Post-Brexit UK announces largest military spending since Cold War

By Andrew MacAskill and William James

LONDON (Reuters) – Britain announced its biggest military spending increase since the Cold War on Thursday, pledging to end the “era of retreat” as it seeks a post-Brexit role in a world Prime Minister Boris Johnson warned was more perilous than for decades.

Johnson said the extra spending reflected the need to upgrade military capabilities even as the COVID-19 pandemic pummels the economy and strains public finances. He outlined plans for a new space command, an artificial intelligence agency and said the navy would be restored as Europe’s most powerful.

Outlining the first conclusions from a big review of foreign policy and defense, he announced an extra 16.5 billion pounds ($22 billion) for the military over the next four years. The defense budget is now just under 42 billion pounds a year.

“The era of cutting our defense budget must end, and it ends now,” Johnson told parliament by video link from his Downing Street office, where he is isolating after contact with someone who tested positive for COVID-19.

“I have done this in the teeth of the pandemic, amid every other demand on our resources, because the defense of the realm and the safety of the British people must come first.”

NEW GLOBAL ROLE

Britain was the main battlefield ally of the United States in Iraq and Afghanistan and, alongside France, the principal military power in the European Union. But its 2016 vote to leave the EU has made its global role uncertain at a time when China is rising and President Donald Trump has cast doubt on U.S. support for traditional allies.

The military spending announcement comes just a week after Johnson promised U.S. President-elect Joe Biden that Britain was determined to remain a valuable military ally.

Christopher Miller, acting U.S. defense secretary in Trump’s outgoing administration, welcomed the extra spending.

“The UK is our most stalwart and capable ally, and this increase in spending is indicative of their commitment to NATO and our shared security,” he said. “With this increase, the UK military will continue to be one of the finest fighting forces in the world.”

The government said the increase will cement Britain’s position as the largest defense spender in Europe and second-largest in NATO.

A national cyber force will be established alongside the new space command, which will be capable of launching its first rocket by 2022. These and other new projects will create up to 10,000 jobs, the government said.

Britain’s main opposition Labor Party said the increase was long overdue after the ruling Conservative government cut the size of the armed forces by a quarter in the last decade.

The extra funding will raise further concerns about how the government manages its defense and security budget after repeated accusations it allowed costs to spiral for overly-ambitious projects.

A report by lawmakers said on Thursday that Britain’s GCHQ spying agency ignored evidence and broke its budget in choosing an expensive central London headquarters for a newly-created cyber-security center.

After media reports that billions of pounds could be cut from Britain’s foreign aid budget, Defense Secretary Ben Wallace told Sky News that higher defense spending would not come at the expense of aid.

“It doesn’t mean to say we are abandoning the battlefield of international aid, we’re still one of the most generous givers of international aid,” Wallace said.

(Additional reporting by Elizabeth Piper in London; Editing by Catherine Evans)

Special Report: Pentagon’s latest salvo against China’s growing might – Cold War bombers

By David Lague

HONG KONG (Reuters) – On July 21, two U.S Air Force B-1B bombers took off from Guam and headed west over the Pacific Ocean to the hotly contested South China Sea. The sleek jets made a low-level pass over the aircraft carrier USS Ronald Reagan and its escorting fleet, which was exercising nearby in the Philippines Sea, according to images released by the U.S. military.

The operation was part of the Trump administration’s intensifying challenge to China’s ruling Communist Party and its sweeping territorial claims over one of the world’s most important strategic waterways. While senior Trump officials launch diplomatic and rhetorical broadsides at Beijing, the U.S. Defense Department is turning to the firepower of its heavily armed, long-range bombers as it seeks to counter Beijing’s bid to control the seas off the Chinese coast.

Since late January, American B-1B and B-52 bombers, usually operating in pairs, have flown about 20 missions over key waterways, including the South China Sea, the East China Sea and the Sea of Japan, according to accounts of these flights from U.S. Air Force statements and official social media posts. These missions, military analysts say, are designed to send a crystal-clear signal: The United States can threaten China’s fleet and Chinese land targets at any time, from distant bases, without having to move America’s aircraft carriers and other expensive surface warships within range of Beijing’s massive arsenal of missiles.

In this response to the growing power of China’s military, the Pentagon has combined some of its oldest weapons with some of its newest: Cold War-era bombers and cutting-edge, stealthy missiles. The supersonic B1-B first entered service in 1986; the newest plane in the B-52 fleet was built during the Kennedy administration. But these workhorses can carry a huge payload of precision weapons. A B-1B can carry 24 of the U.S. military’s stealthy new Long Range Anti-Ship Missiles, which entered service in 2018 and can strike targets at ranges of up to 600 kilometers, according to U.S. and other Western officials.

“A single B-1 can deliver the same ordnance payload as an entire carrier battle group in a day,” said David Deptula, dean of the Washington-based Mitchell Institute for Aerospace Studies and a retired U.S. Air Force Lieutenant General. And, in a crisis, he added, bombers can be rapidly deployed.

“Depending on where they are, ships can take weeks to get in place,” said Deptula. “But by using bombers, they can respond in a matter of hours,” he adds, noting that the U.S. object is to deter war. “Nobody wants to engage in conflict with China.”

Chinese and western military strategists warn that a conflict between the two nuclear-armed powers could be difficult to contain.

In a clash with China, this fast response from the bomber force could be vital while the U.S. and its allies rush naval reinforcements to the Pacific to bolster the vastly outnumbered U.S. naval fleet stationed in the region, according to current and former U.S. and other Western military officers.

A spokeswoman for Pacific Air Forces, Captain Veronica Perez, said the U.S. Air Force had increased its publicity about its bomber missions to assure allies and partners of Washington’s commitment to global security, regional stability and a free and open Indo-Pacific. “Though the frequency and scope of our operations vary based on the current operating environment, the U.S. has a persistent military presence and routinely operates throughout the Indo-Pacific,” she said.

China’s defense ministry did not respond to questions from Reuters.

LOWEST POINT

While the bomber missions continue, relations between Washington and Beijing have reached their lowest point since the 1989 Tiananmen crackdown. In a show of force, Chinese fighter jets crossed the mid-line of the Taiwan Strait while U.S. Secretary for Health, Alex Azar, was visiting Taipei on Aug. 10 to congratulate the government of President Tsai Ing-wen on its successful containment of the COVID-19 virus. Azar was the most senior American official to visit Taiwan in four decades.

Taiwan’s missile radars tracked the Chinese fighters in only the third such incursion across the median line since 2016, the Taiwanese government said. Beijing condemned the visit. It regards the island as a province of China and hasn’t ruled out the use of force to bring it under Communist Party control.

In a series of speeches ahead of Azar’s visit, top Trump officials had hammered China on multiple fronts, including its military build-up, territorial ambitions, domestic political repression, intellectual property theft, espionage, trade practices and its failure to alert the world to the danger of COVID-19.

In one of the most harshly worded attacks on China from an American official in decades, U.S. Secretary of State Mike Pompeo said on July 23 that China’s military, the People’s Liberation Army (PLA), was not a normal fighting force.

“Its purpose is to uphold the absolute rule of the Chinese Communist Party elites and expand a Chinese empire, not protect the Chinese people,” he said. “And so our Department of Defense has ramped up its efforts, freedom of navigation operations out and throughout the East and South China Seas and in the Taiwan Strait as well.” In July, Pompeo declared most of Beijing’s claims of sovereignty over the South China Sea illegal.

With the combination of bombers and long-range missiles, the United States is trying to turn the tables on the PLA. Over more than two decades, China has assembled a force of ground, sea and air-launched missiles that would make it deadly for warships of the U.S. Navy and its allies to approach the Chinese coast in a conflict. This Chinese strategy is specifically tailored to threaten U.S. aircraft carrier battle groups and the network of bases that form the backbone of American power in Asia.

In a demonstration of this capability, the PLA launched one of its so-called carrier-killer missiles, the DF-26, in an exercise in the South China Sea following the deployment in July of two U.S. aircraft carriers to the area, China’s official military media reported in early August. And a U.S. defense official told Reuters that on Aug. 26, China launched four medium-range ballistic missiles that hit the South China Sea between Hainan Island and the Paracel Islands.

But the PLA Navy’s huge and rapidly expanding fleet is also vulnerable to long-range missiles. China has built the world’s biggest navy, including new aircraft carriers, amphibious assault ships and powerful cruisers and destroyers. And the PLA’s extensive network of bases and ports would also be targets for missiles.

In a conflict, U.S. bombers over the Western Pacific could target PLA Navy warships at their bases on the Chinese coast or underway inside the so-called first island chain, the string of islands that run from the Japanese archipelago through Taiwan, the Philippines and on to Borneo, enclosing China’s coastal seas. Chinese warships would be even more vulnerable if they broke out through the island chain into the Western Pacific, outside the coverage of the PLA’s land-based air defenses and strike aircraft.

THE FIREPOWER GAP

In the aftermath of the Cold War, Washington assumed it had uncontested control of the oceans and neglected to arm its surface fleet with modern, long-range anti-ship missiles. To be sure, the U.S. and its allies, particularly Japan, still have a powerful fleet of attack submarines that would pose a deadly menace to PLA warships. But the bombers help fill the firepower gap in the U.S. surface fleet while the Pentagon is re-purposing existing missiles and introducing new versions to its destroyers and cruisers, according to maritime strategists.

The bomber deployments are one element of a much wider reshaping of forces and tactics that the U.S. and its allies in East Asia have launched to deter China from attacking Taiwan, expanding its hold over the South China Sea or seizing other disputed territories. These include the uninhabited group of isles in the East China Sea known as the Senkaku Islands in Japan and the Diaoyu Islands in China, which are claimed by both Tokyo and Beijing.

Tensions are on the rise around these islands, now under Japanese control. The commander of U.S. forces in Japan, Lieutenant General Kevin Schneider, pledged in July that America would help Japan monitor “unprecedented” Chinese incursions into waters around the Senkakus that were challenging Tokyo’s administration. Within an hour of Schneider’s comments, China’s foreign ministry fired back that the islands were “Chinese territory.”

Long-range U.S. bombers operating from distant airfields would remain a threat if Chinese missile attacks disabled key U.S. bases in Japan, South Korea and Guam. These bases, mostly a carry-over from World War Two and the Korean War, were built at a time when China had very limited means to attack them.

Now it does. In a clear acknowledgement that Guam is now at risk, the U.S. Air Force announced on April 17 it would end its continuous rotation of bombers to the island base and withdraw them to the U.S. mainland.

The absence of a permanent bomber presence at Guam is a blow to Washington’s ability to deter China and North Korea, air power experts say. The island in the Western Pacific is less than a five-hour flight from the South China Sea.

“It makes it look like the Chinese military build-up has worked,” said Peter Layton, a visiting fellow at Griffith University in Australia and a retired Australian air force Group Captain who has worked at the Pentagon. “They are now taken out of range.”

Since then, the United States has sent bombers to Guam for short-term deployments from their continental bases. U.S. air power researchers suggest that the availability of better training facilities at mainland U.S. bases was also a factor in the decision to withdraw the bombers. But in further evidence of Guam’s vulnerability, the head of the U.S. Indo-Pacific Command, Admiral Philip Davidson, has asked Congress to fund a powerful missile defense system for the island by 2026.

Another hurdle for the Pentagon: America’s bomber force is shrinking just as the PLA challenge grows. From a force of more than 400 at the end of the Cold War, the U.S. bomber fleet has shrunk to 158 aircraft. Of those planes, 62 are B-1Bs and 76 are B-52S. The United States also has a smaller force of 20 newer B-2 stealth bombers.

The air force plans to retire 17 B-1Bs next year to concentrate resources on the remaining bombers until the planned introduction of a new generation of stealthy bomber, the B-21, toward the end of this decade. This bomber is expected to sharply improve the U.S. Air Force’s ability to penetrate Chinese airspace. Northrop Grumman is now building the first prototype, according to air force officials.

‘NOT LIKE FIGHTING SADDAM’

As the risk of conflict rises, some Western air power experts doubt that U.S. bombers would deliver a decisive advantage in a clash with the PLA. They say the Chinese military has spent decades preparing formidable, integrated air defenses. Even if the U.S. bombers were able to sink PLA Navy warships and stealthily penetrate Chinese airspace to strike some ground targets, they say it would not necessarily translate into victory against a vast and powerful adversary.

And, they warn, it might be impossible to fight a limited conflict on China’s periphery. “It is not like fighting Saddam Hussein, it would be a major world war,” said Layton, the retired Australian air force officer. “Both sides have nuclear weapons and there is the potential for escalation. If either side is losing, what is going to happen then?”

Alongside relying on its bombers, the United States has been forced to develop other plans to offset the Chinese missile and naval threat. The U.S Marine Corps is planning to disperse smaller units armed with long-range anti-ship and land-attack missiles through the first island chain, where they could threaten the Chinese navy and land targets on China’s mainland.

The U.S. Army also intends to spread forces through the first island chain and other outposts in the Western Pacific. It is planning a series of major exercises this year and next where troops would deploy to islands in the region, according to senior commanders and top Pentagon officials.

New weapons are in the pipeline that would give specially formed army task force units the firepower to strike at Chinese warships and other targets in a conflict. The U.S. Army’s top commander, General James McConville, told an online seminar hosted by the Washington-based Center for Strategic and International Studies in late July that a very long-range hyper sonic missile was under development and tests had been successful. And soldiers would have the tools to attack an enemy’s navy. “We are going to have mid-range missiles that can sink ships,” McConville said.

The U.S. and its allies also intend to link all their surveillance systems and weapons together in a regional network so that tracking information about a target could be shared between radar stations, satellites, surface warships, submarines, aircraft and land forces. In this system, a stealth fighter flying from a carrier could detect an enemy warship and relay this information to an army unit on an island, which could attack the foe with an anti-ship missile.

On May 21, two U.S. B-1B bombers from Guam flew to an area near Misawa Air Base in Japan, where they conducted long-range anti-ship missile training with a P-8 Poseidon maritime surveillance aircraft and the aircraft carrier USS Ronald Reagan, according to a U.S. Pacific Air Force statement. This exercise demonstrated that the U.S. had the capability to “hold any target at risk, anytime and anywhere,” said Perez, the Pacific Air Forces spokeswoman.

The ships and aircraft involved in this exercise likely practiced the sharing of target information to mount a simulated attack, according to U.S. and Asian military experts. On other missions this year, the American bombers have held joint exercises with U.S., Japanese and South Korean fighters.

CHINESE AIRSPACE

In this networked battlefield, the Pentagon’s old warhorses of the air would be an even more formidable rival.

The speed and range of America’s Cold War-vintage bombers would allow them to approach Chinese targets from different directions and fire salvos of difficult-to-detect missiles at multiple ships, according to current and retired U.S. air force officers. With even longer range missiles that Washington has in the pipeline, such attacks could be mounted from well outside the range of China’s powerful, land-based air defenses. American bombers can also drop precision-guided mines to block strategically important ocean passages or ports.

And the U.S. B-2 stealth bombers could penetrate more deeply into Chinese airspace and attack key targets with sharply less chance of detection than the older bombers. These bombers already carry a heavy payload of precision, land-attack munitions and could also be configured to carry the Long Range Anti-Ship Missile.

A B-1B could take off from the continental United States, refuel from tanker aircraft en route, and arrive over the Western Pacific in about 15 hours, according to Deptula and other military aviation analysts. From Hawaii the trip would take about nine hours, they say. Even closer, from northern Australia, the transit would take six hours without refueling.

The Australian government announced in February it would spend $814 million upgrading a key air base at Tindal in the Northern Territory, including a major extension to its runway. Part of the reason for the upgrade is to support expanded U.S. Air Force operations, the Australian government said. American bombers are already using the base.

The B-1B originally served as a nuclear bomber. That role has been phased out. It now carries around 34 metric tonnes (75,000 pounds) of conventional guided and unguided weapons, the biggest payload of any U.S. aircraft. In the military operations launched after the attacks of Sept. 11, 2001, these bombers were flown hard for almost two decades to provide ground support to American and allied troops in the Middle East and Afghanistan.

With the Pentagon having turned its competitive sights on China, the B-1B is now increasingly employed as a ship killer. In future, it could also be armed with a new hyper sonic missile, the Air-Launched Rapid Response Weapon (ARRW), now in testing, and a new long-range cruise missile, according to senior U.S. Air Force commanders. Hyper sonic missiles traveling at more than five times the speed of sound would be hard to intercept.

The B-52 is an even older icon of American might, in service since the mid-1950’s. It carries a slightly smaller payload than the B-1B. As part of this weapons load, it can be armed with up to 14 upgraded versions of the Cold War-era Harpoon anti-ship missile. And, it could also be configured in future to carry 20 Long Range Anti-Ship Missiles, according to air power experts. Along with the B-2, the B-52 can also launch nuclear missiles.

While these older bombers remain potent, American air power experts say a strong force of B-21 stealth bombers will be much more effective when they begin entering service later this decade. The new bomber is being developed in a highly classified program. “All the indications are that it is proceeding well in the development phases,” said Deptula.

(Reporting by David Lague in Hong Kong. Edited by Peter Hirschberg.)

Italy says China a key strategic partner, despite U.S. concerns

By Angelo Amante

ROME (Reuters) – Italy and China need to forge closer ties, Italian Foreign Minister Luigi Di Maio said on Tuesday, potentially putting Rome at odds with Washington, which has raised alarm over Beijing’s economic ambitions.

Di Maio was speaking after talks with the Chinese government’s top diplomat State Councillor Wang Yi, who was beginning a visit to Europe that will also include the Netherlands, Norway, France and Germany.

Italy became the first major Western economy to join China’s international infrastructure project, the Belt and Road Initiative, when it signed a raft of accords in 2019. However, the move has yielded little for Italy so far.

“It was a very fruitful meeting,” Di Maio said, adding that he had discussed with Wang how to “relaunch (our) strategic partnership from the economic and industrial view point”.

Wang told reporters it was important for China and the European Union to strengthen relations and deepen cooperation to tackle the coronavirus.

U.S. President Donald Trump blames Beijing for the spread of the disease, which emerged in China last year. He also wants to restrict the global development of Chinese telecom giant Huawei Technologies Co., accusing it of acting as a Trojan Horse for Chinese cyber spies.

Italy has not joined the United States in imposing restrictions on Huawei and Di Maio made no reference to the company in his remarks. In an apparent reference to tensions with Washington, Wang said China did not want to see a Cold War.

“A Cold War would be a step backwards,” he said. “We will not let other countries do this for their own private interests, while damaging the interests of other countries.”

Di Maio said he had raised the issue of Hong Kong with Wang, saying its citizens’ rights and freedoms had to be respected.

China unveiled a national security law last month which Hong Kong pro-democracy protesters and the West say breaches the 1984 Sino-British treaty that guaranteed Hong Kong’s autonomy.

Economic clout makes China tougher challenge for U.S. than Soviet Union was – Pompeo

By Robert Muller

PRAGUE (Reuters) – China’s global economic power makes the communist country in some ways a more difficult foe to counter than the Soviet Union during the Cold War, U.S. Secretary of State Mike Pompeo said on a visit to the Czech Republic on Wednesday.

Pompeo called on countries around Europe to rally against the Chinese Communist Party (CCP), which he said leverages its economic might to exert its influence around the world.

“What’s happening now isn’t Cold War 2.0,” Pompeo said in a speech to the Czech Senate. “The challenge of resisting the CCP threat is in some ways much more difficult.”

“The CCP is already enmeshed in our economies, in our politics, in our societies in ways the Soviet Union never was.”

The Cold War reference came after China’s ambassador to London last month warned that the United States was picking a fight with Beijing ahead of the U.S. presidential election in November.

U.S.-China ties have quickly deteriorated this year over a range of issues including Beijing’s handling of the coronavirus; telecoms-equipment maker Huawei; China’s territorial claims in the South China Sea; and the clampdown on Hong Kong.

Pompeo’s visit to the Czech Republic, part of the Soviet bloc until the 1989 democratic Velvet Revolution, marked the first stop on a swing through the region to discuss cyber and energy security.

He used the occasion to swipe at both Russian and Chinese influence and lauded officials in the central European nation of 10.7 million who took on Beijing over the past year.

He cited the Czech Republic’s efforts to set security standards for the development of 5G telecommunications networks after a government watchdog warned about using equipment made by China’s Huawei.

Pompeo and Prime Minister Andrej Babis signed a declaration on 5G security in May, but the country has not made an outright decision to ban Huawei technology. Its President Milos Zeman has been promoting closer ties with China.

Pompeo also acknowledged the chairman of the Czech Senate Milan Vystrcil, who followed through on a plan by his deceased predecessor to visit Taiwan at the end of this month, a trip that has angered China.

Pompeo said some nations in Europe would take longer to wake up to the threats, but there was a positive momentum.

“The tide has turned (in the United States), just as I see it turned here in Europe as well. The West is winning, don’t let anyone tell you about the decline of he West,” he said.

“It will take all of us… here in Prague, in Poland, in Portugal. We have the obligation to speak clearly and plainly to our people, and without fear. We must confront complex questions… and we must do so together,” he said.

(Writing by Jan Lopatka; Editing by Michael Kahn, William Maclean)

Putin says Russia will make new missiles, warns of arms race

Russian President Vladimir Putin delivers a speech during a plenary session of the Eastern Economic Forum in Vladivostok, Russia September 5, 2019. Sputnik/Mikhail Klimentyev/Kremlin via REUTERS

By Gabrielle Tétrault-Farber and Vladimir Soldatkin

VLADIVOSTOK, Russia (Reuters) – President Vladimir Putin said on Thursday that Russia would produce missiles that were banned under a landmark Cold-War era nuclear pact that ended last month, but that Moscow would not deploy them unless the United States did so first.

Speaking at an economic forum in Russia’s Far East, Putin said Moscow had urged the United States to de-escalate a spiraling arms race between the former Cold War foes, but that Washington had not responded.

The Russian leader said he was concerned by U.S. talk of deploying missiles in Japan and South Korea, a deployment he said would cover parts of Russian territory.

Tensions over nuclear arms control have been rising after Washington formally pulled out of the Intermediate-Range Nuclear Forces Treaty (INF) pact last month accusing Russia of violating it, allegations Moscow denied.

Last month the United States tested a conventionally-configured cruise missile that hit a target more than 500 km away, a test that would have been prohibited under the INF.

The pact banned land-based missiles with a range of 310-3,400 miles, reducing the ability of both countries to launch a nuclear strike at short notice.

“…Of course we will produce such missiles,” Putin told an economic forum in the Russian city of Vladivostok. He repeated a pledge by Moscow not to deploy any new missiles unless the United States does so first.

“We are not happy about the fact that the head of the Pentagon said that the United States intends to deploy them in Japan and South Korea, this saddens us and is a cause for certain concern,” Putin said.

Putin said he offered U.S. President Donald Trump in a recent phone call the chance to buy one of the hypersonic nuclear weapons Moscow is developing. He said Trump spurned the offer and replied that Washington was making its own.

Putin said he feared that an arms race could spread into space and that Washington could develop a new space weapon.

(Additional reporting by Andrey Kuzmin, Maria Vasilyeva; Writing by Tom Balmforth; Editing by Catherine Evans)

Deploying new U.S. missiles would be ‘reckless act’: North Korean media

FILE PHOTO: U.S. Secretary of Defence Mark Esper arrives for a meeting with Japanese Prime Minister Shinzo Abe at Abe's official residence in Tokyo, Japan, August 7, 2019. REUTERS/Issei Kato

By Josh Smith

SEOUL (Reuters) – Any move by the United States to place new ground-launched, intermediate-range missiles in South Korea could spark a “new Cold War” and an escalating arms race in the region, North Korean state media said on Wednesday.

U.S. Defense Secretary Mark Esper this month said he was in favor of placing ground-launched, intermediate-range missiles in Asia, a day after the United States withdrew from the Intermediate Nuclear Forces (INF) treaty with Russia.

“The U.S. pointed out that it is now examining a plan for deploying ground-to-ground medium-range missiles in the Asian region and South Korea has been singled out as a place for the deployment,” North Korea’s state news agency KCNA said.

“It is a reckless act of escalating regional tension, an act that may spark off a new Cold War and arms race in the Far Eastern region to deploy a new offensive weapon in South Korea,” it said in a commentary.

Other senior U.S. officials have said any deployment of such weaponry would be years away.

South Korea’s defense ministry has said there had been no discussion of placing American intermediate-range missiles in the country, and there were no plans to consider the idea.

The KCNA statement also criticized recent moves to improve military sites in South that host U.S. Terminal High Altitude Area Defense (THAAD) systems, which are designed to intercept ballistic missiles.

“It is a hard fact that the deployment of THAAD is pursuant to the U.S. strategy to contain great powers and hold supremacy in Northeast Asia, not the one for ‘shielding’ South Korea from someone’s ‘threat’,” KCNA said.

North Korea’s military has launched a series of missiles in recent weeks to protest what it sees as a military build-up in South Korea, as well as joint military exercises by South Korean and American troops stationed on the peninsula.

The launches have complicated attempts to restart talks between U.S. and North Korean negotiators over the future of the country’s nuclear weapons and ballistic missile programs, which prompted sanctions by the United Nations Security Council.

(Reporting by Josh Smith; Editing by Clarence Fernandez)

Struggle between big powers spells hostile future: report

Munich Security Conference (MSC) chairman Wolfgang Ischinger presents the Munich Security Report for 2019 in Berlin, Germany, February 11, 2019. REUTERS/Annegret Hilse

BERLIN (Reuters) – A new age of competition between major global powers like China, the United States and Russia leaves the world facing an unpredictable and more hostile future, the hosts of a major security conference said on Monday.

Entitled “The Great Puzzle: Who Will Pick Up the Pieces?”, their report aims to set the agenda for leaders at the Munich Security Conference annual meeting from Thursday.

U.S. Vice President Mike Pence is due to attend the event in the Bavarian capital, which comes after Washington said earlier this month it would suspend compliance with a landmark nuclear missile pact with Russia.

“Given the prevailing strategic outlooks in Washington, Beijing, and Moscow, expectations of a new era of great power competition are seeming to turn into a self-fulfilling prophecy,” the report read.

“If everyone prepares for a hostile world, its arrival is almost preordained … The post-Cold War period and the general optimism associated with it has come to an end.

“But it is unclear what kind of new order will emerge … and whether the transition period will be peaceful.”

Conference chairman Wolfgang Ischinger, a former German ambassador to Washington, urged policymakers from mid-sized powers including the European Union to do more to preserve a liberal international order.

In a newspaper interview, Ischinger suggested France’s nuclear arsenal should serve the purpose of shielding the whole of the EU and not just France. This would mean EU countries would have to share the cost of maintaining France’s nuclear weapons, he told the Funke group of newspapers.

Chancellor Angela Merkel, who addresses the conference on Saturday, is using her last term to focus on a foreign policy aimed at defending and refreshing multilateralism.

But the report said Berlin and Paris needed to work together more effectively to boost the capacity of the “ill-prepared” EU to deal with heightened great power competition.

“With domestic contexts in both capitals unlikely to become less complicated, the coming year will show whether the tandem can work out its differences or whether another window of opportunity has been missed,” the report read.

Running through other mid-sized powers, the report turned to Britain and said “Brexit proceedings will continue to inflict wounds on both sides of the Channel for years to come.”

Looking further east, it said: “Those counting on Japan to anchor security in East Asia may yet have to temper their expectations.”

(Writing by Paul Carrel; Editing by Andrew Cawthorne)

For Putin, economic and political reality dampen any appetite for arms race

FILE PHOTO: U.S. President Donald Trump meets Russian President Vladimir Putin in Helsinki, Finland, July 16, 2018. REUTERS/Kevin Lamarque/File Photo

By Andrew Osborn

MOSCOW (Reuters) – With his ratings down and state funds needed to hedge against new Western sanctions and raise living standards, Russian President Vladimir Putin cannot afford to get sucked into a costly nuclear arms race with the United States.

Alleging Russian violations, Washington said this month it was suspending its obligations under the Intermediate-range Nuclear Forces Treaty (INF) and starting the process of quitting it, untying its hands to develop new missiles.

That raises the prospect of a new arms race between Washington and Moscow, which denies flouting the treaty. Putin responded by saying Russia would mirror the U.S. moves by suspending its own obligations and quitting the pact.

But Putin, who has sometimes used bellicose rhetoric to talk up Russia’s standoff with the West and to rally Russians round the flag, did not up the ante.

He did not announce new missile deployments, said money for new systems must come from existing budget funds and declared that Moscow would not deploy new land-based missiles in Europe or elsewhere unless Washington did so first.

“…We must not and will not let ourselves be drawn into an expensive arms race,” Putin told Defence Minister Sergei Shoigu.

His statement was borne of necessity.

Harsh economic and political realities and memories of how the cost of the Cold War arms race contributed to the Soviet Union’s demise means Putin’s options are limited, a situation that may curb his appetite for expensive escalation in future.

“We need to keep in mind that the question of an arms race that could cut us into pieces is entirely realistic,” Sergei Dubinin, former governor of Russia’s central bank, told Russia’s RBC TV channel before Washington announced its exit.

He said the United States was trying to repeat its successful Cold War strategy of pushing Moscow into an arms race it could not afford and that Russia would be ill-advised to try to attain parity and needed a smart response instead.

Memories of empty supermarket shelves in the run-up to the 1991 Soviet collapse still haunt many older Russians as the then Soviet Union directed huge cash flows to the military-industrial complex to try to keep up with the United States while neglecting the consumer economy.

“They (the Americans) recall that the Soviet Union collapsed in part because it tried to keep up with the United States when it came to who produced more missiles, nuclear submarines and tanks,” Viktor Litovkin, a military expert, told the Russian army’s Zvezda TV channel.

“They are trying to do the same thing today.”

COUNTING THE COSTS

With the INF treaty suspended, Washington and Moscow have said they will develop previously prohibited short- and intermediate-range land-based missiles, with Russia saying it wants them ready by 2021.

Shoigu told Putin the money to develop two new land-based missile launchers would come from this year’s budget by reallocating existing funds.

Russia does not disclose the full extent of its military and national security spending, but says it will account for around 30 percent of its 18-trillion-rouble ($273-billion) budget this year.

Oil revenues mean Russia is not short of money. Its budget surplus this year is projected to be 1.932 trillion rubles ($29.3 billion) or 1.8 percent of gross domestic product. Russia’s foreign exchange reserves stand at $478 billion, the fifth largest in the world.

But the money is already allocated in a way dictated by Moscow’s difficult geopolitical situation and by Putin’s own increasingly tricky domestic political landscape. Reallocating the money would be painful.

Moscow is hoarding cash to try to give itself a $200-billion buffer against new Western sanctions and is embarking on a multi-billion dollar spending push to try to overhaul the country’s creaky infrastructure and raise living standards.

With signs of rising discontent over years of falling real incomes, rising prices, an increase in value-added tax and an unpopular plan to raise the pension age, Putin is under pressure to deliver.

Igor Nikolaev, director of auditor FBK’s Strategic Analysis Institute, said Putin might have to take money from other parts of the budget to fund a new arms race which would force him to scale back social spending plans or dip into the national wealth fund to top up the budget.

If a burgeoning arms race intensified, such a scenario would become more likely and Putin would be reluctant to spend more on defense in the current political climate, he said.

“It would not be desirable, especially as we know what’s happening with real incomes and that there are problems with his rating,” said Nikolaev. “Cutting spending on national projects would receive a mixed reaction.”

Though re-elected last year until 2024, and therefore not under immediate political pressure, Putin’s trust rating has fallen to a 13-year low. A poll this month showed the number of Russians who believe their country is going in the wrong direction hit its highest level since 2006.

Putin’s symmetrical response to Washington, which involves developing new missiles, has already angered some Russians.

“Are new arms a source of joy?” wrote blogger Vladimir Akimov, saying the money would be better spent on lifting people out of poverty. “Why not begin by repairing the roads and knocking down the wooden shacks (that people live in) across the country.”

(Additional reporting by Andrey Ostroukh, Editing by Timothy Heritage)

U.S. has offered to hold arms control talks with Russia -official

FILE PHOTO: National flags of Russia and the U.S. fly at Vnukovo International Airport in Moscow, Russia April 11, 2017. REUTERS/Maxim Shemetov/File Photo

WASHINGTON (Reuters) – The United States has offered to hold talks on arm control issues with Russia on the sidelines of a United Nations meeting in Beijing next week, a senior State Department official said on Thursday.

Under Secretary of State Andrea Thompson told reporters the talks almost certainly would include a dispute over a Cold War-era treaty limiting intermediate-range missiles.

Washington has pledged to withdraw from the pact because of what it charges is the deployment by Moscow of a new cruise missile that violates the Intermediate-Range Nuclear Forces Treaty (INF Treaty).

Moscow has denied that the missile in question, the Novator 9M729 (called the SSC-8 by NATO), violates the agreement, which bars either side from stationing short- and intermediate-range, land-based missiles in Europe.

Moscow says the missile’s range keeps it outside of the treaty and has accused the United States of inventing a false pretext to leave an accord it wants to exit anyway to develop its own new missiles.

Thompson said the United States has presented Russia with a proposal for a “verifiable” test of the missile’s range but Moscow has not embraced the plan.

Unless the Russians come back into compliance with the INF Treaty, the United States will make good on its decision to suspend its compliance with the pact at the end of a 60-day period on Feb. 2, Thompson said.

(Reporting by Jonathan Landay; Writing by Makini Brice; Editing by Jonathan Oatis)

Former President George H.W. Bush remembered for role in Cold War, Iraq

A flag is draped over the gate to the neighborhood of the home of former President George H.W. Bush, a day after he passed away in Houston, Texas, U.S. December 1, 2018. REUTERS/Gary McWilliams

By Gary McWilliams and Bill Trott

HOUSTON/WASHINGTON (Reuters) – Tributes to former U.S. President George H.W. Bush, who died at the age of 94, poured in from around the world on Saturday as global leaders honored him for his role in helping to end the Cold War and reduce the threat of nuclear annihilation.

FILE PHOTO: Republican presidential candidate Mitt Romney (L) picks up the formal endorsement of former President George H.W. Bush and former first lady Barbara Bush in Houston March 29, 2012. REUTERS/Donna Carson/File Photo

FILE PHOTO: Republican presidential candidate Mitt Romney (L) picks up the formal endorsement of former President George H.W. Bush and former first lady Barbara Bush in Houston March 29, 2012. REUTERS/Donna Carson/File Photo

Bush, the 41st U.S. president who served in the office from 1989 to 1993, also routed President Saddam Hussein’s Iraqi army in the 1991 Gulf War but lost his chance for a second term in the White House after breaking a no-new-

taxes pledge.

“Many of my memories are linked to him,” said Mikhail Gorbachev, the last leader of the Soviet Union, with whom Bush signed a strategic arms reduction treaty that scaled back the two countries’ nuclear arsenals.

“We happened to work together in years of great changes. It was a dramatic time demanding huge responsibility from everyone,” Russia’s Interfax news agency quoted Gorbachev as saying.

Bush, who also served for eight years as U.S. vice president during Ronald Reagan’s two-term presidency and earlier as head of the CIA, died on Friday night at his home in Houston. His death was announced by his longtime spokesman Jim McGrath.

FILE PHOTO: U.S. President George H.W. Bush laughs while attending the annual White House Correspondents Association Awards dinner in Washington May 21, 1988. REUTERS/Stelios Varias/File Photo

FILE PHOTO: U.S. President George H.W. Bush laughs while attending the annual White House Correspondents Association Awards dinner in Washington May 21, 1988. REUTERS/Stelios Varias/File Photo

Speaking in Buenos Aires, U.S. President Donald Trump called Bush “a high-quality man.”

“He was a very fine man. I met him on numerous occasions. He was just a high-quality man who truly loved his family,” Trump told reporters at a G20 summit in Buenos Aires. “He was a terrific guy and he’ll be missed. He led a full life, and a very exemplary life, too.”

The White House said a state funeral will be held on Wednesday at the National Cathedral in Washington. Trump, who plans to attend the funeral with first lady Melania Trump, also designated Wednesday as a national day of mourning and ordered the lowering of the American flag for 30 days.

Former U.S. presidents lauded Bush. “His administration was marked by grace, civility and social conscience,” Jimmy Carter, a Bush predecessor and now the oldest living former president at 94, said in a statement.

Barack Obama described Bush as “a patriot and humble servant” while Bill Clinton, who defeated Bush in the 1992 presidential election, recalled his “great long life of service, love and friendship.”

FILE PHOTO: George H. W. Bush, in uniform as a Naval Aviator Cadet, is pictured in this early 1943 handout photo obtained by Reuters November 30, 2012. George Bush Presidential Library and Museum/Handout via REUTERS/File Photo

FILE PHOTO: George H. W. Bush, in uniform as a Naval Aviator Cadet, is pictured in this early 1943 handout photo obtained by Reuters November 30, 2012. George Bush Presidential Library and Museum/Handout via REUTERS/File Photo

Bush, a U.S. naval aviator during World War Two, was the father of former President George W. Bush, who served two terms in the White House in the 2000s, and former Florida Governor Jeb Bush, who unsuccessfully sought the 2016 Republican nomination for president. Like his sons, he was a Republican.

After falling short of his party’s presidential nomination in 1980, Bush ran for the presidency again in 1988 and defeated Massachusetts Democrat Michael Dukakis, winning 40 of the 50 U.S. states.

His death came seven months after that of his wife, former first lady Barbara Bush, to whom he was married for 73 years. He was admitted to a Houston hospital with a blood infection that led to sepsis a day after her funeral in April.

“The entire Bush family is deeply grateful for 41’s life and love, for the compassion of those who have cared and prayed for Dad, and for the condolences of our friends and fellow citizens,” George W. Bush said in a statement.

Trump said he spoke on Saturday to George W. Bush and Jeb Bush about their father’s death.

At a gate outside the Houston neighborhood where the Bushes lived, residents on Saturday created a makeshift memorial by laying flowers before a U.S. flag.

“They weren’t just the president and former first lady, they were part of the neighborhood,” said Ellen Prelle, who added a poinsettia and remembered the former first couple as involved and caring.

At the G20 summit in Buenos Aires, German Chancellor Angela Merkel recalled visiting him in the White House. “He was the father or one of the fathers of German reunification and we will never forget that,” she said.

Bush served as president during the fall of the Berlin Wall in 1989.

“His ethos of public service was the guiding thread of his life and an example to us all,” said British Prime Minister Theresa May. “In navigating a peaceful end to the Cold War, he made the world a safer place for generations to come.”

Russian President Vladimir Putin said Bush “faithfully served his country all his life – with a gun in his hand during the war years and in high government roles in peacetime,” according to Russian state news agency TASS.

FILE PHOTO: U.S. President George H. W. Bush waves goodbye to U.S. Marines and members of the British 7th Armoured Brigade as they conclude a Thanksgiving Day visit with troops in the Saudi desert November 22, 1990. REUTERS/Rick Wilking/File Photo

FILE PHOTO: U.S. President George H. W. Bush waves goodbye to U.S. Marines and members of the British 7th Armoured Brigade as they conclude a Thanksgiving Day visit with troops in the Saudi desert November 22, 1990. REUTERS/Rick Wilking/File Photo

EXTENSIVE POLITICAL RESUME

George Herbert Walker Bush, a Connecticut Yankee who came to Texas to be an oilman, died as the patriarch of a Republican political dynasty. He and George W. Bush were only the second father and son to hold the office of president, after John Adams (1797-1801) and John Quincy Adams (1825-1829).

His second son, Jeb, undertook his own campaign for the presidency in 2015 before dropping out. Bush’s father, Prescott Bush, was a U.S. senator from Connecticut.

Trump signed an order closing the federal government on Wednesday in a show of respect for Bush. The New York Stock Exchange and Nasdaq will also be closed on Wednesday in his honor.

Bush’s body will arrive at the U.S. Capitol on Monday and lie in state through Wednesday morning. The public will be able to line up to view Bush’s casket continuously from Monday evening until Wednesday morning.

Trump said the presidential plane will be flown to Houston to bring Bush’s body to Washington after Trump returns from Argentina. Bush’s body will be returned to Houston on Wednesday and a service will be held on Thursday at St. Martin’s Episcopal Church there.

Bush’s casket will then travel by train from nearby Spring, Texas to College Station. He will be buried on Thursday on the grounds of his presidential library at Texas A&M University, the school said. He will be buried in a family plot next to his late wife.

Bush had first sought the presidency in 1980, campaigning on experience gathered as a U.S. congressman from Texas, envoy to China, director of the Central Intelligence Agency, United Nations ambassador and chairman of the Republican National Committee.

Reagan, the former actor and California governor, vanquished Bush in the Republican primaries but chose him as his running mate, hoping Bush’s reputation as a moderate would balance his own hard, conservative image.

The high points of Bush’s presidency included the end of the Cold War, which brought the dissolution of the Soviet Union and its hold on former Eastern Bloc countries.

“He was the only one of the world leaders at the time (who) did so much to overcome communism and help Poland,” said Lech Walesa, the former head of Poland’s Solidarity trade union who led protests and strikes that shook communist rule in the 1980s.

“He will remain in hearts and memory forever,” Walesa said on Twitter.

Bush won a decisive victory in ousting Saddam’s Iraqi army from Kuwait, bringing him popularity at home, and made progress on Middle East peace. But Bush’s foreign affairs victories were overshadowed by a stagnant economy at home. He broke his “read my lips” pledge not to raise taxes and lost his 1992 re-election bid to Clinton, a Democrat.

Bush, who was born on June 12, 1924, in Milton, Massachusetts, grew up wealthy, attending elite schools but putting off college so he could enlist in the Navy at 18. He flew 58 missions off aircraft carriers in World War Two and survived being shot down over the Pacific Ocean.

After returning from the war, he married Barbara Pierce, with whom he would have six children. After he graduated from Yale University on an accelerated schedule, the Bushes headed to the oil fields of West Texas.

It was there that Bush became involved in politics, first losing a U.S. Senate race in 1964 before winning election to the U.S. House of Representatives in 1966.

After two terms and another failed Senate bid in 1970, he was appointed by President Richard Nixon as U.S. ambassador to the United Nations. In 1974, President Gerald Ford made him an envoy to China and later director of the CIA.

Bush did not endorse fellow Republican Trump, the eventual winner of the 2016 presidential election who attacked both Jeb and George W. Bush during his campaign. He did not publicly say whom he voted for in the election, but a source told CNN he went for Trump’s Democratic opponent, Hillary Clinton.

Bush did send Trump a letter in January 2017 saying he would not be able to attend his inauguration because of health concerns but wishing him the best.

(Reporting by Gary McWilliams in Houston; Bill Trott, David Morgan, David Shepardson and Humeyra Pamuk in Washington; Steve Gorman in Los Angeles; Roberta Rampton in Buenos Aires; Mark Heinrich in London; Andrew Osborn in Moscow; and Marcin Goclowski in Warsaw; Editing by Alistair Bell, Jonathan Oatis and Will Dunham)