Good morning. Here’s your Daily Situational Awareness for Friday, 24 June 2022.
- READ TIME: 3 min 51 seconds
- Russia-NATO INTSUM
- Indo-Pacific INTSUM
- Geopolitical INSTUM
RECESSION IN GERMANY IF GAS CUT: German industry energy analysts said a “recession [is] inevitable” if Russia cuts off gas supplies. Germany’s Federal Network Agency President Klaus Mueller said, “As it stands today, we have a problem.” The national regulator is enacting its three-part emergency plan to increase energy efficiency and reduce demand to prevent a potential recession. Italy, Germany, Denmark, Austria, and the Netherlands have implemented at least the first step in their emergency energy plans.
RUSSIA SAYS UN IN BLACK SEA ‘MEDDLING’: Russia’s Foreign Minister Sergei Lavrov rejected international calls for the United Nations to ensure Ukrainian grain shipments leave unabated. “The attempts to organize some kind of international coalition for the implementation of these procedures are aimed solely at interfering in the Black Sea region under the auspices of the UN. And we see this quite clearly,” Lavrov said. He insisted that Ukrainian vessels have a safe passage guarantee and agreement with Turkey.
IEA WARNS RUSSIA MAY CUT GAS COMPLETELY: The International Energy Agency (IEA) warns Russia may cut off gas supplies to Europe entirely for leverage in negotiations. IEA’s executive director said, “This is the reason Europe needs contingency plans.” According to the agency, Russia’s most likely course of action will include finding “issues” with European gas customers as a pretext to reduce supplies ahead of winter and possible negotiations on Ukraine or sanctions relief.
CHINA’S XI CALLS FOR A HALT TO UNILATERAL SANCTIONS: On Thursday at the BRICS virtual summit, China’s President Xi Jinping urged world leaders to oppose efforts by the U.S. and other countries to maintain their political and military power through unilateral sanctions of their geopolitical opponents. Xi’s remarks reflected China’s backing of Russia in its war in Ukraine and its aim to form an international alliance opposed to the U.S.-led liberal democratic order. Xi went on to say that nations should “reject the Cold War mentality and bloc confrontation, oppose unilateral sanctions and abuse of sanctions, and reject the small circles built around hegemonism by forming one big family belonging to a community with a shared future for humanity.”
CHINA FIELDS NEW SYNTHETIC APERTURE RADAR FOR COMMERCIAL DRONE USE: China has achieved a breakthrough in commercially produced synthetic aperture radar technology for use in the drone market as a high-resolution imaging tool. In the past, SAR has only been available on U.S. military drones like the Predator and Global Hawk due to its size and power requirements, but Chinese developers at Shenzhen University developed a solution. Using a new algorithm for data compression of analog signals, the team of developers was able to significantly reduce the size, complexity, and power consumption of SAR without diminishing image quality. This new SAR, called 1-bit SAR, will allow commercially available drone aircraft and ships to see at night, in all weather conditions, and analyze the material properties of a target.
NEPAL BACKS OUT OF U.S. STATE DEPARTMENT PROGRAM OVER FEARS OF U.S. MILITARISM: The Nepal government canceled its participation in the U.S. State Department Partnership Program (SPP) on Wednesday. A government spokesperson stated that Nepal was unambiguously against foreign programs that gave the appearance of a military alliance. In the past, Nepal has sought to avoid any transnational agreements that could jeopardize its delicately balanced relationship between India and the United States on the one hand and China on the other.
CHANCES OF GLOBAL RECESSION AT 50%: Citigroup released a report Wednesday that forecasts a near 50% probability of a global recession. The report stated, “Recession is an increasingly palpable risk” to the economy when assessing global growth over the coming 18 months. Barclays also announced it expects U.S. economic growth to slow to 1.1% in 2023, down from 5.7% in 2021. Central banks are aggressively raising rates in an attempt to curb inflation as cost of living indexes across global economies are reaching record levels. The U.S. Federal Reserve is reportedly committing to interest rate hikes well above neutral while the ongoing collapse of new home sales in the U.S. is seen as a forerunner to an overall collapse of the housing market.
U.S.- LED COALITION ATTEMPTS TO SANCTION RUSSIA FOR CONFLICT DIAMONDS: A U.S.-led coalition consisting of Ukraine, Australia, Britain, Canada, and the European Union was pushing to place Russia on the agenda at this week’s Kimberley Process (KP) meeting in Botswana. The coalition sought to broaden the KP’s definition, under which only gems funding rebel movements are “conflict diamonds,” to include those sourced in Russia. The attempt was blocked by China, Belarus, Mali, the Central Africa Republic, and Kyrgyzstan. Russia is the largest producer of diamonds in the world. The KP certification scheme is designed to eliminate the trade in so-called “blood diamonds”, after devastating civil wars in Angola, Sierra Leone, and Liberia, which were largely financed by the illicit diamond trade.
ANOTHER DOMINO WOBBLES AS ECUADOR BEGINS TO UNWIND: Yesterday in Ecuador’s capital of Quito, one person was killed and dozens wounded in protests over soaring fuel prices and food shortages. The Confederation of Indigenous Nationalities, which organized the protests, said one protester was killed by gunshot wounds while demonstrating near the National Assembly. Protest leaders demanded the government cut gasoline prices by 20% and put price controls on agricultural products to halt rising food prices. Indigenous movement leaders also asked the government to lift the state of emergency currently in place in six provinces in north-central Ecuador and remove military and police presence around protest sites in Quito.
IN TODAY’S EARLY WARNING: Mike looks at worsening U.S. port conditions. You can get access to his daily report here: https://forwardobserver.com/subscribe
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