Russia tells Washington curbs on its banks would be act of economic war

The U.S. dollar sign is seen on an electronic board next to a traffic light in Moscow, Russia August 10, 2018. REUTERS/Maxim Shemetov

By Andrew Osborn and Andrey Ostroukh

MOSCOW (Reuters) – Russia warned the United States on Friday it would regard any U.S. move to curb the activities of its banks as a declaration of economic war which it would retaliate against, stepping up a war of words with Washington over spiraling sanctions.

The warning, from Prime Minister Dmitry Medvedev, reflects Russian fears over the impact of new restrictions on its economy and assets, including the rouble which has lost nearly six percent of its value this week on sanctions jitters.

Economists expect the economy to grow by 1.8 percent this year. But if new sanctions proposed by Congress and the State Department are implemented in full, something that remains uncertain, some economists fear growth would be almost cut to zero in future.

In a sign of how seriously Russia is taking the threat, President Vladimir Putin discussed what the Kremlin called “possible new unfriendly steps by Washington” with his Security Council on Friday.

Moscow’s strategy of trying to improve battered U.S.-Russia ties by attempting to build bridges with President Donald Trump is backfiring after U.S. lawmakers launched a new sanctions drive last week because they fear Trump is too soft on Russia.

That, in turn, has piled pressure on Trump to show he is tough on Russia ahead of mid-term elections.

On Wednesday, the State Department announced a new round of sanctions that pushed the rouble to two-year lows and sparked a wider sell-off over fears Russia was locked in a spiral of never-ending sanctions.

Separate legislation introduced last week in draft form by Republican and Democratic senators, dubbed “the sanctions bill from hell” by one of its backers, proposes curbs on the operations of several state-owned Russian banks in the United States and restrictions on their use of the dollar.

Medvedev said Moscow would take economic, political or other retaliatory measures against the United States if Washington targeted Russian banks.

“I would not like to comment on talks about future sanctions, but I can say one thing: If some ban on banks’ operations or on their use of one or another currency follows, it would be possible to clearly call it a declaration of economic war,” said Medvedev.

“And it would be necessary, it would be needed to react to this war economically, politically, or, if needed, by other means. And our American friends need to understand this,” he said, speaking on a trip to the Russian Far East.

Pedestrians walk by an electronic board showing currency exchange rates of the U.S. dollar against Russian rouble in Moscow, Russia August 10, 2018. REUTERS/Maxim Shemetov

Pedestrians walk by an electronic board showing currency exchange rates of the U.S. dollar against Russian rouble in Moscow, Russia August 10, 2018. REUTERS/Maxim Shemetov

FEW GOOD RETALIATORY OPTIONS

In practice, however, there is little Russia could do to hit back at the United States without damaging its own economy or depriving its consumers of sought-after goods, and officials in Moscow have made clear they do not want to get drawn into what they describe as a mutually-damaging tit-for-tat sanctions war.

The threat of more U.S. sanctions kept the rouble under pressure on Friday, sending it crashing past two-year lows at one point before it recouped some of its losses.

The Russian central bank said the rouble’s fall to multi-month lows on news of new U.S. sanctions was a “natural reaction” and that it had the necessary tools to prevent any threat to financial stability.

One tool it said it might use was limiting market volatility by adjusting how much foreign currency it buys. Central bank data showed on Friday it had started buying less foreign currency on Wednesday, the first day of the rouble’s slide.

The fate of the U.S. bill Medvedev was referring to is not certain.

The full U.S. Congress will not be back in Washington until September, and even then, congressional aides said they did not expect the measure would pass in its entirety.

While it was difficult to assess so far in advance, they said it was more likely that only some of its provisions would be included as amendments in another piece of legislation, such as a spending bill Congress must pass before Sept. 30 to prevent a government shutdown.

(Additional reporting by Tom Balmforth in Moscow and Patricia Zengerle in Washington Writing by Andrew Osborn Editing by William Maclean)

Russia reels, denounces new U.S. sanctions as illegal, unfriendly

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

By Andrew Osborn

MOSCOW (Reuters) – Russia condemned a new round of U.S. sanctions as illegal on Thursday after news of the measures sent the rouble tumbling to two-year lows and sparked a wider asset sell-off over fears that Moscow was locked in a spiral of never-ending curbs by the West.

Moscow has been trying with mixed success to improve battered U.S.-Russia ties since Donald Trump won the White House in 2016, and Russia’s political elite was quick to chalk up a summit last month between Trump and Vladimir Putin as a victory.

But initial triumphalism swiftly turned sour as anger over what some U.S. lawmakers saw as an over deferential performance by Trump and his failure to confront Putin over Moscow’s alleged meddling in U.S. politics galvanized a new sanctions push.

Having bet heavily on improving ties with Washington via Trump, Moscow now finds that Trump is under mounting pressure from U.S. lawmakers to show he is tough on Russia ahead of mid-term elections.

In the latest broadside, the U.S. State Department said on Wednesday it would impose fresh sanctions by the month’s end after determining that Moscow had used a nerve agent against a former Russian double agent, Sergei Skripal, and his daughter, Yulia, in Britain, something Moscow denies.

In an early reaction, the Kremlin said the sanctions were illegal and unfriendly and that the U.S. move was at odds with the “constructive atmosphere” of Trump and Putin’s encounter in Helsinki.

The new sanctions come in two tranches. The first, which targets U.S. exports of sensitive national-security related goods, comes with deep exemptions and many of the items it covers have already been banned by previous restrictions.

However, the second tranche, activated after 90 days if Moscow fails to provide “reliable assurances” it will no longer use chemical weapons and allow on-site inspections by the United Nations or other international observer groups, is more serious.

NBC, citing U.S. officials, said the second tranche could include downgrading diplomatic relations, suspending the state airline Aeroflot’s ability to fly to the United States and cutting off nearly all exports and imports.

The State Department’s announcement fueled already worsening investor sentiment about the possible impact of more sanctions on Russian assets and the rouble at one point slid by over 1 percent against the dollar, hitting a two-year low, before recouping some of its losses.

The U.S. move also triggered a sell-off in Russian government bonds and the dollar-denominated RTS index fell to its lowest since April 11.

“There is local panic on the currency market,” BCS Brokerage said in a note. “At times, the number of those who want to ditch the rouble is becoming so high so there is not enough liquidity.”

ILLEGAL

The Kremlin said the new sanctions were “illegal and do not correspond to international law.”

“…Such decisions taken by the American side are absolutely unfriendly and can hardly be somehow associated with the constructive – not simple but constructive – atmosphere that there was at the last meeting of the two presidents,” Kremlin spokesman Dmitry Peskov said.

Washington had become an unpredictable player on the international stage, Peskov added, saying “anything could be expected” from it and that it was important that Russia’s financial system, which he described as stable, was prepared.

In a sign the Kremlin was not eager to escalate an already difficult situation however, Peskov said it was too early to talk about Russian countermeasures.

He criticized the U.S. decision to link the sanctions to the British nerve agent case, an incident the Kremlin has long cast as a Western plot to damage its reputation and provide a pretext for more sanctions.

Skripal, a former colonel in Russia’s GRU military intelligence service, and his 33-year-old daughter were found slumped unconscious on a bench in the southern English city of Salisbury in March after a liquid form of the Novichok type of nerve agent was applied to his home’s front door.

European countries and the United States expelled 100 Russian diplomats after the attack, in the strongest action by Trump against Russia since he came to office.

Konstantin Kosachyov, head of the upper house of parliament’s international affairs committee, was cited by the Interfax news agency as saying it looked like Washington was now behaving like “a police state.”

Dmitri Trenin, director of the Carnegie Moscow Center and a former colonel in the Russian army, said the State Department’s move looked like the latest salvo in what he called a hybrid war.

“Sanctions are the U.S. weapon of choice,” Trenin wrote on Twitter.

“They are not an instrument, but the policy itself. Russia will have to brace for more to come over the next several years, prepare for the worst and push back where it can.”

At variance with Moscow over Ukraine and Syria, Western sanctions have already drastically reduced Western involvement in Russian energy and commodities projects, including large-scale financing and exploration of hard-to-recover and deep water resources.

Proposed U.S. legislation prepared by several senators calls on Trump to widen the sanctions further to include virtually all Russian energy projects and effectively bar Western companies from any involvement in the country.

Introduced by Republican and Democratic senators last week in draft form, Senator Lindsey Graham, one of the measure’s lead sponsors, has called it “the sanctions bill from hell.”

(Additional reporting by Dmitry Zhdannikov, Tom Balmforth, Denis Pinchuk, Andrey Ostroukh; Editing by Richard Balmforth)

Trump invites Putin to Washington despite U.S. uproar over Helsinki summit

U.S. President Donald Trump walks from Marine One as he arrives on the South Lawn of the White House in Washington, U.S., July 18, 2018. REUTERS/Joshua Roberts

By Steve Holland and Doina Chiacu

WASHINGTON (Reuters) – President Donald Trump has invited Russian President Vladimir Putin to Washington this autumn, the White House said on Thursday, a daring rebuttal to the torrent of criticism in the United States over Trump’s failure to publicly confront Putin at their first summit for Moscow’s meddling in the 2016 election.

Four days after Trump stunned the world by siding with Putin in Helsinki over his intelligence agencies, the president asked national security adviser John Bolton to issue the invitation to the Russian leader, said White House spokeswoman Sarah Sanders.

What happened at Monday’s one-on-one between Trump and Putin with only interpreters present remained a mystery, even to top officials and U.S. lawmakers who said they had not been briefed.

Trump’s director of national intelligence, Dan Coats, said in response to a question at the Aspen Security Forum in Colorado: “Well, you’re right, I don’t know what happened at that meeting.”

The coveted invitation was sure to be seen as a victory by Putin, whose last official visit to the United States was in July 2007, when he spent two days at the Bush family compound.

Both Trump and Putin earlier on Thursday praised their first meeting as a success and blamed forces in the United States for trying to belittle its achievements, Trump citing discussions on counterterrorism, Israel’s security, nuclear proliferation, cyber attacks, trade, Ukraine, Middle East peace and North Korea.

In one Twitter post, Trump blamed the media. “The Summit with Russia was a great success, except with the real enemy of the people, the Fake News Media.”

In Moscow, Putin said the summit “was successful overall and led to some useful agreements” without elaborating on the agreements.

Top Senate Democrat Chuck Schumer criticized the invitation. “Until we know what happened at that two hour meeting in Helsinki, the president should have no more one-on-one interactions with Putin. In the United States, in Russia, or anywhere else,” he said in a statement.

Coats, who on Monday roundly defended the intelligence agencies’ findings of Russian meddling, also advised against a one-on-one meeting with Putin, saying he “would look for a different way of doing it.”

An official visit by a Russian president to the United States is a rare event: the last time was in June 2010 with Dmitri Medvedev, now Russian prime minister.

A senior White House official said Bolton extended the official invitation to Putin on Thursday via his Russian counterpart. No date has been set and it was unclear whether it would be timed for the U.N. General Assembly in late September.

FILE PHOTO: U.S. President Donald Trump and Russian President Vladimir Putin shake hands as they hold a joint news conference after their meeting in Helsinki, Finland July 16, 2018. REUTERS/Grigory Dukor

FILE PHOTO: U.S. President Donald Trump and Russian President Vladimir Putin shake hands as they hold a joint news conference after their meeting in Helsinki, Finland July 16, 2018. REUTERS/Grigory Dukor

REJECTION OF PUTIN PROPOSAL

The week was one of the toughest for Trump since he took office 18 months ago as aides struggled with damage control and convincing Americans that the president did not favor Russian interests over his own country’s. Forty-two percent of registered voters said they approved of Trump’s overall job performance, according to a Reuters/Ipsos opinion poll taken after the summit.

Bolton on Tuesday laid out four talking points for the crisis-hit White House, according to one official: that Trump stress he supports U.S. intelligence agencies, that there was never any Russian collusion with his campaign, that Russian meddling is unacceptable and the United States is doing everything it can to protect elections in 2018 and beyond.

With Trump under fierce criticism in the United States, the White House on Thursday rejected Putin’s proposal that Russian authorities be present for the questioning of Americans it accuses of “illegal activities,” including a former U.S. ambassador to Moscow.

It was the latest about-face in a week of multiple reversals. Critics complained that Trump was given ample opportunity at a joint news conference on Monday to scold Putin over Russian interference in the election but instead accepted Putin’s denials over the word of American intelligence agencies.

Trump on Tuesday said he misspoke during the news conference. On Wednesday, Trump answered “no” to a reporter’s question on whether Russia was still targeting the United States, only to have Sanders say later he was saying “no” to answering any questions – not to the question itself.

Republican and Democratic U.S. lawmakers grappled with Trump’s conflicting statements as they discussed ways to show their opposition to what they saw in Helsinki, including strengthening sanctions.

On Monday, Putin described the proposal when he was asked about the possible extradition of 12 Russian intelligence officers indicted in the United States on charges of interfering in the 2016 election by carrying out cyber attacks on Democratic Party networks.

Putin indicated he would permit American law enforcement officials to observe questioning by Russian officials of the indicted Russians and vice versa for Russian investigations. He mentioned London-based financier Bill Browder, a onetime investor in Russia who said he exposed corruption there. Standing alongside Putin, Trump called the idea “an incredible offer.”

Sanders on Thursday said, “It is a proposal that was made in sincerity by President Putin, but President Trump disagrees with it,” a day after saying the proposal was going to be discussed by Trump’s team. “Hopefully President Putin will have the 12 identified Russians come to the United States to prove their innocence or guilt.”

(Reporting by Steve Holland, Doina Chiacu, Richard Cowan, Lisa Lambert, Susan Heavey in Washington and Andrew Osborn and Olesya Astakhova in Moscow; Writing by Doina Chiacu and Mary Milliken; Editing by Will Dunham and Grant McCool)

Turkish court keeps U.S. pastor in jail; Trump calls on Erdogan to act

A Turkish soldier stands guard in front of the Aliaga Prison and Courthouse complex in Izmir, Turkey July 18, 2018. REUTERS/Kemal Aslan

By Ezgi Erkoyun

ALIAGA, Turkey (Reuters) – A Turkish court decided on Wednesday to keep an American pastor in jail, dashing hopes that he could be released during his trial on terrorism and spying charges, a case that has deepened a rift with NATO ally Washington.

Andrew Brunson, a Christian pastor from North Carolina who has lived in Turkey for more than two decades, was indicted on charges of helping the group that Ankara blames for a failed 2016 coup against President Tayyip Erdogan, as well as supporting outlawed PKK Kurdish militants.

Brunson, who denies the charges, faces up to 35 years in jail if found guilty.

“It is really hard to stay in jail and be separated from my wife and children,” Brunson, wearing a black suit and a white shirt, told the court in Turkish.

“There is no concrete evidence against me. The disciples of Jesus suffered in his name, now it is my turn. I am an innocent man on all these charges. I reject them. I know why I am here. I am here to suffer in Jesus’s name.”

U.S. President Donald Trump late on Wednesday said in a tweet that Erdogan “should do something to free this wonderful Christian husband and father,” saying that Brunson has “been held hostage far too long.”

The U.S. Senate passed a bill last month including a measure that prohibits Turkey from buying F-35 Joint Strike Fighter jets because of Brunson’s imprisonment and Turkey’s purchase of Russia’s S-400 air defense system.

The U.S. envoy to Turkey said he was “disappointed” by the ruling of the court in the Aegean province of Izmir, where Brunson had been living.

“Our government is deeply concerned about his status and the status of other American citizens and Turkish local employees of the U.S. diplomatic mission who have been detained under state of emergency rules,” Charge d’Affaires Philip Kosnett told reporters outside the courtroom.

“We have great respect for both Turkey’s traditional role as a haven for people of faiths and Turkey’s legal traditions,” he said. “We believe this case is out of step with these traditions.”

NEW WITNESSES

Erdogan has previously linked Brunson’s fate to that of Fethullah Gulen, a U.S.-based Muslim cleric who Turkey accuses of masterminding the failed coup. Gulen denies any involvement in the coup, in which at least 250 people were killed.

The spokesman of Turkey’s ruling AK Party, Mahir Unal, said that just as Washington had responded repeatedly to Ankara’s requests for Gulen’s extradition by saying it was a matter for the U.S. courts, so Brunson’s fate was a judicial matter.

Brunson was pastor of the Izmir Resurrection Church, serving a small Protestant congregation in Turkey’s third-largest city, south of the Aegean town of Aliaga where he is now on trial.

His lawyer Ismail Cem Halavurt had raised hopes that Brunson could be released as the prosecution witnesses finish testifying.

But Halavurt said on Wednesday the prosecution has added the testimony of two new anonymous witnesses to the case and that the court would reconvene on Oct. 12 to hear them and view new evidence.

Turkey’s lira weakened against the dollar immediately after the ruling, reflecting investor worries about tensions with the United States.

Brunson’s trial is one of several legal cases that have raised tensions between Washington and Ankara. A U.S. judge sentenced a Turkish bank executive in May to 32 months in prison for helping Iran evade U.S. sanctions, while two locally employed U.S. consulate staff in Turkey have been detained.

The two NATO allies are also at odds over U.S. policy in Syria, where Washington’s ally in the fight against Islamic State is a Kurdish militia that Turkey says is an extension of the PKK, which has waged a three-decade insurgency in southeast Turkey.

In a statement late on Wednesday, four Republican U.S. senators called for the immediate release of Brunson and other U.S. citizens being held in Turkey, warning of legislative reprisals otherwise.

“We encourage the Administration to use all the tools at their disposal to ensure the release of these innocent people before Congress is forced to press for even stricter legislative measures that will be difficult to unwind,” Senators Thom Tillis, Jeanne Shaheen, James Lankford, and Lindsey Graham said.

(Writing by Ezgi Erkoyun and Humeyra Pamuk; Editing by John Stonestreet and Leslie Adler)

Putin accuses U.S. forces of trying to ruin Trump summit outcome

Russia's President Vladimir Putin attends a meeting with Russian ambassadors and representatives to international organisations in Moscow, Russia, July 19, 2018. REUTERS/Sergei Karpukhin

By Andrew Osborn and Olesya Astakhova

MOSCOW (Reuters) – Russian President Vladimir Putin on Thursday accused forces in the United States of trying to undermine the success of his first summit with U.S. President Donald Trump, but said the two leaders had begun to improve U.S.-Russia ties anyway.

Putin and Trump sat down for their first summit in Helsinki on Monday, an event that sparked a storm of criticism in the United States after Trump refused to blame the Russian leader for meddling in the 2016 U.S. election, something Putin denies.

Trump later said he had misspoken and accused “some people” of hating the fact that he got along with Putin. The White House has been struggling to contain a political outcry and confusion over the summit ever since.

Putin, speaking to Russian diplomats from around the world assembled in Moscow, said on Thursday the Helsinki summit had been successful.

“It was successful overall and led to some useful agreements. Of course, let’s see how events will develop further,” he said, without disclosing the nature of the agreements he referred to.

However, Putin said “powerful” U.S. forces were trying to sabotage what the summit had achieved.

“We see that there are forces in the United States that are prepared to casually sacrifice Russian-U.S. relations, to sacrifice them for their ambitions in an internal political battle in the United States.”

Those same forces appeared ready to sacrifice hundreds of thousands of U.S. jobs and hurt U.S. business and security while waging their divisive political battle, Putin said.

‘NARROW PARTY INTERESTS’

Putin did not name names, but spoke of U.S. politicians who put their “narrow party interests” above the best interests of the United States and were powerful enough to be able to foist their questionable “stories” on millions of Americans.

He said it would have been naive to expect that the Helsinki summit could have resolved problems that had built up over many years in the space of a few hours.

“Despite the difference in opinions (with Trump), we did agree that Russian-U.S. relations are in an extremely unsatisfactory state. In many respects, they are even worse than during the Cold War,” he said.

But the two leaders had at least made a start when it came to improving relations.

“The path to positive changes has all the same begun,” said Putin. “It’s important that a full-scale meeting has finally taken place allowing us to talk directly.”

Putin warned however of the dangers of Moscow and Washington failing to continue to mend ties, saying the New START strategic arms reduction treaty would expire soon unless both countries took action.

“If today, right now, work on extending it is not begun it will simply expire in a year and a half.”

(Additional reporting by Tom Balmforth and Gabrielle Tetrault-Farber; Writing by Andrew Osborn; Editing by Peter Graff)

Trump sits down with Putin after denouncing past U.S. policy on Russia

U.S. President Donald Trump and Russia's President Vladimir Putin shake hands as they meet in Helsinki, Finland July 16, 2018. REUTERS/Kevin Lamarque

By Jeff Mason and Andrew Osborn

HELSINKI (Reuters) – U.S. President Donald Trump sat down with Vladimir Putin for a long-awaited summit on Monday saying he wanted good relations with Russia, after blaming Washington’s own past “foolishness and stupidity” for the countries’ hostile ties.

Trump opened the meeting with warm words for Putin, seated next to the Russian leader in an ornate presidential palace in neutral Finland, and said it was a longstanding goal of his to improve the relationship between the two countries.

“I think we will have an extraordinary relationship. I hope so. I’ve been saying it, and I’m sure you’ve heard over the years, and as I campaigned, that getting along with Russia is good thing, not a bad thing,” he said.

U.S. President Donald Trump and Russia's President Vladimir Putin shake hands as they meet in Helsinki, Finland July 16, 2018. REUTERS/Kevin Lamarque

U.S. President Donald Trump and Russia’s President Vladimir Putin shake hands as they meet in Helsinki, Finland July 16, 2018. REUTERS/Kevin Lamarque

But to Trump’s critics, the friendly words had already been overshadowed by an extraordinary denunciation of his own country’s prior policies, which Trump tweeted out hours before the summit.

“Our relationship with Russia has NEVER been worse thanks to many years of U.S. foolishness and stupidity and now, the Rigged Witch Hunt!” he tweeted before the summit began.

The Russian foreign ministry “liked” his tweet, and tweeted back: “We agree”.

Trump’s opponents at home were furious, with one Democratic congressman tweeting that Trump had turned the White House into “a propaganda arm for the Kremlin”.

Putin and Trump met alone apart from interpreters before a working lunch with aides. Trump said they would talk about a range of subjects, listing trade, the military, nuclear weapons and China.

But, at least in his public remarks at the outset, he mentioned none of the issues that have lately brought U.S.-Russian relations to the lowest point since the Cold War: Moscow’s annexation of territory from Ukraine, its support for Syria’s Bashar al-Assad, as well as Western accusations that it poisoned a spy in England and meddled in elections.

“Our relationship with Russia is strained because of the very malign actions he’s refusing to take Russia to task for,” tweeted Democratic U.S. Representative Gregory Meeks, a member of the House Foreign Affairs Committee. “Though relations were worse during the Cold War, at least then the US Presidency wasn’t a propaganda arm for the Kremlin.”

The Kremlin has played down expectations for the summit. It said it did not expect much from the meeting but hoped it would be a “first step” to resolving a crisis in ties.

“Presidents Trump and Putin respect each other and they get along well,” Kremlin spokesman Dmitry Peskov said. “There is no clear agenda. It will be determined by the heads of state themselves as they go along.”

While Trump has been abroad since last week, the special prosecutor investigating allegations that Russia interfered to help him win the 2016 presidential election indicted 12 Russians on Friday for stealing Democratic Party documents.

U.S. President Donald Trump, first lady Melania Trump, Finland's President Sauli Niinisto his wife Jenni Haukio pose for a photo in Helsinki, Finland, July 16, 2018. REUTERS/Kevin Lamarque

U.S. President Donald Trump, first lady Melania Trump, Finland’s President Sauli Niinisto his wife Jenni Haukio pose for a photo in Helsinki, Finland, July 16, 2018. REUTERS/Kevin Lamarque

“WHICH TEAM DO YOU PLAY FOR?”

Trump’s foes at home have been scathing about his apparent refusal to criticize Putin. His 2016 opponent Hillary Clinton tweeted: “Great World Cup. Question for President Trump as he meets Putin: Do you know which team you play for?”

Russia denies interfering in the U.S. presidential election. The state RIA news agency quoted a Russian source as saying Moscow was “ready to discuss, ready to undertake mutual obligations of non-intervention into internal matters”.

Trump has said he will raise the election meddling but does not expect to get anywhere. He has repeatedly noted that Putin denies it, while also saying that it is alleged to have taken place before he became president.

For Putin, that the summit is even happening despite Russia’s semi-pariah status among some Americans and U.S. allies is a geopolitical win.

The summit caps a trip abroad during which Trump sternly criticized NATO allies for failing to spend enough on their militaries and embarrassed British Prime Minister Theresa May by saying she refused to take his advice about how to negotiate Britain’s exit from the EU. He referred to the European Union itself as a “foe” in trade, and repeatedly criticized it.

In some of the strongest words yet reflecting the unease of Washington’s traditional allies, Germany’s foreign minister said on Monday Europe could not rely on Trump.

“We can no longer completely rely on the White House,” Heiko Maas told the Funke newspaper group. “To maintain our partnership with the USA we must readjust it. The first clear consequence can only be that we need to align ourselves even more closely in Europe.”

(Additonal reporting by Steve Holland in Helsinki and by Christian Lowe and Polina Devitt in Moscow; Writing by Andrew Osborn and Peter Graff; Editing by Angus MacSwan)

Trump will focus on Russia’s ‘malign’ activity at summits: U.S. officials

FILE PHOTO: Russia's President Vladimir Putin talks to U.S. President Donald Trump during their bilateral meeting at the G20 summit in Hamburg, Germany, July 7, 2017. REUTERS/Carlos Barria//File Photo

WASHINGTON (Reuters) – U.S. President Donald Trump will discuss Russia’s “malign activity” during a summit with NATO leaders and follow up in a meeting Russian President Vladimir Putin to determine whether Moscow wants to reduce tensions, U.S. official said on Thursday.

“The president believes a better relationship with Russia would be good for both America and Russia, but the ball really is in Russia’s court and the president will continue to hold Russia accountable for its malign activity,” Jon Huntsman, U.S. ambassador to Russia, told reporters on a conference call.

“We’re entering with our eyes wide open, but peace is always worth the effort,” Huntsman said.

Trump is slated to meet Putin in Helsinki on July 16. He will meet with NATO leaders the week before in Brussels.

(Reporting by Jeff Mason, Doina Chiacu and Arshad Mohammed; Editing by David Gregorio)

Donald Trump’s visit puts Britain’s Brexit dependence on show

FILE PHOTO: U.S. President Donald Trump shake hands with Britain's Prime Minister Theresa May during the World Economic Forum (WEF) annual meeting in Davos, Switzerland, January 25, 2018. REUTERS/Carlos Barria/File Photo

By Guy Faulconbridge and William James

LONDON (Reuters) – When Donald Trump visits Britain next week, Prime Minister Theresa May will have to face a harsh reality: Brexit makes Britain more dependent than ever on an alliance with the most unpredictable U.S. president in living memory.

Sandwiched between a NATO meeting and a summit with Russia’s Vladimir Putin, Trump’s first visit to Britain as president comes at one of the most important junctures for Europe and the West since the 1991 fall of the Soviet Union.

From challenging Western assumptions about the EU and free trade to courting the Kremlin and North Korea’s leader, Trump has delivered on his promise of an “unpredictable” U.S. foreign policy.

That leaves May, who held hands with Trump at the White House during her visit after his inauguration, in a difficult position as she seeks closer trade ties with the United States to offset the disruption of leaving the EU on March 29, 2019.(F

“The irony is that by leaving the EU, the United Kingdom will be less useful to Washington as an ally but it will also need the United States much more,” said Jeffrey A. Stacey, a former State Department official in Obama’s administration.

“So May has been thrown into the arms of the most unpredictable U.S. president in living memory,” Stacey said.

Over 50,000 people have signed up for a protest on Trafalgar Square in central London against the Trump visit, which will include a meeting with Queen Elizabeth and possibly even a round of golf at his Turnberry course in Scotland.

Even taking account of Trump’s penchant for deal making, the visit is likely to be heavy on rhetoric about an increasingly lopsided “special relationship” and short on specifics such as the details of a post-Brexit trade deal.

For supporters, Trump and Brexit offer the prospect of breaking free from what they see as obsolete institutions and rules that have weakened the United States and its allies relative to competitors such as China.

But for many British diplomats, Brexit marks the collapse of a 70-year British strategy of trying to balance European integration with a U.S. alliance based on blood, trade and intelligence sharing.

“May’s rushed diplomacy with Trump has been foolish: what has she actually got out of the relationship so far?” said one senior European diplomat in London, who spoke on condition of anonymity.

“You Brits are leaving Europe but do you really want to jump into the arms of Donald Trump’s America? And more importantly, do you have a choice?” the diplomat asked.

HOLDING HANDS

Trump’s victory in the 2016 presidential election shocked British diplomats in Washington and relations between May, a vicar’s daughter, and Trump have been strained at times.

The enduring image of May’s visit to the White House in January 2017, when she became the first foreign leader to meet the president after he took office, was Trump taking May’s hand to help her down the steps of a White House colonnade.

But any good vibrations from that moment soon dissipated when Trump, the same day, announced plans to ban migrants from seven Muslim-majority countries – a decision that drew fierce international criticism and appeared to blindside May.

Days later, thousands marched on parliament to protest the decision to offer a Trump full state visit to Britain, and 1.8 million people signed a petition saying the invitation should be canceled because he might embarrass the Queen.

Trump has repeatedly thwarted British and other European diplomatic overtures, withdrawing from multilateral agreements on climate change, human rights, and a treasured deal to curb Iran’s nuclear ambitions in exchange for lifting sanctions.

Officials around May insist that Britain still has the capability to influence Trump, outlining a handling strategy that involves appealing to his self interest, “planting the seed” of an idea and allowing him time to consider its merits.

But, much will rest on the personal dynamic between May, a staid, career politician who prides herself on careful decision-making, and Trump, the brash, often-bellicose, former reality TV star who declared last month he would know within a minute whether a deal could be struck with North Korea’s Kim Jong Un

“We talk about Trump and Macron because it seems interesting with some upsides. We talk about Trump and Angela Merkel because it’s ‘difficult'” said Leslie Vinjamuri, head of the U.S. and Americas program at the Chatham House think tank.

“Theresa May gets a bit lost in all of that. She has neither been strong nor weak, there doesn’t seem to be any special affection.”

Asked at last month’s G7 meeting in Canada whether Trump was a “good friend” to Britain, May said: “The United States and the United Kingdom are good friends. President Trump and I work together.”

But just hours after the meeting concluded he tore up a joint communique on trade, equality and the environment that May and other G7 leaders had labored late into the night to agree.

Therein lies the difficulty for May.

“When he’s here, he’ll give, but I think when he walks away he will very quickly forget what the visit was about,” Vinjamuri said.

(Editing by Angus MacSwan)

Battle for control of U.S. Congress advances in seven states

FILE PHOTO: A woman wears a sticker in multiple languages after voting in the primary election at a polling station in Venice, Los Angeles, California, U.S. June 5, 2018. REUTERS/Lucy Nicholson/File Photo

By Joseph Ax

NEW YORK (Reuters) – A bitterly personal matchup in New York between a convicted felon seeking to reclaim his congressional seat from a former prosecutor is among dozens of key races in seven U.S. states on Tuesday, as voters pick candidates for November elections that will determine control of Congress.

Voters in Colorado, Maryland, South Carolina, Utah, Oklahoma and Mississippi will also select competitors for the Nov. 6 elections, when Democrats will seek to wrest control of Congress from U.S. President Donald Trump’s Republican Party.

Democrats need to flip 23 of 435 seats to gain control of the House of Representatives, which would stymie much of Trump’s agenda while opening up new avenues of investigation into his administration. They would have to net two seats to take the Senate, but face longer odds there, according to analysts.

Residents of New York City’s Staten Island borough will decide whether to give Republican Michael Grimm, fresh off a prison term for tax fraud, a chance to return to his old seat in Congress, three years after he resigned following his guilty plea.

The race has seen the candidates trade personal insults and accusations of lying, with Trump’s presence looming above it all.

Grimm, a bombastic former FBI agent known for once threatening to toss a television reporter off a balcony, has attacked incumbent Republican Representative Dan Donovan, the borough’s former district attorney, for not sufficiently supporting Trump.

Donovan, who earned Trump’s endorsement in May, has responded by calling attention to Grimm’s criminal conviction.

The district is considered within reach for Democrats in November.

“They should have a reality show: ‘The Real Candidates of Staten Island,'” said Douglas Muzzio, a political science professor at Baruch College. “It’s nasty, it’s personal – and it’s enjoyable to watch.”

DEMOCRATIC BATTLES

Voters in upstate New York will pick among seven Democrats in one of this year’s most expensive House campaigns. Republican first-term incumbent John Faso is considered vulnerable in November, and his potential challengers have collectively raised more than $7 million.

In Colorado, an establishment-backed Democrat and a liberal insurgent are vying to take on incumbent Republican Representative Mike Coffman, whose district favored Democrat Hillary Clinton over Trump in 2016.

Jason Crow, an Iraq war veteran backed by the national party, is facing Levi Tillemann, who was endorsed by Our Revolution, a group born out of Bernie Sanders’ 2016 presidential bid. Tillemann earned attention this month with an anti-gun violence video in which he blasted himself in the face with pepper spray.

South Carolina’s Republican contest for governor is the latest test of Trump’s sway among party voters. The president campaigned on Monday alongside Governor Henry McMaster, who is in a tight nominating battle with businessman John Warren. The winner is likely to prevail in November.

Voters will also pick Senate candidates in states including Utah and Maryland. Analysts say Democrats face a steep climb trying to take that chamber, as they are defending seats in states like Indiana, Montana and North Dakota that supported Trump two years ago.

Former Republican presidential candidate Mitt Romney is expected to earn his party’s Senate nomination in Utah, while Chelsea Manning, who served seven years in military prison for leaking classified data, is a long shot in Maryland’s Democratic nominating contest against incumbent Senator Ben Cardin.

(Reporting by Joseph Ax; Editing by Scott Malone and Peter Cooney)

U.S. identifies North Korea missile test site it says Kim committed to destroy

FILE PHOTO: A North Korean long-range rocket is launched into the air at the Sohae rocket launch site, North Korea, in this photo released by Kyodo February 7, 2016. Mandatory credit REUTERS/Kyodo

By Matt Spetalnick

WASHINGTON (Reuters) – The missile engine test site that President Donald Trump said North Korean leader Kim Jong Un had committed to destroy is a major facility in the western part of the country that has been used for testing engines for long-range missiles, according to a U.S. official.

Trump told reporters after their June 12 summit that Kim had pledged to dismantle one of his missile installations, which would be North Korea’s most concrete concession at the landmark meeting in Singapore.

However, the president at the time did not name the site.

A U.S. official identified it on Wednesday as the Sohae Satellite Launching Ground, saying North Korea “has used this site to test liquid-propellant engines for its long-range ballistic missiles.”

Pyongyang has said its missiles can reach the United States.

“Chairman Kim promised that North Korea would destroy a missile engine test stand soon,” the official told Reuters, speaking on condition of anonymity.

There was no immediate word on the exact timetable, and North Korea has not publicly confirmed that Kim made such a commitment.

CBS News was the first to identify the site, which is the newest of North Korea’s known major missile testing facilities.

Although Trump has hailed the Singapore summit as a success, skeptics have questioned whether he achieved anything, given that Pyongyang, which has rejected unilateral nuclear disarmament, appeared to make no new tangible commitments in a joint written declaration.

The U.S.-based North Korea monitoring group 38 North said in an analysis at the end of last week there had been no sign of any activity toward dismantling Sohae or any other missile test site.

The U.S. official said: “The United States will continue to monitor this site closely as we move forward in our negotiations.”

LITTLE-KNOWN SITE

What little is known about the Sohae site, located in Tongchang-ri, has been pieced together from analysts’ assessments and the North Korean state news agency KCNA.

It was reported to have been established in 2008 and has research facilities nearby for missile development as well as a tower that can support ballistic missiles. The site is mainly used to test large Paektusan engines built for long-range missiles such as the Hwasong-15.

North Korea has spent considerable effort and resources to develop the site as a “civilian space program” facility, denying that it has a military application, said Jenny Town, a research analyst at the 38 North.

“Presumably, if North Korea does destroy the Sohae facility, they are also signaling that they are willing to stop satellite/rocket launches this time around as well, a point that has derailed negotiations in the past and is a significant new development,” she said.

North Korea has other missile testing facilities but the shutdown, if it happens, would be significant, analysts said.

“The missile testing is not just done in Tongchang-ri so it does not necessarily mean all ICBMs (intercontinental ballistic missiles) will be disabled. But the most well-known one is this, so there is a great symbolic meaning if this is shut down,” said Moon Hong-sik, a research fellow at the Institute for National Security Strategy in South Korea.

North Korea announced ahead of the Singapore summit the suspension of its ICBM testing and also closed its nuclear bomb test site. U.S. officials, however, have cautioned that such actions are reversible.

Asked on Wednesday whether North Korea has done anything toward denuclearization since the summit, U.S. Defense Secretary Jim Mattis told reporters: “No, I’m not aware of that. I mean, obviously, it’s the very front end of a process. The detailed negotiations have not begun. I wouldn’t expect that at this point.”

Yang Uk, senior research fellow at the Korea Defence and Security Forum, agreed that a shutdown of the Sohae testing site would be a symbolic gesture rather than a move to technically disable its missile capabilities.

“Sohae has technically been used as an ‘engine’ testing site. North Korea has already finished developing (the) Baekdu Engine, so there would be no problem running ICBM missile programs even if they close down the Sohae site,” Yang said.

The move will only be significant if North Korea takes more than cosmetic steps to fully shutter the site, not just the test stand, said Melissa Hanham, a senior research associate at the James martin Center for Nonproliferation Studies.

“It’s only a good deal if they dismantle all the facilities at Sohae and re-employ the scientists in something civilian,” she said.

(Reporting by Matt Spetalnick; Additional reporting by Idrees Ali in WASHINGTON and Christine Kim, Josh Smith, and Jeongmin Kim in SEOUL; Editing by Lisa Schumaker and Darren Schuettler)