U.S. Interests Face Challenges in Europe, Intelligence Chief Says

WASHINGTON, Feb. 16, 2009 – (This is the third in a series on the intelligence community’s annual threat assessment.)

Russia’s perceived strengths and its policies, tensions in Eurasia, Caucasus and Central Asia, and instability in the Balkans all pose challenges to U.S. interests in Europe, the director of national intelligence said Feb. 12.

Dennis C. Blair, a retired Navy admiral, told the Senate Select Committee on Intelligence that Russia continues to rebuild its military and, as events in Georgia last year show, use those forces to impress on the world that the nation is still relevant.

“Russian challenges to US interests now spring more from Moscow’s perceived strengths than from the state weaknesses characteristic of the 1990s,” Blair said in prepared testimony.

“U.S. involvement in Iraq and Afghanistan and general anti-Americanism have created openings for Russia to build alternative arrangements to the US-led international political and economic institutional order,” he said.

Russia is attempting to increase its ability to influence events, he said, by “actively cultivating relations with regional powers, including China, Iran, and Venezuela.”

Blair said Russia’s energy policy is aimed at increasing the country’s importance on the European continent.

“Moscow also is trying to maintain control over energy supply and transportation networks to Europe to East Asia, and protect and further enhance its market share in Europe through new bilateral energy partnerships and organizing a gas cartel with other major exporters,” he said.

“Russia appears to believe the continued heavy dependence of European countries and former Soviet states on Russia’s state gas monopoly, Gazprom, provides Moscow with political and economic leverage,” he said.

The United States and Russia can continue to work some issues together, Blair said, but some issues – such as NATO enlargement, European Missile Defense and the breakaway Georgian provinces of Abkhasia and South Ossetia – will pose difficulties.

Russia’s relations with its neighbors – and once vassals – will always be strained to one extent or another. Armenia, Azerbaijan, Ukraine, Georgia, Belarus all have complicated relationships with Moscow, he said.

Ukraine will have a presidential election next winter, and pressure applied by Russia pressure and by the global financial crisis will work on the country, he said.

“Ukraine has moved toward democracy and Western integration despite numerous political tests since independence,” he said. Progress will be difficult because of weak political institutions and on-going conflicts with Russia over gas-pricing and contracts, he said, noting that the Ukrainian economy is weak, and this may affect stability in the nation.

The former Central Asia soviet socialist republics – Kazakhstan, Kyrgyzstan, Turkmenistan, Tajikistan and Uzbekistan – are ill-equipped to deal with growing Muslim extremism, he said.

“Energy helped make Kazakhstan a regional economic force, but any sustained decline in oil prices would affect revenues, could lead to societal discontent and will derail to momentum for domestic reforms,” he said.

The global financial crisis will affect Tajikistan and Kyrgyzstan the most, since over 40 percent of the gross domestic product of both countries comes from remittances, but all of the Central Asian countries – with their weak governments – will be affected, Blair said.

The Balkans are the greatest threat to stability within Europe, Blair said. Kosovo could be a flashpoint. The new country is effectively divided into a Serbian ethnic majority north and a Kosovar-Albanian south. Even as Serbia’s government in Belgrade seeks to align itself more closely with the European Union and NATO, it will not compromise on Kosovo.

There is also continued shakiness in Bosnia-Herzigovina and the future of the nation as a multi-ethnic state remains in doubt, Blair said, noting that inter-ethnic tensions may have increased in that country to “perhaps the highest level in years.”

Biographies: Dennis C. Blair Related Sites: Testimony: Annual Threat Assessment of the Intelligence Community

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SNIPPET - Quote:

http://www.dni.gov/testimonies/20090212_testimony.pdf

Annual Threat Assessment of the
Intelligence Community
for the Senate Select Committee on Intelligence

Dennis C. Blair
Director of National Intelligence
12 February 2009

February 2009

SENATE SELECT COMMITTEE ON
INTELLIGENCE

FEBRUARY 2009
INTELLIGENCE COMMUNITY
ANNUAL THREAT ASSESSMENT

UNCLASSIFIED
STATEMENT FOR THE RECORD

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