RUSSIAN FEDERATION SITREP

SPEECH. Putin is making his annual speech to parliament today. Again I encourage you all to read what he actually says rather than selections twisted to fit propaganda requirements in the MSM. English. "The agreement between Ukraine and the European Union has been signed and ratified, but the implementation of the provisions regarding trade and economy has been postponed until the end of next year. Doesn’t this mean that we were the ones who were actually right?” Well, doesn’t it?

SOUTH STREAM. South Stream was a proposed gas line from Russia, under the Black Sea, to come ashore in Bulgaria and serve southern Europe. The southern equivalent of Nord Stream, it would avoid the uncertainty of Ukrainian transit routes. The EU took against it and Bulgaria was pressured to delay or cancel. Brussels thought that Moscow could be bullied. It was wrong: Putin announced the cancellation in Ankara. "If Europe does not want to implement it, then it will not be implemented. We will focus our energy resource flows on other regions of the world”. Western governments and media are trying to spin this as a defeat for Russia. "These reports are evidence of pressure mounting on Russia... and reduce Russia’s ability to use gas as a tool of coercion”. This is nonsense of course. Southern Europe will remain dependent on uncertain shipments of Russian gas passing through Ukraine or on as-yet-unbuilt tankers and port facilities bringing in more expensive and possibly non-existent LNG from the USA. It won’t see employment in building the line or transit fees. Some reactions from Bulgarians. The Eurocrats and NATOcrats in Brussels get their Russian gas via Nord Stream. So they will be warm this winter.

ECONOMY. Some numbers. From RosStat year-on-year: industrial growth up 2.9%, average monthly salaries up 8.6%, unemployment down 6.6%, economic growth in Q3 slowed to 0.7%, retail trade turnover up 2.2%; new housing construction up 18.3%. Economic Development Ministry forecasts: GDP growth in 2014 increased from 0.5% to 0.6%, recession expected first half of 2015, inflation in 2014 9%, up from 7.5%; Ruble/USD average in 2014 37.4 (weakened 6.8%), in 2015 will average 49. So, yes sanctions and oil prices are having an effect but a good deal of substitution is going on.

MH17. The report that The Netherlands, Ukraine, Australia and Belgium signed a non-disclosure agreement on the results of the investigation appears to be true. There are only two logical possibilities: either the rebels shot it down or Kiev-associated forces did; should Kiev have a veto on the investigation? A basic questions has been given new life by the mother of a victim who is suing Kiev because the airspace wasn’t closed. Others may join the suit. Indeed, why wasn’t it closed? Finally it is reported that Malaysia has been invited to join the investigation: why wasn’t it in the first place? All of this is highly suspicious.

CHINA-RUSSIA. On the very day Putin announced the cancellation of South Stream, Xi declared that China must establish "big country diplomacy with Chinese characteristics”. Deng’s mantra had been "hide your brightness, bide your time”. I guess the time has come to show the brightness. Meanwhile Russia-China trade has increased 7-10% this year already. And, in an enigmatic but nevertheless clear way Beijing recognises Crimea’s secession (a more accurate choice of word than "annexation”, by the way) and supports Moscow’s actions in Ukraine.

UKRAINE-EU. A piece from Der Spiegel on the EU-Ukraine negotiations giving a lot of blame to Merkel for the disaster. And the agreement was postponed after all. Nothing is said about Nuland’s meddling or the EU’s curious indifference to the collapse of theFebruary agreement it negotiated.

BRILLIANT DIPLOMACY. Beijing and Moscow ever closer. Southern Europe will now be nervous every winter and resentful of Brussels’ diktat. Moscow and Ankara are closer. And now the Japanese PM says he is determined to settle the territorial dispute withRussia. Russia finds a new friend in Nigeria. And Hungary is run by a "neo-fascist dictator”. If there were anything amusing about this, it would be funny.

NOTHING TO WORRY ABOUT. Nuclear accident at the Zaporozhskaya reactor, but nothing to worry about says Yatsenyuk. This story from May of a Right Sector attack is, of course, just Russian propaganda.

OOPS. Biden visited Kiev, taking the head of the table(!) Cyberberkut says it hacked his staff’s files. The alleged files, showing the deep extent to which Washington backs Kiev’s military, are on its website.