China’s recent cut of rare earth elements production may force Russia and the United States to ramp up production, according to an Australian academic. Rare earth elements find use in many manufacturing industries like wind turbines, catalytic converters used in cars and electronics.

President of Belarus Alexander Lukashenko is engaged in a war of words with Moscdow over his failure to recognise until now the break-away former Georgian states of Abkhazia and South Ossetia. Moscow is threatening to publish recordings of him promising to recognise the Moscow-supported republics while the Belarus leader says the Russians are failing to come through with enough incentives.

USA and Russia to collaborate on energy efficiency

Following the commitment by Presidents Barack Obama and Dmitry Medvedev at the June 24th U.S.-Russia Summit to promote energy efficiency and green technology, the U.S. International Development (USAID) and the Russian Energy Agency (REA) on July 21 signed a Protocol of Intent to deepen collaboration on energy efficiency, "smart grid" technology, and clean energy. The agreement will foster partnerships with U.S. and Russian utilities, regulators and others to share information and best practices. Potential activities will reduce energy loss in electricity systems and decrease levels of carbon emissions to help mitigate climate change.

Spies or something. We’ve all heard that on Monday the FBI said it had broken up a Russian sleeper ring in the USA. I don’t doubt that it could be true as reported – of course Russia “spies” on the USA and vice versa. But questions remain: the spy craft described – brush off passes, dead letter drops, invisible ink – is ludicrously fustian: is this the SVR’s idea of how to pass information these days? And sleepers who knew each other? And, as so far reported, none of the information they were after seems to have required such clandestine efforts. No doubt we will learn more but I remain sceptical that this was a serious effort by Moscow. There are many plausible (or implausible) theories about the matter and here’s my offering: Gordievskiy tells us that it was not unknown in the old days for KGB officers to invent whole agent networks in order to supplement their incomes; perhaps some enterprising officer strung together a bogus network, this time with actual people in it. Therefore, it is quite possibly true as reported but some questions need answers. Thus far the two capitals are keeping calm.

Meetings. Several meetings last week: G8 and G20 plus Medvedev’s visit to the US. They seem to have gone well from Russia’s perspective but the “spy circle arrests” can complicate matters if either side wants them to.

Russophobic rubbish. This essay by Anatoly Karlin is the best takedown of the commonplace twaddle of the Kommentariat that I have seen for years. Unlike theirs, his essay is based on facts; facts in the whole, not carefully selected factoids. But of course it’s much easier to string together a few current factoids to bolster the everlasting brief for the prosecution than to do the work Karlin has.

Chicken wars. Medvedev and Obama have agreed to resume US poultry exports to Russia – something not insignificant in the US economy. Given that US standards permit carcasses to be washed in a chlorine solution, while EU regulations – which Russia has adopted – do not, the details of the agreement will be interesting.

Privatisation. Medvedev has called for more privatisation of state property (and, as an interesting example, half of the military airfield at Kubinka is for sale). Putin nationalised a number of things but that was not necessarily such a bad idea at the time when there were so many people busy trying to steal them: it is now time to loosen the regulations. Medvedev has already greatly reduced the number of “strategically important companies”. Same team, same plan, different phase.

Other Russia. For some time now, Other Russia, which has been posing as a united – and democratic – opposition, has been staging rallies to provoke the police and get headlines. The Western media has generally fallen for it, despite better informed people saying that the bulk of the participants come from the unsavoury, and not especially “democratic”, National Bolsheviks. Well, the NatBol leader, Eduard Limonov, has made it plain: “In practice, the coalition has fallen apart, and for the past two years has existed on paper or through the work of my followers.” He says he will form a party of that name. And Russia will get another opposition party.

Gas. One of the problems with Russian gas supply to Europe is that many storage facilities are in countries, formally part of the USSR or bound to it, which are no longer under Gazprom’s control. Gazprom has been building facilities in Serbia, the Netherlands, Hungary and the UK; CEO Miller saidthe plan is to create 6.5 billion cubic metres’ worth of storage by 2016.

Customs code. Today Russia, Belarus and Kazakhstan start a regime of free trade among them and a common customs tariff outside them. It’s been a long dreary haul to recreate some of the trade links of Soviet times and this may as far as the effort gets.

Belarus. Lukashenka announced that Azerbaijan had lent Belarus the money to pay its latest bill for Russian gas. I guess the Belarus experiment – a sort of extended USSR – is coming to an end. Taking loans to cover gas consumption – and in the summer too – does not suggest much of a future.

Gori’s favourite son departs. The statue of Ioseb Besarionis-dze Jughashvili, aka Iosef Stalin, was surreptitiously removed from the main square in Gori Georgia Friday night. It will, they say, be replaced by a monument for the victims of the 2008 war. Georgian victims, I dare say, not Ossetians.

Kyrgyz Republic. On Friday the nephew of Bakiyev was arrested and confessed (under interrogation) to a role in organising the rioting in southern Kyrgyzstan. The referendum on a new Constitution which will create a parliamentary republic was held on Sunday and the changes passed comfortably. OSCE observers have expressed themselves as satisfied. It is reported that nearly all refugees have returned from Uzbekistan.

This weekly Situation Report originally appeared in Russia: Other Points  of View http://www.russiaotherpointsofview.com/