrastructure often leads to disruptions in electricity provision. The government said in October that around 65% of regional power grids were in a poor state of wear and tear. The frustration with the grid stands in contrast to Kazakhstan’s status as a net energy exporter.

The rate of power outages became especially stark last year amid the influx of cryptocurrency mining firms to Kazakhstan that started in 2021.

The Kazakhstan Electricity Grid Operating Company (KEGOC), a state-owned company, even introduced scheduled blackouts throughout late 2021 to prevent a system overload amid the spike in crypto-mining.

In 2021, Kazakhstan was considering the possibility of importing electricity from Russia in order to compensate for the strain on the grid caused by the crypto-mining, but with the ongoing war in Ukraine this became an increasingly unlikely possibility with the country attempting to reduce its economic reliance on its traditional ally.

The crypto boom

By the middle of 2021, the crypto mining industry in Kazakhstan had expanded from hosting a small group of prospectors drawn from around 2017 by cheap electricity to having the second-largest crypto sector in the world. In October 2021, Kazakhstan accounted for a remarkable 18.3% of the world's hash rate.

In the spring of 2022, Kazakhstan's bitcoin boom peaked after the authorities abruptly disconnected miners from the grid.

By late 2021, there were local estimates showing bitcoin mining in Kazakhstan was consuming more than 1.5 gigawatts of power, where two-thirds of that came from illicit miners or “grey” miners.



Heating or a higher hash rate? No-one put it to the vote in Ekibastuz (Photograph of a crypto mining farm in Iceland. Credit: Marco Krohn, cc-by-sa 4.0).

No wonder the grid was overloaded. Isolated blackouts spread. The lack of power supplies was even seen as a major contributory factor to raw tensions that spawned widespread public demonstrations in January 2022, culminating in the "Bloody January" countrywide political unrest that saw at least 238 individuals killed, according to the official account.

Following the unrest and more energy blackouts, the government moved to effectively shut down the cryptocurrency mining boom. Access to the electricity grid was restricted. Even mining operations run by relatives of individuals in power were cut off from the electricity network.

Miners gradually began to leave Kazakhstan, leaving their operations empty and abandoned. Ekibastuz went from having a high concentration of functioning crypto-mining enterprises, drawn by the vicinity's high level of electricity generation based on its traditional coal mining output, to being full of empty mining operations by the end of 2022.

Crypto parasitising off heating energy?

According to an article published by Kazakh news website Exclusive.KZ, residents of Ekibastuz noticed that issues with heating supplies for their apartment buildings significantly worsened after local power and heating authority Teplokommunenergo got a new chief. Azat Sarpekov took the helm in the winter of 2021-2022. Under Sarpekov, reported Exclusive.KZ, the main thermal power plant supplying heat to the city began directing energy capacities to “acquiring crypto-profits”.

The website also claimed that employees of the thermal power plant anonymously admitted to journalists that they were engaged in “imitating” work at the power plant.

And in April of 2022, around the same time that the energy ministry alerted the public to difficulties at the power plant, Exclusive.KZ noted that investigative journalists had discovered a mining farm on property of Teplokommunenergo. Whether Sarpekov faced any action amid the discovery is unclear—but in September, he was appointed deputy governor of Ekibastuz, the news outlet said.

In early December, with residents of the city still enduring unheated homes, a top Ekibastuz heating plant official, Sergei Vidlog, was found dead in his car.

Whether his death was down to suicide or perhaps even foul play remains unclear—Vidlog’s body was found in his car in a garage on December 4. According to RFE/RL’s Kazakh Service, police attributed Vidlog’s death to a suicide that took place “after a falling-out with his wife”.

Given information shared by Exclusive.KZ, questions arise pertaining to Vidlog’s death. The mismanagement of the plant and energy infrastructure was already a major scandal, as Kazakh social media framed the situation as a greater failure involving the central government. But surely any possibility of the disaster being a near direct result of individuals in power mining crypto would have caused an even bigger uproar.

The situation also raises questions about all the “abandoned” crypto-mining farms—initially set up by foreign firms—that appeared in and around Ekibastuz. Were some of them taken over by individuals working for local authorities? Did mining operations simply continue instead of being halted as intended by the government?

Whatever the true sequence of events, the necessity of limiting crypto-mining in Kazakhstan was underlined.

As things stand, Kazakhstan has seen its global hash rate fall to 6.4% (down from the 18.4% peak) since the first quarter of 2022, reducing the carbon emissions of the nationwide power network by 10%, according to ClimateTech vice chair Daniel Batten. And due to Kazakhstan being 87.6%-fossil fuel dependent, less mining in the Central Asian nation results in a higher proportion of clean energy in the Bitcoin energy mix.

The country is unlikely to again become a top player in the cryptocurrency mining world unless it manages to properly address the issue of transitioning much of its energy sector to renewable energy. Or perhaps crypto might ride again in Kazakhstan if the ex-Soviet state builds an expected nuclear power plant.

Or not.

Following the collapse of the Bahamas-based FTX cryptocurrency exchange and hedge fund last year, a scandal that occurred around the same time as the Ekibastuz affair, Kazakhstan is in fact now considering a further tightening of crypto-mining regulations.
Court ruling on Hidroelectrica management calls into question IPO planned this year
Hidroelectrica

By Iulian Ernst in Bucharest March 7, 2023

A March 6 court ruling invalidating the selection of Romanian state-controlled hydropower group Hidroelectrica’s management in 2019 has called into question the company’s IPO planned later this year.

The Court of Appeal rejected Hidroelectrica’s appeal to a lower court’s ruling issued in April 2022 in the case of the former Hidroelectrica CFO Petronel Chiriac who challenged the legality of the selection procedures for the company’s Board of Directors in 2019.

Hidroelectrica said in a statement released after the Court of Appeal announced its ruling on March 6 that the ruling has no impact on the planned IPO, reported Ziarul Financiar daily.

The ruling, furthermore not final, regards only the selection procedure and does not invalidate the mandates of the company’s board of directors, according to the interpretation by Hidroelectrica’s management set out in its statement.

The mandate of the board expires in June 2023 and a selection process is on course for appointing a supervisory board in charge of setting the selection procedures for a new board of directors, the company also explained.

However, a statement signed by lawyer Mihai Kehaiyan, who claims to have represented the plaintiff in this process, but does not mention his name, claimed that” "the five directors of Hidroelectrica no longer have any legal capacity — they can no longer sign documents … Practically, they no longer operate as members of the Hidroelectrica Board as of March 1.”

The lawyer argued that some of the board members should have been rejected from the first stages of the selection procedures, as they failed to meet basic requirements such as speaking a foreign language, meeting seniority criteria or not being in a conflict of interest with the company.

Hidroelectrica was expected to carry out its IPO on the Bucharest Stock Exchange (BVB) either in the first part of May or in June, after filing the prospectus with the financial market authority, ASF, in April, Karoly Borbely, a member of the company’s managing board, said in February.

The IPO is designed to allow restitution fund Fondul Proprietatea to cash part of its 20% stake in Hidroelectrica. Borbely added that, in future, the Romanian state might decrease its 80% participation to 65-70%.

The manager of Fondul Proprietatea, Franklin Templeton, argued for a dual listing in Bucharest and London, but its shareholders approved the proposal backed by the Romanian authorities and Hidroelectrica shares will be listed only in Romania. The local market wouldn’t be deep enough for the 20% Hidroelectrica stake, Templeton argued.
Australia Walks Geopolitical Tightrope Amid Lithium Boom

Australia is entangled in the superpower competition between China and the United States over the control of lithium.


By Marina Yue Zhang
March 7, 2023
Whether Australia can beat the "resources curse" and benefit from the "Great Lithium Boom" will be a delicate balancing act.

Clean energy technologies are essential to achieve the decarbonization targets set in the Paris Agreement. Critical minerals — including lithium, nickel, cobalt, graphite, copper, and rare earth elements — are vital to produce clean energy products like solar panels, wind turbines, and power batteries for electric vehicles (EVs).

Demand for lithium, a key component in lithium-ion batteries, has soared over the past three years as the clean energy transition accelerates. Though abundant, lithium is unevenly distributed and non-renewable. And until an alternative material for or approach to power batteries becomes available, lithium looks set to be at the center of geopolitical tensions over the control of critical resources.

The top three producing countries process over 80 percent of the most critical minerals used in lithium batteries. China dominates the processing of almost all minerals, with more than 50 percent of total market share — except for nickel and copper — of which China controls 35 and 40 percent, respectively.

Technology-intensive industries rely on interdependencies between countries with different endowments. This works well during periods of geopolitical stability and cooperation but the high concentration of processing in the lithium battery supply chain means that it is vulnerable to disruption by war, global pandemics, natural disasters, or geopolitical tensions.

Australia has the world’s largest battery-grade lithium deposits, and export revenues have skyrocketed, with lithium becoming Australia’s sixth most valuable commodity export. Australia needs to consider how to profit from the boom and what role it can play in the lithium race.

Lithium battery production relies on a global supply chain composed of mineral extraction and production, mineral refinement and processing, and battery-cell production and battery-pack assembly. This supply chain is a complex network of organizations, people, activities, information, and resources.

Australia and China complement each other in this supply chain. Australia supplies 46 percent of lithium chemicals and a large proportion goes to Chinese processing facilities and then to Chinese battery and EV makers. China produces 60 percent of the world’s lithium products and 75 percent of all lithium-ion batteries, primarily powering its rapidly growing EV market, which accounts for 60 percent of the world’s total.

The severity of supply chain vulnerability is different for Australia and China. China relies on imports of lithium chemicals from Australia for downstream productions, but it can source lithium from other channels, including its domestic supplies or from South America.

Yet China’s dominance in lithium processing means that few countries could absorb Australia’s supply if China looks to alternative sources. Long lead times in building lithium processing facilities limit the speed at which new production can be ramped up to meet rapid demand increases. Building such capabilities requires capital investment, skilled workers, and an ecosystem where complementary suppliers of components, equipment, and services are clustered to minimize costs.

Prioritizing national security over economic benefits, the United States and European Union aim to increase their self-sufficiency in the lithium supply chain out of a concern about potential disruption to battery supplies stemming from China’s dominance of production. China could face the possibility of being cut off from the U.S.-led supply chain system.

Australian Industry and Science Minister, Ed Husic, commented: “Australia has globally significant deposits of essential battery materials and strong local innovation and research capabilities. By drawing on these strengths, Australia can take its place in the profitable global battery supply chain.” He implied that faced with the geopolitical tensions of lithium, Australia should move from a low-value-adding “digging it and shipping it” to a higher value-adding position, including lithium chemical processing and even battery manufacturing.

While Australia has not suffered a “resources curse” in the traditional sense, its resources boom in iron ore and natural gas in the past thirty years has led to the appreciation of the Australian dollar, which has lowered the competitiveness of other exports, especially in manufacturing. In 2021, value-added in manufacturing dropped to less than 6 percent of Australia’s GDP, down from almost 14 percent in 1990.

Australia moving up the value chain would require investment and technology, and bear a significant environmental cost. Without scale advantages, Australian-made products will fail to achieve global competitiveness. Australia must consider long-term industrial policies that enable the country to play a role in fighting against climate change rather than being caught between the superpower competition.

Australia is entangled in the superpower competition between China and the United States over the control of lithium. Chinese EV and battery manufacturers want to invest in Australia’s lithium production, including technology and talent development — as indicated by a deal between Ford and battery manufacturer CATL that will build a battery plant using China’s technology in the United States. But the United States expects Australia to be on board its friend-shoring of supply chains.

Whether Australia can beat the “resources curse” and benefit from the “Great Lithium Boom” will be a delicate balancing act between many factors.

Politicians and policymakers are responsible for making the right choice to balance national and economic security concerns, emergent and incumbent stakeholders as well as current and future needs. Lithium should provide a path to a clean future, not a tool for supremacy of great power competition.

This article was originally published on the East Asia Forum.