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Putin Stokes Libya Crusade Spat on NATO Bombing Anniversary

Night Launch From Sea of Tomahawk Cruise MissileMarch 23 (Bloomberg) -- In 1999, Russia was among the most vociferous critics of Western air attacks on a maligned dictator. Today, as Prime Minister Vladimir Putin visits the site of those bombings in Belgrade, little has changed.

Putin, who on March 21 condemned the air and missile strikes waged by the U.S. and its allies in Libya as a "crusade," will meet Serbian President Boris Tadic on the eve of the 12th anniversary of the launch of an air bombing campaign in Yugoslavia by the North Atlantic Treaty Organization.

The Libya intervention risks souring ties between Russia and the European Union, which accounts for 54 percent of the country's trade, with Putin holding the reins of power before 2012 presidential elections that may return him to the Kremlin. Russian opposition to the 78-day offensive aimed against Serbian leader Slobodan Milosevic prompted a rift with the West, leading the country to suspend cooperation with NATO in 1999.

"Putin is very, very suspicious of Western activism wherever it happens," Tony Brenton, U.K. ambassador to Russia from 2004 to 2008, said in a phone interview yesterday. "But there are huge distinctions between what happened in Yugoslavia, where we bypassed the Security Council, and what is going on in Libya, where we worked through the Security Council."


The Russian prime minister warned yesterday that "the number of victims is growing" from the conflict in Libya. "Those who take part in this tragedy should think about it, they should think about it and pray for the salvation of their souls," he said after talks with Slovenian Prime Minister Borut Pahor in Ljubljana.

Putin, whose rhetoric provoked a rare clash with President Dmitry Medvedev, was expressing his "personal point of view" about events in the North African state, Dmitry Peskov, the premier's spokesman, told reporters yesterday in Ljubljana. The president "has the final say on foreign policy and no splits are possible," Putin told reporters in the Slovenian capital.

Putin had criticized last week's United Nations resolution authorizing military action in Libya, which Russia didn't veto, as "defective and flawed." Medvedev defended the UN decision, saying that he had allowed it to pass because he "broadly" agreed with it. Putin also said the allied strikes were killing only civilians, accusing the countries conducting them of having no "conscience."


Russia backed Milosevic in 1999, leading then-Prime Minister Yevgeny Primakov to turn around his plane en route to the U.S. over the Atlantic Ocean as NATO threatened air strikes to force Serbian troops to withdraw from the breakaway province of Kosovo and end the persecution of mainly Muslim ethnic Albanians in the territory.

Kosovo unilaterally declared independence from Serbia in 2008, which Russia has refused to recognize.

Russia risks spurring capital flight if relations with the West deteriorate. Investors, locals and companies pulled more than $300 billion from Russia from its five-day war with Georgia in August 2008 until the middle of February 2009, according to BNP Paribas SA.

Russia's net outflow of capital reached $38.3 billion in 2010, more than the official $22 billion forecast. That compared with $56.9 billion a year earlier, central bank data published on Jan. 13 showed. The country last had a net inflow in 2007, when it reached $81.7 billion.

Investment Wanes

Medvedev, who said on March 21 that foreign direct investment was at an "unacceptably low level," has sought to lure capital by promoting Moscow as a financial center and creating a private equity fund to allow the government to share risks with foreign investors and help "modernize" the economy.

The EU is the main investor in the economy of the world's biggest energy exporter, accounting for 75 percent of foreign direct investment, according to the European Commission.

Even so, Russia may adopt a far more hostile attitude if the U.S. and European nations leading the offensive in Libya introduce ground forces or seek to overthrow Libyan leader Muammar Qaddafi, said James Sherr, head of the Russia and Eurasia Program at London-based research group, Chatham House. This would run counter to its interests of improving relations with the West to attract foreign investment, he said.

'Unmanageable' Dilemma

"The dilemma could become unmanageable for Russia if events in Libya take a very adverse turn which lead the core of the current coalition to change their objectives," Sherr said in a phone interview.

U.S. Defense Secretary Robert Gates, in Russia for talks aimed at resolving a dispute over a planned U.S. missile defense system that Russia has warned could spark a new arms race, expressed surprise at Putin's remarks.

"I'm a little curious, frankly, about the tone that has been taken," Gates told reporters after meeting Russian counterpart Anatoly Serdyukov yesterday. Putin appeared to be taking at face value "outright lies" by Qaddafi about the number of civilian casualties, he said.

U.S. President Barack Obama has made a priority of mending relations with Russia after they sank to a post-Cold War low following the Russian invasion of Georgia, a U.S.-allied former Soviet nation. Russia and the U.S. signed a nuclear arms reduction treaty last year.

Medvedev, 45, a trained lawyer picked by Putin to replace him as president in 2008 because of a constitutional ban on serving more than two consecutive terms, is a more acceptable partner for the West than Putin, said Masha Lipman, an analyst at the Moscow Carnegie Center.

Final Say

Yet Western nations know that Putin, 58, a former colonel in the Soviet-era KGB, has the final say on all policy and is the one who will decide which of the two men stands in 2012 for president.

"One of the reasons Putin picked Medvedev was because he represents a more acceptable face to the West, but Putin remains the final arbiter," Lipman said. "Of course Western countries would prefer Medvedev to stay on but these leaders are aware of who has the upper hand in Russia."

Brenton said the hope is that the Western military intervention in Libya won't last long enough to cause any lasting damage, with cooperation over Iran and Afghanistan at stake.

"Our hope and I would guess their expectation is that internal forces in Libya will now quickly remove Qaddafi and then we will all get on with working with whoever replaces him," Brenton said.

Article ©2011 BLOOMBERG L.P. ALL RIGHTS RESERVED; article first appeared at www.bloomberg.com/news/2011-03-22/putin-stokes-libya-crusade-spat-as-visit-recalls-nato-bombings.html

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