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6:00 PM ET, Thursday, September 7, 2023
The Cipher Brief curates open source information from around the world that impacts national security. Here's a look at today's headlines, broken down by region of the world:
The Americas
Foreign Relations Chair Pressing U.S. Oilfield Service Firms Over Business in Russia. Senator Bob Menendez, the head of the U.S. Senate Foreign Relations Committee, sent a letter to the top three U.S. oilfield service companies — SLB, Baker Hughes and Halliburton — asking why they have continued business in Russia since the start of the Ukraine war and demanding that they “cease all investments” in Russian fossil fuel infrastructure. According to an Associated Press report in July, customs data shows that Russia imported over $200 million worth of drilling and well construction technology from the three companies in the year after its invasion of Ukraine. Analysts say that since Russian oil is often in hard-to-reach areas, if U.S. oilfield services withdrew at the start of the war, Russian oil production would have taken an immediate hit. There is no evidence that the firms violated sanctions by sending the equipment to Russia, and the companies wound down Russian operations months after the invasion. However, in contrast, oil majors like Exxon, Shell and BP fully quit Russia within days or weeks of the start of the war, writing off billions in assets. SLB only committed to stopping the equipment transfers to Russia two days after the Associated Press report. A spokesperson for SLB did not comment on Menendez’s letter. A Baker Hughes spokesperson confirmed receipt of the letter and said the company is addressing concerns “directly with [Menendez’s] office.” A Halliburton spokesperson maintained that the company was the first major oilfield to leave Russia and has not conducted operations there for over a year. Associated Press
Analysis: Biden to Appeal to Emerging Markets at G20 Summit. President Joe Biden has the opportunity to promote the U.S. and its Western allies as the best partners to emerging market economies in Africa, Latin America and Asia at the G20 summit in India, especially since Chinese President Xi Jinping will not be attending the meeting. Biden will bring a proposal to the summit to increase the lending power of the World Bank and International Monetary Fund by around $200 billion to primarily help developing and middle-income countries. While less than China’s Belt and Road Initiative (BRI), White House national security advisor Jake Sullivan said the proposal offers a “credible alternative.” The U.S. has said the BRI is “coercive” and has significantly indebted participating countries to China. The offer and Biden’s outreach comes as China faces an economic slowdown, which analysts say may impact Beijing’s ability to support developing countries, thus making potential gaps that the U.S. could fill. Associated Press Reuters
Western Europe
Sweden Says Waiting for Turkey to Start Ratification of NATO Bid. Swedish Foreign Minister Tobias Billstrom said Thursday that Sweden is ready to join NATO and is waiting on Turkey to begin the ratification process. Turkey and Hungary still have not approved Sweden’s membership application. Turkish President Tayyip Erdogan said at the NATO summit in Vilnius in July that the Turkish parliament will take up ratification when it reconvenes in October. Reuters
Central and Eastern Europe
Ukraine Claims Further Gains on Southern Front. Ukrainian forces report further incremental gains in southern Ukraine at key villages near the strategic rail hub of Tokmak. Soldiers of the Ukrainian 46th separate airmobile brigade said on unofficial Telegram accounts that they have captured Russian positions east of the village of Novoprokopivka, which is just under 2 miles south of the recently liberated settlement of Robotyne. The 46th airmobile brigade said harder fighting is occurring north of the village of Verbove, adding that Russian air strikes and artillery and drone strikes from both sides are constantly bombarding the area. The Institute for the Study of War says geolocated footage shows Ukrainian troops have advanced west of Verbove and are pushing on Novoprokopvika. Russian-appointed officials in occupied parts of Zaporizhzhia and Russian military bloggers gave conflicting accounts, claiming that Russian forces “inflicted massive fire damage” on Ukrainian troops and repelled their attacks. CNN
Ukraine Says Russian No Longer Has Enough Forces Positioned to Launch Offensive from Belarus. A spokesperson for the State Border Guard Service of Ukraine said on Thursday that Russia has relocated most of its troops training in Belarus and now no longer has enough forces positioned to launch an offensive into Ukraine from Belarusian territory. The spokesperson said almost all Russian units have been trained and completed rotation, with no new units deployed to replace them. Analysts say Russia may have moved troops from Belarus to the northeastern front in Ukraine, between the cities of Kupiansk and Kreminna. The spokesperson did say that Russia continues regular shelling and attempted sabotage attacks in the Chernihiv, Kharkiv and Sumy regions, just east of Belarus and along Ukraine’s northern border with Russia. CNN
Lloyd’s Considers Providing Insurance for Black Sea Grain Shipments. British insurance firm Lloyd’s of London is reportedly in talks with the UN to provide insurance for Ukrainian grain shipments if a Black Sea grain deal can be reinstated. Lloyds CEO John Neal said that “absent UN intervention and UN clearance, we [Lloyds] would not sanction the insurance.” Insurance for cargo ships is critical to get any shipments out of Ukraine through the Black Sea. Turkey has been attempting to convince Russia to return to the UN-brokered Black Sea Grain Initiative, which Moscow withdrew from in July. CNN Reuters
Russia Proposes Military Registration of Prisoners. Russia’s Ministry of Defense proposed a law that would allow for the military registration of prisoners. Current laws bar any “citizen serving a sentence of imprisonment” from military registration, but the ministry’s proposal would reverse this rule. Russian prisoners have already been used by Russia in its invasion of Ukraine. Although initially denied but then openly flaunted by Wagner Group head Yevgeny Prigozhin, Russian private military groups fighting in Ukraine have bolstered their ranks with prisoners. CNN
Ukraine War Critics in Russia Face ‘Carousel Arrests.’ Russian authorities appear to have repeatedly arrested critics of Moscow’s invasion of Ukraine. Timofei Rudenko, a 30 year old who had posted criticism of the war on social media, was arrested and detained five times in two months for a series of misdemeanors. According to publicly available documents, each day Rudenko was released, he was immediately accused of new minor offenses and returned to custody. On July 21, Rudenko was arrested for a sixth time for allegedly justifying terrorism on the internet, a crime punishable with up to seven years in prison. Three Russian human rights lawyers described these arrests as an example of “carousel arrests” aimed to keep someone in constant custody. They said that this practice was increasingly being used by Russian authorities in their crackdown on criticism of the war. A Reuters review of the public documents revealed seven different cases of carousel arrests this year. Valeriya Vetoshkina, a Russian lawyer specializing in defense against espionage and treason, said she knew of at least 10 examples of carousel arrests this year and that the true figure was likely higher. Reuters
Asia and Oceania
Vice President Harris Warns North Korean Military Support for Russia Would Be ‘Huge Mistake.’ U.S. Vice President Kamala Harris said on Thursday that it would be a “huge mistake” for North Korea to provide military support to Russia for its invasion of Ukraine. The U.S. has warned about a potential deal in which North Korea will send weapons to Russia. Harris, who was at the ASEAN summit in Indonesia, told CBS News that any arms deal would “further isolate” Pyongyang and Moscow and be a sign of desperation for Russia. Sydney Seiler, former National Intelligence Officer for North Korea at the U.S. National Intelligence Council, said the “strategic impact” of any deal will depend on what North Korea wants, which could include support to boost military manufacturing, food supplies, or even satellite imagery until Pyongyang manages to launch military satellites. It’s unclear whether Russia is willing to give advanced nuclear weapon or missile technologies to North Korea. Reuters
North Korea Allows New Staff at Russian Embassy for First Time Since Pandemic. North Korea has allowed twenty new diplomats and staff members at the Russian embassy in Pyongyang, marking the first time that new staff has been sent to the embassy in nearly four years. North Korea’s anti-Covid travel restrictions forced many embassies in Pyongyang to close, with China’s embassy being the only other embassy known to have received new staff since the height of the pandemic. The arrival of the new Russian staff comes as North Korea and Russia reportedly discuss arms deals and as U.S. officials suggest that North Korean leader Kim Jong Un could visit Russia soon to meet Russian President Vladimir Putin. Reuters CNN
Chinese Rare Earths Prices Hit 20-Month High Amid Myanmar Mining Suspension. Rare earth metals sourced from China have reached their highest price in 20 months. Analysts said this spike in prices is linked to a mining suspension in Myanmar, a major producer, that has sparked stockpiling of the metals. Mines in Myanmar’s Pangwa region in the Kachin State have been closed since Monday in preparations for inspections during September 6-7. According to the U.S. Geological Survey, Myanmar was the fourth largest source of rare earth mining in 2022 and accounted for 38% of rare earth imports into China in the first half of 2023. Analysts said the pause on mining activities will briefly disrupt refineries in southern China, which are reliant on Myanmar feedstock supply, for one to three weeks and lead to a short term price increase. However, the long term supply and demand balance for 2023 is unlikely to be affected, unless there is an extended shutdown of Kachin mining. Reuters
Middle East and Northern Africa
Middle East Boosted on World Stage With Financial Boom. As Western financiers have been hampered with rising interest rates, cash-laden sovereign-wealth funds in the Middle East are having their moment on the world’s financial stage. Funds in the region have overseen a surge in mergers and acquisitions worth billions of dollars. Higher energy prices caused by the Ukraine war have swelled the region’s fossil fuel-dependent wealth funds, giving them the money to spend on deal making. Top Saudi and UAE officials are also pumping additional money into their wealth funds in support. The region’s new financial dominance comes as Gulf state leaders also work to strengthen their presence in other areas, from diplomacy to sports, to expand their global influence. Wall Street Journal
Analysis: Iran’s Nuclear Slowdown Could Facilitate U.S. Talks. Analysts say Iran’s steps to slow its development of near-weapons-grade uranium might help ease U.S.-Iranian tensions, but do not signify progress towards a wider nuclear deal before the 2024 election. The IAEA reports that Iran has reduced the rate it is making 60% enriched uranium and has diluted a fraction of its 60% stockpile, although the stockpile continues to grow. Experts said Iran is by no means “pumping the brakes” on its nuclear program as the value of its nonproliferation steps is relatively small, but it may be enough to reach de-escalatory “understandings” to lower tensions over nuclear and other issues. Expectations for a U.S.-Iranian prisoner exchange this month may also help facilitate dialogue. Notably, as part of prisoner exchange discussions, the $6 billion in Iranian funds were transferred from South Korea to Qatar. While the Biden administration says the funds remain in a restricted account, it appears Tehran will have more access to them in Qatar than in South Korea. Reuters
Sub Saharan Africa
Pentagon Repositions Troops, Pulls Some Non-Essential Staff in Niger as New U.S. Envoy Arrives. Officials say the Pentagon is repositioning some troops in Niger and withdrawing some non-essential personnel “out of an abundance of caution,” marking the first major U.S. military movement in Niger since the coup in July. The officials did not provide specifics on the reason for the repositioning or say how many personnel will be impacted. The U.S. has 1,100 troops in Niger at Air Base 101 in the capital of Niamey and Air Base 201 in the city of Agadez on the southern edge of the Sahara. One official said the movement aims to “safeguard U.S. assets” while continuing operations to counter extremists in the region, adding that the move “does not change our overall force posture” in Niger. The U.S. has trained Niger’s military in counterterrorism and to conduct drone missions against Islamic State and the region’s al Qaeda affiliate. Training has been paused and U.S. troops have largely been confined to bases since the coup. Reports of the military movement came days after the U.S. State Department announced U.S. Ambassador to Niger Kathleen FitzGibbon arrived in Niamey. The department said she will not formally present her credentials due to the “current political crisis” but is in the country to ensure “senior leadership of our mission at a challenging time.” Reuters
Sudan’s Army Chief Visits Qatar. Sudan’s army chief Abdel Fattah al-Burhan traveled to Qatar on Thursday to speak with Qatari emir, Sheikh Tamim bin Hamad Al Thani, on the Sudan crisis. In their meeting in Doha, Burhan provided updates on the situation in Sudan and Sheikh Tamim reiterated his call for broad peace negotiations. Burhan’s Qatar visit marked his third international trip since the start of fighting between the Sudanese army and rival paramilitary Rapid Support Forces in April. Burhan previously traveled to Egypt and South Sudan to discuss the conflict. Analysts said his Qatar trip was more political and diplomatic than his other more security- and military-focused trips. Experts say his trips abroad in general have been to confirm his legitimacy with the international community. Associated Press Al Jazeera
Cyber and Tech
U.S. Examines Source for Huawei Smartphone Chips; Congress Mulls More Limits. National Security Adviser Jake Sullivan said the U.S. is looking into the “character and composition” of the recently released Huawei smartphone to find out if the device’s components may have been acquired in violation of U.S. restrictions on semiconductor exports. Many experts were surprised by the sophistication and capabilities of the Huawei smartphone in light of Washington’s steps to restrict Chinese access to Western chip technologies. If Huawei was able to produce a 5G chip domestically it would be viewed as a significant accomplishment. Huawei has not responded to multiple media requests for comment. Meanwhile, members of Congress have called for an investigation into whether certain chip manufacturers circumvented U.S. export controls to provide Huawei with advanced components. Others, like Representative Mike Gallagher, chairman of the House Select Committee on Competition with China, have suggested the U.S. halt all exports to both Huawei and China’s Semiconductor Manufacturing International Corporation (SMIC), including older technology currently allowed under the law. CNN Bloomberg South China Morning Post Reuters
DoD Leader Reiterates Rationale, Deliverables of ‘Replicator’ Drone Initiative. Deputy Defense Secretary Kathleen Hicks reiterated on Wednesday an ambitious vision for military drone assets under the “Replicator” initiative announced last week. Speaking at the Defense News Conference, Hicks said that all-domain, attritable autonomous systems – ADA2, in Pentagon parlance – would be produced “at a scale of multiple thousands in multiple domains” in the next 18-24 months. The motivation for such a program is the prospect of continuing Chinese military advances in AI-enabled weapons systems. Hicks did not share precise details of the ADA2 platforms to be developed, noting “some things we will only reveal at a time and place and manner of our choosing.” She did describe several potential drone “use cases,” including pods of solar-powered, self-navigating marine platforms bristling with sensors; fleets of ground-based ADA2 systems providing logistics support and reconnaissance insights, and orbiting ADA2 devices whose sheer numbers offer insurance against an adversary’s efforts to degrade or destroy space-based constellations. Regarding ADA2 assets, Hicks noted “these aren’t ships or aircraft that we’ll be using for the next 30 to 50 years.” Instead, she projected military units might use them “for three to five years before we move on to the next thing…given a dynamic, fast-moving adversary in the pace of innovation.” DefenseScoop
Chinese Hackers Employ AI-Generated Content in Worldwide Influence Operations. AI use is expanding among Chinese hacking groups as they direct influence operations in the U.S. on social media platforms to play up “politically divisive topics, such as gun violence.” According to researchers at the Microsoft Threat Intelligence Center, imagery employed in the campaigns is more sophisticated and “eye-catching” than in the past. “This relatively high-quality visual content has already drawn higher levels of engagement from authentic social media users,” the researchers said. Microsoft assessed that overall Chinese information operations have “successfully engaged target audiences in at least 40 languages and grown its audience to over 103 million.” The worldwide efforts to influence audiences is carried out with the help of “state media employees and affiliates who masquerade as independent social media influencers across all major Western social media platforms.” Noting that China does not normally blend cyber and influence operations – a distinction from Russian and Iranian cyber tactics, which often combine “hack-and-leak campaigns” — Microsoft researchers nevertheless project continued expansion of China’s “impressive cyber capabilities” in cyberespionage operations across the globe. A particular geographic focus of Beijing’s campaigns has been the South China Sea area, where influence operations indicate “attempts to gain competitive advantages for China’s foreign relations and strategic military aims.” CyberScoop Reuters
No Reason Given for Army Cancellation of Long-Range Hypersonic Weapon Test. In what is described as a setback for the Pentagon hypersonic weapons program, the Army this week canceled a scheduled test of the first hypersonic missile in its arsenal. The Army did not disclose what caused the test of the Long-Range Hypersonic Weapon (LRHW) to be scrubbed, but it raised questions whether it can meet a September 30 goal for the weapon to be deemed initially combat capable. The LRHW system comprises a ground-launched missile equipped with a hypersonic glide body and associated transport, support, and fire control equipment. The weapon has a reported range of 1,725 miles. The weapon’s importance to the Pentagon is underscored by a DIA report in March that assessed China is leading in the development of hypersonic weapons, which can be equipped with nuclear warheads. Bloomberg
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