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In Hot Water: Climate Change, IUU Fishing and Illicit Finance

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In Hot Water: Climate Change, IUU Fishing and Illicit Finance


For instance, the Extractive Industries Transparency Initiative was launched in 2002 to facilitate the voluntary disclosure by governments and firms of the beneficial owners of extractive companies. Sadly, the initiative only targets oil, gas and mineral resources, with IUU fishing having been ignored.

Meanwhile, the Fisheries Transparency Initiative (FiTI) highlights efforts to increase transparency around beneficial ownership, covering the importance of beneficial ownership in its Standard, which defines the information national authorities should publish online about their fisheries sectors. A number of states have signed on to the FiTI Standard. As the first country to report on its commitments, in 2020 the Seychelles passed legislation (the Beneficial Ownership Act 2020) requiring the maintenance of up-to-date registers of beneficial owners, with a central register of beneficial owners in place by 2021. Yet initiatives such as FiTI face a range of issues, not least uptake by a limited number of countries to date and the fact that it only asks countries to report on their progress in implementing public beneficial ownership registries, rather than making it a requirement of adopting the Standard.

Action from the Financial Action Task Force (FATF) – the global financial crime watchdog – has also been slow. In 2020, FATF highlighted the ways in which widespread use of shell and front companies enables the import and export of endangered wildlife products. A year later, FATF expanded its focus from illegal wildlife trade (IWT) to money laundering risks linked to illegal logging, illegal mining and waste trafficking. But disappointingly, FATF has continued to ignore IUU fishing to date.

In the absence of attention paid by FATF to this issue, in 2022, the Asia-Pacific Group on Money Laundering (APG) included a chapter in its typologies report on the illicit finance dimension of IUU fishing, providing case studies and analysis that underline the industrialised nature of the issue. Other FATF-style regional bodies, however, have yet to turn their focus to IUU fishing. They have failed to follow the APG’s example despite the clear demonstration that there is no need to wait for FATF itself – particularly when the impacts of an issue such as IUU fishing are of particular concern to members (often across the Global South).This lack of widespread action comes despite the fact that the UN Sustainable Development Goals (SDGs) reference natural resource crimes including fisheries crime and tax abuse in the fishing industry as contributing factors to illicit financial flows, as included in SDG target 16.4.1.

Encouragingly, the G7 Climate and Environment Ministers’ Communiqué released in May 2021 welcomed ‘discussions by Finance Ministers on strengthening beneficial ownership transparency to better tackle the illicit financial flows stemming from IWT and other illicit threats to nature’. Yet, again, IUU fishing was not named specifically. This is despite the fact that G7 countries account for the majority of the global seafood market, with this omission reflecting the limited political will to tackle this crisis.

Meanwhile, broader trends in relation to progress on transparency of beneficial ownership could have negative implications for the fisheries sector. Notably, in November 2022, the EU Court of Justice approved a ruling that stands to stall progress by invalidating provisions of the EU’s Anti-Money Laundering Directive that allowed public access to registries detailing beneficial owners. Although it has a much wider scope than beneficial ownership in the fisheries sector, this ruling is likely to undermine progress in this area.

Financial Transparency Must be Prioritised

With climate change heightening geopolitical tensions around fisheries in certain regions and driving changes in patterns of convergence between IUU fishing and other crimes, this failure to act on the opacity and financial secrecy enabling IUU fishing must be addressed. This is particularly urgent given that IUU fishing relies heavily on the formal financial system, making it highly susceptible to concerted action by the anti-financial crime community. Given what is at stake and the need for effective deterrents, financial transparency should now be placed at the heart of efforts to tackle IUU fishing.

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Foreign Ministries and Cyber Power: Implications of Artificial Intelligence

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In Hot Water: Climate Change, IUU Fishing and Illicit Finance


The field of cyber security is no stranger to hyperbole and scaremongering – including the doom rhetoric forecasting a ‘Cyber Pearl Harbour’ or ‘Cyber 9/11’. For AI, the equivalent would be debates about its existential risks that invoke Arnold Schwarzenegger’s serial portrayal of The Terminator. While both cyber security and AI share the burden of unhelpful baggage, they also share something more important: AI and cyber security are likely to become increasingly interdependent. States have long tried to mitigate the risks and embrace the opportunities of cyberspace. As they now play catch up in efforts to regulate and negotiate shared principles about how to use AI, states should ensure that their respective cyber diplomacy and AI diplomacy are not conducted in silos. They should be pursued as closely together as possible.

No state wants to be left behind in the race to secure strategic advantage in AI or cyberspace – although, realistically, some states are better placed than others to cultivate a domestic ecosystem supportive of AI innovation and to harness its operational benefits. While AI is far from being a new development in cyber security, it will nonetheless be increasingly integrated into both defensive and offensive operations in cyberspace. This will increase the speed and scale of engagements, raising questions about how to ensure adequate human comprehension and control – and how to constrain competition to reduce the risk of imprudent or escalatory uses of AI in cyberspace.

Cyber Diplomacy and Cyber Power

The interdependence of AI and cyber power (in short: the ability of a state to achieve its objectives in and through cyberspace) is a striking example of how contemporary trends in geopolitical competition have affected how we think about developments in science and emerging technology. This is not a new development. International discussions of responsible state behaviour in cyberspace and efforts to collaborate against cybercrime have been a formal part of the global agenda for 20 years. Through this process, states and non-state stakeholders (from the private sector to civil society) have wrestled with the darker side of the rise of the internet and digital technologies, discussing the threats posed by cyber-criminals and hostile states. The diplomatic process has had its ups and downs, but it has delivered an emerging agreement about the applicability of international law to cyberspace and the existence of a range of voluntary norms, rules and principles that should guide states’ behaviour therein. Many debates remain to be settled, such as those over the interpretation and implementation of existing norms, the merits of elaborating new norms, and the best institutional format for the next phase of global cyber diplomacy.

Foreign Ministries and Cyber Diplomacy

In the UK and other states, foreign ministries have become increasingly active in this agenda. At one level, it is unsurprising that the Diplomatic Service should be a leading institutional player in cyber diplomacy, but at another level it should be remembered that much of the substance of these diplomatic discussions has a bearing on operational activities that are the domain of a state’s armed forces and intelligence agencies. Consequently, the institutional landscape of cyber policy is somewhat crowded – particularly in those states that possess more ‘cyber power’, such as the UK. Different institutional actors will have different views about what a state’s policy should be, and relatedly, different equities at stake in the decision-making process.

Across four iterations of UK strategy (2009, 2011, 2016 and 2022), it has been evident that the UK has increased its investment in the diplomatic and foreign policy elements of cyber strategy. The Foreign, Commonwealth and Development Office (FCDO) is active in global cyber negotiations and discussions, including in forums such as the UN and OSCE. It is engaged in funding and developing the cyber capacities of other states and regional bodies. It is also involved in the UK’s elaboration of the concept of Responsible, Democratic Cyber Power, which serves both as an underlying principle of how the UK approaches the use of cyber power, and as a trope of strategic communication as the UK tries to shape domestic and international debates about how states should organise themselves to exercise cyber power in a precise, proportionate and well-regulated fashion.

The role of foreign ministries in this process is multifaceted. In addition to leading the negotiating effort in diplomatic forums, they provide a window into the thinking of other states about how cyber capabilities should be used and regulated, and act as a source of reporting about foreign AI innovations (both scientific and in policy or regulation). Foreign ministries have long since lost their monopoly on managing relationships with other states – defence ministries, for example, have a clear need to maintain direct contact with their foreign counterparts – but there remains a coordinating role for foreign ministries to ensure that this patchwork of foreign ties is pursued coherently.

Foreign ministries need to be organised for effective performance, for example by creating departments for cyber and emerging technology policy. The FCDO has had a cyber policy department for over a decade, and it has grown significantly in that time, but there is a valid question for the future about whether more coherence could be established by merging the department with its counterpart focused on international technology policy. Similarly, beyond the policy branch, foreign ministries should improve the knowledge baseline for policy decisions by creating and resourcing cadres for research and analysis. For all foreign ministries increasing the size of their policy effort on AI and cyber power, a useful question to ask is what a sensible commensurate increase would look like in supporting functions like research. The risk of pursuing one without the other is that the institution gets less bang for its buck overall. If states are worried about geopolitical competition in AI and cyber power – and they clearly are worried – then there is a need for a systematic net assessment of developments in other states. This should be pursued collaboratively with allies and partners, but it is first necessary to look at domestic arrangements and determine whether they are fit for purpose.

Summit Meetings: Good or Bad?

Finally, a word about the UK’s intended hosting of a global summit for AI safety, announced by the prime minister on his recent visit to the US and scheduled for later this year. It is easy to be cynical or sceptical about such initiatives. Is the cost justified by the likely benefits; could the official bandwidth they consume be devoted to other, more productive things; or will heads of government grandstanding together project the image of substantive engagement, but lead to little in practice?

In fairness, these summits can have their place, so long as they are a productive part of a wider effort. They can signal that heads of government are interested, which can drive bureaucratic activity. Even if the attendance list is restricted to the most ‘likeminded’ states, this can still have value (a recent example is the US-led Summit for Democracy) and in the short term can actually be more productive, helping to coordinate a coalition of those states most willing to embrace the challenge of ensuring that the impact of emerging technologies does not undermine democracy, freedom and human rights. But preaching to the converted will only do so much. This is especially true when an alternative approach, such as China’s, is being marketed energetically to states already receptive to the message that new technologies of surveillance and control can further tip the balance between governments and citizens.

Conclusion

The global agenda of cyber diplomacy is already busy, with debate about norms of state behaviour in cyberspace and a new cybercrime treaty. Similarly, the UK proposal of a summit on AI safety is but one example of intensifying international efforts to address the impact of AI. The challenge for foreign ministries will be to ensure coherence between these two agendas, especially recognising the priority of understanding the implications of AI for cyber norms diplomacy. Foreign ministries need to organise themselves, coordinate effectively (domestically and with allies), and contribute to the process of understanding and shaping relevant developments in other states. The implications of AI and other emerging technologies for cyber power represent a significant new priority for diplomacy and foreign policy. Foreign ministries need to adapt to meet this challenge.

The views expressed in this Commentary are the author’s, and do not represent those of RUSI or any other institution.

Have an idea for a Commentary you’d like to write for us? Send a short pitch to [email protected] and we’ll get back to you if it fits into our research interests. Full guidelines for contributors can be found here.

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Ukraine: Guterres ‘strongly condemns’ Russian attacks on Odesa and other ports

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Ukraine: Guterres ‘strongly condemns’ Russian attacks on Odesa and other ports

In making its decision, Russia also withdrew safe passage guarantees for ships carrying grain and other foodstuffs navigating in the northwestern part of the Black Sea.

Over the past year, the Initiative has facilitated the export of more than 30 million tonnes of Ukrainian grain to global markets via three Black Sea ports, including Odesa.

Grain deal stalled

The Black Sea Initiative was agreed by Russia, Ukraine, Türkiye and the UN in Istanbul last July, along with a parallel accord between the UN and Russia on grain and fertilizer exports, known as the Memorandum of Understanding (MoU).

According to news reports, at least three people were killed during what was a third successive night of airstrikes on Wednesday into Thursday, targeting facilities in Ukrainian port cities.

At least 19 people were injured in Mykolaiv, a city close to the Black Sea, including a child, according to Ukrainian officials.

Head of communications for UN aid coordination office OCHA in Ukraine, Saviano Abreu, tweeted that the “horrific” attack on the city occurred right in the centre. Humanitarians are supporting families whose houses have been hit, and have provided emergency support including cash assistance. 

Russian contradiction

In a statement released by UN Spokesperson Stéphane Dujarric, UN chief António Guterres said the attacks “contradict” Russia’s commitments under the still active MoU, which states Russia “will facilitate the unimpeded export of food, sunflower oil and fertilizers from Ukrainian controlled Black Sea ports”.

“The Secretary-General also recalls that the destruction of civilian infrastructure may constitute a violation of international humanitarian law. These attacks are also having an impact well beyond Ukraine”, the statement continued.

Negative impact on prices

“We are already seeing the negative effect on global wheat and corn prices which hurts everyone, but especially vulnerable people in the Global South.”

Mr. Guterres said he would “not relent” in his bid to ensure Ukrainian and Russian food and fertilizer are available on international markets, linking this to ongoing efforts to combat global hunger and rising food prices worldwide.

Lifeline for world’s poorest

UN Resident Coordinator in Ukraine, Denise Brown, also condemned the attacks, saying she was horrified by the images coming from Odesa of damage and destruction.

“It is the second day in a row that this civilian port, a crucial lifeline for Ukraine and for the poorest people in the world who depend on Ukrainian grain, has been severely damaged in massive strikes.” she said in a statement. 

“This is inhumane and against international humanitarian law,” she added, before calling for an end to the assaults.

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Cyber Resilience Act: MEPs back plan to boost digital products security

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Cyber Resilience Act: MEPs back plan to boost digital products security
Photo by Towfiqu barbhuiya on Unsplash

New cyber resilience rules adopted on Wednesday will establish a uniform set of cybersecurity requirements for all digital products in the European Union.

The draft cyber resilience act approved by the Industry, Research and Energy Committee aims to ensure that products with digital features, e.g. phones or toys, are secure to use, resilient against cyber threats and provide enough information about their security properties.

MEPs propose more precise definitions, feasible timelines, and a fairer distribution of responsibilities. The draft rules put products into different lists based on their criticality and the level of cybersecurity risk they pose. MEPs suggest expanding this list with such product as identity management systems software, password managers, biometric readers, smart home assistants, smart watches and private security cameras. Products should also have security updates installed automatically and separately from functionality ones, MEPs add.

They also emphasise the importance of professional skills in the cybersecurity field, proposing education and training programmes, collaboration initiatives, and strategies for enhancing workforce mobility.

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Lead MEP Nicola Danti (Renew, IT) said: “With ever-increasing interconnection, cybersecurity needs to become a priority for industry and consumers alike. Europe’s security in the digital domain is as strong as its weakest link. Thanks to the Cyber Resilience Act, hardware and software products will be more cyber secure, vulnerabilities will get fixed and cyber threats to our citizens will be minimised.”

Next steps

MEPs on the Industry Committee backed the draft cyber resilience act with 61 votes to 1, with 10 abstentions. They also voted to open negotiations with Council with 65 votes to 2, and 5 abstentions – a decision which will have to be greenlighted by the full House in a forthcoming plenary session.

Background

New technologies come with new risks, and the impact of cyber-attacks through digital products has increased dramatically in recent years. Consumers have fallen victim to security flaws linked to digital products such as baby monitors, robot-vacuum cleaners, Wi-Fi routers and alarm systems. For businesses, the importance of ensuring that digital products in the supply chain are secure has become pivotal, considering three in five vendors have already lost money due to product security gaps.

Serious Question: Is My Device Listening to Me?

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Serious Question: Is My Device Listening to Me?


The UK is truly a digitised nation. In 2022, Statista figures showed that only 13% of people in the UK didn’t own any smart home devices. And 98% of the UK population has a mobile phone. All this proves we have devices everywhere: in our pockets, in our homes, and in our workplace. However, many devices work by constantly recording the world around them. And for many of us, that is unsettling.

Cybersecurity - illustrative photo.

Cybersecurity – illustrative photo. Image credit: Kenny Eliason via Unsplash, free license

For instance, you might be chatting to a friend about something, then pop online on your phone. All the adverts on your browser are about that thing you were just chatting about. It can be weirdly unsettling when you speak about something and an advert for it appears 10 minutes later.

The UK public has realised something is afoot. A survey in 2021 found that 66% were aware of their phones listening to them.

But why are phones listening? Is it a cause for concern? And what can you do to stop your device from quietly listening to you? 

Why is my device listening?

The main way your smart devices are listening is for their ‘wake words’ like ‘Hey Siri’ and ‘Alexa’. This helps them deliver functionality to you, kicking into action when needed. The likes of Siri will also send snippets of your conversations to Apple to help improve the service.

The other reason is for marketing purposes. Search engines and websites track your browser history and cookies to serve up more tailored adverts while you use the internet. They do this because more well-targeted ads are more likely to result in a sale. Some devices can also listen out for and use your voice to target these adverts. 

Should I be worried?

Our phones don’t record us by mistake or illegally. If you have signed a user agreement with a tech company like Apple or Google, you will almost certainly have let them record you.

Now, whether that is a good or a bad thing depends on a few factors. Do you use these services? If not, then their recording could be an issue. Do you care about personalised ads? If not, then do you care about providing that data? And do you like sharing personal data with third parties in general? The eeriness of personalised content could be a factor here.

What can I do to improve my privacy?

If you don’t want your device to record you, there are several things you can do. First, you can add another layer of protection by using a virtual private network that will disguise your data.  But wait, are VPNs legal in the UK? Well, thankfully, they are. And as a result, they can be used to protect against things like location tracking and data monitoring. 

Next, visit the relevant settings in your device and turn off all settings related to your phone listening in. It can take a few minutes, but this is the best way to stop your phone from eavesdropping.

Do you care about phones listening in on your conversations? Were you aware of the practice to begin with?



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Elon Musk – xAI Will Try to “Understand the Universe”

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Elon Musk revealed that his new artificial intelligence company, xAI, aims to “understand the universe.”

During a lengthy Twitter Spaces audio chat, Musk discussed his vision for xAI, touching on topics such as the evolution of Earth and the vulnerability of civilization. As a joke, he suggested that xAI’s mission could be described by a single sentence “what the hell is really going on?”

The billionaire and Tesla CEO established xAI after criticizing other companies like OpenAI and Google for developing AI technology without adequately considering the risks to humanity.

Musk expressed that xAI would focus on building a “good AGI” (artificial general intelligence), which refers to AI capable of problem-solving similar to humans.

In the Twitter Spaces session, which experienced a delayed start due to algorithm adjustments, Musk mentioned that xAI would collaborate closely with his other companies, Twitter and Tesla.

He revealed some technical details, for example, that public tweets would be used to train xAI’s AI models, and that there could be a potential collaboration with Tesla on developing AI software. Elon Musk emphasized the mutual benefit of such an ecosystem, as it could accelerate Tesla’s progress in self-driving capabilities.

Written by Alius Noreika

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Winners of 2023 UN Human Rights Prize Announced

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Winners of 2023 UN Human Rights Prize Announced

Established by the General Assembly in 1966, the Prize was awarded for the first time in 1968 on what is now Human Rights Day, 10 December, and it is awarded every five years for achievements in the field of human rights.

Previous recipients have included Jimmy Carter, Nelson Mandela, Dr. Denis Mukwege, Eleanor Roosevelt, Malala Yusafzai, and the International Committee of the Red Cross (ICRC).

This year’s winners were the Human Rights Center “Viasna”, based in Belarus,  Julienne Lusenge from the Democratic Republic of the Congo, Amman Center for Human Rights Studies from Jordan, Julio Pereyra from Uruguay and the Global Coalition of civil society organizations, Indigenous Peoples, social movements and local communities.

Award ceremony

The recipients of the Prize were chosen by a Special Committee from more than 400 nominations received from Member States, the UN system, and civil society. 

The Committee is chaired by the President of the General Assembly, and its members include the President of the Economic and Social Council, the President of the Human Rights Council, the Chair of the Commission on the Status of Women, and the Chair of the Advisory Committee of the Human Rights Council

The Office of the UN High Commissioner for Human Rights (OHCHR) provided support to the special committee. 

“The winners’ dedication speaks to the universal nature of human rights at a critical time,” said Mr. Kőrösi.

The award ceremony for the 2023 Prize will take place at UN Headquarters in New York in December 2023, as part of activities to commemorate Human Rights Day. 

Defending human rights 

The members of the Special Committee conveyed their admiration for all civil society actors who with their work contribute to the promotion, protection, and advancement of human rights. 

They also acknowledged the important role played by human rights defenders and activists, praising them for their courage and dedication while strongly condemning any attempts to “silence and intimidate” them.

They expressed solidarity with those who are detained in retaliation for their work in defending human rights and pursuing the implementation of all the provisions of the Universal Declaration of Human Rights, marking it’s 75th birthday this year.

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Libya: Rights experts denounce discriminatory travel policy

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Libya: Rights experts denounce discriminatory travel policy

Under the policy, all women and girls are mandated to fill out a detailed form providing personal information, reasons and previous history of traveling without a male guardian. Those who refuse to complete or submit the form are denied exit. 

“Not only is this policy discriminatory, but it also restricts the freedom of movement of women and girls, including students who leave the country to study abroad,” the experts said in a statement.

Rights defenders intimidated

The experts voiced their deep concern about the negative impact of the discriminatory procedure on the fundamental rights and freedoms of women and girls “in contradiction with Libya’s international and national obligations on non-discrimination, equality and the right to privacy.”

They were also concerned about reported attempts by the Libyan Internal Security Agency (ISA) to intimidate human rights defenders, including women, who have spoken out against these policies.

Appeal to authorities

The experts urged the authorities to withdraw this discriminatory requirement, and to prevent all intimidation, harassment and attacks against women and human rights defenders who have protested against the policy.

“The restriction marks a further erosion of the rights of women and girls in Libya and sends the wrong signal,” they said. “Women’s equality and dignity must be ensured.”

The experts who issued the statement were appointed by the UN Human Rights Council in Geneva.

They are not UN staff and are not paid for their work.

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After the NATO Summit: Are We Already at War with Russia?

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In Hot Water: Climate Change, IUU Fishing and Illicit Finance


One of the most resounding absences from the discussion in Vilnius was what to do about Russia. Although Ukraine’s membership (or lack thereof), Sweden’s accession and debates around F-16s all loomed large, when it came to practicalities around the most pressing threat to European security, there were few strategic viewpoints presented beyond deterrence or total disengagement.

The starkest discussion of Russia came not from the final communique but at the NATO Public Forum – which this author attended – which was held on the side-lines of the summit. In a panel discussion, UK Defence Secretary Ben Wallace noted that it would be a mistake to dismiss statements from Russia’s senior leadership entirely as propaganda. While tempting to cast them as irrelevancies, public statements do give clues about Russia’s political barometer, and a sense as to how the Russian leadership sees the world. Wallace was referring to a now-notorious essay that President Vladimir Putin wrote in July 2021 about Ukraine, which revealed his belief that Ukraine was not a country independent of Russia. Although this essay was not an inevitable precursor to the subsequent invasion, Wallace did suggest that a closer reading of official statements signalled how Ukraine was being discussed at the highest political levels in Russia.

This discussion was part of a point about the potential for nuclear escalation in Ukraine, but revealed more broadly that there are still many things we don’t know about Russian decision-making on warfare – in particular where Moscow’s red lines or thresholds for escalation might be, or a real sense of how the Kremlin is interpreting the West’s actions. For this, it is worth examining views and actions from Moscow in response to the summit.

Preparing for War?

One of the most alarming responses to the summit came from prime-time Russian talk show 60 Minutes, which claimed that the build-up of NATO forces meant that NATO was preparing for war with Russia. Despite clear messaging from NATO that it does not want a conflict with Russia, the summit was framed as escalatory, threatening a direct clash with Russia with Ukraine caught in between. No stranger to hyperbole, deputy chairman of the Security Council Dmitry Medvedev warned that ‘nuclear apocalypse’ was a possible scenario that could mark the end of the war. Then, the day after the summit concluded, Foreign Ministry spokesperson Maria Zakharova went further, maintaining that the subtext of the summit had been for NATO to declare its intention to launch a major European war.

The idea that Russia is on an irreversible course of war with the West is not a new one, and has become a mainstream topic of discussion of late. But if Russia already considers itself at war with the West, and NATO believes that it has done everything to avoid escalation and direct confrontation with Russia, then there is significantly less common ground to work with. It might also be worth considering that a Russia which believes itself already at war may be willing to engage in riskier and more unpredictable behaviour, which makes de-escalation and understanding Moscow’s actual red lines much more of a challenge.

Where are the Red Lines?

It is unlikely to be a coincidence that around the summit, rhetoric from Russia on the use of nuclear weapons escalated. In the build-up to Vilnius, Putin maintained that Russia had moved nuclear weapons to Belarus, and the Ministry of Foreign Affairs (MFA) put out a series of (highly unlikely) conditions for their withdrawal, such as the removal of all US forces in Europe. There have also been other statements from Sergei Naryshkin, head of the SVR (foreign intelligence), that Ukraine is manufacturing a so-called ‘dirty bomb’, likely in an attempt to push a false-flag narrative. Pro-government tabloid Komsomolskaya Pravda suggested that with the increase in NATO (non-nuclear) forces, Russia reserved the right to respond, including with the use of nuclear weapons.

Some of the choreography is important here. It is noteworthy that the MFA’s communication around nuclear posturing came not from Foreign Minister Sergei Lavrov himself, but from a lesser known and more junior official called Alexei Polishchuk, who leads a department on Commonwealth of Independent States – not an area of particular priority for Russia at the moment. Polishchuk has form – he has talked about Ukraine using nuclear weapons before – but it is unusual for his department to be leading on the rhetoric surrounding such a critically important issue.

While it would be unwise to ignore Russia’s signalling around the potential use of nuclear force, it does seem that the Kremlin has come to expect a response from the West whenever it is mentioned, as this returns to the agenda the urgency of opening emergency communication channels with Russia. It is possible that Russia views the West’s response as a potential weakness, or it could be attempting to probe NATO’s own willingness to use nuclear force. Or, it could be seeking to create the future basis for a practical security discussion; with Russia’s suspension of New START in February 2023, there are currently no arms control treaties underpinning nuclear security in Europe – a dangerous scenario that has prompted significant debate among the academic community in Russia, not all of it escalatory. Public sentiment is important here too – a sociological survey released on 13 July indicated that three-quarters of Russians are opposed to the country using nuclear weapons in Ukraine, even if – as the question was framed – it would win the war. The survey may have been commissioned to test the waters, and to determine the extent to which the public’s views are in line with some of the senior leadership’s comments of late.

All of this suggests that discussions about nuclear weapons and their movement to Belarus might represent more of a foreign policy tool than an actual willingness to escalate at a senior level. While it is difficult to determine where Moscow’s thresholds are, there are few issues that grab the West’s attention like the nuclear question, and Russia might have viewed this as an opportunity to insert itself back into the conversation.

What Do We Do with This?

Taking Russia’s foreign policy statements at face value is difficult. As ever, its purported aims represent a myriad of self-interests and often competing and contradictory goals. But if we assume that Russia does believe it is already at war with NATO, then there ought to be a more pressing discussion about what the West does with Russia from here.

NATO’s final communique mentions Russia numerous times as the most significant and direct threat to the world order and international security. But what was not addressed was whether there has been any collective improvement since the war began in the Alliance’s understanding and anticipation of how Moscow thinks – either regarding NATO, or about the conditions for nuclear warfare, or where its other red lines might be. If the answer is that there has not been any improvement, then there does not seem to be an agreed-upon sense of how that could change in the longer term, and the practical implications this would have for military spending or prioritisation of resources.

For a summit focused on security, there did not seem to be much strategic thinking on how to avoid groupthink about a highly dangerous adversary whose thresholds for escalation we do not fully understand.

The views expressed in this Commentary are the author’s, and do not represent those of His Majesty’s Government, RUSI or any other institution.

Have an idea for a Commentary you’d like to write for us? Send a short pitch to [email protected] and we’ll get back to you if it fits into our research interests. Full guidelines for contributors can be found here.

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MEPs back plans for a more affordable and consumer-friendly electricity market

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more affordable and consumer-friendly electricity market
Photo by Alexander Schimmeck on Unsplash

The reform of the electricity market, to make it more stable, affordable and sustainable, received the support of the Energy Committee on Wednesday.

In their amendments to the draft legislation, MEPs propose to further strengthen consumer protection against volatile prices. Consumers should have the right to fixed-price contracts, dynamic price contracts, as well as more key information on the options they sign up to, banning suppliers from being able to unilaterally change the terms of a contract. The aim is to ensure that all consumers, as well as small businesses, would benefit from long-term, affordable and stable prices and to mitigate the impact of sudden price shocks.

MEPs also advocate that EU countries prohibit suppliers from cutting the electricity supply of vulnerable customers, including during disputes between suppliers and customers, and prevent suppliers from requiring these customers to use prepayment systems.

Special contracts and flexibility

The Energy Committee backs wider use of so-called “Contracts for Difference” (CFDs) to encourage energy investments and suggest leaving the door open for equivalent support schemes after approval by the Commission. In a CFD, a public authority compensates the energy producer if market prices fall too steeply, but collects payments from them if prices are too high.

MEPs also highlight the importance of Power Purchase Agreements (PPAs) in providing consumers with stable prices and renewable energy providers with reliable revenues. The European Commission is tasked with setting up a marketplace for PPAs by the end of 2024.

MEPs adjusted the criteria for declaring an electricity price crisis, to make sure there are concrete measures to better protect citizens and companies.

The committee also advocates in favour of “non-fossil flexibility” (the ability of the power grid to adjust to changes in supply and demand without relying on fossil fuels) and flexibility on the demand side, for instance via the use of home battery systems. This can help balance the electricity grid, reduce price fluctuations, and empower consumers to adapt their energy consumption to prices and their needs.

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“With this agreement, Parliament puts citizens at the centre of the design of the electricity market, prohibiting companies from cutting the power of vulnerable and at-risk consumers, promoting the right to share energy, reducing price spikes and promoting affordable prices for citizens and companies”, said lead MEP Nicolás González Casares (S&D, ES). “We turned CfDs into the reference system for encouraging the electricity sector to transition towards a renewable-based zero-emission system. A system that will improve make companies more competitive through clean electricity at competitive and stable prices”, he added.

Next steps

The electricity market reform was backed by 55 MEPs on the Industry, Research and Energy Committee, 15 voted against and 2 abstained. They also voted to open negotiations with Council by 47 votes to 20 against, and 5 abstentions – a decision which will have to be greenlighted by the full House in a forthcoming plenary session.

Background

Energy prices have been rising since mid-2021, initially in the context of the post-COVID-19 economic recovery. However, energy prices rose steeply due to gas supply problems following the launch of Russia’s war against Ukraine in February 2022, which unleashed an energy crisis. High gas prices had an immediate effect on electricity prices, as they are linked together under the merit order system, where the most expensive (usually fossil fuel-based) energy source sets the overall electricity price.