Putin enjoys 'rattling the cages', former US diplomat says


Holly Aguirre
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Despite attempts at diplomacy and pleas for de-escalation, tension continues to rise along the Ukrainian border, where Russia has amassed some 127,000 troops.

In December, Russian President Vladimir Putin sent a list of demands on Ukraine to western leaders. The West formally responded on Wednesday.

“The document we’ve delivered includes concerns of the United States and our allies and partners about Russia’s actions that undermine security, a principled and pragmatic evaluation of the concerns that Russia has raised, and our own proposals for areas where we may be able to find common ground,” US Secretary of State Antony Blinken said.

In an effort to make sense of what is going on, how we got here and what to expect, The National spoke to George Krol, a career diplomat who has served in various roles in India, Russia and Ukraine, and was the US ambassador to Uzbekistan (2011-2014), Belarus (2003—2006) and Kazakhstan (2015-2018).

What are the roots of the Ukraine conflict?

Formerly part of the Soviet Union, Ukraine borders Russia to the east and the north-east, with coastlines on the Sea of Azov and the Black Sea.

Ukraine declared independence from the Soviet Union in 1991, and after that time, about one third of its trade was conducted with Russia and another third with neighbouring European nations.

In 2008, Ukraine announced it would sign a “stabilisation agreement” with the EU, which led to many economic and cultural benefits, including tariff-free trade, access to the European Investment Bank, visa-free movement for its citizens and, longer term, the modernisation of the country's energy infrastructure.

  • A Russian soldier attends a military exercise at the Golovenki training ground in the Moscow region, Russia. AP Photo
    A Russian soldier attends a military exercise at the Golovenki training ground in the Moscow region, Russia. AP Photo
  • A member of the 14th Separate Mechanised Brigade of the Ukrainian Armed Forces takes part in anti-aircraft military drills in the Volyn region, Ukraine. Reuters
    A member of the 14th Separate Mechanised Brigade of the Ukrainian Armed Forces takes part in anti-aircraft military drills in the Volyn region, Ukraine. Reuters
  • People walk past a sign reading 'I Love Ukraine' in the central square in Kiev. EPA
    People walk past a sign reading 'I Love Ukraine' in the central square in Kiev. EPA
  • Russian naval frigate 'Admiral Essen' sails during an exercise in the Black Sea. AP
    Russian naval frigate 'Admiral Essen' sails during an exercise in the Black Sea. AP
  • Employees of essential city industries and services attend a military training session outside Lviv, Ukraine. Reuters
    Employees of essential city industries and services attend a military training session outside Lviv, Ukraine. Reuters
  • Airman 1st Class Olabode Igandan organises ammunition, weapons and other equipment bound for Ukraine during a foreign military sales mission at Dover Air Force Base, Delaware. AP
    Airman 1st Class Olabode Igandan organises ammunition, weapons and other equipment bound for Ukraine during a foreign military sales mission at Dover Air Force Base, Delaware. AP
  • A member of the public waves a Ukrainian flag at a rally attended by soldiers and police in Odessa, Ukraine. Bloomberg
    A member of the public waves a Ukrainian flag at a rally attended by soldiers and police in Odessa, Ukraine. Bloomberg
  • A Ukrainian serviceman patrols the front line near Avdiivka village, not far from the pro-Russian militant-controlled city of Donetsk, Ukraine. EPA
    A Ukrainian serviceman patrols the front line near Avdiivka village, not far from the pro-Russian militant-controlled city of Donetsk, Ukraine. EPA
  • A Belgian Air Force F-16 fighter jet participates in Nato's Baltic Air Policing Mission in Lithuanian airspace. AP
    A Belgian Air Force F-16 fighter jet participates in Nato's Baltic Air Policing Mission in Lithuanian airspace. AP

The EU expected commitments in kind as well as political and human rights reform — something that proved a bit of a stumbling block for Kiev.

The trial and consequent seven-year imprisonment of former Ukrainian prime minister Yulia Tymoshenko for abuse of power in 2011 outraged European leaders and rights groups.

Ms Tymoshenko, an opponent of former Ukrainian president Viktor Yanukovych’s government, had been in favour of integration into the EU and membership in Nato while strongly opposing Ukraine’s membership in the Russia-led Eurasian Customs Union.

But Mr Yanukovych’s refusal to sign a free-trade agreement with the EU in 2014 resulted in an eruption of violent protests through the country.

Mr Yanukovych, who had maintained close ties with Moscow, was removed from office by a majority vote in Parliament and replaced by an interim government. Ms Tymoshenko was released and cleared of all charges a few months later.

Russia responded by annexing Ukraine’s Crimean Peninsula and backing a separatist rebellion in the eastern part of the country.

"Ukrainian politics is a very complicated group: there's control of oligarchs, nationalists and the like ... Yet the population as a large would like to see this thing resolved peacefully," Mr Krol said.

"But will their politicians make some kind of a deal that would allow some semblance of normalcy in their lives?"

Over the past several months, Russia has sent troops to its border with Ukraine, alarming Nato, as it sees the build-up as the precursor to an invasion.

Does Russia want to invade Ukraine?

“t's not that they want to invade Ukraine, and I don't think they even intend to invade Ukraine and I don't see really what they can gain from that other than a big problem on their hands because they're getting more out of it from bringing attention to it … rattling the cages, which they're doing,” Mr Krol said.

“There are some who say that they want to keep this pot boiling, because it keeps the Ukrainian government, its leverage on them and keeps them keeps them weak and keeps the tension on this situation, but they could turn it up and up and down, like a flame of gas.”

Mr Krol pointed to Russia's manoeuvres in Belarus, its fleet in the Black Sea and how its army has taken up positions in Moldova, all in addition to the thousands troops amassed on the Ukrainian border.

“They’ve got Ukraine surrounded and putting up the pressure to try to, if you will, force the Ukrainian government to come to terms — as well as the West — without going so far as to actually physically, seize the country and occupy it.”

The diplomat said the aim was to “keep everyone guessing” while maintaining a spotlight on the issue to bring the US to the table to discuss “serious matters that the Russians feel they have been raising again and again for many of these last 30 years".

  • An instructor trains members of Ukraine's Territorial Defence Forces, volunteer military units of the armed forces, in the capital Kiev. AP
    An instructor trains members of Ukraine's Territorial Defence Forces, volunteer military units of the armed forces, in the capital Kiev. AP
  • Dozens of civilians have been joining Ukraine's army reserves in recent weeks amid fears about a Russian invasion. AP
    Dozens of civilians have been joining Ukraine's army reserves in recent weeks amid fears about a Russian invasion. AP
  • US President Joe Biden, centre, meets online with his national security team and senior officials to discuss Russia's actions towards Ukraine. AP
    US President Joe Biden, centre, meets online with his national security team and senior officials to discuss Russia's actions towards Ukraine. AP
  • A member of the US Air Force packs ammunition, weapons and other equipment bound for Ukraine, at Dover Air Force Base, Delaware. Reuters
    A member of the US Air Force packs ammunition, weapons and other equipment bound for Ukraine, at Dover Air Force Base, Delaware. Reuters
  • A Ukrainian soldier stationed in the trenches at the front line with Russia-backed separatists near Gorlivka, Donetsk. AFP
    A Ukrainian soldier stationed in the trenches at the front line with Russia-backed separatists near Gorlivka, Donetsk. AFP
  • Rising tension about Russia’s military build-up on the Ukraine border was not eased during talks on Friday between US Secretary of State Antony Blinken and Russian Foreign Minister Sergey Lavrov in Geneva. AFP
    Rising tension about Russia’s military build-up on the Ukraine border was not eased during talks on Friday between US Secretary of State Antony Blinken and Russian Foreign Minister Sergey Lavrov in Geneva. AFP
  • A Ukrainian soldier pets a dog in a trench at the front line. AFP
    A Ukrainian soldier pets a dog in a trench at the front line. AFP
  • A Ukrainian soldier walks near the line of separation from Russian-backed rebels in the Donetsk region. Reuters
    A Ukrainian soldier walks near the line of separation from Russian-backed rebels in the Donetsk region. Reuters
  • Activists hold an EU flag and posters as they gather in support of Ukraine at the Ukrainian embassy in Tbilisi, Georgia. AP
    Activists hold an EU flag and posters as they gather in support of Ukraine at the Ukrainian embassy in Tbilisi, Georgia. AP
  • The Russian embassy in London. Reuters
    The Russian embassy in London. Reuters
  • Supporters of Ukrainian sovereignty arrive with a Ukrainian flag before holding a protest on the Peace Bridge in Calgary, Canada. Reuters
    Supporters of Ukrainian sovereignty arrive with a Ukrainian flag before holding a protest on the Peace Bridge in Calgary, Canada. Reuters
  • People rallying in patriotic support of Ukraine hold a 500-metre ribbon in the colours of the Ukrainian flag outside St Michael's Golden-Domed Monastery on Unity Day, in Kiev. Getty Images
    People rallying in patriotic support of Ukraine hold a 500-metre ribbon in the colours of the Ukrainian flag outside St Michael's Golden-Domed Monastery on Unity Day, in Kiev. Getty Images
  • A woman attends the patriotic rally in Kiev. There are now more than 120,000 Russian troops posted on the border along with significant numbers of tanks, artillery and missile batteries. Getty Images
    A woman attends the patriotic rally in Kiev. There are now more than 120,000 Russian troops posted on the border along with significant numbers of tanks, artillery and missile batteries. Getty Images
  • A woman wearing a face mask in the colours of the Ukrainian flag stands at the Wall of Remembrance in Kiev, which shows the photographs, names and birth and death dates of approximately 4,500 soldiers who have died fighting for Ukraine in the Donbas conflict. Approximately 13,000 people have died in the war. Getty Images
    A woman wearing a face mask in the colours of the Ukrainian flag stands at the Wall of Remembrance in Kiev, which shows the photographs, names and birth and death dates of approximately 4,500 soldiers who have died fighting for Ukraine in the Donbas conflict. Approximately 13,000 people have died in the war. Getty Images

What does President Putin have against Nato?

Mr Krol said a slow boil began when Nato engaged in the bombing of Serbian positions in Yugoslavia in mid-1999 during the Kosovo War.

“There was no United Nations approval for this. No Nato member was being attacked by Serbia. There was no threat from Serbia to a Nato member and yet Nato decided — largely because of the United States' insistence on it — to conduct a military campaign against Serbia,” he said.

Kosovo declared independence from Serbia in 2008 and was recognised as independent by the US and other Nato members.

“I was director of Russian Affairs at the State Department and the Russians … they felt this could happen to them, because after all, they were fighting a separatists’ battle, very brutally, on both sides in Chechnya,” Mr Krol said.

“And when Nato was bombing Belgrade, and many Russians … immediately saw that this could be a threat and this is what Nato is really all about.”

The diplomat said the US has tried to “manage” Russia and its reactions to the expansion of Nato over the years by establishing the Nato-Russia Council, which aimed to give Russia a voice — but not a veto — in the alliance's actions.

But Mr Krol said the arrangement was frustrating for Russia, the largest country in Europe, not to have veto power while smaller countries did.

Mr Krol said, however, that several European countries protested granting Russia veto power, “saying, ‘You can't let Russia into Nato because they'll subvert it. It’s like having the wolf in your house'".

Nato suspended practical co-operation with Russia following the 2014 intervention in Crimea, but has held a number of meetings since, with the organisation saying it “remains open to a periodic, focused and meaningful political dialogue with Russia on the basis of reciprocity".

“In diplomacy, it's really tough, but the effort has to be made. What are all the different formulations that at the end of the day, everyone can finally agree on, even though they all dislike it so much?”

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How to apply for a drone permit
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What are the regulations?
  • Fly it within visual line of sight
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  • Drones must weigh 5 kg or less
Fixtures (all times UAE)

Saturday
Brescia v Atalanta (6pm)
Genoa v Torino (9pm)
Fiorentina v Lecce (11.45pm)

Sunday
Juventus v Sassuolo (3.30pm)
Inter Milan v SPAL (6pm)
Lazio v Udinese (6pm)
Parma v AC Milan (6pm)
Napoli v Bologna (9pm)
Verona v AS Roma (11.45pm)

Monday
Cagliari v Sampdoria (11.45pm)

La Mer lowdown

La Mer beach is open from 10am until midnight, daily, and is located in Jumeirah 1, well after Kite Beach. Some restaurants, like Cupagahwa, are open from 8am for breakfast; most others start at noon. At the time of writing, we noticed that signs for Vicolo, an Italian eatery, and Kaftan, a Turkish restaurant, indicated that these two restaurants will be open soon, most likely this month. Parking is available, as well as a Dh100 all-day valet option or a Dh50 valet service if you’re just stopping by for a few hours.
 

Ten tax points to be aware of in 2026

1. Domestic VAT refund amendments: request your refund within five years

If a business does not apply for the refund on time, they lose their credit.

2. E-invoicing in the UAE

Businesses should continue preparing for the implementation of e-invoicing in the UAE, with 2026 a preparation and transition period ahead of phased mandatory adoption. 

3. More tax audits

Tax authorities are increasingly using data already available across multiple filings to identify audit risks. 

4. More beneficial VAT and excise tax penalty regime

Tax disputes are expected to become more frequent and more structured, with clearer administrative objection and appeal processes. The UAE has adopted a new penalty regime for VAT and excise disputes, which now mirrors the penalty regime for corporate tax.

5. Greater emphasis on statutory audit

There is a greater need for the accuracy of financial statements. The International Financial Reporting Standards standards need to be strictly adhered to and, as a result, the quality of the audits will need to increase.

6. Further transfer pricing enforcement

Transfer pricing enforcement, which refers to the practice of establishing prices for internal transactions between related entities, is expected to broaden in scope. The UAE will shortly open the possibility to negotiate advance pricing agreements, or essentially rulings for transfer pricing purposes. 

7. Limited time periods for audits

Recent amendments also introduce a default five-year limitation period for tax audits and assessments, subject to specific statutory exceptions. While the standard audit and assessment period is five years, this may be extended to up to 15 years in cases involving fraud or tax evasion. 

8. Pillar 2 implementation 

Many multinational groups will begin to feel the practical effect of the Domestic Minimum Top-Up Tax (DMTT), the UAE's implementation of the OECD’s global minimum tax under Pillar 2. While the rules apply for financial years starting on or after January 1, 2025, it is 2026 that marks the transition to an operational phase.

9. Reduced compliance obligations for imported goods and services

Businesses that apply the reverse-charge mechanism for VAT purposes in the UAE may benefit from reduced compliance obligations. 

10. Substance and CbC reporting focus

Tax authorities are expected to continue strengthening the enforcement of economic substance and Country-by-Country (CbC) reporting frameworks. In the UAE, these regimes are increasingly being used as risk-assessment tools, providing tax authorities with a comprehensive view of multinational groups’ global footprints and enabling them to assess whether profits are aligned with real economic activity. 

Contributed by Thomas Vanhee and Hend Rashwan, Aurifer

Formula One top 10 drivers' standings after Japan

1. Lewis Hamilton, Mercedes 306
2. Sebastian Vettel, Ferrari 247
3. Valtteri Bottas, Mercedes 234
4. Daniel Ricciardo, Red Bull 192
5. Kimi Raikkonen, Ferrari 148
6. Max Verstappen, Red Bull 111
7. Sergio Perez, Force India 82
8. Esteban Ocon, Force India 65
9. Carlos Sainz Jr, Toro Rosso 48
10. Nico Hulkenberg, Renault 34

Scotland's team:

15-Sean Maitland, 14-Darcy Graham, 13-Nick Grigg, 12-Sam Johnson, 11-Byron McGuigan, 10-Finn Russell, 9-Ali Price, 8-Magnus Bradbury, 7-Hamish Watson, 6-Sam Skinner, 5-Grant Gilchrist, 4-Ben Toolis, 3-Willem Nel, 2-Stuart McInally (captain), 1-Allan Dell

Replacements: 16-Fraser Brown, 17-Gordon Reid, 18-Simon Berghan, 19-Jonny Gray, 20-Josh Strauss, 21-Greig Laidlaw, 22-Adam Hastings, 23-Chris Harris

MATCH INFO

West Ham United 2 (Antonio 73', Ogbonna 90 5')

Tottenham Hotspur 3 (Son 36', Moura 42', Kane 49')

Leap of Faith

Michael J Mazarr

Public Affairs

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BUNDESLIGA FIXTURES

Friday (UAE kick-off times)

Borussia Dortmund v Paderborn (11.30pm)

Saturday 

Bayer Leverkusen v SC Freiburg (6.30pm)

Werder Bremen v Schalke (6.30pm)

Union Berlin v Borussia Monchengladbach (6.30pm)

Eintracht Frankfurt v Wolfsburg (6.30pm)

Fortuna Dusseldof v  Bayern Munich (6.30pm)

RB Leipzig v Cologne (9.30pm)

Sunday

Augsburg v Hertha Berlin (6.30pm)

Hoffenheim v Mainz (9pm)

 

 

 

 

 

WOMAN AND CHILD

Director: Saeed Roustaee

Starring: Parinaz Izadyar, Payman Maadi

Rating: 4/5

The National Archives, Abu Dhabi

Founded over 50 years ago, the National Archives collects valuable historical material relating to the UAE, and is the oldest and richest archive relating to the Arabian Gulf.

Much of the material can be viewed on line at the Arabian Gulf Digital Archive - https://www.agda.ae/en

2019 Asian Cup final

Japan v Qatar
Friday, 6pm
Zayed Sports City Stadium, Abu Dhabi

Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.

Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.

Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.

Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.

“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.

Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.

From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.

Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.

BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.

Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.

Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.

“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.

Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.

“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.

“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”

The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”

Tips for avoiding trouble online
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  • Deliveroo will team up with Pineapple Express to offer customers near JLT a special treat: free banana caramel dessert with all orders on January 26
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Nayanthara: Beyond The Fairy Tale

Starring: Nayanthara, Vignesh Shivan, Radhika Sarathkumar, Nagarjuna Akkineni

Director: Amith Krishnan

Rating: 3.5/5

Most sought after workplace benefits in the UAE
  • Flexible work arrangements
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  • Financial well-being incentives 
Who is Mohammed Al Halbousi?

The new speaker of Iraq’s parliament Mohammed Al Halbousi is the youngest person ever to serve in the role.

The 37-year-old was born in Al Garmah in Anbar and studied civil engineering in Baghdad before going into business. His development company Al Hadeed undertook reconstruction contracts rebuilding parts of Fallujah’s infrastructure.

He entered parliament in 2014 and served as a member of the human rights and finance committees until 2017. In August last year he was appointed governor of Anbar, a role in which he has struggled to secure funding to provide services in the war-damaged province and to secure the withdrawal of Shia militias. He relinquished the post when he was sworn in as a member of parliament on September 3.

He is a member of the Al Hal Sunni-based political party and the Sunni-led Coalition of Iraqi Forces, which is Iraq’s largest Sunni alliance with 37 seats from the May 12 election.

He maintains good relations with former Prime Minister Nouri Al Maliki’s State of Law Coaliton, Hadi Al Amiri’s Badr Organisation and Iranian officials.

Sri Lanka's T20I squad

Thisara Perera (captain), Dilshan Munaweera, Danushka Gunathilaka, Sadeera Samarawickrama, Ashan Priyanjan, Mahela Udawatte, Dasun Shanaka, Sachith Pathirana, Vikum Sanjaya, Lahiru Gamage, Seekkuge Prasanna, Vishwa Fernando, Isuru Udana, Jeffrey Vandersay and Chathuranga de Silva.

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Updated: January 28, 2022, 4:30 PM