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Blackwater USA | Daily Brief

Hong Kong

  • Junius Ho, a rambunctious pro-China politician in Hong Kong, was stabbed in the chest by a man who poised as a supporter to get close to him for a picture. Ho survived, and is currently probably in better shape, who was whisked away for questioning.
  • Ho was likely targeted for his outspoken pro-Beijing stance. He has given multiple speeches condemning protesters and supporting police violence against them, and there are even photos from July 21st of him shaking hands with the group that went on to beat protesters up in the Yuen Long train station a few hours later.
  • Chief Executive Carrie Lam strongly condemned the attack in a press conference.

Libya

  • Both the NYT and the Washington Post had new stories about the influx of Russian Wagner Group mercenaries into Libya to fight for Khalifa Haftar’s LNA. The GNA estimates there are around 300 of them in Libya, including several excellent snipers.
  • Moscow is denying any knowledge of a Russian presence in Libya, although not very plausibly: “the Kremlin does not have this information.” The Post article is pasted below.

Afghanistan

  • A Taliban attack on the district HQ in Charbolak, Balkh killed four policemen—including the district police commander.
  • Chief Executive—and potential next President—Abdullah criticized Pres. Ghani’s seven-point peace proposal as a mere “wish list,” and said that: “Nobody is taking it seriously — neither the people of Afghanistan, nor anybody.” Not that Abdullah has a better plan; more likely, it’s just politically convenient for him to criticize everything Ghani does while they wait patiently for election results to come out.

IS

  • Several branches of IS have publicly declared support for their new central leader, Abu Ibrahim al Hashimi al Qurashi, so it certainly looks like the group will survive Baghdadi’s death under new management.
  • IS fighters stormed a border post between Tajikistan and Uzbekistan, killing at least two guards. 15 of the attackers were killed in the ensuing gun battle, and another five were captured on the Tajik side of the border.
  • Tajikistan likely has a lot of IS holdouts: it offered amnesty to IS members who returned home, under the condition that they committed no other crimes. It’s also the poorest former-USSR country, and has porous borders with Afghanistan—all of which makes it a fertile breeding ground for IS.

Yemen

  • Secret footage showed a variety of U.S. weaponry, including Oshkosh MRAPs, being offloaded from a Saudi-registered ship in Aden last week—despite the U.S. Congress’s objections to sending arms to Yemen. The ship seems to have turned its tracking beacon off last month near Port Sudan, following a trick that sanctions-evading tankers use to sneak Iranian oil to Asia.
  • Yemen’s government signed another power-sharing deal with UAE-backed separatists in the south of the country, which should free government forces to focus on fighting the Houthi insurgency.

U.S.

  • Democrats fared better than Republicans in yesterday’s midterm elections. Andy Beshear beat incumbent Republican Gov. Matt Bevin in Kentucky, even though Pres. Trump won KY by 30 points in 2016—and even campaigned for Bevin on Monday. And both houses of the VA state legislature flipped Democratic.
  • The bike rider who flipped Pres. Trump’s motorcade the bird—and lost her federal government contracting job over it—beat an eight-year Republican incumbent for a seat on the Fairfax County Board of Supervisors, which will be her first elected position.

Azerbaijan

  • Opposition party leader Tofiq Yaqublu says he’s been tortured in police custody since his Oct. 19th arrest in Baku for disobeying police orders. It’s no great surprise that he was tortured, but I’m shocked that the news of it leaked through Azerbaijan’s iron censors—especially given that Yaqublu is still in jail (his daughter appears to have tipped RFE/RL to the story).

Venezuela

  • The U.S. sanctioned five more Venezuelan officials yesterday, but also licensed some U.S. companies to pay taxes in Venezuela—despite sanctions. The officials who received new sanctions are all people who have been sanctioned by the EU or Canada for links to corruption or violence against protesters.
  • A study by Caracas-based Econoalitica found that 54% of all retail transactions in Venezuela in October were carried out with U.S. dollars. The rate was far higher—86%—in Maracaibo, which has had frequent blackouts that prevent credit card transactions. However, it was lower in Caracas, where Pres. Maduro has kept things running more smoothly.

Guyana

  • Bloomberg published an excellent article on Guyana, with “pro tips for dealing with a near-doubling of your economy in one year.” Pasted below.

DRC

  • ADF terrorists crossed into DRC from Uganda late last night, and killed 10 civilians in Kokola, Beni.
  • We haven’t seen much news about the DRC Army’s “large-scale operations” against the ADF in the region, though news travels slow there. One Army Major suggested that this latest attack was the result of the ADF panicking because it’s cornered by the Army, and lashing out against civilians instead.

Migration

  • France announced plans to establish a quota system for immigrant workers that aims to protect French jobs. They haven’t announced which professions will be included in the new quotas, which would take effect next summer.

Arrival of Russian mercenaries adds deadlier firepower, modern tactics to Libya’s civil war (WaPo)

At first, the fighters inside the empty school building, about 20 burly, heavily armed Russian mercenaries in dark fatigues, seemed trapped, recalled some of the Libyan militiamen who were there.

But as the Libyans pushed forward, snipers opened fire from inside with high-powered rifles. Within minutes, three Libyan militiamen were killed, all shot in the head.

Hundreds of Russian mercenaries, many highly trained and well-armed, are fighting alongside renegade Libyan commander Khalifa Hifter as he seeks to oust the country’s United Nations-backed government, according to Libyan military commanders and fighters, as well as U.S. military and other Western officials.

These foreigners fighting for Hifter’s self-described Libyan National Army are introducing new tactics and firepower on the battlefield, threatening to prolong the most violent conflict in this North African country since the Arab Spring revolution eight years ago.

“The entry of the Russian forces into the war has altered the battlefield,” said Osama al-Juwaili, a top commander of the Libyan government’s forces. “Their presence complicates things for us.”

They represent the latest escalation in Libya’s proxy war, which has drawn in European and Arab countries — notably the United Arab Emirates and Egypt — despite an international arms embargo. And the arrival of these mercenaries comes at a time when Russia has been expanding its military and diplomatic reach across the Middle East, Africa and beyond, enjoying greater clout in places such as Syria where the United States is disengaging.

“We are aware of Russian private military companies operating in Libyan National Army-controlled territory in eastern Libya, and they have also operated in western Libya,” said Rebecca Farmer, a spokeswoman for the U.S. military’s Africa Command.

Farmer said the Russian mercenaries work for the Wagner Group, a private army that experts have linked to Yevgeniy Prigozhin, a close ally of Russian President Vladimir Putin. The Wagner Group has previously appeared in combat in Syria, the Central African Republic, Ukraine and other countries considered strategic for the Kremlin’s geopolitical and economic interests.

Russia has arms and construction agreements worth in excess of $4 billion, made with late Libyan dictator Moammar Gaddafi, who was ousted and killed in the country’s 2011 uprisings and NATO intervention.

“They have a strong economic rationale in their continued support to Hifter,” said Farmer, referring to Moscow.

A senior Western official described the Russians as “guns for hire” and said, based on the analysis of intelligence and military experts, that these mercenaries were believed until recently to number about 300. But “very alarming” new information indicates there are thousands, said the official, who spoke on the condition of anonymity because of the sensitivity of the issue.

Once largely based in Hifter’s eastern Libyan strongholds, they are “now being brought to the front lines,” said the official, adding that these fighters include snipers and artillery experts and have brought “some tactical skills and edge to the fight.”

Senior military commanders for the Libyan government have estimated the number of Russian mercenaries at 300 based on their intelligence sources inside Hifter’s territory. “We have eyes on the ground there,” one top commander said.

Some pro-government fighters said they knew the mercenaries were Russian by the chatter on their hand-held radios. Both sides can access each other’s frequencies at times, and the pro-government fighters recall hearing Russian spoken. In the battle for the empty school, fighters said, they heard the enemy fighters screaming commands and names in Russian.

A Washington Post reporter also reviewed Russian identity cards, documents and other material belonging to the Russians found at the site of clashes, as well as photos and videos of the mercenaries taken by Libyan militia fighters.

A spokesman for Hifter’s Libyan National Army, Col. Ahmed al-Mismari, said the reports of Russians are “fake news” and that “all our fighters are Libyan.”

Putin’s spokesman, Dmitry Peskov, declined to answer questions sent by The Post about the mercenaries, replying that “The Kremlin does not have this information,” while a spokesman for Prigozhin said the businessman “has nothing to do with the so-called ‘Wagner’ private military company” and declined to comment further.

Hifter’s offensive

The Russian mercenaries entered Libya in September, according to Libyan commanders and fighters, six months after Hifter launched a surprise offensive on the capital. The 75-year-old commander, a former general in Gaddafi’s army who is a dual U.S.-Libyan citizen and lived for years in Northern Virginia, is aligned with a rival eastern government.

His forces, composed of eastern militias, are battling armed groups from Tripoli and other western cities aligned with the Government of National Accord. The conflict has killed more than 1,000, including at least 100 civilians, and driven more than 120,000 from their homes, according to the World Health Organization.

In addition to the United Arab Emirates and Egypt, Saudi Arabia is backing Hifter, as is France. Italy and other European nations, as well as Turkey and Qatar, are supporting the Tripoli-based government. U.S. policy has been uncertain since April when President Trump endorsed Hifter’s offensive in a telephone call.

The former Soviet Union had a close relationship with Gaddafi, sending weaponry and military advisers to Libya throughout the 1970s and 1980s.

In Hifter, Moscow sees an opening to gain back billions in lucrative oil and military contracts that it lost when Gaddafi was killed, analysts said. Russia has printed billions of Libyan dinars to prop up eastern Libya’s economy and help finance Hifter’s military campaign. Russia has also blocked a U.N. Security Council statement that sought to condemn Hifter’s offensive.

New tactics, new wounds

Along one front line in southern Tripoli, Libyan fighters ran fast between houses pocked by mortar shells and bullets to avoid being caught in the sights of Russian snipers.

On the second floor of a half-destroyed mansion, commander Khalifa Al Naluti peered out at an apartment complex 100 yards away. “The Russians are over there,” he said. “It’s dangerous to stand here.”

Under fire on Libya’s front lines

Libyan fighters on both sides are undisciplined, often firing excessively and haphazardly at targets. The Russians, by contrast, move in small groups and attack from side positions, mostly at night or in the early morning hours, Libyan fighters say. The Russians preserve their ammunition, firing at optimal moments with precision.

“Their fighting style is different than what we are used to,” said Jabber Abu Dabous, a militiaman. “They fight in a professional manner.”

And the Russians may not only be fighting but also training Hifter’s forces. Since the arrival of the Russians, Hifter’s forces have begun using novel military tactics and new weaponry, say ­pro-government militia fighters.

At the only field hospital in Al Aziziyah, a small town 25 miles southwest of Tripoli, doctors have been treating new types of war injuries over the past several weeks.

Nearly every bullet wound is now in the chest or head, reflecting the snipers’ expertise, said a senior surgeon who spoke on the condition of anonymity because he feared for his relatives who live in Hifter-controlled areas. Mortars, too, have been striking targets with greater precision. “They’ve become more accurate in the last three weeks,” said the doctor.

In at least six deaths, the bullet entry wounds were unusually small. The bullets did not exit the body, suggesting the presence of modern guns and ammunition, he said. In previous conflicts, the wounded arrived during the day, as the fighting usually ended by dusk. Now, they are seeing more casualties arriving in the pre-dawn darkness.

“The timing of battles, the types of injuries, the way people are dying, it’s all changed now,” said the doctor.

Recovered from the Russians

When the Russians entered the multi-story Awlad Telese school in Al Aziziyah, a dozen ­pro-government fighters were on the floors above. A firefight broke out as the better-equipped Russians lobbed grenades and the militiamen fired with their AK-47 rifles at any mercenary who tried to come up the stairs, recalled two fighters who were there.

Some of the mercenaries, the militiamen said, were blond. They wore helmets, black bulletproof vests and olive green and black attire. They carried black backpacks with small antennas and clutched black modern-looking guns, which fired rapidly.

Soon, the bulk of the mercenaries were shooting out of the school’s windows at the ­pro-government fighters outside trying to push forward.

“We were lucky,” said Mohammed Abdul Gader, 30, one of the Libyan militiamen on the floor above. “If they were all fighting us, we would not have survived.”

The battle lasted nearly 24 hours. In the early morning, the pro-government fighters advanced in Turkish armored vehicles into the school, said Mohammed Hamadi, a 33-year-old commander who was there. The mercenaries blew a hole in the wall of a classroom and escaped.

Recovered at the site were a pension card for a Russian, born Nov. 25, 1969, from the Siberian city of Tomsk, as well as a Russian credit card, a card for Russian stores selling military uniforms, groceries and construction materials, and a card to Decathlon, a popular Europe-wide clothing store. Also found at the site of clashes were small cards depicting Russian Orthodox Christian saints and prayers in Russian.

A cellphone belonging to a Russian fighter was found after another recent clash, containing photos of men in Soviet Union military uniforms and a black cap with Russian text that read Ministry of Defense of the USSR. Another image showed a black-and-yellow sign in Russian reading “Russian Naval Infantry” — Russia’s equivalent of the Marines — and “wherever we are there is victory.” There was also a picture of a sleeve chevron of the air assault brigade of the 165th battalion of the Russian Naval Infantry.

At the sites of various clashes, militiamen have also recovered photos of wives and children, as well as boxes of pills and other medicine made in Russia for flu, headaches and even to control the bladder.

Most notably, however, are the modern Russian-made weapons that have been discovered on the front lines. They include automatic rocket-propelled grenade launchers, cannister-shaped land mines, sound bombs and other explosives.

In a recovered notebook are handwritten drawings and notations in Russian listing weaponry and other military equipment, battlefield maps and geographical coordinates, combat tasks and military activity. There was also a Russian weapons manual that showed how to build mines and bombs and how to use small arms. Plastic protractors and an electric gadget to measure distances for mortar launches were found at a battle site.

“We’ve never seen these weapons before on a Libyan battlefield,” said Juwaili, the top commander.

Can Guyana Survive Striking It Rich? (Bloomberg)

Pro tips for dealing with a near-doubling of your economy in one year.

Early last month, Guyanese President David Granger was knees-down in a community garden brandishing a spade. Granger was there to plant a tree — it was National Tree Day — but also an idea. “Don’t let us get drunk. Let us remain sober,” he told the attentive audience.

Guyana might find that a challenge. Next year, Exxon Mobil Corp. and its prospecting partners will start pumping oil from one of the world’s biggest recent finds: some 5 billion barrels of crude cached in the sandstone deep below the Caribbean floor. The windfall promises to change the energy landscape in the Western hemisphere. Guyana may never be the same.

In five years, national output is expected to reach 750,000 barrels a day, making Guyana Latin America’s fourth-largest oil producer and perhaps the world’s largest per capita oil power, generating a barrel per person per day. Oil revenues are expected to climb from zero to almost $631 million by 2024, according to the International Monetary Fund. Income per capita will more than double by next year, topping $10,000. Overall, its economy is projected to grow by 86% next year — 14 times China’s projected growth rate.

Metabolizing so much wealth so quickly — like drinking from a fire hose, as one engineer put it — would be intoxicating for even the sturdiest constitution. For this small, poor country troubled by ethnic strife, with shaky institutions and only the sketchiest plans to put such bounty to use, the system shock could be devastating.

That’s where trees and sobriety come in. To unleash the potential of the coming oil boom, Guyana must accept that wealth and development are cultivated, not simply extracted. Such was the logic behind the Green State Development plan, a wonk’s bet that Guyana can pull off what no other developing nation with an oil bonanza has managed: marshal a massive energy windfall without drowning in riches.

Resource curse, Dutch disease, the paradox of plenty: The name and address of the malediction vary. The outcome does not. Guyana has only to look to Venezuela, the failing petrostate next door that is home to the world’s largest reserves. After years of squandering oil rents on vanity politics and misguided social programs, Venezuela has seen oil output fall by more than half since mid-2018. To escape Venezuela’s fate and that of so many other ailing oil baronies, Guyana has to act now and decisively. The checklist is extensive.

Don’t bring the oil onshore. Sure, such abstinence offends the instincts of the aspiring petrocrat. “It must be in the textbooks they read as children. Every minister of development wants to add value to oil,” said Rice University energy expert Francisco Monaldi. “That’s a big mistake.” Building a tangle of pipelines and refineries is exorbitant, brings marginal returns and makes the host country a magnet for corruption, Monaldi said. One of the headline scandals in Brazil’s Carwash corruption probe was a head-turning case of contract fraud on a grossly overpriced domestic refinery and petrochemical complex launched amid the euphoria over earlier big oil discoveries. Will Guyana heed the experts and forgo investing in iffy refineries? Or will they cave to the temptation once the crude starts flowing?

Resist the local content temptation. Petro-populists typically try to make foreign operators buy a hefty portion of supplies from native providers. That sounds fair enough. But inexperienced domestic companies rarely have the enterprise or production capacity to deliver. Instead, local content becomes an open invitation to padded contracts, subterfuge and waste. Until now, Guyana has avoided the trap of skewing the market by promoting “local champions,” said Marcelo de Assis, head of Latin American upstream research for energy consultants Wood Mackenzie. If Guyana’s nationalist opposition has its way, however, the rules could change.

Get the rules straight. How does a country with one-third of its population living in poverty and a ranking of 164th out of 228 nations in human development manage the haul from what’s likely to be the world’s most profitable new deepwater wells? The short answer: through policy transparency, reliable rules and regulatory acumen, all of which are in short supply. “What we see is a bottleneck, a lack of readiness for oil,” said Assis. “They are scrambling, which indicates that the public sector is not geared to act as a regulator.”

Forge a political pact. Guyana’s conflicted politics are no help. Rival coalitions have been quarreling since last December, when the Granger government lost a confidence vote. New elections are scheduled for early 2020, just as Guyana’s oil is set to flow. Clashing ideas are part of democracy. But with political tensions spilling into the courts and threatening to flare into a constitutional crisis, the risk of judicial delays leading to “legal loopholes and omissions in the oil framework” run high, according to the consultancy Verisk Maplecroft. The political turbulence is troubling news for the Guyanese and their multibillion-dollar stakeholders.

Hire globally. With a population of 780,000, chronic brain drain and no track record in oil extraction, Guyana could use some ringers. Fortunately, the world is flush with savvy oil engineers, geologists and logisticians. But Guyana’s government has been slow to capitalize on global talent, including the nearly half-million-strong Guyanese diaspora. “I don’t understand what’s keeping them from hiring abroad,” said one foreign observer, who has advised the Guyanese government for years. “It’s baffling.”

So is the recent ruling barring binational Guyanese from serving government: Four of Granger’s cabinet ministers with dual nationalities were forced to resign this year. Since some of the most highly trained Guyanese were educated abroad, such scruples amount to a nationalist own goal. The powerful private sector, led by Exxon and its partners, has no such qualms about recruiting expats. Guyana’s government should follow their lead.

Don’t forget renewable energy. Guyana’s electricity currently depends on fossil fuels. With greenhouse gas emissions already reaching 2.6 tons per capita a year, rivaling those of its outsize neighbor Brazil, Guyana could make matters far worse under the coming oil boom. And since much of Guyana’s coastline sits at or below sea level, the deepening climate emergency poses an existential threat. Encouragingly, Guyanese seem to be starting their oil boom with few illusions about the fleeting bounty below their feet. The government wisely, if belatedly, set up a sovereign wealth fund to steward the money. Hence, the official encomiums to agriculture and forestry, and renewable energy, touted to fuel 100% of the power grid by 2040. That’s an admirable goal. Let’s hope Guyana has the temperance and the trees to stay the course.

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