Putin’s incentive to fight on

Putin has an incentive to keep fighting in Ukraine [View in browser]( [Bloomberg]( Welcome to Balance of Power, bringing you the latest in global politics. If you haven’t yet, sign up [here](. Two years of war with no end in sight. Vladimir Putin’s [invasion of Ukraine]( has turned into a political, military and economic battle of stamina and will between the Russian president and Kyiv’s US and European allies. Ukrainian resistance remains unbowed, even as the task grows harder and bloodier with ammunition supplies and manpower dwindling and US military aid stuck in Congress. Russian forces have made advances in recent days after months of stalemate on the battlefield. President Volodymyr Zelenskiy’s military shakeup exposed tensions within the leadership amid growing war-weariness in Kyiv, while in Russia, the prison death of opposition leader Alexey Navalny underlined how intense state repression has become under Putin. The US will unveil [fresh sanctions]( today to punish Putin for the war and demise of Navalny. Still, the Kremlin leader boasts that 10 years of international sanctions — starting after the 2014 annexation of Crimea — failed to destroy Russia’s economy. Tomorrow also marks the anniversary of the start of the Desert Storm ground war in 1991 that expelled Iraqi forces from Kuwait after Saddam Hussein’s invasion. A US-led coalition restored Kuwait’s borders under a United Nations Security Council resolution that Moscow supported. Today, Russia uses its permanent UNSC membership to block condemnation of Putin’s invasion. And nobody proposes sending NATO troops to help Ukraine restore its international borders, even as alliance members worry they may be next to be attacked. That’s partly due to Putin’s nuclear saber-rattling. He signaled his defiance again yesterday by taking a flight on a [Russian strategic nuclear bomber](. Zelenskiy is signing security guarantees with key allies as he continues to press for NATO membership, which is unlikely as long as the war continues. That offers Putin an incentive to keep fighting until Western resolve cracks. The risk in a third year of war is that Ukraine [gets just enough support]( to continue resisting but not sufficient to defeat Russia. —[Anthony Halpin]( A Ukrainian soldier fires a mortar at Russian positions. Photographer: Scott Peterson/Getty Images Global Must Reads Putin is shipping free grain to six African countries as part of a program that includes security assistance and arms supplies to [forge closer ties]( with the continent. What the Kremlin gets in return is political support and access to markets that can potentially soften some of the impact of US and European sanctions. President Joe Biden likes to brand himself as the most pro-labor president in US history. Yet the reality is Republican frontrunner Donald Trump has far more donors among people who report being employed in [largely blue-collar workplaces](. That could be a warning sign for Biden’s 2024 reelection bid that relies on winning heavily unionized states — Michigan, Wisconsin and Pennsylvania. Yemen-based Houthi militants are preparing for a lengthy confrontation with the US and its allies by continuing to attack shipping in the Red Sea [regardless of how the Israel-Hamas war]( plays out. Maha Yahya, director of the Carnegie Middle East Center in Beirut, said the Iran-backed militants have influenced international trade and “have realized the power of this tool.” Senegalese President Macky Sall pledged to step down at the end of his term on April 2 after weeks of turmoil sparked by his attempt to stay in power. [A constitutional crisis]( in the West African country, long thought of as one of the continent’s most stable democracies, erupted when he postponed elections scheduled for this weekend and lawmakers proposed extending his tenure by 10 months. Senegalese gendarmes during opposition demonstrations in Dakar on Feb. 4. Photographer: John Wessels/AFP/Getty Images The US and China are in talks that could ease the [$400 billion-plus annual debt service burden]( for poorer countries through new measures to prevent a wave of emerging market sovereign defaults, sources say. The discussions represent one of the most significant attempts in years at economic cooperation between the rival superpowers, Eric Martin and Shawn Donnan report. The Palestinian economy has suffered a devastating blow from the Israel-Hamas war, the World Bank says in a report, describing it as “[one of the largest shocks recorded]( in recent economic history.” The ribbon-cutting ceremony tomorrow at a new chip-making facility built by Taiwan Semiconductor Manufacturing Co. marks [an early victory for Japan]( as governments around the world [race to establish]( domestic semiconductor capabilities. The UK will be granted limited access to the European Union’s border agency as part of a post-Brexit deal designed to boost overseas cooperation to [slow the flow of migrants]( across the English Channel. Washington Dispatch Biden is back in Washington today after a trip to California that included several fundraisers. Congress, however, doesn’t return until next week, just days before a deadline that could lead to another government shutdown and with questions regarding security at the southern border and assistance to Ukraine still unresolved. So far, no plan has emerged to address the March 1 funding deadline, and the Senate must consider the House’s impeachment of Homeland Security Secretary Alejandro Mayorkas. As for Ukraine aid, House Speaker Mike Johnson has said Biden could end the impasse by taking executive action on border enforcement. But he immediately rejected restrictions that the administration is considering as [“election year gimmicks.”]( The speaker has sought one-on-one talks with Biden on the migration surge and possible House approval of $95 billion in foreign aid which passed the Senate. Johnson has refused to allow House lawmakers to vote on that measure, which includes funds for Ukraine, Israel’s battle against Hamas and to support Taiwan. While Biden’s aides at first characterized such a session as unproductive, last weekend the president said: “I’d be happy to meet with him if he has anything to say.” One thing to watch today: Trump and Nikki Haley campaign across South Carolina the day before that state’s Republican primary. [Sign up for the Washington Edition newsletter]( for more from the US capital and watch Balance of Power at 5pm ET weekdays on Bloomberg Television. Chart of the Day Peru’s economy posted its [second-worst contraction]( in more than 30 years in 2023, as political turmoil and extreme weather hurt the once booming South American nation. And Finally First it was telecommunications equipment, then social-media applications; now the US sees the latest [national security threat from China]( coming from ... ship-to-shore cranes. “They’re collecting data, they’re looking at information,” Gene Seroka, executive director of the Port of Los Angeles, said in a Bloomberg Television interview. But addressing that potential vulnerability could be challenging: Few nations other than China build the giant container-moving machines. WATCH: Seroka discusses a potential national security risk from Chinese-made cranes. Source: Bloomberg Pop quiz (no cheating!) The president of which country compared Israel’s war on Hamas to Adolf Hitler’s extermination of Jews during the Holocaust? Send your answers to balancepower@bloomberg.net. 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