In Geopolitics Today: Friday, February 3rd
Challenges to Electric Battery Production Despite Rising Demand, The US Pressures Middle East Allies to Expel Wagner Group, and other stories.
Poland a Key Market for South Korea’s Defence Exports
South Korea and Poland have established a military relationship that extends beyond security and is accompanied by increased economic ties. This is due to South Korean companies looking to shorten supply chains, COVID-19 pandemic and growing tensions between the US and China, and Poland's attractive position in the EU's economic and defence architecture, providing access to the European market, a skilled labour force, and being capable of becoming a Korean defence production hub.
Deepening cooperation between the two countries provides a competitive advantage due to a lack of domestic competition in certain market sectors by South Korean companies. Poland, located in Central Europe, offers alternative trade routes for Korean defence products and access to other markets in CEE, such as Hungary and the Czech Republic. The Polish-Korean defence relationship has potential for both countries, with Poland boosting its military capabilities and reviving its military industry, and South Korea solidifying its growing share of the European and global defence markets.
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Challenges to Electric Battery Production Despite Rising Demand
The global demand for electric vehicles (EVs) and electronic devices is growing, leading to an increase in demand for electric batteries. Companies are struggling to keep up with the production due to various challenges such as supply chain constraints, lithium shortages, and increased costs. These challenges continue to threaten battery production with huge investments required to support it, making the future of the electric battery uncertain.
The US views the battery shortage as a threat to its national security, as its green transition may be endangered. The battery demand is expected to rise by 30% globally to 4,500 GWh by 2030 with 40% of this demand coming from China. However, automakers and energy companies will face various challenges while scaling production including labour and material shortages, the time taken to develop factories, competition for resources, and product shortages. The batteries from the first generation of EVs will also need to be replaced, presenting the threat of electrical waste and demonstrating the never-ending demand for batteries.
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US Senators Plan to Halt $20B Arms Sale to Turkey over NATO Dispute
A group of 29 US senators signed a letter to President Biden, threatening to block a $20bn arms sale that includes 40 Lockheed Martin F-16 fighter jets and upgrades to Turkey's existing fleet.
The senators argue that Turkey is violating its commitments under a trilateral agreement signed last year with Finland and Sweden, and are calling the sale into question if Ankara continues to block the two countries from joining NATO. Senate Foreign Relations Chairman Bob Menendez and Senator Chris Van Hollen have suggested that sanctions may be imposed on Turkey for blocking the entry of Finland and Sweden into NATO and for threatening to attack US-backed Kurdish forces in Northern Iraq and Syria.
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Rising Tensions between Iran and Azerbaijan
Iran-Azerbaijan tensions are on the rise as Iran tries to fill the gap left by Russia in the ongoing conflict between Azerbaijan and Armenia. This is causing concerns of a potential military conflict between the two countries.
Azerbaijan has evacuated its embassy staff and issued a travel warning to its citizens due to what it calls an “unstable situation” with Iran. Meanwhile, Azerbaijan's President Aliyev has stirred Iranian fears of a separatist movement in northern Iran. Azerbaijan and Iran disagree on the status of Iran's ethnic Azerbaijani community. Russia's absence in the region has also led to questions over its effectiveness as a peace guarantor. The outcome of talks on the Zangezur corridor, which would connect Azerbaijan and Turkey through Armenia's territory, will be crucial in determining if tensions will deescalate.
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The US Pressures Middle East Allies to Expel Wagner Group
The United States is putting pressure on Middle East allies to expel the Wagner Group, a Russian military contractor with close ties to Russian President Vladimir Putin, from Libya and Sudan where it has expanded in recent years.
The Biden administration is making a broad push against the group. Wagner Group is owned by Russian oligarch Yevgeny Prigozhin so the US has been working with the governments of Egypt and the UAE to pressure military leaders in Sudan and Libya to end their ties with the group. The Wagner Group's role in Sudan and Libya was reportedly the focus of recent talks held between CIA director William Burns and officials in Egypt and Libya.