Posts Tagged ‘Customs Union’

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Upping the ante – Wagons roll

August 23, 2014

Today it appears The Kremlin has lost patience with the either the combatants in eastern Ukraine, the ICRC insistence of safe passage assurances from both sides prior to entry, and/or a seemingly deliberate stalling by Ukrainian border guard and customs service of the Russian humanitarian convoy.  A stalling that enables Ukrainian military to continue to make advances in and around Donetsk and Luhansk.

Nevertheless the Russian humanitarian convoy has rolled into Ukraine regardless of permissions and assurances – and seemingly without ICRC personnel too – in what is clearly going to be interpreted as yet another escalation by The Kremlin.

Krasnodon border crossing 20 meters from Ukraine

Krasnodon border crossing 20 meters from Ukraine

Why now, after already waiting a week to carry out this mission within full accordance with international norms?

To insure Ukrainian forces are far more restricted in their military abilities during the days the humanitarian convoy is going to be in eastern Ukraine?

To create an incident against the humanitarian convoy for which Ukrainian forces will be blamed – despite their illegal entry and defiance of all agreed procedures prior to entry into Ukraine?

To create an incident for which the separatists will be blamed, allowing The Kremlin to disown them having fired on a Russian humanitarian convoy?

Perhaps to insure there is no absolute defeat of the Kremlin sponsored fighters prior to the visit of Chancellor Merkel on 23rd August – the 75th anniversary of the Molotov-Rippentrop Pact – insuring she pushes diplomatic solutions against an open door, as Ukraine already seeks and acknowledges “There is no solely military way to solve the situation” despite its current military ascendancy.  Maybe she can convince Ukraine to give a little more than it would do otherwise.

Is it to have a yet larger Kremlin-cast shadow over Ukrainian Independence Day on 24th August, this time via an entirely undeniable violation of Ukrainian sovereignty?

Maybe it is to insure that there is still a Kremlin sponsored fight to negotiate the settlement of in Minsk on 26th August, when Presidents Putin, Poroshenko, Lukashenko, Nazarbeyev, High Representative of the Union for Foreign Affairs and Security Policy/Vice President of the European Commission Catherine Ashton, European Commissioner for Energy Günther Oettinger and European Commissioner for Trade Karel De Gucht all meet?

Perhaps it is far more basic than that?  By upping the ante, is it simply a way to give the impression of negotiating from a position of strength when the Minsk meeting arrives?   Another act of Kremlin defiance prior to that meeting to insure all attending are well aware of The Kremlin ability to act unilaterally as and when it wants to?  An immediate retort to the statement of President Poroshenko yesterday, when he stated “We will not let anyone call into question the sovereignty and territorial integrity of our state. Our state doesn’t threaten anyone. It is peaceful and doesn’t want to make war.”  This latest action immediately calling into question the sovereignty and territorial integrity of the Ukrainian state again.  To be sure, President Poroshenko has been seeking to enter any negotiations from a position of strength too.

Maybe it has far more to do with the domestic Russian audience seeing that The Kremlin leadership will act in Ukraine within or without international norms and laws (again) prior to any negotiated settlements in Minsk – those negotiations clearly about far more than the situation in eastern Ukraine looking at the attendees.  Gas and trade are clearly on the agenda too.

The Russian domestic audience and domestic policy is certainly a major driver in Russian foreign policy – especially so in relation to nations on its periphery.  Domestic perception matters – and matters greatly.  A (perhaps final) act of “Russian power” in defiance of all international agreements prior to a negotiated exit in eastern Ukraine (as far as fighting is concerned)?

That said, it’s still not clear what The Kremlin will come away with from the Minsk meeting should it decide to end hostilities in eastern Ukraine.

Time will very, very soon tell.

 

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Shooting the messenger in the Donbass – євромайдан

December 28, 2013

Much of what has been written in this blog over the past few weeks has been євромайдан-centric.  It has been generally supportive and also occasionally critical – as I am a democracy advocate.

Anything peaceful and law abiding that promotes or strives for democracy and all its supporting pillars I would find very difficult not to support.

However, it would be easy to think that the entire country supports the євромайдан cause given the majority western media coverage.  In the interests of fairness, it is necessary to be mindful that it is most certainly not so.

The above YouTube clip – with English subtitles – clearly makes that case.

Or does it?

Marching through Donetsk with the EU flag is probably not the best way to engage many there in open minded dialogue.  The response would be similar to marching through Lviv with the Customs Union flag and expecting an open minded dialogue.

It is not as though people in Donetsk – at least those I know – do not want a more robust and responsive  democracy.  They do.  They want rule of law, a free media, their basic freedoms of speech and assembly and all the other pillars of a democratic society.

The problem for them is not necessarily the message – but the messenger (and the messenger’s paraphernalia).

Not exactly an intractable problem to find or create a different and more acceptable messenger (with or without different and more acceptable paraphernalia) carrying the same core message that would gather public support in the East.

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Putin’s Ukrainian “solution” – What of the Customs Union now?

December 20, 2013

A few weeks ago I wrote about a very possible cause for Mr. Putin’s Customs Union and soon to be launched Eurasian Union unraveling before it even takes off – “Despite many “experts” and “commentators” stating that without Ukraine it is nothing but a hollow shell, it is perhaps Kazakhstan and not Ukraine that will be the undoing of Mr Putin’s Eurasian political legacy before it even officially gets going. It is no secret that the Kazakhs are very unhappy with the existing Customs Union and will need a great deal of convincing to continue onwards with the new Eurasian Union. Perversely the threat of it unraveling comes not from an unwilling Ukraine, but from within its existing ranks.”

Well, perhaps that threat should now include the other nation in the Customs Union trio – Belarus.

It is no secret that the Belorussian President, Alexandre Lukashenko, has mismanaged his economy for decades to such an extent that it is in a far worse position to that of Ukraine – whom Mr. Putin so graciously bailed out a few days ago to the tune of $15 billion from the Russian National Welfare Fund, together with reducing gas prices by 33% – worth approximately $7 billion per annum until 2019.

However, in several recent visits, President Lukashenko has been told by the Kremlin the cupboard is bare and there is no further money to give to bail him out, despite Belarus being a dear ally and partner – and the Russian cupboard whilst not entirely bare is certainly very close to it, and the Russian economy has stalled.

The result for Mr. Putin will be one of two things.

Firstly, a very upset President Lukashenko sitting along side a very annoyed President Nazarbayev of Kazakhstan who has not seen the benefits of the Custom Union he expected to see.

When President Lukashenko comes again for more assistance, if Mr. Putin refuses to bail out Belarus from the Russian Welfar Fund as well – with everybody now aware that the the Kremlin is prepared to slash prices, lower levies and throw up to $15 billion at a struggling economy – and by extension nation – it wants to control, and that is not even a member of the Customs Union, well surely keeping a member within the fold demands equal financial assistance from a Lukashenko perspective.

In the wake of the Ukrainian “solution”, it is a certainty that the Belorussian regime will be quickly knocking on the Kremlin door with begging bowl in hand and realpolitik in mind.

Alternatively, Mr. Putin can say “No”, but in the current circumstances and with an already very annoyed Kazakh partner, a very upset Belorussian partner may very well spell a crisis for the Customs Union and snuff out any chance of the Eurasian Union ever seeing the light of day when signatories are required in 2015.

With its usual perversity, the regional geopolitics of the region – and the Putin “solution” for Ukraine – may yet be the end of his dream with regard a regional political legacy – as well as relieving  immediate concerns with an exposed EU regarding immediate Ukrainian default.

Pandora’s Box – or rather the Russian Welfare Fund – may just have been opened with no way to close it again whilst sustaining Mr Putin’s vision.  Ukraine may well prove to be its downfall – though we have to suspect that assurances have been made by President Yanukovych that upon reelection, the Eurasian Union will be the favoured direction.

The Kremlin and Mr Yanukovych must therefore hope that the necessary election fraud to keep him in power will be within the parameters of plausible election result manipulation.

In the meantime the EU and those in favour of a definite and binding European integration (not necessarily the same thing as joining the EU) must remember that time – via demographics – are on their side as the USSR become little more than a chapter in Ukrainian history books for those increasing number of voters born to an independent Ukraine.

Keeping the domestic and international pressure on the current leadership via the framing of issues through democratic, transparent good governance is the only durable and intelligent way to win the day – whether agreements are ever signed or not!

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євромайдан – A success? Define success

November 27, 2013

A very simple question from a reader has arrived asking if євромайдан and the massive protests will work and change the decision of the Cabinet of Ministers and President to suspend the signing of the EU Association Agreement in the next few days.

The answer to that, as far as the Vilnius Summit is concerned is a definite and unambiguous “No”.

As much as I believe in the ideology behind the євромайдан civic gatherings, they are not going to be enough to change the decision made by those that have made them – and short of some very direct realpolitik by Angela Merkel with Viktor Yanukovych at the Summit, there is no chance of a changing of the decision.  That realpolitik is very unlikely to happen with Anegla Merkel having already charged Russia with breaches of OSCE Charter for carrying out exactly the kind of realpolitik that she would need to use to try and reverse the current decision.

Thus the Europeans have effectively reached the limits of negotiation and their soft power, #євромайдан has an approving look from the Europeans but little more in the immediate, and the opposition cannot effectively hijack the demonstrations without a lot of the demonstrators going home, unwilling to be associated with the political rhetoric and add-ons they will want to attach to the single and simple message the protests have been organised to deliver.

However, success when it comes to policy, including the policy of civic gatherings, is a subjective issue and depends very much upon the definition given to “success”, the parameters and benchmarks of measurement and time over which it is measured.

#євромайдан will fail to achieve signatures at the Vilnius Summit.  In that regard it will not be a success.

What it has done is awake a distant and bureaucratic politic class, both in Ukraine and the EU, to the emotional, psychological and romantic pull of the younger generations toward Europe.  With every year that passes, there is an inevitability that the Ukrainian identity gets stronger and ties to the ex-Soviet nations weaker psychologically.

The romanticism and ideologies psychologically attached to London, Paris, Vienna, Barcelona et al simply overwhelm the attraction of Moscow for the younger generations.  So whilst an independent Ukrainian identity gets stronger through the demographic of new voters reaching voting age vis a vis the old “Homo Sovieticus” voting generation dying off, the bias westwards will grow.

євромайдан  has perhaps removed the view that the Ukrainian exercise is simply a paper bureaucratic exercise for those far removed from society and sitting in a policy drafting bubble.  For once they are not getting political or civil society input, neither of which are particularly reliable in Ukraine – this feedback is direct from the people and in large numbers.  Especially from the future of Ukraine – the youth to 30 somethings demographic.

The public display may very well help garner a much more robust and united position on Ukraine amongst the European nations.  After all, they now know where the Ukrainian heart is – or will certainly be as time passes – despite having to suffer the same feckless political class when dealing with Ukraine that the Ukrainian society has to suffer.

If this happens because of євромайдан then that is surely a success.

If it brings about momentum to take decisions over Visa-free tourist visits to the Schengen area for Ukrainians sooner rather than later to further their romantic and ideological draw to European capitals and consolidate a generational move away from Moscow, then there are definite advantages to playing that long-term game for Europe.

If this happens because of євромайдан  then that is a success.

It will certainly keep the EU Association Agreement issue as an electoral issue for the 2015 presidential elections and keep all candidates talking “integration westwards”.

There are of course issues for євромайдан post Vilnius and the most important are whether it will continue and maintain any momentum turning from civic gatherings to civil society entity or not.  To disappear would be a failure when the job remains to be done.

The other is will it allow itself to become party politically aligned.  That would also be a failure.  It must remain consistent in its European integration message and as “a-political” and inclusive as is possible.

Ultimately, whether євромайдан works and is a success depends upon your definition of success, how you measure it and over what time you anticipate favourable results.

In the short term, at the very least, the EU cannot be seen to abandon the Ukrainian people or their future now.  There can be no retraction of the Association Agreement from Ukraine.  At the very least, European integration will remain a domestic political topic until the 2015 presidential elections and beyond.  In that regard  євромайдан has done a sterling job if not fulfilling its initial goal in a few days time.

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Kyiv calls “time out” – And?

November 22, 2013

Unsurprisingly, Kyiv today officially paused its signing of the EU Association Agreement.

Undoubtedly many will simply write this off to President Yanukovych and a zero sum policy of retaining power by keeping Ms Tymshenko in prison.  That quite probably has a lot to do with it – though it may not keep him in power regardless.

Alternatively we can all point at Russia and shout “Boo, Hiss!” to avoid a blame game between Kyiv and Brussels.

Perhaps those millions in favour of the agreement will turn out en masse with a policy of civil disobedience in numbers reminiscent of 2004/5 and panic the National Security Council and President Yanukovych into a different decision over the next week?  Time will tell.

Regardless, the EU must also look to its own game which has seriously fallen short when it comes to convincing the Ukrainian population as well.  If it had not been for Russian muscle-flexing some months ago, the EU PR drive would have failed to gain any impact or traction with the Ukrainian public whatsoever.

The Delegation of the EU to Ukraine, retweeting and sharing faceless statements on Facebook has been a complete and utter failure at a time when it needed to be very noisy, very public and ruffling feathers.  The EU events belatedly organised in Ukrainian cities were farcical and garnered very little interest.

Far, far too little, and far, far too late to try and directly frame Ukrainian societal opinion – particularly so when the automatic “self-attraction” the EU somehow considers itself to still have, has long since eroded over the past few years in the eyes of its own constituents and also its neighbours.

I have long opined that dependence upon the feckless political class – regardless of them being in power or opposition – is to depend upon a channel seriously disconnected from the public to pass any message.

I have also long opined that to continue to throw money at an uncivil civil society that is even further divorced from the public than the political class, is also a seriously flawed policy which has not delivered any results when it comes to framing public opinion, raising the EU profile, or delivered any robust results with any Ukrainian government past or present.

Civil society used to have grass roots – in Ukraine it is tumbleweed, and thus there is almost no connection to the society it purports to represent.  Societal trust in civil society is simply lacking.   It is a shambles.

Quite how the EU identifies “success” for its money when it comes to Ukrainian civil society and then distributes further funding accordingly, would be a very interesting schematic – and an even more interesting definition of “success” I suspect.

In a nutshell, neither of these channels have any robust connection with Ukrainian society – they were/are/will continue to fail to deliver any EU message effectively or convincingly.

In the meantime, numerous Russian TV channels, broadcasting in every Ukrainian home, are directly reaching the Ukrainian audience – whether believed or otherwise in their rhetoric.

A last minute effort to throw a few willing EU Member State ambassadors in front of a camera – pointless in the extreme.

Sadly, the only EU Member States who I expect to have understood this will have been Poland and the Baltic’s – for good reason.  They know only too well “Homo Sovieticus” and the associated character traits.  They also have a far greater understanding of Russian shenanigans and their effects.

Quite how the typical Russian style of negotiation with Kyiv came as an apparent surprise to Brussels again defies belief.

For the EU to have built up the Vilnius Summit into an over-hyped “now or never” moment and then to have failed so spectacularly to convince the Ukrainian public that this top-down – rather than bottom-up – project needed their support seems to belay a basic democratic requirement of societal “buy-in”.

As political science would not claim a democracy is consolidated unless 70% or more of constituents would irrefutably reject any other model of governance – a solid “buy-in” – then how any favourable polling of 45 – 53% (poll dependent) toward the EU Association Agreement – after Russian assistance – can be seen as “robust” again defies belief.

Nurturing Ukrainian societal “buy-in” should have started in 2009 when the EaP project started – and it should have been done directly.  It is not as though the feckless political class or uncivil and ineffective civil society were any better then, than it is now.  And it should have been – and should be – painfully obvious to the EU which deals with both, that was and is the case.

And?

Well, as the Association Agreement remains initialed and therefore theoretically able to be signed at any time, there is now a choice within the EU to do several things irrespective of the current Ukrainian leadership.

It can simply give up – but that does not provide a particularly flattering  image of the EU if it is perceived to crumble to Russian realpolitik in its own neighbourhood.  Stating “it was a Ukrainian choice” does not remove the lessons that need to be learned from this exercise when it comes to EU promotion.  Giving up therefore, is not an option.

As it is very unlikely that Ukraine will immediately run off and sign up to the Russian led Customs Union, there is time to consider future strategy if Ukraine is deemed to remain worthy of any effort.

So, if we are to be realistic, with European Parliament elections next year and then Ukrainian presidential elections in 2015, we arrive at 2016 as the absolute earliest any serious thoughts of revisiting the Association Agreement – less some force majeure occurrence that changes everything.

2.5 years in which – irrespective of Ukrainian leadership – the EU needs to evaluate a common and internally robust position over Ukraine.  Having Member States prepared to sign under condition X but not Y, whilst others are prepared to sign under condition Y but not X is simply a weak position – and a position Russian (if not Ukrainian) leadership will exploit.

2.5 years in which the EU needs to engage with Ukrainian society directly – and not through faulty channels – and insure there is a robust majority consolidated behind the “European integration” agenda.  To claim 50% are in favour, is to acknowledge 50% are not.

Here, when it comes to directly framing public opinion, I will acknowledge that much will depend on the calibre and style of Ambassador sent by EU Member States to Ukraine – as it is they, that between them, will need to remain front and centre in the media eye conveying the same message and not singing from any bilateral song-sheets over the integration agenda.

A much more dynamic and feather ruffling EU Delegation, rather than one that posts photographs of new bike sheds on Facebook with accompanying statements encouraging visitors to brave death or serious injury via manic drivers and the potholed roads of Kyiv to cycle to see them, would be a fairly reasonable suggestion too.

2.5 years in which to encourage, coerce, cajole, threaten, praise, the Ukrainian political class in its entirety along the path to reform, consistent with the existing plans contained within the initialed Association Agreement.  Perhaps in 2.5 years, instead of having to search for implemented progress with a magnifying glass to provide any justification for signing an agreement now, by then there will be reforms in sufficient areas currently of concern, that simply cannot be ignored by even the most hesitant of EU signatories.

Meanwhile Russian pressure will undoubtedly remain constant, if not increase, to prevent such a close call from happening again.

Russia will drive economic “interests” to the fore, and the EU needs to drive democratic “values” just as hard.  If the EU had any sense, and if it is not going to give up on Ukraine,  when it comes to the values and economic interests arguements, it would do well to frame them around Ukrainian opinion surveys that consistently return corruption, unemployment and the economy as the top three concerns of society – and not frame them in a convoluted, overly academic way – in pragmatic policy suggestions and specific strategies that will be understood clearly by the public and take root.

I am only too aware that if I wrote this blog in an overly academic manner, I would have far less readers than I actually have.  Not that my readers aren’t capable of understanding overly academic work – but it is excessively tedious to be faced with in-numerous citations, footnotes, and dry theoretical  prose.  I read such material all the time and accept it is very boring to most people.

The unfortunate issue when it comes to Ukrainian politics itself, it that both the current power and opposition (less Klitschko who as a late-comer has not yet had the chance) have over-promised and under-delivered to Russia, the EU and the Ukrainian public time and time again in equal measure.  Who would trust any of them to continue along the reform path now – rather than immediately engage in standard name-calling, you’re worse than me, presidential campaigns more or less effective immediately – to the detriment of reform that could still continue given the political will to do so?

Perhaps the saddest thing of all, is that in 2.5 years time, the Ukrainian  political class will still be feckless.  It will still not be responsive.  It will not be inclusive.  It will not be tolerant.  In short, it will remain the proverbial country mile from the democratic values that the EU wants to project and have chosen as the lead principle for this agreement.

Thus any signing in 2.5 years time may yet be seen to undermine the values this agreement is supposed to hold as uncompromisable.

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A day when everybody made sense? EU, Ukraine & Russia

August 29, 2013

It doesn’t happen very often, but 27th August was a day when it appeared everybody – with the exception of Russia – was singing from the same song-sheet and actually sounding in tune with the realities of the current EU/Russia/Ukraine situation.

Firstly, Stephan Fule and Andriy Kluyev on message and striking the right tone – although once again Stephan Fule states the European Commission is ready to – and is engaging with – the current Ukrainian government, opposition and civil society without seeming to grasp the need for direct engagement with the biggest constituency of them all, the Ukrainian people.

As neither the Ukrainian government, opposition or civil society manage to effectively engage with Ukrainian society, perhaps the EU should try do so before Russia whips up ethnic Russia sentiment across Ukraine?  Surely it is better to preempt what is inevitable.

Secondly there was Mykola Tomenko (in my opinion the best leader the Batkivschyna Party will never have) setting out a reasonable foreign policy toward Russia.

“Ukraine and Russia have quite a substantial political and economic crisis in their bilateral relations. Unfortunately, the crisis will worsen before November.

Such remarks should prompt our leadership to look for new forms of relations with Russia, or, to be more precise, to build mutually beneficial and pragmatic economic relations.

 The post-Soviet rhetoric about the two brotherly nations should remain in history textbooks. We should talk about two states building their relations on a pragmatic and mutually beneficial basis.

Unfortunately, we can say that this is not the end but in fact only the beginning of such a confrontation on Russia’s part. This calls for a more appropriate response from the Ukrainian leadership: saying that nothing happened and everything is okay is an attempt to bury one’s head in the sand. 

The Ukrainian authorities should substantively reconsider their approaches toward relations with Russia. The Ukrainian leadership has spent several years explaining to Ukrainian society the possibility of building a coordinated system of equitable relations within the format of an association with the Customs Union and the European Union. However, the opposition has always pointed out that it is impossible to work simultaneously in two distinct systems.”

Unfortunately, “reasonable” works only when both parties are prepared to sacrifice “positions” but seek more than “needs” – effectively working by way of the middle road of “interests”.  Mr Tomenko seems to have a rather hopeful outlook when it comes to Russia being “reasonable” any time soon.

It is also rather a stretch to say the current government have suggested an association with both Customs Union and EU to society.  What it has suggested publicly and often – swiftly pooh-poohed by Russia – was a Customs Union +1 (Ukraine) arrangement whereby Ukraine was not a full member of the Customs Union.  The current government is fully aware – having negotiated and agreed the Association Agreement and DCFTA with the EU themselves – that the two are not compatible (because the CU does not allow Ukraine to set unilaterally its trade parameters – a requirement of the EU).

However he is quite right.  The current government should face the reality that the current status quo is an impossibility should any agreement be signed.  Russia will sulk and will make Ukraine suffer given every opportunity.  The recent warning shots have been fired and leave no room for doubt.

Nevertheless, until signatures dry on any agreements – and there is no guarantee there will be any signatures at all –  perhaps stretching that status quo as long as possible is not such a bad option over the next few months.  What is Mr Tomenko’s contingency plan should there be no signing with the EU and also having ruled out any kind of 3 +1 styled Customs Union arrangement having completely poisoned the Russian well in advance?

Lastly, pro-EU Party of Regions MP Volodymyr Oliynyk made some very valid points – particularly in respect of Ukrainian society.

As we all know from personal experience, there is a societal lag when it comes to changes in policy from the top – in any nation.

“We can change clothes, but we must change ourselves, to become Europeans by ourselves: in behavior, in attitudes to each other, to the law. In this sense our task isn’t simple, but these amendments are necessary, primarily for Ukraine.”

Mr Oliynyk is absolutely right in what he says above.  It is easy to change legislation or policy.  It is not easy to change the attitudes of society – they do indeed lag a long way behind on the occasions society is not driving the change.

Again we return to the fact nobody has made any direct impact through dialogue with the biggest constituency of them all – the Ukrainian people.

He went on to say, “If Russia imposes sanctions, God forbid, of not an economic, but political character… undoubtedly we’ll find new market outlets, but Russia will also lose…We don’t want such development of events. We need mutually beneficial partner relations, but, as Shevchenko wrote once: everyone has his truth, his will in his house.

Within these words are the critical element of self-determination and sovereignty as Shevchenko no doubt understood very well.

Ultimately Ukraine must take control of the situation both East and West when it comes to its own destiny.  It cannot allow others to dictate its destiny any longer – and the days of fence-sitting are over.

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Customs Union may withdraw from FTA with Ukraine – Glazyev

August 23, 2013

Presidential advisor to Vladimir Putin, Sergei Glazyev seems to have made a rather clear statement regarding the future of Russian-Ukrainian trade, business and R&D should Ukraine and the EU sign the pending Association Agreements in November.

There is perhaps a need to meddle with the technicalities of the trade bureaucracy if Ukraine is going to dump the Russian GOST standards systems and replace them with EU standards – undoubtedly there will be many existing and agreed contracts relating to GOST standards to which Ukraine, at some point in the future will no longer work to, for example.

There is perhaps a legal necessity to address such issues for the future.  There is, however, no need to politicise such issues as has currently been happening unless the singular intent is to use the issue as a political tool – which is exactly what has happened in the past week.

I wrote on the day the media began talking of a “trade war” – that was never a “trade war” or even about trade – “I would be surprised if this matter was not resolved by the end of the month.

After all amongst the products that will be considerably delayed in arriving with Russian customers are products such as trains and rolling stock, maintenance parts for the aforementioned, steel, pipes and other metals for construction use, jet and prop aviation engines, transformers and road building aggregate and materials – discounting chocolate and dairy produce. All items where replacements are not easily and quickly sourced within Russia – at least not yet.

The aim of this Russian exercise is not to cause lengthy delays to Russian businesses relying on these Ukrainian products – but to cause panic in Kyiv and amongst Ukrainian producers, whilst providing a little taste and fair warning of the pain that may lay ahead if it signs the Association Agreement.”

And so it proved to be that the “trade war” that never was – which is why I never used the phrase – concluded within a week.  The Russian point made and Ukrainian response robust – at least publicly.

If we are to believe Arseniy Yatseniuk, leader of the opposition Batkivshchyna Party, “Now they have played the last card by banning all Ukrainian exports.” inferring there will be little else that can follow.  However, Yatseniuk will undoubtedly rue such an ill-thought out statement (not for the first time).  There are in fact several other very hurtful sticks in the Russian armoury to beat Ukraine with that can be employed at any time.

The last Russian window of opportunity to scupper the EU-Ukrainian association agreement lays not within the next few months prior to any signing (as it seems all media and political mutterings would like to suggest) , but within the period between signing and ratification – and that will take 2 years at least.

Ergo shenanigans aplenty await Ukraine – in numerous guises across not only political, business and fiscal spheres, but also within the social sphere, and of an order of magnitude and frequency that Ukraine is yet to experience since independence.   Ukraine will have to be prepared to take the pain.

In relation to the agreements, only when all 28 EU Member States, the EU institutions and Ukraine have ratified the agreements can those pro-Ukrainian forces within the EU, and pro-EU forces within Ukraine afford to relax.

Despite the Customs Union (read Russia) framing the Ukrainian future choice in purely economic terms whenever and wherever it can, Russian concern relates to its desire to keep a nation with a perceived shared history, culture and language looking toward it favourably.  The perception of Ukraine turning its back on Russia for the EU will present difficult questions for those in the Kremlin when ordinary Russians in huge numbers begin to ask whether the chosen Ukrainian direction is in fact the right direction – and shouldn’t Russia be following that route too?

For Russia, there is much more to play for than the EU has at stake – thus during the period between any signing and eventual ratification Yatseniuk’s “last card” comment will surely come back and haunt him.  Fortunately for him, he is unlikely to have to deal with it being in opposition – and likely to stay there for the next few years at least.

Returning to Glazyev’s statement, will the Customs Union withdraw from the FTA it has with Ukraine?  Not immediately – but that doesn’t mean it won’t if EU-Ukrainian agreement ratification becomes a real possibility in the years ahead.

Ukraine would do well to assess how swiftly Russia can replace the Ukrainian suppliers it currently relies upon – as somebody within the Kremlin will certainly be working on that scenario right now.

 

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