Trade protectionism -- or at least the threat of it -- has raised it head as the global economy has declined, bringing with it all the historical fears about the Great Depression. Consider the flurry of concern about a "Buy American" clause in one of the U.S. stimulus bills.

It is traditionally assumed that widespread protectionism would most hurt the biggest economies, the United States and Japan. But Barclays Capital analyst David Woo says this is not so and that Russia, Canada, Australia and Sweden are the most vulnerable.

Woo studied various factors that would play on the effect of protectionism on a country, from openness and flexibility to its dependence on trade and it savings.

Japan turned out to be the least vulnerable. "Its relative closeness, relative flexibility of its labour market, and its terms of trade more than outweigh the negative contribution to its growth from a narrowing of its trade surplus in a global protectionist environment," Woo writes.

As for the United States, "the only reason why it failed to take first place is because of its extremely low saving rate, which will limit the scope for domestic demand to offset falling exports."

Mexico,  India and China took the third, fourth and fifth places, respectively. So it's not all about emerging markets.

To many of the hundreds of defence experts, heads of state, ministers and journalists at the Munich Security Conference, U.S. Vice President Joe Biden’s speech was the keenly awaited highlight of the three-day gathering in Bavaria. Biden, on his first trip to Europe in his new role, was expected to lay out the foreign policy priorities of President Barack Obama’s administration to European allies, including Washington’s future policy on Afghanistan and Iran.

But well before Biden took the stage in the plush Munich hotel, French President Nicolas Sarkozy told the audience that he, at least, was already in the know about Biden’s speech. As Biden watched on from the front row, Sarkozy deviated from his speech on France’s policies towards NATO and the defence priorities of the European Union, and said with a smirk: ”I already know what the vice-president will say … because he sent me his manuscript in advance. “That’s part of good management,” Sarkozy said to loud laughter from the audience. Biden smiled, listening to Sarkozy’s comments over headphones through a translator.

Biden delivered his speech about an hour later, saying the new U.S. administration was determined to set a new tone in America’s relations around the world but also announcing it would ask for more from its partners. After talking about U.S. relations with Russia and Iran and detailing U.S. priorities in the Middle East, Biden turned towards Sarkozy, sitting in the audience. ”We warmly welcome the decision by France to fully cooperate in our structures,” Biden said, referring to Sarkozy’s plans to return France to NATO’s command structure. ”That’s the main reason the president got our speech,” he added. Sarkozy, sitting in the front row, grinned uneasily and squirmed in his seat. 

It is not unusual for leaders to circulate speeches to allies or journalists before they deliver them, but it is unusual for politicians to reveal publicly they have seen them. British Foreign Secretary David Miliband seemed to know in advance what Sarkozy would say, telling Reuters a day before the
French leader’s speech in Munich that he did not expect any major new announcement on NATO.    

 Jaap de Hoop Scheffer made sure no other leader revealed the details of his speech. Apparently, the NATO chief’s remarks were only finished shortly before he actually delivered them.

(Photo/ U.S. Vice President Biden meets French President Sarkozy at the 45th Conference on Security Policy in Munich. Michael Dalder/Reuters)

According to George Friedman from the Stratfor intelligence group the United States should forget the idea of sending more troops to Afghanistan and concentrate instead on covert operations against al Qaeda and the Taliban.

As has become increasingly clear, the administration of President Barack Obama faces a hard time raising its troop presence in Afghanistan without either relying on precarious supply lines through Pakistan or making political compromises with Russia to win its support for using alternative routes through Central Asia.

"So how can Mr. Obama reconcile the two goals of strengthening the American presence in Afghanistan while curbing Russian expansionism?" asks Friedman. "The answer is to rely less on troops, and more on covert operations like the CIA. Covert operators are far more useful for the actual war that we are fighting (and they can carry their supplies on their backs). The primary American interest in Afghanistan, after all, is preventing terrorist groups from using it as a base for training and planning major attacks. Increasing the number of conventional troops will not help with this mission."

His article struck me not so much for the suggestion about the need for covert operations. One wonders whether Friedman has ever lived in a small-town environment where you can barely open a curtain without being noticed let alone carry a backpack with satellite phone and whatever other equipment you might need to hunt down equally sophisticated militant groups who will have made a point of recruiting intelligence from the local population.

What is interesting is his assertion that sending more troops is not the answer.

There are a few articles out there suggesting that Afghanistan could be Obama's Vietnam, including from U.S. analysts Juan Cole and Norman Solomon.  But such suggestions are usually dismissed as the talk of the American left, and most of the discussion in Washington seems to be more about the fine details of exactly how the United States should refine its strategy in Afghanistan to focus on limited, achievable goals rather than a grander vision of a tolerant pluralistic democracy -- while nonetheless accepting the need for more troops

So are those who are fretting about how the United States should recalibrate strategy in Afghanistan missing the point? Is Friedman right to say that sending more troops is not the answer? And if so, what is the alternative?

(Reuters photo of Nuristan in Afghanistan/Bob Strong)

U.S. efforts to improve supplies for its troops in Afghanistan just had a double setback after militants in northwest Pakistan severed the main supply route for western forces and Kyrgyzstan's president said the United States must close its military base there.

Militants blew up a bridge on the Khyber Pass, cutting the supply route to western forces in Afghanistan and underscoring the need for the United States to seek alternative supply lines. The U.S. military sends 75 percent of supplies for the Afghan war through Pakistan but has been looking at using other transit routes through Central Asia. Although Washington has been sketchy on the details of its plans, its Manas military airbase near the Kyrgyz capital Bishkek has so far provided important logistical support for its operations in Afghanistan.  During a visit to Moscow, Kyrgyz President Kurmanbek Bakiyev announced the closure of the base, opened after the 9/11 attacks.  Bakiyev made the announcement after securing a $2 billion loan and a further $150 million in aid from Russia.

So what is going on here? Is Russia taking advantage of U.S. vulnerability in Afghanistan to flex its muscles in Central Asia? Or responding to a perceived threat of U.S. expansionism in the region?

"Russia has the capability to exact a steep price for its cooperation, and it seems fairly certain that the Kremlin will strive to do just that," he wrote. "One area in which it will likely try to exact that price is in the Caucasus and Black Sea regions, specifically in seeking NATO assurances that Georgia and Ukraine will not be offered membership in the alliance for the foreseeable future, if ever. It is a mark of the strategic malpractice of past U.S. policymakers in Central Asia and Afghanistan that Moscow now finds itself in position to potentially dictate conditions for participation in an endeavor that is clearly in Russia’s best interests."

There are still lots of stray threads in this struggle for influence in Central Asia. Tajik President Imomali Rakhmon just reversed an earlier decision to cancel a trip to Moscow, in what was seen as an attempt to put pressure on Russia to increase financial support for Tajikistan. Meanwhile the United States is quietly rebuilding ties with Uzbekistan, despite its human rights record, according to this article in the Christian Science Monitor. Uzbekistan evicted the U.S. military in 2005 after Washington and other Western governments called for an inquiry into the reported massacre of hundreds of civilians during a protest in the city of Andizhan.

And if you don't want to go through Central Asia, NATO says it would not oppose member nations making deals with Iran to use it as a transit route to supply their forces in Afghanistan, according to this AP story. That would probably require compromises of its own, not least over Iran's nuclear programme. The alternative, of course, is to keep relying on Pakistan as the easiest entry point into Afghanistan -- bringing us full circle back to the early days post 9/11 when the Bush administration turned to Islamabad for help in overturning the Taliban.

Can, or will, the new administration of President Barack Obama chart a different course?

Russia has reversed its decision to station missiles in the Western outpost of Kaliningrad, next door to the European Union, according to Interfax.

The move would be the clearest signal so far of the start of a thaw in U.S.-Russia relations, which could be one of the major changes in U.S. President Barack Obama’s first year in office. We don’t know what commitment, if any, Obama may have given to Russian President Dmitry Medvedev on the missile shield (the two spoke by telephone earlier this week).

Obama’s scepticism about the effectiveness and utility of missile defence was clearly stated during the campaign. But since the Russians unilaterally made the Kaliningrad threat on the day of his election, the suspension of the deployment plan is a clear goodwill gesture. It follows NATO’s announcement, slipped out without fanfare earlier this week, that political relations with Moscow, frozen after the Georgia war, would resume within a few weeks.

Expect Georgian President Mikheil Saakashvili to foam about appeasement.

The Obama administration has already made clear it will pursue bilateral and multilateral nuclear arms control treaties which Bush eschewed. At the very least, they will try to negotiate a new strategic arms reduction treaty to replace START 1, which expires at the end of this year. This is important because it treats Russia as a nuclear power on an equal footing with the United States, which the status-conscious Kremlin craves and the Bush administration always dismissed.

Obama realises he needs Russian cooperation for the two biggest foreign policy items on his agenda this year: trying to defang Iran’s nuclear ambitions and turn the tide in Afghanistan.

The Russians have made clear what some of the trade-offs could be: safe supply routes for U.S. and NATO forces to Afghanistan across Russia and its central Asian friends in exchange for a halt to NATO expansion along Russia’s southern border. There is no consensus in NATO to take in Ukraine and Georgia. Germany and France blocked giving them a roadmap to membership last year and the U.S. agreed reluctantly in December to put the issue on the back-burner for now.

The question is whether Obama will go further in reassuring Moscow that membership is off the table for the foreseeable future. Expect howls of betrayal from neo-cons, the Baltic states and Poland if he does. Another potential trade-off involves the U.S. postponing missile shield deployment in Poland and the Czech Republic as long as diplomatic efforts are under way to persuade Iran to stop its nuclear enrichment programme, in return for Russian agreement to tougher U.N. sanctions against Iran and postponement of delivery of high-grade S300 air defence missiles which Moscow has reportedly sold to Tehran, and which could make any U.S. air strike on Iran more difficult.

Both trade-offs would require the Obamistas to eat ideologically unpalatable craw and take flak in Washington, but that’s the prerogative of new administrations.

The implications for Europe of closer U.S. ties with Russia are mixed. The Obamistas have promised their first move in relations with Russia will be to consult European allies. But unless deftly handled diplomatically, a strategic opening to Russia could heighten fears of being bypassed in the Baltic and central European states, and cause frustration in Brussels at being out of the loop.

(Russia’s President Dmitry Medvedev speaks during a show commemorating the 65th anniversary of the lifting of the Leningrad siege in World War Two in St.Petersburg, January 27, 2009. During the war, Leningrad suffered an 872-day siege by invading German armies where starvation killed 640,000 people and bombs killed 17,000. REUTERS/RIA Novosti/Kremlin/Vladimir Rodionov/Handout (RUSSIA). )

The Russian Orthodox Church elected Metropolitan Kirill, 62, as its new leader on Tuesday, succeeding Alexiy II who died last month. The new leader of the 165 million-strong Church, the largest in the Orthodox world,  is seen as a moderniser who may thaw long icy ties with the Roman Catholic Church.

There was speculation before the vote that nationalists, anti-westerners and anti-Catholic forces among the clergy and monks might rally to block Kirill's election. He seemed to take the possibility seriously enough to strike a conservative tone in recent days. In his address before the vote, Kirill spoke of "the assault of aggressive Western secularism against Christianity" and of "attempts by some Protestant groups to revise the teachings of Christianity and evangelical morality". He also hit out at Protestant and Roman Catholic missionaries, saying they sought converts in post-Soviet Russia -- a key point of discord with the Vatican.

(Photo: Metropolitan Kirill before the vote, 27 Jan 2009/Alexander Natruskin)

But the vote showed his support was strong. Kirill received 508 votes from a total of 677 valid ballots cast. His rival, conservative nationalist Metropolitan Kliment, 59, polled just 169 votes and a third candidate, Metropolitan Filaret of Belarus, withdrew in favour of Kirill.

Kirill, whose official title is Metropolitan (senior archbishop) of Smolensk and Kaliningrad, is one of the few  senior Russian clerics to have met Pope Benedict. He favours closer ties with the Vatican and observers say he would chart a more independent course for the Russian church.

Hopes of a thaw have been fuelled by Kirill's meetings with Pope Benedict at the Vatican in 2006 and 2007 and his optimistic comments about better relations with Rome. He even spoke about a thaw in an interview with the pope's own paper, L'Osservatore Romano.

(Photo: Pope Benedict and Metropolitan Kirill at the Vatican, 7 Dec 2007/L'Osservatore Romano)

But Kirill has also echoed Alexei's criticisms of Catholics on occasions. On Monday, as delegates gathered for the election, Kirill said in a newspaper interview that there was some way to go before a meeting between the heads of the two churches would be possible. "A meeting between the patriarch and the pope will become possible only when there are conclusive signs of real and positive progress on issues which for a long time have been problematic for our relations," he said.

Here's our video of the voting session in Moscow's Christ the Saviour Cathedral, with a long clip of Kirill addressing the Local Council (in Russian):

Keeping track of the many countries with a stake in Afghanistan -- and the shifting alliances between them -- is beginning to feel awfully like one of those school history lessons when you were supposed to understand the complex and tenuous balance of power whose breakdown led to World War One.

NATO Secretary-General Jaap de Hoop Scheffer became the latest to call for a regional solution to Afghanistan when he said this week that the United States and its NATO allies must directly engage with Iran if they are to win the war there. “If we are going to succeed in this game, we need to be playing on the right field,” he said. “And that means a more regional approach. To my mind we need a discussion that brings in all the relevant regional players: Afghanistan, Pakistan, India, China, Russia and, yes, Iran.”

The idea of seeking Iran's cooperation as part of a regional strategy for Afghanistan has been around for a while, as I have discussed in previous posts here, here and here. It gained currency during the U.S. presidential campaign among foreign policy analysts looking for an alternative to the policies of former president George W. Bush. But what seems to be new is a certain realpolitik creeping into the discussion after the inauguration of President Barack Obama turned a subject for debate into one of actual policy decisions.

Shi'ite Iran has reasons to cooperate with the United States over Afghanistan. It is deeply suspicious of the hardline Sunni ideology of the Taliban which regards Shi'ites as apostates. But at the same time, among the issues up for discussion is how far the United States and Iran can find common ground, given Washington's concerns about Tehran's nuclear programme and backing for Hezbollah in Lebanon and Hamas in Gaza.

Then even if Washington were to find an accommodation with Iran over Afghanistan, where would Russia - one of the other regional players seen as crucial to a regional solution -- fit into the picture?  According to this piece in Eurasia, Moscow might act to undermine any rapprochement between the United States and Iran, fearing this would damage its commercial interests and threaten its stranglehold on gas supplies to Europe.

Russia in turn seems to be flirting with China, by suggesting that the Shanghai Cooperation Organisation could play a bigger role in stabilising Afghanistan, as discussed in this post. Like Iran, Russia is expected to demand a price for help over Afghanistan which in Moscow's case may include less ardent support for NATO aspirants Ukraine and Georgia and a review of the missile shield due to be set up in the Czech Republic and Poland.

And just in case Obama missed the point, the Moscow Times spelled it out in an op-ed before his inauguration. "Afghanistan may well define your foreign policy legacy the way Iraq defined Bush's. You will need all the support you can muster, including from Iran. You will also need Russia's support. Moscow understands that the stability of its southern flank will hugely depend on what happens on the Hindu Kush mountain range in eastern Afghanistan and northwestern Pakistan. But Moscow is torn between giving support to the West and preparing for the West's withdrawal from Afghanistan. The latter would mean cutting deals with the Taliban locally and relying on China strategically. You can help Russia make the right choice."

As if all that was not complicated enough, the attack on Mumbai in November last year has soured relations between India and Pakistan, dashing hopes that by improving relations between the two countries the United States might reduce tensions in Afghanistan, where both have competed for influence.

In the early years of the last century, it took only the assassination of Archduke Ferdinand of Austria in Sarajevo to show the weakness of the balance of power that had held the peace until then. So what do we make of today's shifting allegiances? No more than the bedding down of a new century, and the jostling for influence under a newly elected U.S. administration? Or a cause for fear?

(Photos by Bob Strong in Afghanistan)

(Photo: Russian Orthodox prelates vote for candidates for patriarch, 26 Jan 2009/pool)

There was a slightly Soviet air to the proceedings as bishops of the Russian Orthodox Church voted on Sunday for three candidates to be considered as their new patriarch. Meeting in the gold-domed Christ the Saviour cathedral overlooking the Moskva River, just a few hundred metres from the Kremlin, about 200 metropolitans and bishops had delegates badges dangling from their necks along with their usual pectoral crosses. A Soviet-style "presidium" of 16 top prelates presided over the session in the Hall of Church Councils. The proceedings started with voting for an election committee, a drafting committee and a credentials committee. Journalists covering the session couldn't help but think of the old communist party conferences.

Seated in the middle of this "presidium," Metropolitan Kirill -- the acting patriarch and frontrunner for the top post -- added to the atmosphere by chairing the meeting with a distinctively firm hand. But there were differences, of course. Voting for the three candidates was secret. And when it came time to announce the results of the vote, there was no official stamp to validate the protocol.

(Photo: Metropolitan Kirill addresses the Council of Bishops, 25 Jan 2009/Alexander Natruskin)

For readers outside of Russia, the only other major church election they might have seen in the news was the 2005 Roman Catholic conclave that picked Cardinal Joseph Ratzinger to become Pope Benedict XVI. That vote took place behind locked doors in the Vatican's Sistine Chapel, beneath Michelangelo's famous ceiling and his huge fresco of the Last Judgment behind the altar. Here the "presidium" sat in front of polished stone images of the 12 Apostles in a kind of modern icon style. Journalists were allowed in for the opening of the session,  had to leave during the pre-vote debates but could return for the actual voting and result.

When the official stamp was finally found, the announcement ceremony got underway. "Your Holiness, Metropolitan Kirill, please bless me to announce the protocol of the secret ballot vote to elect candidates for the See of the Patriarch of Moscow," Metropolitan Isidor of Yekaterinodar and Kuban, head of the election committee, finally said from a Soviet-style rostrum. After he read out the results giving Kirill a strong lead of 97 out of 197 votes, the delegates gave the acting patriarch a long ovation.

Kirill reminded the hierarchs not to forget to bring a special liturgical mantle on Tuesday when a solemn service will be held before the start of the Local Council to elect the new patriarch. "Those without these mantles will not be allowed to take part in the service," Kirill stressed.

(Photo: Christ the Saviour Cathedral, 26 Jan 2009/Alexander Natruskin)

The Local Council is made up of about 700 bishops, monks and laymen. Russian newspapers say the lay delegates will include members of the ruling United Russia party, one possible conduit for the influence the Kremlin is assumed to want to exercise in this election. Delegates to the Local Council can also nominate their own candidates for the final round.

The Local Council will meet in the main hall of the cathedral. Unlike the Catholic conclave, where the doors are shut during the whole process, journalists here will again be allowed in for the start and end of the session. The result is due Tuesday or Wednesday.

One more thing -- there won't be any white smoke either, another trademark of a papal election. The Russian Orthodox Church will do it the Russian way, even if it sometimes seems to have a few Soviet touches.

(Photo: Candidates for Russian Orthodox patriarch selected by the Council of Bishops. Pictured are (L-R): Metropolitan Kliment, Metropolitan Kirill and Metropolitan Filaret, 25 Jan 2009/Alexander Natruskin)

Central Asia is much in demand these days, whether as a transit route for U.S. and NATO supplies to Afghanistan as an alternative to Pakistan or for its rich resources, including oil and gas.

So it's worth noting that India has been hosting Kazakh President Nursultan Nazarbayev as its guest of honour at its Republic Day celebrations while signing a bunch of trade deals in the process. According to reports in the Indian media, including in the Business Standard, the Week and the Times of India,  India is seeking supplies of uranium for its nuclear plants and access to Kazakhstan's oil and gas and in return would be expected to support Kakazhstan's bid for membership of the World Trade Organisation. (India's state-run Oil and Natural Gas Corp (ONGC) said on Saturday it had signed a deal to explore for oil and gas in Kazakhstan.)

Before anyone gets too carried away about India stealing a march in Central Asia, this Indian website adds a note of realism: "India’s strategy towards Central Asian countries has been no different than its strategy towards African nations, and can be only summarized as 'playing catch-up with the Chinese',” it says. "In this new “Great Game” of the century, India is consistently assuming the role of “Johnny-come-lately” to China in Central Asia."

That said, it still struck me as an interesting signpost in the competition between Asia and the U.S-led west for resources and influence, with Central Asia likely to become increasingly important both as a source of energy and as a supply route to Afghanistan.

The significance of this competition is unlikely to be lost on Russia which, according to this article by former Indian diplomat M K Bhadrakumar ,could end up playing off the United States against China.  He writes that while Russia does not want to see the United States and NATO defeated in Afghanistan, nor does it want them to use Central Asian supply routes to Afghanistan as an excuse to win access to the region's oil and gas. "Russian experts estimate that the proposed Caspian transit route could eventually become an energy transportation route in reverse direction, which would mean a strategic setback for Russia in the decade-long struggle for the region's hydrocarbon reserves." So as part of this complex balancing act, he says, it is looking for a bigger role for the Shanghai Cooperation Organisation -- dominated by Russia and China -- in stabilising Afghanistan.

Critics of the Bush administration acknowledged that former vice-president Dick Cheney got the importance of Central Asia even as they condemned his methods. Now India is jumping in on the act.  How is the new administration of President Barack Obama going to approach Central Asia, while juggling relations with Russia, trying to turn the tide in Afghanistan and reducing U.S. dependence on Pakistan?

(Photos: President Nursultan Nazarbayev inspects guard of honour in New Delhi/B. Mathur

Young hunter with his tame golden eagle in central Kazakhstan/Shamil Zumakov)

The difference between Europe having Russian gas as normal and not having it came down, in the end, to three words. They were hand-written next to what looks like the signature of Ukraine’s Deputy Prime Minister Hryhory Nemyrya and they were: “With declaration attached”.

That was enough to undercut a deal hammered out by Czech Prime Minister Mirek Topolanek, whose country holds the rotating EU Presidency, to deploy monitors along the gas pipeline route — Russia’s condition for turning the taps back on.

The declaration that Nemyrya referred to set out Ukraine’s position in a dispute with Moscow over gas prices. It said, among other things, that Ukraine has no outstanding debts to Russia, an assertion with which Moscow strongly disagrees. Russia said the addition of the three words made the monitoring agreement null and void. Deal off.

Which was a shame, because the two sides came tantalisingly close to turning the gas back on.
A few hours earlier, a team of European Union monitors had arrived by bus at the Sudzha gas compressor station in western Russia. They were all set to supervise the resumption of gas flows. They even had a party of journalists in tow to witness the big moment.

In the event, the monitors ate some food, had a tour of the site, and then left for the nearby town of Kursk, presumably to find a hotel for the night. The journalists were loaded onto a bus and driven back to the Ukrainian border where they had come from. For the EU officials trying to get the gas turned back on, it was back to the drawing board. And for people in the worst affected countries in Europe, it meant more days worrying about an energy crisis in mid-winter. 

So whose fault was it? Maybe Topolanek should have stopped Nemyrya inserting those three little words. It’s worth asking if these problems would have arisen if the row happened two weeks earlier, when Nicolas Sarkozy still held the EU presidency on behalf of France. Maybe Ukraine should not have tried to amend the agreement by the back door. Maybe Russia should have held its nose and found a way to work around those three words if that was what it took to restore gas flows quickly. Whatever the answer, the episode makes one thing clear: there is total mistrust between the governments of Russia and Ukraine.

The deal could still be resurrected. Russian gas export monopoly Gazprom said early on Monday Ukraine had signed a new version of the agreement, without the conditions. A Russian delegation was on its way to Brussels, possibly to add their signatures to the new version. But even once the deal is done and the gas is flowing again to Europe, the row at the centre of all this, over how much Ukraine should pay for its gas, will still be there. And with so little trust between Moscow and Kiev, as illustrated by the saga of the three little words, that leaves vast potential for new flare-ups.