Friday, October 26, 2018

Russia in Review: October 18 - 25, 2018

Russia in Review is a weekly intelligence summary (INTSUM) produced by the Institute for the Study of War (ISW). This ISW INTSUM series sheds light on key trends and developments related to the Russian government’s objectives and its efforts to secure them. Receive future Russia in Review INTSUM products via-email by signing up for the ISW mailing list.

Reporting Period: October 18 - 25, 2018

Author: Jack Ulses

Forecast: Russia is attempting to undermine Western efforts to constrain the Kremlin. Moscow may exploit proposals to modernize the Kosovo Security Force to fuel regional ethnic tensions and call for the removal of the NATO Mission in Kosovo. The Kremlin is also setting conditions to evade Western sanctions in Egypt and may export this model to other emerging markets such as Vietnam and Indonesia.

The Kremlin may attempt to marginalize NATO as a security guarantor in Kosovo. The Kosovo Parliament approved draft legislation on October 18 to expand the Kosovo Security Force (KSF) from 2,500 to 8,000 personnel.[1] The body is expected to vote on the final reading of the bill in the near term.[2] Legislators have not offered any clear reasons for its passage at this time but the measure may have gained urgency amidst recent interference by ethnic Serbs and Russia in the Balkans. The legislation has regardless inflamed ethnic tensions in Kosovo. Serbia reportedly pressured ethnic Kosovar Serbs to resign from the KSF following the initial proposed expansion in June 2018.[3] The Kremlin is well-positioned to exploit these tensions to destabilize the wider Balkans. Russia could attempt to link the KSF to ongoing nationalist movements among ethnic Albanians in order to encourage recruitment for paramilitary groups of ethnic Serbs such as the Serbian Honor.[4] The KSF’s expansion could also embolden newly-elected Bosnian Serb President Milorad Dodik to call for a similar reinforcement of the Republika Srpska in Bosnia-Herzegovina. Tensions over the measure could also spoil negotiations over a land-swap agreement between Serbia and Kosovo. Russia could ultimately use the potential for ethnic tensions linked to the successful expansion of the KSF as a justification to call for the removal of the NATO Mission in Kosovo.[5]

The Kremlin is setting conditions to evade Western sanctions in Egypt. Russia announced that construction has begun on an exclusive industrial zone located on the Suez Canal prior to the recent visit of Egyptian President Abdel Fattah el-Sisi to Moscow.[6] The Kremlin has sought to increase its influence in Egypt in order to secure access to strategic basing on the Mediterranean Sea and undermine U.S. influence in North Africa. Russia could use the new industrial zone as a vector to evade sanctions from the West. The Russian Export Center (REC) - a state-run joint stock company that supports overseas exports by Russia - will manage the industrial zone.[7] The REC has previously supported businesses sanctioned by the West.[8] The Kremlin could use this new zone to facilitate trade in non-dollar currencies and mitigate the financial impact of future sanctions. The Kremlin could also use the zone to obfuscate its ownership of large maritime shipments and potentially assist other malign actors in sanctions evasion. Russia may consider exporting this model if successful to other global emerging markets such as Vietnam and Indonesia.[9] The Kremlin can use these developments to set conditions to pursue an aggressive foreign policy even less constrained by the potential financial impact of sanctions by the West.

[1] Muhamer Pajaziti, “Kosovo: Parliamentary debates on the creation of the army expected to start,” Ibna, October 16, 2018, www.balkaneu(.)com/kosovo-parliamentary-debates-on-the-creation-of-the-army-expected-to-start/; Die Morina, “Kosovo President Warns Govt Over its Army Plans,” Balkan Insight, September 13, 2018, www.balkaninsight(.)com/en/article/kosovo-govt-approves-the-expand-of-competences-for-its-security-force-09-13-2018.
[2] [“Committee meeting: Committee on Internal Affairs, Security and Oversight of the Kosovo Security Force,”] Republic of Kosovo Assembly, October 23, 2018, www.kuvendikosoves(.)org/?cid=1,159,7664; Die Morina, “Kosovo Security Force competences to expand with newly-passed laws,” Prishtina Insight, October 10, 2018, https://prishtinainsight(.)com/kosovo-security-force-competences-to-expand-with-newly-passed-laws/.
[3] Dia Morina, “Belgrade 'Pressured' Serbs to Quit Kosovo Security Force,” Balkan Insight, September 19, 2018, www.balkaninsight(.)com/en/article/belgrade-pushed-kosovo-serb-ksf-members-to-resign-report-finds-09-19-2018; “KSF Serb members quit after pressure from Belgrade,” Gazetta Express, July 2, 2018, www.gazetaexpress(.)com /en/news/ksf-serb-members-quit-after-pressure-from-belgrade-174292.
[4] “Serbia puts military on high alert over incident involving ‘Kosovo special forces’,” RT, September 29, 2018, www.rt(.)com/news/439920-serbia-troops-high-alert/.
[5] Mira Kankaras Trklja, [“NATO kicks the last knife in Kosovo, Serbia is preparing the answer,”] Sputnik, October 19, 2018, https://rs.sputniknews(.)com/analize/201810191117553714-kosovo-vojska-amerika-/.
[6] “Construction of Russian Industrial Zone in Egypt Underway – Lavrov,” Sputnik, October 13, 2018, https://sputniknews(.)com/middleeast/201810131068848232-russia-egypt-lavrov-industrial-zone-creation/.
[7] [“On signing the Agreement between the Government Russian Federation and the Arab Government Of the Republic of Egypt on the creation and maintenance of conditions activities of the Russian industrial zone in the economic zone of the Suez Canal Arab Republic of Egypt,”] Russian Trade Ministry, April 30, 2018, http://static.government(.)ru/media/files/fCiWsxJxLCkTzNJXUIwQ0QODxut4RDv8.pdf; [“On approval by the Russian Party of the draft Agreement between the governments of Russia and Egypt on the creation and maintenance of conditions for the activities of the Russian industrial zone in the Suez Canal Economic Zone,”] Russian Trade Ministry, March 3, 2018, http://government(.)ru/docs/32536/.
[8] Tarek Bazza, “Russia’s Gazprom, Novatek Show Interest in Morocco’s Natural Gas,” Morocco World News, October 9, 2018, www.moroccoworldnews(.)com/2018/10/254868/russias-gazprom-novatek-show-interest-in-moroccos-natural-gas/.
[9] “Russia plans to launch four industrial zones abroad in 6 years,” TASS, September 12, 2018, http://tass(.)com/economy/1021304.