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Many western commentators are frantically predicting the imminent onset of World War III following Joe Biden's decision to permit the use of US ATACMS missiles inside of Russia. The Russian media and political establishment will undoubtedly respond furiously to this move. But much depends on how the missiles are used. With a Trump Presidency on the horizon on a mandate to end the war in Ukraine, I believe Putin will be measured in his response. Republican commentators have condemned the move by Biden as escalating risk of WWIII Unlike in 2016, there has been fairly widespread condemnation from supporters of Trump at Biden's move, which has been viewed as a blatant escalation. Donald Trump Junior went to X to claim the Biden administration was trying to 'get World War 3 going before my father has a chance to create peace and save lives.' Other Republican politicians including Senator Mike Lee of Utah and Representative Marjorie Taylor Greene in Georgia have echoed the World War 3 warning. Venture Capitalist and Trump Support David Sacks asked if Biden's goal was 'to hand Trump the worst situation possible?' Biden copies Obama's final move, to break up the diplomatic ground for an incoming Trump Presidency Biden's move was designed to make the diplomatic terrain harder for Trump to navigate on Ukraine policy. Putin will view it in those terms too. He will remember that President Obama pulled a similar - though less dangerous - stunt during this final days in office. In one of his final foreign policy moves Obama announced sanctions against Russia for alleged election meddling, and expelled 35 Russian diplomats from the USA. This prompted a frenzy of reporting about how Putin might respond, much like we have seen over the past twenty-four hours. In the end, Putin chose not to respond and, instead, he paused to see where US policy would go under the incoming Trump administration. ATACMS decision not as significant as it appears as Zelensky's hands still tied Biden's decision is an extension of the decision from May to allow limited use of US HIMARS systems to hit military installations in the borderlands of Russia to reduce attacks on Kharkiv. Zelensky won't have weapons free to strike at will within Russia. While escalatory, it is not as significant as it seems. The indications coming out of the US administration are that the ATACMS missiles may only be used to quell an expected major Russian assault on Ukrainian formations dug in in Kursk oblast. Biden's decision an attempt to help Zelensky save face after blunder of Kursk offensive Ukraine has lost around half of the territory in Kursk that it occupied during its audacious raid in August. Clinging on to that territory until peace talks inevitably happen to end the war, Zelensky has said, will allow him symbolically to trade Russian land for Ukrainian land occupied by Russia. Since the Kursk offensive, Ukraine has lost more land to the relentless, grinding Russian advance in the Donbas, which takes small steps most days. Losing the foothold in Kursk will reveal what many commentators already point out, that the Ukrainian incursion was a strategic blunder by Zelensky that won't change the outcome of a war he is losing. So, a US decision to permit the use of ATACMS at best is an attempt by the Biden Administration to help Zelensky save face. Russia's response will depend on actual ATACMS strikes With the use of ATACMS entirely dependent on US intelligence and targeting, it is unlikely that the outgoing Biden administration will permit wider attacks outside of the Kursk theatre or in military centres that are in range of Kursk. However, we have yet to see how the missiles will be used and Putin will take his cue from that, rather than acting pre-emptively. Putin will have to respond in some way Despite the use of HIMARS already inside of Russia, Putin will have to reciprocate in some way, having said on screen in St Petersburg in September that he would. He doesn't have the political space not to act. Putin has been here before and probably won't overreact Putin knows that a major Russian retaliation that targeted US military or other assets would make it far harder for Trump to sue for peace between Russia and Ukraine, as he has promised to do. I assess it unlikely that Putin would escalate to a nuclear level on the back of what is essentially a tactical change in western weapons' use. He won't want to close off any space that Trump has to negotiate, which is Biden's aim in taking the ATACMS decision. While he has the resources and political support to continue bleeding Ukraine white, the war in Ukraine still comes at a significant economic and human cost to Russia. Trump offers a potential off-ramp that would leave Putin in a better position that he was in March 2022, when the US and UK blocked the Istanbul peace agreement. Putin will be happy for Russian state commentators to whip up the risk of over-escalation As happened in late 2016, Putin will undoubtedly encourage Russian talking heads to sow panic in the western media about a possible Russian over-escalation. That will give him space to respond in a moderate way and illuminate the western press as hysterical and Russophobic, a common attack line. More likely, he will: up strategic attacks on energy infrastructure in Ukraine; possibly target NATO weapons' distribution hubs in Poland; make a limited and pre-signaled strike on a US military facility in Europe or elsewhere. The risk to the UK and France There are signals that the UK and France are following America's move in possibly authorising the use of Storm Shadow and Scalp Cruise Missiles inside of Russia. I believe the same limitations on targeting would apply, as above. The same risks of a limited Russian strike on UK and French assets therefore apply. However, the bigger risk is that a Trump Administration will reverse the decision on ATACMS use inside of Russia, leaving both countries on a limb in which Ukraine still hits Russia with their weapons while Trump pushes for peace talks between Zelensky and Putin. That will mean France and Britain have a bigger climb down from their position of unquestioning support for war in Ukraine, when ceasefire talks start. In Britain in particular, that may increase pressure on the government's enormous spending on supporting the ongoing war, at a time when taxes are taking a massive hike and the cost of living crisis continues. There is more scope for France to pivot its position within the EU, which will be unable to match US financial military support for Ukraine if Trump pushes, instead, for peace. Keir Starmer has already got off to a bad start with Trump by sending Labour party activists to support the Harris campaign. He risks leaving the UK increasingly isolated and irrelevant on Ukraine policy. Plus ca change! For now, don't expect World War III to start overnight. Keep calm and carry on pressing for this mindless war to end.

I recently spoke with Lasha Kasradze about the economic backdrop to Georgia's recent elections, and why Georgia is right to stick to its current path of economic development, and to avoid a binary choice between Europe and Russia. This piece was aired on Imedi TV in Georgia.

My recent chat with Larry Johnson on his countercurrents podcast. A nice opportunity for you to get to know me a bit better.

Coalition countries are giving Kyiv money that helps prolong a losing war while saddling the suffering country with enormous debt. Below an article that I recently published in Responsible Statecraft . President-elect Trump says he can end the war in Ukraine in a day . But there is a catch. Washington institutions and EU policy makers have Trump-proofed the war for at least another year. This idea — that hard-wired Western support for President Volodymyr Zelenskyy’s fight against Russia could be insulated from the incoming U.S. president — has been cooking for the past year. In the month before the first votes had been cast in this week’s U.S. election, policy makers on both sides of the Atlantic had been solidifying their fortifications against the risk of a Trump victory. In its October report , the International Monetary Fund — which the developing world often sees as a rich country club serving Western interests — made a baseline assumption that war in Ukraine would “wind down in late 2025,” at the earliest, one year after the U.S. election. Provisional Western funding for another year of war had already been secured in June in the form of the G7’s $50 billion lending package for Ukraine. That gives Zelenskyy enough to plug the yawning hole in his state finances sufficiently to keep fighting. He will still need to manage other significant risks along the way, not least of which include the country’s energy infrastructure and military mobilization. Ukraine recently announced a plan to mobilize a further 160,000 troops following the April decision to lower the age of military draftees from 27 to 25. But the EU has been working hard to ensure that Zelenskyy can take the risk, underwritten with European money. Although what they have created is catastrophically ill-thought through. The European Union loan itself — up to a maximumof €35 billion (around $38 billion) — is so high precisely because of the uncertainty about whether the U.S. would match the funding of other G7 nations. This is Trump-proofing in action. In essence, even if Trump doesn’t agree to the proposed $20 billion U.S. contribution made by Biden, Europe is prepared to cover the cost of another year of devastating war. Little matter that, for Ukraine itself, $50 billion in extra debt represents around 30% of GDP for one year of fighting — if the country hasn’t collapsed in that time. According to the IMF, if war does indeed end in late 2025, Ukrainian debt will hit 108% of GDP and only start to fall in 2028. In this scenario, Ukraine’s economy wouldn’t return to its pre-war size until 2031, representing nine years of lost growth. If war continues into 2026 (the IMF downside scenario), debt will hit a massive 136% of GDP, and Ukraine’s economy will be further stunted. The G7 funding was made on the naive assumption that Ukraine would never have to repay it, or, in the IMF’s words, “to ensure debt sustainability.” In late October, the European Parliament agreed on a Ukraine Loan Cooperation Mechanism as “non-repayable financial support” to cover any repayments Ukraine needs to make against the G7 loan package of $50 billion. Separate from the G7 loans, it is the pot of funds made up of the profits from seized Russian assets of €210 billion (about $225 billion) held in EuroClear in Belgium. These funds currently generate around €4-5 billion ($4.3-5.4 billion) in profit each year although some of that profit is already being used , for example, in restoring Ukraine’s energy infrastructure. However, this Loan Cooperation Mechanism could easily fall apart in the coming year. Self-evidently, if a ceasefire is agreed in Ukraine and a peace process, finally, launched, Russia will press hard for the return of these assets as part of staged sanctions relief. U.S. officials under the Biden administration had been pressuring the EU to agree to a longer freezing of Russian assets of 3-5 years, although Hungary blocked a decision to change EU policy on sanctions renewal until after the U.S. election. With Trump now elected, Hungary, and possibly others, likely won’t want to set the Russian asset freeze in stone. Look at the EU small print, and you’ll see that if funds from frozen Russian assets run out or if no funds are received from Russia for war reparations, then Ukraine will have to service the loan itself.That would explode the IMF’s claim that this debt is sustainable and put significant additional pressure on Ukraine’s flagging finances. Economies rebound after wars though, so, perhaps, some might argue, this is worth the risk. Growth over time would help to reduce the massive Ukrainian debts brought on by war. But what benefit is another year of fighting when Ukraine is losing the war in its east? Russia’s Donbas offensive sped up ahead of the U.S. election with a major southern push towards Khurakove. Around 50% of Donetsk remains under Ukrainian control, including major centers such as Kramatorsk and Pokrovsk. At the current rate of military progress, it would, according to some commentators, take Russia at least another year to complete its conquest of the Donbas. Although with Ukraine potentially demoralized by the change in power in Washington, Russia will continue to press its advantage and gobble up more ground before Trump takes office. There is no foreseeable military scenario at the moment which predicts that Ukraine will reverse the tide of Russian advances. Despite stop-start talks in Qatar, Russia will continue to pummel Ukraine’s critical national infrastructure, rendering life miserable for even more Ukrainian people as the winter grows colder. By giving Ukraine an extra $50 billion in lending, Europe will simply be helping Ukraine manage to sacrifice more of its land, at a huge cost in death and destruction. As Vice President-elect JD Vance pointed out in April, the math doesn’t add up . And with a now significant possibility that U.S. weapon supplies will dry up, the risk of a complete collapse of Ukraine’s front line will grow. The best way to stand with the glorious country of Ukraine is to end this nonsense and finally sue for peace. That will require difficult conversations between the 47th president of the United States and his war-hungry European colleagues. But first, he needs to pick up the phone to Putin and Zelenskyy.

Below a copy of my article published in Responsible Statecraf t. Closer ties to Europe have not helped Tbilisi on the fiscal front, just look at the numbers Indignant western armchair pundits and politicians have fallen into collective rage, signallng that the general election result in Georgia equated to the theft of a European choice. The opposition to the apparent winner, the ruling Georgia Dream party, is now being joined by international voices, including the U.S ., calling for an investigation into claims of election violations. But Western politicians, journalists, and NGOs have cynically, and in a way, willfully ignored the wider economic picture, and have instead spun up the election as an existential struggle between Europe (European Union) and Russia. There is so much nuance here that needs to be examined and is not. For one, study the vast amount of credible economic data and you’ll uncover the unpalatable truth that Georgia has been a net loser from closer EU economic ties thus far. And that the war in Ukraine, which the EU is helping to bankroll, has halted progress on key economic priorities in Georgia, including reducing unemployment. Taking a step back, Georgia has become an economic dynamo since 2012 through its sovereign endeavors. This small, proud nation with a population of 3.1 million, ranks number 7 in the World Bank’s ease of doing business index, ahead of the UK and every EU country except Denmark. Average economic growth has been a throaty 5.2%, 6.2% percent if you subtract the pandemic contraction in 2020. GDP per capita has increased by 79%. According to the World Bank, poverty reduced from 70.6% to 40.1% between 2010 and 2023, through sound macroeconomic management. There’s still more work to do to get it lower. Georgia’s economic growth performance has largely been driven by domestic investment. As a percentage of GDP, investment has averaged a brisk 26.6% per year since 1996, compared to the EU (21.8%) and the UK (18.8%). Yet signing the EU Deep and Comprehensive Free Trade Agreement (DCFTA) in 2014 didn’t unleash a tidal wave of new European investment into Georgia . EU foreign direct investment in 2024 was only $65k higher than in 2014, at an average 29.6% of total FDI in Georgia over that period. Russia is a significant but not key investment player, accounting for just 5.4% of FDI in 2023. If we look at trade, the signing of the DCFTA, in theory at least, should have driven a mutually beneficial surge in trade. But that simply hasn’t happened. The European Commission website proudly announces that Europe is Georgia’s biggest trade partner. But EU trade with Georgia accounts for just 20.9% of the total. And that is only because Georgia has been flooded with European exports since 2016. In fact, western European states have been eating Georgia’s lunch when it comes to trade. On average, Georgia’s eight largest western European trade partners (including the UK) now export four times as much to Georgia than they import. The biggest culprit is Germany which in 2022 exported 7.8 times more ($673 million) to Georgia than it received in imports ($86 million). European exports to Georgia had quadrupled to 3.6 billion Euros by 2023 and are still rising. Yet, Georgian exports to the EU have stood still. Why? Look on the EU website and you will find 58 separate trade defense investigations by Europe against Georgia since 2021, looking to restrict imports of everything from tires to tinplate and tableware. Europe actively places barriers against Georgian imports. Georgia has been accused of helping Russia evade export sanctions, but the evidence for that is weak . Look East and you will see a different picture. Bulgaria exports as much to Georgia as the powerful western EU nations combined, yet is the only EU trading nation that imports more from Georgia than it exports. Because trade is all about gravity. Sofia is much closer to Tbilisi than Strasbourg. Countries trade more with those countries closer to their borders because the cost of trade is lower. Through a mix of gravity and history, 62.2% of Georgia’s exports go to its eight biggest Eurasian trade partners (former Soviet states, Turkey, China and India). And the trade balance is more even than it is with Europe, as Eurasian states export 1.8 times more to Georgia than they import. Russia exported 2.9 times more than Georgia in 2022 because of a surge in fuel exports. However, Georgian exports to Russia have also increased by 56% since 2017 and now make up 9.4% of the total. The major economic shock Georgia has had to confront has been the war in Ukraine. A net 87,200 people from Russia, Ukraine and Belarus emigrated to Georgia between 2022 and 2023, two thirds of them Russian. Historically, Georgia had fairly even net migration, but the war-induced influx prompted unprecedented house price inflation of around 35% with rents up by as much as 50%. High inflation during the first two years of the Ukraine war appears to have been tamed by the National Bank of Georgia which hiked interest rates to their highest level since the Global Financial Crisis. An economic flip side, is that Georgia saw a much needed boost in its current account which recorded its only significant surplus since the Soviet period in the third quarter of 2022. This was driven by surging service exports, that is, foreign money spent by migrants in Georgia. Foreign Exchange reserves also rose to a post-Soviet high. But the influx of Russians fleeing the draft undoubtedly increased resentment and social tension in part driven by historical enmity, including around the 2008 Georgian war. But it runs deeper. Georgia’s impressive reduction in unemployment has also flat-lined, having dropped from 20.6% in 2009 to 11.6% in 2020. Worryingly, 26.7% of Georgia’s young people are unemployed, and have seen young, digitally nomadic, middle class Russians crowding out opportunities in high-valued-added sectors. The West has framed the election and its results in almost Manichean terms, a battle of light and dark, between Europe and Russia. They have positioned Georgia Dream’s founder Bidzina Ivanishvili, as a Kremlin stooge. Yes, Ivanishvili, like many oligarchs, gained his wealth during the chaos of Soviet collapse. His nationalism is rooted in a conservatism that has echoes of Putin’s Russia and Orban’s Hungary. But his economic approach in Georgia has been driven by specifically Georgian considerations. And elections always, ultimately, get tipped by domestic issues. By today’s election count, it would seem a majority of Georgian people chose prosperity over war. It’s time to let Georgia’s government get back to the task of strengthening their wonderful country still further.

Wars, after all, are won by economies, not armies. Growing up on a British Army base in West Germany, I was conscious, even as a child, of being situated in a country that was booming. When the Berlin wall fell, the huge difference in economic development between West Germany and East Germany was something that could be elucidated not only through data, but also visually, by observing the drab buildings and beaten down citizens from the east. While it may be impossible to replicate the West German economic miracle today, a partitioned Ukraine can nevertheless move on to secure a brighter, more prosperous future for its citizens. It is worth remembering that the very point of the Maidan movement which started in 2013, was to secure prosperity for Ukraine through greater economic integration into Europe and the wider world. That hasn’t happened, not just since 2022, but since 2014. It is no great surprise that Ukraine’s economy today  is smaller than it was  before war began. Yet Ukraine has received over  $380bn in foreign aid  during that time. Imagine Ukraine’s prosperity today, if the $190bn economy of 2019 has received a foreign injection amounting to 200% of GDP? Most of that money has vanished into thin air and the flames of war. Some of it will have gone into rampant  corruption . Hardly any of it has gone into productive investment. Yet investment was a key pillar of West Germany’s success.  Investment alone contributed  an average of almost 2.2% per year to GDP growth in West Germany in the 39 years before the Berlin wall fell. As I’ve  reported before , investment is an issue that Ukrainian leaders have consistently failed to grip since 2014, when the policy of western-backed confrontation with Russia began. With cities and over half of its  electricity generation  destroyed, there is huge scope in Ukraine to generate catch up growth by investing in the basics of infrastructure. Indeed, it is the degradation of Ukraine’s infrastructure that is  slowing the growth  that it can create today. Investment needs people. A major factor in West Germany’s success was the rapid increase in its population after the war. West Germany’s labour force rose by  almost 44%  in the decade from 1950-1960, with much of the labour coming from disaffected Germans in the east. Ukraine could benefit from that same windfall of labour should it decide to end the war, having seen huge depopulation since the outbreak of war of up to  10 million  people. Agreeing a ceasefire would allow the slow process of Ukrainian citizens returning to their homeland including the at least 1 million men of fighting age who have avoided the draft. The return of citizens would also relieve the drag on Ukraine’s current account deficit from Ukrainians spending their money in foreign countries. West Germany kick started business productivity and exports, seeing export growth average 17.5% between 1950-55 as businesses reformed and increased productivity. Germany remains, today, a global exporting powerhouse. Despite its productive agriculture, rich mineral wealth and talented workforce, Ukraine has been stuck in a toxic combination of low investment and import dependence (see my earlier article) since 2014. Ukraine’s  Finance Minister  recently said that 30% of businesses in Ukraine have stopped functioning while 45% have decreased production. This lack of a clear economic strategy from Ukraine’s leaders is not a factor of the current war; Ukraine’s leaders haven’t set out a clear strategy for growth over the past decade. That lack of economic leadership will continue at least for as long as this war continues. Yet the military facts on the ground have not changed significantly. That delicate balance, in which Russia is making progressive, but nonetheless small gains, is held in place both by Ukraine’s dire military logistical situation and by Russia’s decision not to go all in. There is a palpable sense from Russia military bloggers of the Kremlin wanting to avoid a large scale mobilisation, and steering clear of the  extreme tactics  that Ukraine has pursued to press gang men into military service. However, with Russia set to  spend even more on defence  in 2025, the imbalance in the two forces may shift further in its favour, whoever wins the U.S. Presidential election. So the situation, inexorably, will continue to worsen against Ukraine. Having been fairly static for the past month, because of the distraction of Kursk, the front line in the Donbas is shifting westwards again at an increased tempo. The  fall of Vuhledar  in the south has precipitated a rapid (by the slow standards of the front line) push north, the  Pokrovsk salient is broadening , and Toretsk is being gradually consumed. Ukraine today has become locked in self-fulfilling militarism and a state of dependency on outside help, focussed only on the chimera of victory against Russia. Zelensky’s personal fate is closely linked to the continuation of the war, the cessation of which would bring a close to martial law in Ukraine, and the consequent pause in elections. Yet looking back, West Germany’s economic miracle, or  Wirtschaftswunder , started when German leaders took back economic control; they did so after a period of disastrous military rule that saw  cigarettes  become a tradeable currency. Ukraine is not at that stage, yet. However, it’s worth remembering that one of the reasons East Germany failed as a state project was that few people of working age wanted to live there. Indeed, it’s this  feeling of being left behind  which has fuelled a rise in popular support for the BSW and AfD parties. Ukraine needs its people to come home and to reengage in the reconstruction and political rehabilitation of their magnificent country. Nothing, no Ukrainian victory plan, no injection of additional weapons or authorisation to strike slightly deeper into Russia, will change the basic mathematics of Ukraine’s disadvantage. Wars, after all, are  won by economies , not armies. The cold, unpalatable reality is that some form of partition will be imposed on Ukraine when hostilities finally draw to a close. When that happens, Ukrainian leaders will need, finally, to refocus on their economy, as West German leaders did in 1949. This article was published in Strategic Culture .

Below a copy of my article published by Responsible Statecraft today. Moldova’s election result has left incumbent President Maia Sandu damaged. An EU referendum delivered only a wafer-thin vote in favor of membership of the bloc. And in the first round of a presidential vote that Western commentators predicted Sandu might edge narrowly, she fell some way short of the 50% vote share she’d need to land a second presidential term. She will now face a unified group of opposition parties in the second round with her chances of remaining in office in the balance. Where did it all go wrong? Sandu’s mistake was in making the Moldovan election about a binary choice between Europe and Russia. Even before the final votes were counted, Sandu was claiming widespread electoral fraud sponsored by pro-Russian oligarch Ilan Shor. Reports that pro-Russian groups paid voters to come out to vote are credible. If that achieved anything, it was to mobilize voters in Moldova naturally inclined to want ties with Russia, rather than flipping votes of pro-Europeans. With a 33% turnout needed to legitimize the plebiscite, a final roll of just 50% hinted at widespread voter apathy in Moldova. In a country where only 9% of the population identifies as ethnically Russian, an almost 50% vote against EU membership illustrates wider concerns that the government in Chisinau has not addressed domestic issues important to ordinary people. For example, many Moldovans are worried about the race to EU membership undermining small farmers and local traditions. Sandu’s claims of interference must also be set against a concerted effort by Moldovan authorities to make it harder for Moldovan voters in Russia and breakaway Transnistria, to vote. A mere 10,000 ballot papers were sent to Russia, where the Moldovan population is thought to number over 150,000 people. The population of Transnistria is 367,000, but they were only allowed to vote in Moldova itself. (For the record, Moldova insists that Transnistria is part of Moldova .) Meanwhile, Shor’s political party was banned and media channels linked to him closed down. In the end, the pro-European referendum passed with a tiny majority, made possible by a large number of pro-European votes by members of the Moldovan diaspora, who don’t live in Russia. This will make it difficult for Sandu to claim a resounding endorsement of future EU membership. It will almost certainly stoke anti-EU sentiment in the Russia-backed breakaway Transnistria where a majority of the ethnically diverse population wants closer ties with Russia . Pro-Russian sentiment will also be fueled in the autonomous status of Gagauzia in the south, where 95% of voters did not choose a European future in the referendum. Of course, the Transnistria question, nor, to a lesser extent, that of Gagauzia, shouldn’t necessarily create a bar on possible future EU membership by Moldova, as Cyprus has shown. But by making the referendum about ethno-nationalist politics, Sandu will have stimulated the secessionist tendencies there, making the process of EU integration more problematic. She also exposes herself to the accusation of letting Moldova become a geo-strategic test-tube for Western influence, something that Russia will undoubtedly look to exploit. European Commission President Ursula Von der Leyen was in Chisinau shortly before the vote exhorting Moldovans to express their free choice. NATO Secretary General Mark Rutte chose to weigh in with concerns about Russian efforts to derail Moldova’s European future. These pronouncements are imbued with notions that Moldovan membership of the EU would stabilize Europe’s eastern border and strengthen security against Russia. But that ignores the lessons of history. Those same arguments were used in Ukraine in 2014. Making the Moldovan election a zero sum tussle between Europe and Russia — rather than a vote about what ordinary Moldovans want to see happen domestically — risks making Moldova a new, much smaller, more economically vulnerable, version of Ukraine. And the critical point is that Sandu has yet to make the economic case that EU membership, rather than Moldova maintaining balanced relations with all countries, including Russia, will provide the boost that the country needs. A pro-European report from 2014 shows that significant economic benefits accrue to countries in anticipation of possible membership, but that EU membership won’t necessarily benefit every new member, mentioning Greece. The reality is that annual economic growth in Moldova since the signing of the Deep and Comprehensive Free Trade Agreement with the EU in 2014 has been significantly lower, on average, than in the first 10 years of the Millennium. That anticipation effect has not yet been seen in Moldova. A key reason is that Moldova’s trade with Russia has fallen sharply since the DCFTA was signed. Sandu talks about 65% of Moldovan exports going to Europe as a triumph. In fact, Moldova imports twice as much from Europe, stoking a stubborn current account deficit. To some extent, that has been offset by inflows of foreign investment into Moldova. But it is nevertheless clear that strengthened relations with Europe haven’t been enough to make up for the cutting of trading relations with a country — Russia — that had previously been a key trading partner with Moldova. The other key reason is demographic. Moldova has the fastest shrinking population in the world. Over a quarter of Moldova’s population have taken advantage of EU citizenship, by virtue of their entitlement to Romanian passports. That has led to an emptying of talent from Moldova as young, talented workers seek better pay elsewhere, mostly in Europe, but also in Russia. The economy would need to be growing at a brisker rate than it is to entice the most talented Moldovans back to their country. But, making Moldova the next frontier state for the West’s battle with Russia will place a heavy drag on encouraging diaspora Moldovans to return. Moldova is a country that I am deeply fond of and have visited many times. As it happens, I have always considered that it is a country that would benefit from closer economic ties with Europe. I also believe that a politically stable and economically prosperous future for Moldova rests on that beautiful country maintaining close relations with Europe and with Russia. Maia Sandu may come to rue her failure to make this election about Moldova itself.

I had a sense of déjà vu with Russia’s decision to kick out six alleged British spies in August. After the Salisbury nerve agent attack in March 2018, I sweated for a week in Moscow, waiting to hear if I’d be kicked out in the diplomatic tit-for-tat. Russia’s announcement was timed to embarrass Keir Starmer as he travelled to Washington last week for talks with Joe Biden. It was also a blow to the critically small pool of Russia experts in the British government. In the hostile goldfish bowl of UK-Russia relations, both sides are constantly on the lookout for ‘undeclared’ intelligence officers (i.e. spies) working covertly by masquerading as diplomatically accredited staff in the respective Embassies. We kicked out the Russian Defence Attaché earlier this year. The Russians run a huge ‘guess-the-spy’ game around the clock, with all manner of covert and overt surveillance. I was regularly followed by Russian intelligence, including a fun chase round central Moscow on the day that the post-Salisbury expulsions were announced, with my kids in the back of the car.   Russia’s domestic intelligence service the FSB gleefully revealed details about the six expelled British diplomats and their inexplicable jogging habits around Moscow’s third ring road or curious meetings in towns close to Moscow. In a strange departure from the convention of keeping the details out of the public gaze, the names and photos of the expelled Brits have been flying around social media.  That’s why Russia’s Ambassador Andrei Keilin was hauled into the Foreign Office for a tongue lashing. But there was a big dose of ‘nothing to see here’ in the revelations. Russia hasn’t caught anyone red-handed, not now, or recently, even though they’ve laid on the charm with honey-traps and kompromat. Yes, both sides work hard to gather secrets; the Head of MI6 recently called on Russians to spy for Britain.   The relationship between diplomacy and intelligence is symbiotic; UK and Russian intelligence do have ‘declared’ channels to talk when they really have to.  But the Russians are winning in the real ground game of espionage and diplomacy anyway. Much like in war, having an edge can come down to a bigger supply of the right people with the right skills in the right places. And Russia has a significant advantage over us in the number of staff they employ in the UK compared to our outfit in Moscow. It’s quite simple. Russia only employees Russians at its Embassy. Most staff at the British Embassy in Moscow are also Russian, because of the Foreign Office’s model of employing less expensive local staff. That’s a good model in friendly nations. Less so in Moscow where the FSB has been known to harass locally employed Russian staff.  When I left Moscow in February 2019, almost 90 per cent of the staff across the Russia and British Embassies were Russian.  Add to that, a community of over 150,000 Russians in the UK against a small number of British expats in Russia.   There are seldom more than a few dozen diplomatically accredited Brits at our Embassy Moscow.  After Salisbury, the loss of twenty-three colleagues cleaned out the political wing of the Embassy, leaving a few people like me, with mere months left on their postings, in a two for the price of one deal. Kicking out six political officers in August will have put a bit dent in the Embassy’s ability to function again. Where those officers liked to go jogging in Moscow is really a secondary issue. I took a lunchtime run from the Embassy once surrounded by a crowd of twenty agents, in one of the weirder stunts they pulled on me. The point is, it will take months for replacement staff to get diplomatic visas, if they ever do. So, this is really about degrading the UK’s ability to have a functioning Embassy in Moscow. Russia plays this game better than us.  Fewer Brits in Moscow, means less insight for London policy makers and weaker advice being put to David Lammy. And the UK struggles to generate officers with the right skills to fill the jobs we have at the Embassy in Moscow, as Russia expertise has been hollowed out over the last three decades. The Foreign Office has a poor record in ensuring political staff arrive in Moscow with the Russian language and diplomatic skills they need. I saw no real thought put into a strategic workforce plan to maintain a pipeline of Russia expertise over the longer-term. British universities are slowly cutting back on Russian language degrees.  When I arrived in Moscow in July 2014, the Foreign Office spoke often about the need to ‘rebuild’ after a period of post-Cold War disinvestment. This challenge has yet to be gripped with any vigour or purpose. Russia, on the other hand, has no shortage of English-speaking staff queuing up to work in London. They are generally better qualified, as their Foreign Ministry invests seriously in its Diplomatic Academy and runs a feeder Diplomatic University, which some people call ‘spy school’.   There is a wider problem, too. In recent days, Russian military bloggers have taken great delight in circulating what they claim to be detailed organisation charts of the ‘massive’ Foreign Office’s Eastern Europe and Central Asia Directorate (EECAD), following an FSB information hack. But in my experience, most staff in this Whitehall Russia machine lack real experience of working on Russia or with Russians. So, Starmer and Lammy are chest-beating their way around the world, reliant on advice from kids in London and a barely staffed Potemkin Embassy in Moscow. Little wonder they’ve brought no new ideas of their own to the table. Meanwhile, Russia is gaining friends in the global south with a systematic and well organised diplomatic charm offensive, as war rages in Ukraine. By putting insufficient emphasis on our diplomatic capabilities, the UK has rendered itself a global bit part player on Russia behind the US, China, India, France and Germany. We need a better plan for Russia expertise if we really want to outsmart Putin. This article was published by the Spectator on 20 September 2024.

I'm repeating below an article I wrote on X on 13 September, while Keir Starmer was fruitlessly asking Joe Biden for permission to use Storm Shadow missiles in Russia. The argument still holds true in my opinion, and I elaborated a little during my interview yesterday with Alex Chrstoforou and Alexander Mercouris on their Duran Podcast. I've also copied her my recent interview with the very nice Kelley Vlahos, the Senior Advisor and Editorial Director at Responsible Statecraft in the US. In this interview, filmed before Starmer's arrival in Washington, I correctly predict that he won't get the permission he sought to take the world closer to World War III. Thank God I was right (for now)! 13September 2024 The first confirmed use of ATACMS, Storm Shadow or Scalp inside of Russia would provoke a Russian military strike against a western military target. We should step back from this new missile crisis and push for a negotiated ceasefire. When Sir Keir Starmer meets Joe Biden today he will be seeking weapons free to use Storm Shadow missiles inside of Russia. That comes as no surprise. Britain has been militarily the most hawkish adversary of Russia in the Ukraine proxy war. It would, however, be a mistake for Biden to cede to Britain's demands, because it will provoke a military escalation against those NATO states that engage in the use of western weapons in Russia, including the US. Russia has warned consistently of the risk of escalation and, therefore, retaliation. Yes, Russia has been using its weapons against cities in Ukraine since the war started. But from their perspective, the war in Ukraine has remained largely a war between two opposing sides, even if each side has received materiel support from other countries. It doesn't matter if you disagree. That is how the Russians frame their rules of engagement. They would view any use of western weapons, that rely of US systems and #intelligence   in order to function, as a direct act of war by the participating countries. How Russia might respond Following the first confirmed use of a western supplied missile inside of Russian territory, I assess Russia will launch a targeted conventional strike on a US and UK military asset, including possibly in either country or in one of their overseas facilities ( #guam , #diegogarcia etc). I judge Russia would be careful in targeting a military facility to minimise the risk of civilian casualties in #NATO states. As the Russians are highly reciprocal in how they act, I consider the risk of a tactical nuclear escalation as low, at least in the short term. Russia will also fear the risk of escalation leading to a general war which Russia would not be able to win against a much more powerful NATO and which, therefore, would take us a step closer to all out #NuclearWar.   They will also worry about the impact of a disproportionate nuclear escalation on its diplomatic relations in the wider world, in particular with China. While cyber attacks are a constant risk, I judge Russia would want a retaliation that was attributable and which they could use in their communications. Why Putin will have to act It would be suicide politically for Putin to say that he will act, but then allow months to pass with inaction as British missiles rain down on Russian targets. It is a fantasy to think that he will do nothing. A weapons free signal to use Storm Shadow means that these missiles will strike Russian targets at will for the remainder of this war, and no one has a plan for when the war will end. Both the US and the UK are signalling that they are in this for the long haul. And, given the intense internal pressure he will be under - not necessarily from the Russian public - but from the hawkish parts of his inner circle, it would be politically too damaging for Putin not to respond militarily. The political risk to Starmer For Starmer, the risk is that having beaten his chest and somehow appeared more war mongering that Boris Johnson, he will look weak if he backs down now. He is gambling on calling Putin's bluff i.e. that having said he would retaliate Putin would, nevertheless, backdown. However, that is foolish, and driven by the British government's lack of Russia expertise. If Starmer succeeds in getting Biden's approval, then hot on the heels of a disastrous start to his premiership, he may have to explain why Russian missiles are hitting British military targets, potentially in the UK itself. Which may force him to escalate militarily, or back down and look weak and inept domestically. The risk for Biden Biden risks dragging the US into a direct military conflict with the world's biggest nuclear power, the outcome of which he cannot predict, just two months before an election. There won't be the time for the US to emerge victorious over Russia so that Kamala Harris gets some sort of election boost from victory. More likely, American service personnel will die. The Times has already reported that while Biden may permit the use of UK and French cruise missiles, he may nevertheless not agree to the use of ATACMS inside of Russian territory. Pro-war advocates like Jake Sullivan will believe this hedges the risk of a Russian retaliation against America. But that assessment is also false. Russia has said repeatedly that the use of British and French missiles is only possible with the direct assistance and participation of US assets. Conclusion We have entered a crisis as serious as when Khrushchev sent nuclear weapons to Cuba. Right now, lofted up by hubris and an underestimation of the risk to global peace and security, Starmer is going cap in hand to the White House. The risks to him politically, whatever happens, seem overwhelmingly negative. But right now, I'm more worried about the risk to humanity. Starmer should be pressing for a negotiated end to the fighting in Ukraine, not taking us one step closer to nuclear catastrophe.

With Turkey – a key NATO member - having lodged an application to join, BRICS is set to get bigger, and this can only be a good sign for the collective strength of developing nations in a multipolar world.  It’s also a bad sign, longer term, for US political and economic dominance. Two key moments in the acceleration of BRICS were 2014 when the Ukraine crisis started and 2022, when full blown war broke out.  The weaponisation of the global financial system by the west against Russia helped the core focus of BRICS coalesce around the need to create an alternative financial architecture for developing nations. A BRICS bank (now called the New Development Bank was established) to create an alternative to the World Bank. A Contingent Reserve Arrangement was established, providing an alternative to the IMF for countries who need access to a pool of reserves in the face of currency crises. As the Belgium-based Swift interbank communication service has become politicised, so BRICS Pay was created. Throughout, a core aim is to reduce dependence on the US Dollar for global trade and, therefore foreign exchange reserves. Russia and China’s shift to trading oil in Yuan, Saudi Arabia’s abandonment of the Petrodollar Pact, and the UAE and India’s agreement on trading in rupees are good recent examples of countries choosing to de-dollarize.  While the dollar remains the pre-eminent global trading currency, we should expect to see its share of global trade decline slowly over the coming decade.  This will pose longer-term systemic risks to the USA’s ability to service its vast federal debt, as the cost of borrowing inexorably rises.   BRICS is gathering momentum as the potential benefits of membership become clearer in the eyes of developing nations, and Turkey’s bold decision to apply for membership is a sign of that. While I was the economic counsellor at the British Embassy in Moscow, I watched in slow motion as dissatisfaction in developing countries grew about western domination of the international financial system. Take the International Monetary Fund. Today, 59.1% of the Fund’s voting shares are accounted for by countries with accounting for 13.7% of the World’s population. 57.7% of the bumper distribution of Special Drawing Rights during the COVID Pandemic went to the world’s wealthiest countries. It's not only that developing countries see that the western dominated financial bodies don’t represent their interests.  They have also became increasingly politicised; for example, under pressure from the US in 2015, the IMF changed its rules on debt servicing to allow Ukraine to avoid default, even though it was at that time refusing ever  to service its debt obligations to Russia.  While IMF conditionality on its programmes is rigid, the rules can be changed quickly if the political imperative from Washington demands it. Take the G7, which was the preeminent grouping of the world’s most affluent nations before BRICS found its feet. Following the outbreak of war in Ukraine, G7 countries coordinated over 20,000 economic sanctions against Russia. There is no plan in place for sanctions relief as and when an inevitable ceasefire in Ukraine starts and a peace process begins.  The G7 froze $300bn in Russian foreign exchange reserves; they have more recently established a funding vehicle in which the proceeds of those Russian assets held in Europe are used to fund weapons supplies to Ukraine. Bodies like the IMF, SWIFT and Euroclear have been decisively subjugated by the political interests of the G7. The G20, was intended to be a more inclusive global grouping of the world’s leading 20 economies when it was set up to focus on international financial stability.  But it has also become increasingly dysfunctional as powerful G7 nations try repeatedly to politicise its agenda. So, BRICS has emerged as a more appealing meeting point for developing countries. Its values of non-interference, equality and mutual benefit mean countries with troubled political relationships can come together to strengthen relations through economic ties.  Hence the China, Russia, India triangle, which over history has been beset by tension and conflict. Iran and Saudia Arabia joined BRICS in 2024, almost unthinkable a few short years ago, but made possible by a gradual thawing in their relations brokered by China in 2023. Pakistan is now looking to join BRICS, despite India’s prominent founding role in the group. This gradual rapprochement through trade should be applauded. When it was first convened in 2009, BRICS was seen as a developing nations’ counterbalance to the rich countries’ club of the G8 (now G7). Today, three of the BRICS founding members rank among the world’s top ten economies. Six are members of the G20 group.  The group accounts for 45% of the global population and 28% of its economic output now. Set free from the need to fit within a west-leaning normative set of rules and values, BRICS collaboration has been unleashed by putting the economics first, and letting the politics follow. It’s therefore no surprise that Turkey – which is also a G20 member - has turned to BRICS. After decades of trying to join the European Union, it’s clear that road is permanently blocked. I don’t see Turkey’s future membership of BRICS and its NATO membership as mutually exclusive.  Indeed, straddling Europe and Asia, I think it’s very much to be encouraged that a prominent NATO member state should enjoy a less antagonistic relationship with the developing world. The very point of BRICS is that countries aren’t required to choose one side against another.  There is a long list of other countries who wish to join BRICS, including Mexico, Nigeria, Bahrain, Pakistan, Thailand and Vietnam. Before the end of this decade, BRICS will represent a majority of the global population. The USA, the EU and the UK will continue to be powerful players, but their influence on developing countries and their dominance of the global financial system, seems set to wane as BRICS forges a more multipolar world over the longer term.

Ukraine has occupied more territory in Russia this year than Russia has occupied in Ukraine, but the margin of difference is relatively small. What drove Zelensky’s bold gamble and will it, ultimately, succeed? In a Telegram post on August 16, Zelensky referred to captured land in Kursk as an addition to his "exchange fund." Kursk is less about overall military victory, than about gathering bargaining chips to trade in future peace negotiations with Russia. But that trade will only work to Ukraine’s benefit if its military can hold on to more territory than Russia gains over the period prior to formal negotiations starting. Only then would Zelensky be able to claim that the loss of men and materiel had been worth it. But his profit margin in any future land-for-land trade is narrowing. And all hope of the reported ceasefire talks that had been planned, reportedly, in Doha shortly before Kursk has evaporated. Instead, we have seen a hardening of Russia’s position. In a Telegram post on August 11, Dmitry Medvedev channelled the outrage in the Kremlin that Ukraine blindsided and humiliated Russia. He called for Russia eventually to take Odessa, Kharkiv, Dnipro, Nikolaev, Kyiv and further on. "And let everyone, including the English bastards [he hates us even more than the Americans], be aware of this: we will stop only when we consider this acceptable and advantageous to ourselves." That represents a significant escalation, at least in terms of rhetoric. Of course, this is standard Medvedev, playing his role in the Russian apparatus, with splenetic pronouncements that are to the right of where Putin may be willing to settle. His comments probe sentiment, both internationally and at home. And they shape the narrative of Russian nationalist bloggers, for example, in the use of phrases like "the former Ukraine." i.e, the idea that Ukraine no longer exists as a sovereign nation state. In reality, taking just one of the cities Medvedev has mentioned would require a level of death and destruction far above anything we’ve seen to date. And I don’t assess, right now, that Russia would risk alienating the constituency of support it is building up in the developing world by doing that. But Kursk has changed the risk calculus on both sides. Ukraine had needed to inject morale into its military and civilian population with a victory of sorts, at a time when its lines in the Donbas were cracking, Western support for free weapon supplies was dwindling, and the result of the U.S. election was unclear/potentially worrying. Zelensky may have thought he had nothing to lose by throwing the dice . For Russia, the primary goal before Kursk had been to finish the job in the Donbas , overwhelming those remaining strategic towns and filling out the border of Donetsk and Luhansk oblasts with Russian colors. They have shown openness to cut a deal , including after a new U.S. President took office, so long as that uses the line of contact as a starting point. Realists on the Western side, such as John Mearsheimer and others, cautioned that Kursk was strategic blunder. But Western government and mainstream media were dutifully cock-a-hoop about the Kursk offensive when it started. Ukraine contends that it now controls approximately 1000 square kilometers of sparsely populated land in Kursk oblast after all. However, Ukraine’s military chief Oleksandr Syrskyi has admitted that the advance has slowed and that the focus has shifted to reinforcing land already occupied . The opportunity to capture more Russian land therefore appears limited, although there has been a so far unsuccessful effort by the Ukrainian army to push into Belgorod . In the Donbas, the line of contact around Donetsk had been practically unchanged for ten years since 2014, with both sides dug into heavily fortified positions. Despite large territorial gains by Russia across Ukraine at the start of the war in 2022, that line didn’t budge. Look on the Institute of the Study of War’s interactive map and you’ll see that since the overrun of fortress Avdiivka in February, Russia’s main effort has decisively broken out across rivers and difficult terrain to move 80% of the way to the strategic town of Pokrovsk. Progress has been slow and steady but has gathered momentum since Kursk. Once Pokrovsk falls, there is a flat, empty road from there to the oblast border. Russia will have leveled the scorecard with Ukrainian gains in Kursk and will then focus its main effort on Kramatorsk. As Ukraine is steadily pushed out of the Donbas, Zelensky may throw increasing men and materiel into holding his patch of land in Kursk, at a terrible cost, in a desperate bid to show his gamble wasn’t a catastrophe. Let’s be clear, Kursk has been a huge embarrassment for Russia, both politically and militarily, though probably less so than Yevgeny Prigozhin’s doomed drive towards Voronezh in 2023. Medvedev provides colorful — if exaggerated — insight into the Kremlin mood. He also illustrates the level of hatred in the Kremlin directed towards Ukraine’s Western sponsors. Some commentators in the west are assuming that if Trump is elected President, he may miraculously pull a ceasefire out of a hat. On the back of mounting evidence that Ukraine is slowly losing, I don’t rule out Biden pushing for a temporary pause in fighting before November, to give Harris a hastily papered-over "Putin didn’t win" narrative for voters after a decade of failed U.S. foreign policy. But don’t hold your breath on either front. With no incentives from the West for Russia to strike for peace, Putin may not care where the new occupant of the White House wants to position U.S. foreign policy. The military, economic and demographic cards remain stacked in Russia’s favor . On August 21, Medvedev launched another verbal salvo on Telegram, saying (his capitals) ‘NO NEGOTIATIONS UNTIL THE ENEMY IS COMPLETELY AND UTTERLY DESTROYED.'" History may record that Kursk was a pointless sideshow within a much larger tragedy for Ukraine. This is a copy of a piece I recently published in Responsible Statecraft. Will Kursk be a sideshow that turns into tragedy for Ukraine? | Responsible Statecraft

I applaud the French Government on its delivery of a fabulous Olympiad in Paris and wish the athletes and organisers success in the Paralympics that kick off today.  I have but one criticism. In 2021, the Olympic motto ‘faster, higher, stronger’ was changed with the addition of one word – ‘together’.  Excluding Russia from Paris 2024 eroded the sense of togetherness. It also breached the noble Olympic ideal of keeping sport and culture out of politics.   Banning Russia from the Olympics won’t turn Russian people against Vladimir Putin; he remains as strong as ever, two and a half years into a grinding war in Ukraine. The ordinary Russians that I came to know when I served at the British Embassy in Moscow loved sports, the opportunity to meet and compete with people from different countries, and welcomed me as an equal.  A ban merely confirms to them what Putin has been saying for many years, that the west is intent on Russia’s isolation and destruction.  It increases the sense of resentment towards the west, which is helping to replenish the Russian military with new recruits.   Banning Russia from sport won’t end this needless war in Ukraine. Rather, it will elevate Russia’s determination not to give ground. The US and UK governments in particular need to depart from using sport and culture as a diplomatic tool to isolate Russia and get back the tough diplomacy of negotiating a resolution to the huge challenges and dangers we face through confrontation. It's worth recalling that the origins of an Olympic Truce go back to Ancient Greece, with warring countries setting aside their weapons to compete with their skills and abilities.  It evokes remembrance of British and German troops laying down arms late on Christmas Eve 1914 to exchange gifts, play football, and recover casualties.    With the exception of pauses to the Olympic Games during World Wars I and II, Olympiads have taken place every four years since 1896.  Over that period, the world has seen hundreds of conflicts, uprisings, wars and genocides. Since 1945, there have been inter alia  devastating wars in China, Korea, Vietnam, Greece, Israel, India, Pakistan, the Falklands, the Balkans, terrible genocides in Cambodia and Rwanda, and two wars led by a US coalition in Iraq, the second of which many in Britain consider to have been illegal.   Yet, the banning of countries from sport has been extremely rare. Germany, Hungary, Austria, Bulgaria and Turkey were banned temporarily from the Olympics after World War I and Germany and Japan were banned from the 1948 Olympics.    Russia (with Belarus) is the only country ever to have been banned for its role in a regional conflict, making it the exception to the rule.   Yes, Russia’s invasion on 24 February 2022 breached the notion of an Olympic Truce.  However, that doesn’t explain why Russia was excluded from competing in Paris more than two years later.  During the Paris games, Israel’s offensive in Gaza continued which to date has killed, according to the United Nations, over twenty five thousand innocent civilians including children; calls for Israel to be banned from Paris were brushed off.  There have never been calls for the US or UK to be banned for their role in overseas military adventures.   Since the onset of the Ukraine crisis, there has been a concerted – and highly successful – effort by the US-led west to edge Russia out of all global events in a massive, and in my view, disproportionate politicisation of sport and culture.  No more Football World Cup, Formula One, World Athletics, and for a brief period, Tennis.  Russians can’t sing in Eurovision or go to their local parks to compete in a Saturday morning 5k Parkrun.   All of this departs from the very point of the Olympic games and wider international events; to bring people together in a spirit of solidarity, non-discrimination and peace. In an interview in 2020, IOC Chair Thomas Bach reflected on the sense of powerlessness individual athletes felt as western governments applied pressure for a ban on attendance at the 1980 Olympics in Moscow following the Soviet invasion of Afghanistan. He spoke about why this drove him to join the West German National Olympic Committee, ‘to give all the clean athletes of the world chance to compete in Olympic Games’.   He said, ‘anybody who is thinking about a boycott should learn this lesson from history; a sports boycott serves nothing. It’s only hurting the athletes, and it’s hurting the population of the country because they are losing the joy to share, the pride, the success, with their Olympic team.’    I hope that when Los Angeles lays out the red carpet in 2028, we will see a return to the Olympic ideal of putting aside our weapons so that every country can compete.   This article repeats and adds to a piece I recently posted on the Strategic Culture Foundation Website. Let Russia compete in the next Olympics — Strategic Culture ( strategic-culture.su )