Editor's Reflections

…The sands of the hourglass are beginning to run out for Putin`s project and Europe too…

  GERMÁN & CO

A few days ago, in the Editorial, was shared the following thinking. …". Moreover, such striking white balloons suddenly emerged from outer space, attracting the attention of military intelligence and communities in different places. These —magnificent white balloons— were deployed into space to explore the crucial infrastructures of other sovereign governments without any qualms or concerns.

If we review last week's reflections (…." On the one hand, there is a clear nuclear threat from one of the parties involved. However, the West does not see it as latent; paradoxically, it intensifies military cooperation with Ukraine daily. North Korean leader Kim Jong-un has been firing long-range missiles from his territory, causing alarm in South Korea and Japan, and putting significant strain on US forces in the region. In addition, today, he announced US military reinforcements in the Philippines in the face of a possible military escalation from China to Taiwan.) all the military and political activities have multiplied, and this point is mirrored in today's Editorial in Le Monde, which reads as follows: …." The Chinese balloon is a counterproductive fuss... The divisions between the two major American political parties over China are bad news in a world already destabilized by the Russian invasion of Ukraine.  

Now, the news about the development of the military conflict in Ukraine is no longer so unpleasant for President Vladimir Putin compared than the beginning of the invasion, which is reflected in his attitude and expression by images of him, released on the Russian President's office's hard-hitting website. 

Meanwhile, the world economy is disintegrating as fast as the Berlin Wall. Besides additionally, a horrific earthquake in Syria and Turkey has claimed more than ten thousand casualties, who only politically aid the unstable President Recep Tayyip Erdoğan.

The real issue is, who is winning this crazy war? The answer is emphatic NO ONE.

Quote of the day…

Ben Rhodes, the former diplomatic adviser to Democratic President Barack Obama took the opportunity to poke fun: "What a moment. None of us shall ever forget where we were when we learned the news of The Balloon, nor forget the harrowing victory that was won in the final moments of The Battle of The Balloon," he tweeted.

Most Read…

Pope Francis urges followers to pray that AI and robots ‘always serve mankind’

The pope is worried about AI-driven inequality

Pope Francis has asked believers around the world to pray that robots and artificial intelligence “always serve mankind.”

  THE VERGE BY JAMES VINCENT

In Its Push for an Intelligence Edge, China’s Military Turned to Balloons

Chinese military scientists have been looking for ways to make them more durable, harder to detect and even to serve as platforms that fire advanced weapons.

  NYT BY CHRIS BUCKLEY AND AMY CHANG CHIEN

How Russia Is Surviving the Tightening Grip on Its Oil Revenue

Restrictions on Russia’s oil trade are raising the stakes in a protracted economic standoff that is reshaping the global energy market.

  NYT BY ANATOLY KURMANAEV AND STANLEY REED

  ANATOLY KURMANAEV REPORTED FROM BERLIN, AND STANLEY REED FROM LONDON.

Brussels backtracks: EU prepares to quit dirty energy club

In a major policy shift, the European Commission says the Energy Charter Treaty is ‘not in line’ with the bloc’s climate goals.

The European Union is on the brink of withdrawing from an energy treaty that protects fossil fuel investments, following a major U-turn from the European Commission.

  POLITICO EU BY CAMILLE GIJS, FEDERICA DI SARIO AND KARL MATHIESEN

Pictures of the day…

What is Artificial Intelligency?

Artificial intelligence (AI) is the ability of a computer or a robot controlled by a computer to do tasks that are usually done by humans because they require human intelligence and discernment. Although there are no AIs that can perform the wide variety of tasks an ordinary human can do, some AIs can match humans in specific tasks.

Pope Francis urges followers to pray that AI and robots ‘always serve mankind’

The pope is worried about AI-driven inequality

  THE VERGE BY JAMES VINCENT

Nov 11, 2020

Pope Francis has asked believers around the world to pray that robots and artificial intelligence “always serve mankind.”

The message is one of the pope’s monthly prayer intentions — regular missives shared on YouTube that are intended to help Catholics “deepen their daily prayer” by focusing on particular topics or events. In August, the pope urged prayer for “the maritime world”; in April, the topic was “freedom for addiction.” Now, in November, it’s AI and robots.

Although the message sounds similar to warnings issued by tech notables like Elon Musk (the Tesla CEO famously compared work on artificial intelligence to “summoning the demon”), the pope’s focus is more prosaic. He doesn’t seem to be worrying about the sort of exotic doomsday scenario where a superintelligent AI turns the world into paperclips, but more about how the tech could exacerbate existing inequalities here and now.

(We should note also that the call to prayer came out earlier this month, but we only saw it recently via the Import AI newsletter because of the... events that have taken up so much of everyone’s time, energy, and general mental acuity in recent weeks.)

In his message, the pope said AI was “at the heart of the epochal change we are experiencing” and that robotics had the power to change the world for the better. But this would only be the case if these forces are harnessed correctly, he said. “Indeed, if technological progress increases inequalities, it is not true progress. Future advances should be orientated towards respecting the dignity of the person.”

Perhaps surprisingly, this isn’t new territory for the pope. Earlier this year, the Vatican, along with Microsoft and IBM, endorsed the “Rome Call for AI Ethics” — a policy document containing six general principles that guide the deployment of artificial intelligence. These include transparency, inclusion, impartiality, and reliability, all sensible attributes when it comes to deploying algorithms.

Although the pope didn’t touch on any particular examples in his video, it’s easy to think of ways that AI is entrenching or increasing divisions in society. Examples include biased facial recognition systems that lead to false arrests and algorithmically allotted exam results that replicate existing inequalities between students. In other words: regardless of whether you think prayer is the appropriate course of action, the pope certainly has a point.

In Its Push for an Intelligence Edge, China’s Military Turned to Balloons

Chinese military scientists have been looking for ways to make them more durable, harder to detect and even to serve as platforms that fire advanced weapons.

  NYT BY CHRIS BUCKLEY AND AMY CHANG CHIEN

  FEB. 9, 2023

TAIPEI, Taiwan — Long before an unmanned Chinese airship floating over the United States grabbed the world’s attention, Taiwan may have glimpsed Beijing’s ambitions to turn balloons — seemingly so old-fashioned and ponderous — into elusive tools of 21st-century military power.

Residents in Taipei and elsewhere on the island have spotted and photographed mysterious pale orbs high in the sky at least several times in the previous two years. But few people here, even officials, gave them much thought then. Now, Taiwanese officials are grappling with whether any of the balloons were part of China’s growing fleet of airborne surveillance craft, deployed to gather information from the self-ruled island that Beijing claims as its own.

The incursions have come into focus since the United States identified and shot down the Chinese balloon that had spent days traversing the country. Beijing has protested the balloon’s downing, asserting that it was a civilian ship doing scientific research. But American officials say that the balloon was part of a global surveillance effort targeting the military capabilities of various countries.

China’s surveillance airships are likely operated by the Strategic Support Force, experts say, a relatively new and often secretive arm of the Chinese military that carries out electronic surveillance and cyber operations. The force emerged from the Chinese leader Xi Jinping’s drive to modernize the People’s Liberation Army, including expanding its intelligence capabilities, spanning from satellites in space to vessels deep undersea, said Su Tzu-yun, an analyst at the Institute for National Defense and Security Research in Taipei.

“The balloons should be understood as one part of its electronic spying system,” he said in an interview. Even data that the balloons can gather about humidity and air currents may be militarily useful, he said. If China ever launches missiles, “this atmospheric information could improve their accuracy.”

A review of Chinese military studies, newspaper articles and patent filings illuminates the range of Beijing’s interests and ambitions with balloons.

Chinese military scientists have been studying new materials and techniques to make balloons more durable, more steerable and harder to detect and track. People’s Liberation Army researchers have also been testing balloons as potential aerial platforms from which to fire weapons.

Even in this hitherto obscure corner of military innovation, China sees big stakes. Its military researchers warn that rival governments, above all the United States, could beat them at their own game. They especially worry about dominance in “near space,” the inhospitable layer of the atmosphere between 12 and 62 miles above earth.

“Near space has become a new battleground in modern warfare,” an article in the Liberation Army Daily, the official newspaper of China’s military, said in 2018. It celebrated China’s feat in the previous year of sending a balloon, carrying a small live turtle, over 12 miles up. Last year, China experimented with using rockets to propel balloons up to 25 miles above the earth.

The Chinese military, like other militaries, wants to “try all the options,” said Bates Gill, the author of a recent study, Daring to Struggle: China’s Global Ambitions Under Xi Jinping.

“My sense is the People’s Liberation Army is pretty unrestrained these days,” said Mr. Gill, the executive director of the Asia Society Policy Institute’s Center for China Analysis. “Not in the ‘Wild West,’ corrupt sense of the past, but in the sense of how it experiments and pushes the envelope.”

Such boldness may explain the recent balloon flights in the United States and Taiwan, which did not go entirely unnoticed. In September 2021, residents of Taipei, the capital of the island, made anxious calls to weather officials to ask about a pale, tiny dot they were seeing high above them.

Cheng Ming-dean, the head of Taiwan’s Central Weather Bureau, checked a close-up photograph of it and told people to relax: It was just a balloon. The large balloons were seen twice in late 2021 as well as in March of last year. Four clusters of smaller balloons were also spotted early last year.

photograph of the same balloon seen in September 2021, provided by the Central Weather Bureau in Taiwan.Credit...Central Weather Bureau Taiwan

“Back then, I don’t think Taiwan was paying particular attention to this kind of thing,” Mr. Cheng said in an interview.

Now, as some smaller states — particularly those the United States describes as allies and partners — confront this new potential threat of surveillance, their options may be limited.

What we consider before using anonymous sources. Do the sources know the information? What’s their motivation for telling us? Have they proved reliable in the past? Can we corroborate the information? Even with these questions satisfied, The Times uses anonymous sources as a last resort. The reporter and at least one editor know the identity of the source.

Shooting down balloons is likely to be difficult and expensive for many air forces, said Chang Yan-ting, a retired deputy commander of Taiwan’s Air Force. Over 30 years ago, he was a jet pilot sent up to inspect three balloons that were believed to be Chinese. In the end, he decided that they posed no threat, and would have been too hard to bring down, anyway.

“It’s very difficult; these balloons don’t give a radar reflection,” he said in an interview. “Look at the United States: It went to enormous efforts to send F-22s, its best fighter jet, and used its most advanced missiles to strike it — did you see? A bit like using a cannon to shoot a small bird.”

To be clear, the core of China’s digital intelligence collection system remains an armada of more than 260 satellites dedicated to intelligence and surveillance. The balloons, however, may offer some advantages over satellites because they can hover over areas and may produce clearer images, according to U.S. officials who spoke on condition of anonymity to discuss sensitive matters.

The Chinese military is aware of such advantages. In modern battlefields, too, “maintaining constant aerial surveillance has become an urgent task,” a Chinese Liberation Army Daily report said in 2021. With satellites and planes alone, the report said, “it is hard to achieve full-time, full-scope, fixed-point early warning and surveillance from the air.”

If the Chinese Strategic Support Force was responsible for the recent balloon mission over the United States, the force’s relative newness and fragmented background may help to explain how the operation went ahead with seemingly little calculation of the trouble it could create, said Mr. Gill, who has studied the force. It was formed as part of a sweeping military reorganization that Mr. Xi launched in 2015, absorbing parts of the air force, navy and army.

Poor internal communication between the Chinese military and civilian government, and even inside the People’s Liberation Army and Strategic Support Force itself, may have contributed to the problem, Mr. Gill said.

“It’s a really good example of the right hand not knowing what the left hand is doing in China,” he said.

The recent attention on China’s balloon program may discourage the Chinese military from deploying new ones for a while. But the research will likely forge ahead.

Military scientists, especially at China’s National University of Defense Technology, have worked on new materials, designs and navigation tools to make balloons more nimble and long-lasting. They have filed patents for innovations such as a “three-dimensional flight path tracking method for an unmanned airship,” and articles in the Chinese military’s newspapers indicate it pays attention to balloon developments in the United States, France, Israel and other countries.

One lecturer from the National University of Defense Technology, wrote last year in the Liberation Army Daily that China could try to develop smart high-altitude balloons that are able to escape the more turbulent lower atmosphere and catch the steadier wind currents of the upper atmosphere, enabling them to surf long distances helped by small motors.

“With their many advantages,” another article in the same newspaper said last year, “balloons seem to be ushering in their springtime of development.”

Chinese researchers have also speculated about using high-altitude balloons to carry and launch missiles from near space, where they would be harder to detect, to earth.

In 2018, China’s state broadcaster said that researchers had tested a balloon platform that they said could be used to launch hypersonic weapons — which can fly at several times the speed of sound — from midair. But Chinese reports about the country’s military advances are prone to exaggeration. That report noted that the test used scale models, and it is debatable whether China’s other military balloon capabilities always live up to the swaggering claims.

Technical shortcomings may help explain the untimely appearance of the Chinese balloon over the United States — just before the Secretary of State, Antony J. Blinken, was to fly to Beijing. He canceled that trip.

“It may have been bad timing,” Mr. Su, the Taiwanese military researcher, said. “It’s become relatively easy to control the direction of balloons, but controlling their speed is a different matter.”

Chris Buckley is chief China correspondent and has lived in China for most of the past 30 years after growing up in Sydney, Australia. Before joining The Times in 2012, he was a correspondent in Beijing for Reuters. @ChuBailiang

How Russia Is Surviving the Tightening Grip on Its Oil Revenue

Restrictions on Russia’s oil trade are raising the stakes in a protracted economic standoff that is reshaping the global energy market.

  NYT BY ANATOLY KURMANAEV AND STANLEY REED

  ANATOLY KURMANAEV REPORTED FROM BERLIN, AND STANLEY REED FROM LONDON.

  FEB. 7, 2023

Shunned by the West, Russia was able last year to redirect its potent oil exports to Asia, marshal a fleet of tankers unencumbered by Western penalties and adapt evasion schemes perfected previously by its allies Iran and Venezuela.

The strategy worked: President Vladimir V. Putin not only retained but also increased money from energy exports, according to official data, and may have brought in more cash, collected in the shadows of the oil trade, that could be helping the war effort.

But it’s not clear if Russia can keep outmaneuvering efforts to throttle oil revenue. There are signs that Western controls that took effect in December — an embargo on most sales to Europe, and the Group of 7 nations’ price cap on Russian crude sold to other nations — are beginning to have a deep impact on energy earnings.

And another round of sanctions to slash Russia’s war chest began on Sunday, when the European Union’s embargo on Russian diesel, gasoline and other refined oil products took effect. Like the crude oil sanctions, it is accompanied by Group of 7 price caps on Russian diesel and other oil products sold elsewhere.

The gradual ratcheting up of oil sanctions, which are designed to cut Russia’s oil export revenues without snuffing out a fragile global pandemic recovery, is a policy that analysts say could take years to bear fruit.

“Sanctions, in general, are more like a marathon than a sprint,” said Edward Fishman, a former State Department sanctions official. “Now that these sanctions are in place on Russia’s oil sector, I think you have got to assume they are a permanent fixture of the market.”

A year since the start of the war, Russia has been able to keep its oil flowing.

For all of 2022, Russia managed to increase its oil output 2 percent and boost oil export earnings 20 percent, to $218 billion, according to estimates from the Russian government and the International Energy Agency, a group representing the world’s main energy consumers. Russia’s earnings were helped by an overall rise in oil prices after the start of the war and by growing demand after pandemic lockdowns; those trends also benefited Western oil giants like Exxon Mobil and Shell, which reported record profits for 2022. Russia also raked in $138 billion from natural gas, a nearly 80 percent rise over 2021 as record prices offset cuts in flows to Europe.

Export volumes of Russia’s main type of crude have also recovered after a dip in December caused by the imposition of the Group of 7 price cap and a Western embargo on seaborne Russian crude, according to the I.E.A.

Last week, the International Monetary Fund said that the oil price cap, currently $60 per barrel, was unlikely to affect Russian oil export volumes, and that it expected the Russian economy would grow 0.3 percent this year after shrinking 2.2 percent in 2022. That projection beats the fund’s forecasts for the British and German economies.

Russia has blunted the impact of Western measures by redirecting crude exports to China, India and Turkey, exploiting its access to oil ports on three different seas, extensive pipelines, a large fleet of tankers and a sizable domestic capital market that is shielded from Western sanctions.

In the process, the Kremlin was able to re-engineer, in months, decade-long global oil trade patterns. Russia’s oil exports to India, for example, have grown sixteenfold since the start of the war, averaging 1.6 million barrels per day in December, according to the I.E.A.

“Russia remains a formidable force on the global energy market,” said Sergey Vakulenko, an energy scholar at the Carnegie Endowment for International Peace, a research group in Washington. “Opposing such a major player is not easy at all, and won’t happen in a day.”

Even as Russia continues producing about 10 million barrels of oil per day — making it the world’s third-largest producer, after the United States and Saudi Arabia — the European oil ban and price cap adopted on Dec. 5 have recently curtailed the money its treasury derives from exports. In December, Russian oil export revenues were $12.6 billion, nearly $4 billion less than a year earlier, according to the I.E.A. estimates.

That’s largely because Russian oil companies have to offer increasingly large discounts to a shrinking pool of buyers.

The trend appears to be persisting. The Russian government’s revenue from oil and gas production and exports fell in January by 46 percent from the same month last year, the Finance Ministry said on Monday.

The difference between the prices of Brent, a global oil benchmark, and Urals, the main type of exported Russian crude, widened to about $40 per barrel in January, according to the energy data company Argus Media. That gap was just a few dollars before the war.

The Russian Finance Ministry has acknowledged the drop in oil revenues, saying last week that the average price of Urals in January was $49.50 a barrel, nearly half its price a year earlier. The ministry uses the Urals price to calculate its tax take from oil exports.

“The windfall income will decline, and volumes of their receipts will become less predictable,” the Finance Ministry said in a budget forecast late last year.

To supporters of Russian oil sanctions, the Kremlin’s ability to keep selling oil for less money is the intended outcome of the price cap. The idea is to avoid a shortage that could force prices up.

“So far, so good,” said Mr. Fishman, the U.S. sanctions expert.

Some oil experts say, however, that the steep discounts for Russian oil could partly be an illusion.

Using customs data from India, Mr. Vakulenko, the Russian oil expert, showed that local importers of Russian crude paid almost the same price as Brent crude. A New York Times analysis of the same data produced similar results.

The explanation, Mr. Vakulenko suggested, is that at least part of the large discount on the quoted Urals price had been pocketed by Russian exporters and intermediaries, who then charged a higher price to the buyers in India.

This revenue will not accrue directly to the Russian government in taxes, said Tatiana Mitrova, a Russian oil expert at the Center on Global Energy Policy at Columbia University. But because the Russian exporters probably have close ties to the Kremlin, some of money might still support the war effort, she said.

“It’s a complete black box of funds,” she said.

Experts agree that in the longer term, the future of Russian oil revenues will be decided by global economic forces beyond the control of Western sanctions enforcers and Russian evaders.

They say global oil prices will remain the single biggest determinant of how much money the Kremlin will collect from a barrel of exported crude, despite the growing opacity of its trade.

And the fate of that price rests to a large extent on Russia’s ally China, whose economy is just beginning to emerge from years of strict Covid restrictions. In December, China’s imports of crude oil hit a record of 16.3 million barrels a day, according to estimates by Kpler, a firm that tracks energy shipping. If the trend continues, it will strain global oil supplies and benefit the Kremlin.

Adding to the upward pressure on oil prices, OPEC Plus, an alliance of Russia and the Organization of the Petroleum Exporting Countries, said last Wednesday that it would maintain last year’s restrictive output targets, which could strain oil supplies if demand grows.

After a year of preparations, Russia seems able to absorb the immediate impact of Western oil sanctions on production, said Felix Todd, an analyst at Argus Media. Experts say Russia can plug any oil funding gaps in the next few years by using its National Wealth Fund, which it has amassed from past windfall energy profits and is worth about $150 billion.

The Russian government has also shielded its defense and social spending from budget cuts, meaning that even a drastic decline in oil revenues will not hurt its war effort for the foreseeable future, said Alexandra Prokopenko, a Russian economic analyst and former adviser at the Russian central bank.

“Putin has plenty of money to keep fighting,” she said.

Brussels backtracks: EU prepares to quit dirty energy club

In a major policy shift, the European Commission says the Energy Charter Treaty is ‘not in line’ with the bloc’s climate goals.

  POLITICO EU BY CAMILLE GIJS, FEDERICA DI SARIO AND KARL MATHIESEN

  FEBRUARY 7, 2023

The European Union is on the brink of withdrawing from an energy treaty that protects fossil fuel investments, following a major U-turn from the European Commission.

A spokesperson told POLITICO that the Commission on Tuesday recommended to EU countries that the bloc should “carry out a coordinated withdrawal” from the Energy Charter Treaty (ECT).

The news followed a POLITICO report on a document outlining the view of the Commission’s internal legal services that a full-scale EU departure was “unavoidable” after several EU countries — including France, Germany, the Netherlands, Poland and Spain — last year rebelled and said they would leave the deal unilaterally. 

It's a big shift for the Commission, which for years had pushed for reforming the pact and keeping EU countries inside. But given the exodus, the EU's executive told diplomats on Tuesday it now backed leaving the deal.

"No wonder the European Commission now comes to the conclusion that the EU exit appears unavoidable given this political context. It is high time to get the exit done," said Anna Cavazzini, the MEP who leads talks on the treaty in the European Parliament.

The charter is the world’s most used investment treaty. It was designed in the 1990s to encourage Western European companies to invest in post-communist states. The ECT offers generous protections to an estimated €344.6 billion of coal, oil and gas investments in the EU, U.K. and Switzerland, allowing companies to sue countries for profits lost as a result of changes in government policy.

But the treaty now clashes with the EU's pledge to slash the use of fossil fuels under its Green Deal project.

The Commission had tried to reform the 50-plus country pact, but ECT members in Central and Eastern Asia were unwilling to abandon its protections. That precipitated a major campaign against the deal, led by NGOs but joined later by the governments of France and Spain.

“There is still a false hope in the room that an agreement like the ECT would lead to more investments,” said Cornelia Maarfield, a senior trade and investment policy coordinator at green alliance CAN Europe. “But it has never been proven that that is the case.”

The fears over the deal have been borne out in recent years, most notably when the Netherlands was sued by two German coal companies over its plans to phase out the use of the highly polluting fuel.

The Commission now has little choice but to agree with the deal’s opponents. “An unmodernized ECT is not in line with the EU’s policy on investment protection or the European Green Deal,” the spokesperson said.

POLITICO contacted diplomats from several EU member countries, some of which have announced they intend to cut and run from the deal and others that have not. They all said they were still absorbing the Commission’s change of heart.

What happens next?

On the surface, withdrawal from the deal seems like an obvious move for a climate-ambitious bloc. But within its pages lies a poison pill: a ‘sunset clause’ that leaves countries open to lawsuits for 20 years after they exit the pact.

The Commission’s legal note suggested that future lawsuits may be limited because most energy investments in the EU are made by EU companies. The Commission suggested that EU countries should draft a deal between themselves to the effect that the ECT “does not apply, and has never applied, in intra-EU relations.”

However, a coordinated exit will have no effect on current proceedings, said Johannes Tropper, a law researcher at the University of Vienna, and an EU company could still benefit from ECT protection if it has a subsidiary in a country that hasn't left the pact.

Projects with investments from outside the EU would still be subject to potential legal action.

Should a full-scale withdrawal be eventually rejected, the EU’s executive would be left facing two fallback scenarios: a withdrawal preceded by negotiations aimed at ensuring that some EU states remain part of a reformed treaty; or pushing the Council to back the reforms before proceeding to a coordinated departure. 

The first option would allow ECT defenders to remain affiliated with a revised version of the pact, in spite of a subsequent withdrawal of the EU and the European Atomic Energy Community (Euratom). That “would allow for the modernisation of the ECT to be adopted, also for the benefit of non-EU Contracting Parties,” read the legal note.

The last avenue would see the EU and Euratom back a revision of the treaty while “starting proceedings for their withdrawal in parallel.” However, the Commission is aware that this  “would run counter to the public and political announcement already made by a number of Member States,” on top of “being disingenuous vis-à-vis other non-EU Contracting Parties.”

Maarfield believes that the EU’s landmark departure from the dirty energy deal could have a knock-on effect. 

“For other countries wishing to become EU members in the future, it would make a lot of sense to withdraw now, because, once they access the bloc, they would have to rethink their membership within ECT membership anyway,” she said. “So this is actually a great opportunity.”