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Weekly Geopolitical Summary, 14 October 2010

  • Head of Turkmengaz Fired and Replaced with Deputy
  • CYBERCOM to Go Operational This Month
  • Govt Takes over Hungarian Plant after Deadly Toxic Spill
  • French Transport and Oil Industry Strikes Risks Radicalization
  • Bolivia to Start Lithium Production in October
  • ISAF's Torkham AfPak Border Crossing Reopened
  • Iran's President Visits Lebanon in Clear Attempt to Boost Hezbollah

Head of Turkmengaz Fired and Replaced with Deputy

Local media in the Turkmen capital of Ashgabat reported on 8 October that Turkmenistan's President Gurbangulu Berdimuhammedov fired the head of the state-run Turkmengaz for mismanagement (specifically for "serious miscalculations"), and replaced him with Dovlet Mommayev, who until now had served as the company's deputy chairman. Turkmengaz head Nuri Mukhamedov was fired by presidential decree on 8 October. It is unclear whether the deputy head is a long-term or temporary replacement. Mukhamedov had served in the position for only one year, and his predecessor had been fired for the same reasons.

Analytical Note: Gas exports are Turkmenistan's primary revenue source, and Turkmengaz is the largest company in Central Asia that produces and supplies natural gas. According to the country's president, Turkmenistan has 24.6 trillion cubic meters of gas reserves (though some have contested this figure, saying it is overstated). Local media indicated that the Turkmen president had recently been critical of Mukhamedov for the slow pace of development for new gas fields and pipelines. Turkmenistan is currently participating in discussion for new gas pipelines, including a Caspian Sea pipeline to Russia via Kazakhstan; the Caspian Sea Nabucco pipeline through Azerbaijan; and the TransAfghan pipeline to India via Pakistan. In 2009, a Turkmen pipeline to China went operational, as well as an Iranian branch of that pipeline.

CYBERCOM to Go Operational This Month

The new US Cyber Command (CYBERCOM) is reportedly ready to go fully operational this month, in coordination with NATO, to create a global cyber warfare system that will involve all major branches of the US armed forces, according to ISAIntel. In September, the Defense Department dismantled its Joint Task Force Global Network Operations command, which is now part of CYBERCOM, which is being sponsored by US Strategic Command (STRATCOM). CYBERCOM has a "dual mission to conduct offensive and defensive cyber operations," according to the Pentagon. In May, four-star General Keith Alexander was appointed as CYBERCOM's first commander. The center will be staffed by around 1,100 personnel to "ensure US/Allied freedom of action in cyberspace and deny the same to our adversaries". In related news, on 7 October Hun Technology Inc. announced the launch of "C2", a new weapon reportedly designed for CYBERCOM. "Through [C2] we will be able to offer a permanent solution and nuke the problems related to cyber-attacks once and for all," media quoted Ferenc Ledniczky, co-founder and President of the company, as saying. C2 claims to be a technological breakthrough that changes the inherently hackable design of software architecture. Quoted by US media, Ledniczky said: "In developing [C2], we broke away from the traditional approach to computerize the enterprise information management process. Instead we developed an entirely new system which will be un-hackable by virtue of design and without relying on encryption or other protective measures."

Analytical Note: Apparent CIA malware infecting the operating system of a trans-Siberian gas pipeline led to a massive explosion in the Soviet Union in 1982. Jumping ahead to 2007, Estonia's national infrastructure came under cyber attacks, shutting down government institutions, banks and media after servers were overloaded. This happened during a political dispute with Russia. In 2008, Georgia experienced a similar cyber attack during a short war with Russia over the separatist region of South Ossetia. In August, the Pentagon revealed information about a cyber attack against the US military's Central Command in 2008. According to the Pentagon's account, USB memory sticks were randomly placed in a washroom at a US military base in the Middle East providing support for the war in Iraq. The memory sticks, infected with a computer worm by an undisclosed foreign intelligence agency, were picked up by soldiers who ignored protocol and plugged them into military laptops. The worm took 14 months to kill. In a very similar attack earlier this year, Iran experienced a computer worm (the Stuxnet virus) that infected around 30,000 IP addresses, as well as the computers at the Bushehr nuclear plant. The malware, according to international experts, was custom-made to target and manipulate industrial automation software from remote locations. This worm was also apparently spread by a USB memory stick. Some specialists have referred to the malware as an espionage worm, or a malware sleeper cell, because of its ability to immediately infect but remain latent until activated at a later date. It is not impossible that the malware was a US or Israeli (the latter perhaps more probable) cyberwar offensive. Although US President Barack Obama has said that the administration would not monitor private sector networks or internet traffic in the name of cyber security, this clearly cannot be the case with the launch of CYBERCOM, which was undertaken without public debate largely because of the public's inability to grasp the issue.

Govt Takes over Hungarian Plant after Deadly Toxic Spill

Hungarian police have arrested an aluminum plant executive over a fatal toxic sludge crisis, and the state has temporarily seized control of the firm. At least eight people were killed, 150 others injured and scores left homeless when the MAL Hungarian Aluminum Production and Trade Company leaked toxic sludge from its plant in Ajka, some 160 kilometers from the capital, Budapest. Engineers are rushing to complete a dam that would keep the toxic spill from making its way into the area's reservoir. Company director Zoltan Bakonyi was detained for questioning earlier this week, and the Hungarian parliament voted on 9 October to temporarily take over the company. Hungarian Prime Minister Viktor Orban said in a statement that the disaster was the result of "human negligence". The Prime Minister's Office said that the cause of the chemical disaster was MAL's practice of overloading a reservoir of toxic waste at its Ajka plant. Last week, the reservoir's walls cracked and toxic sludge leaked out, contaminating 40 square kilometers of land and seeping into the Danube river. There is risk of a second toxic spill if a new dam is not completed in time.

Analytical Note: Though media is referring to the government takeover of MAL as "nationalization", government officials have been quick to point out that this is not a nationalization, but a temporary takeover, pending an investigation over how the spill happened. They also said the plant could be reopened later this week. Some are criticizing Orban's "populist" response to the disaster - in the form of quick state takeover - but this is typical of Orban's style of governing, and under pressure from ordinary Hungarians to take immediate action and to be given a sense of protection by the state some say he had little choice. Corruption may also come in to play, alongside human negligence, once the investigation gets under way. Reports said that a state environmental inspection had been undertaken just weeks prior to the disaster, and that everything had been in order. Other company executives and witnesses have already told investigators that Bakonyi was aware of the overloading of the reservoirs before they burst.

French Transport and Oil Industry Strikes Risks Radicalization

French transport and oil industry workers launched a massive strike this week, disrupting public transportation services on Tuesday and Wednesday and leading a nationwide protest march in which it is believed that as many as 3.5 million workers turned out. The strikers are demanding that the government scrap plans to raise the retirement age. Oil industry workers from Fos-Lavera, the country's largest oil port, have been on strike for over two weeks, while workers at 12 refineries have voted to join in the protest, reducing crude processing rates and raising the spectre of fuel shortages through the blockage of oil terminals. The French government only has three months of strategic reserves at its disposal, so it not likely to tap into those just yet. The government is not backing down, with President Nicolas Sarkozy vowing to stick to the reforms, which will see the retirement age raised from 60 to 62, and the minimum age to receive a full state pension from 65 to 67. Unions are now talking about open-ended strikes. The strikes took shape on Monday, the day the French senate back the reform bill.

Analytical Note: There is a risk of radicalization, here, and certainly a precedent for it. In 1995 and 2006 similar protests refused to back down and in the end forced the government's hand. This is the third protest related to the retirement age controversy, and there has been a gradual shift in momentum, with the first two protests drawing hundreds of thousands, while the latest has drawn millions. Similar strikes are affecting many European governments who are faced with implementing very unpopular austerity measures to overcome budget deficits in the aftermath of the global financial crisis. The French austerity package has already been approved by the lower house of parliament, while the Senate is voting on each part of the bill separately. The measures will be problematic for Sarkozy, whose popularity ratings are plunging and who faces presidential elections in 2012.

Bolivia to Start Lithium Production in October

Bolivia's minister of mining has announced that the country will begin lithium carbonate and potassium chloride production for export later this month at a plant in Western Bolivia, Bloomberg reports. Production for export will take several months, but the government plans to be able to start exporting by early next year.

Analytical Note: Bolivia is attempting to industrialize its lithium reserves, which stand at an estimated 5.4 metric tons. The country is believed to have the largest lithium reserves in the world, and successful production and export for use in electronic items is expected to provide the country with a major new revenue source. Plant production, according to Bloomberg, should yield around 40 metric tons of lithium carbonate per month, along with 1,000 tons of potassium chloride. For now, the country is still in the market for financing for its lithium development projects. The US imports the most lithium of any country in the world. As reported in the Weekly Geopolitical Summary from 23 September 2010, Iran and Bolivia in early September strengthened ties, with Iran approving a $245 million loan package for Bolivian industrial development. The package will include assistance from Iranian experts in the exploration of mineral deposits, including uranium and lithium.

Updates and In Brief

ISAF's Torkham AfPak Border Crossing Reopened

Last weekend, Pakistani officials reopened the Torkham border crossing to ISAF trucks and tankers lined up to supply logistics to the war in Afghanistan after Washington apologized for an airstrike in which Pakistani soldiers were killed (see last week's geopolitical summary). Some 150 NATO vehicles were destroyed in Taliban attacks on the queuing convoy. The move highlighted the power Pakistan has over the US war in Afghanistan, and how effective the Taliban can be in such a situation.

Iran's President Visits Lebanon in Clear Attempt to Boost Hezbollah

Iran President Mahmoud Ahmadinejad's two-day visit to Beirut on Wednesday started out with official diplomatic speak, and then returned to the expected rhetoric when the Iranian leader addressed a cheering crowd of Hezbollah supporters, calling the group a leader in the fight against Western tyrants. The visit was first and foremost intended to boost Hezbollah's popularity after its 2009 election losses, and as the UN tribunal's investigation into the assassination of former prime minister Rafik al-Hariri is hovering over the movement. Iran is hoping to get Lebanon to cease its partial financing of the UN tribal for the case, and this visit had that in mind.

By. Jen Alic of the Global Intelligence Report

Source: http://www.globalintelligencereport.com/categories/Professional-Level-1

The global Intelligence Report is a Private news & Intelligence service for sophisticated news consumers, investors and energy market participants. To find out more please visit: http://www.globalintelligencereport.com/categories/Professional-Level-1


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