An Ice-Age or a New Spring?

A chill wind is blowing toward Russia, emanating from Brussels.  Whether it will turn out to herald a fresh springtime for EU-Russian relations or else deepen into political permafrost remains to be seen; as always with Russia the auguries are hard to interpret.  But there has certainly been a sharpening of tone in the language adopted by the Commission recently.  Compare “The European Union welcomes Russia's return to its rightful place in the European family in a spirit of friendship, cooperation, fair accommodation of interests and on the foundations of shared values enshrined in the common heritage of European civilization” from the preamble to the ‘Common Strategy of the EU on Russia’, adopted in June 1999, with “[The] EU [should] engage with Russia to build a genuine strategic partnership, moving away from grand political declarations and establishing an issues-based strategy and agenda,” from the conclusions of the ‘Communication from the Commission to the Council and the European Parliament on relations with Russia’, issued on 9th February this year.

 

Writing in ‘The Moscow Times’ (6th June 2003), commenting on the summit in St Petersburg between the EU and Russia a month earlier, the Head of the European Commission Delegation in Moscow confidently asserted that “the EU and Russia have now charted a clear medium- to long-term course for the future development of relations through the decision to create [four common spaces] …This landmark decision lays the groundwork for the further integration of Russia into Europe and compliments [sic] the European Commission's ideas of creating a "Wider Europe" comprising a ring of friends around the European Union, where our neighbors will share in the European Union's single market and the freedom of movement of goods, services, people and capital… [T]he EU has come to a clear understanding with Russia on the goals to be attained in our future relations.”  In contrast, the Commission Communication says starkly, “[D]espite

common interests, growing economic interdependence and certain steps forward, there has been insufficient overall progress on substance.”

 

What has gone wrong?  The Communication states, “President Putin’s four years in charge have … witnessed a weakening of the values to which the EU and Russia …are committed. Indeed, reports by international organisations, including the OSCE and Council of Europe, the conduct of Duma elections in December 2003, events in Chechnya and indications of the selective application of the law raise questions about Russia’s commitment and ability to uphold core universal and European values and pursue democratic reforms.” 

 

Really?  The recent Duma elections give cause for concern, as opposed to, for example, the 1996 presidential election, when Yeltsin went from a 6% approval rating to winning – surely one of the most extraordinary ‘democratic’ achievements of all time? Or the 2000 presidential election, when the Lushkov-Primakov alliance was destroyed by vicious ‘black PR’ on television?  (Let’s not even think about Yeltsin ordering the tanks to fire on the elected Duma in 1993).  As for Chechnya, the war – in all its horror – has been continuing since 1999 (to say nothing of the 1994-1996 one launched by Yeltsin; indeed, historical ‘purists’ argue it has been going on intermittently for the best part of 200 years).  And with regard to the “selective application of the law”, it is disturbing that Russia’s richest man, Mikhail Khordokovsky, former boss of Yukos, has been languishing in jail without trial or bail for the last six months.  Arguably, however, this represents a measure of progress from the early to mid-1990s, when business and business-political disputes were typically resolved with lethal violence and when annual murder statistics were broken down by the occupation of the victims – bankers, journalists and tax collectors were at especially high risk.

 

It is not that the Commission is incorrect in noting the flaws in Mr Putin’s Russia.  It is simply that these flaws – and many much worse ones – have been around ever since Boris Yeltsin led Russia to ‘independence’ from the Soviet Union in 1991.  So, why have the Europeans, who so fulsomely welcomed Yeltsin’s corrupt, dangerous, chaotic and unpredictable Russia back into “its rightful place in the European family”, decided to turn pugnacious at this particular moment?

 

The immediate cause is the current refusal of Russia to accept that it must extend the provisions of the EU-Russia Partnership and Cooperation Agreement (PCA), effective since 1997, to the ten new EU member states, when enlargement takes legal effect on 1st May this year.  If Russia really were to refuse to abide by PCA commitments to the new member states - and Russia argues that its prior and still-in-force bilateral agreements with the new members make this legally inescapable – there could be a full-blown economic and political confrontation.  Terms such as “economic sanctions” currently being bandied about illustrate the possible consequences.  In itself, there is nothing particularly earthshaking about this; Russia and the EU have had, and still have, a number of long-running disputes on a wide range of issues.  What is troublesome is that, in this case, there is an immovable deadline – E-Day (for enlargement) or 1st May.  And yet, awkward though it would be if the matter is not resolved in time (although the Russians are now optimistically saying that they expect a satisfactory outcome before then), it will hardly presage the end of civilization.  The EU will continue to buy strategically vital gas from Russia; Russia will continue to buy essential capital and consumer goods from the EU; the Big Boys of global business (notably the oil majors) will continue to try to sniff out investment opportunities in Russia’s economy.  In accordance with established routine, some kind of resolution will eventually be worked out.  Experienced and cool-headed Russia-watchers in the Commission and the member states know this perfectly well.  So, to return to our key question, why is there a fuss of these proportions right now?

 

To a large extent the answer lies in an all-too-human characteristic – frustration – combined with a bad case of disappointed expectations.  These feelings apply to both parties and, in turn, they have been aggravated by the pot-stirring of the new member states.

 

Frustration

On the Russian side, the frustration stems from the belief that the EU has consistently disappointed.  The PCA offered the prospect of a free trade agreement (FTA) between the EU and Russia, but this was effectively withdrawn in the EU’s 1999 Common Strategy and replaced by the offer of a “common economic space”.  Despite various attempts to define this concept, nobody really knows what it is or might be and it is therefore impossible to forecast what benefits, if any – quite apart from costs - might accompany its introduction.  To this has been added the promise of a further three “common spaces”, embracing justice and home affairs, external security, and research, education and culture.  This is an alien language; after all, the EU does not talk about ‘common spaces’ with its major economic and political partners – the United States, Japan and so on.  So what does it all mean for Russia?  There is no clear answer.

 

Russia also feels it is being bullied by the EU’s insistence that it ratify the Kyoto Protocol, as if Russia’s refusal to do so up to now is the sole cause of the world’s failure to tackle global warming.  Why, Russians ask, does not the EU take the same strong line with the United States or Australia, which have also refused to ratify it?  Any one of these three countries would be sufficient to achieve the “55% threshold” of global emissions required to bring the protocol into effect.  Why pick solely on Russia?  (Actually, if Kyoto is really essential to world survival, why not redraft it so that those countries who have signed up to it can get on with it?)  President Putin’s personal economic adviser, Andrei Illarionov, has made a persuasive case that the scientific assumptions underlying Kyoto are flawed and that implementation could be seriously harmful to Russia’s economic development.  He might be wrong, but he has provided a thoughtful analysis and he is – along with his president and his country - entitled to a considered reply. 

 

Russia also still feels bruised by last year’s fight with Brussels over the issue of transit through Lithuania of people between the Russian mainland and the Russian exclave of Kaliningrad.  Although a mutually acceptable deal was eventually agreed, the rhetoric thrown at Russia by some of the less restrained Schengenites was verging on – if not exceeding – the limits of diplomatic discourse.  For that matter, much of the Russian language was excessive, but at least the Russians were the ones to be harmed by Lithuania moving towards adoption of the Schengen regime for issuing visas, thereby threatening to make it difficult and costly for Russians (previously allowed visa-free transit through Lithuania) to travel between Kaliningrad and the Russian mainland.  The EU was under no such threat.

 

And, although there is undoubtedly a large element of opportunistic populism on the part of the utterances of many Russian politicians, there is a genuine sense of grievance over what is perceived to be hypocritical double-standards by the EU with regard to how ethnic Russians are being treated in, especially, Latvia over that country’s laws regarding language and citizenship.  Elderly Russian-speakers, who are unlikely to be able to master the intricacies of Latvian, will be disadvantaged in numerous areas of civil rights. Russia feels aggrieved that the EU does not, in its view, take its concerns seriously.

 

Furthermore, in the area of practical assistance to Russia, the EU’s Tacis program of technical assistance (consultancy advice, training, exchange visits and the like) – widely touted by the Commission as largess on the grand scale, with over €2 billion committed and largely spent since it started in the early 1990s - is generally regarded as excessively bureaucratic, inflexible, unresponsive to Russia’s rapidly changing needs, and managed by people who have little if any understanding of Russia.  Even the Commission acknowledges, in its February Communication, that, “it has produced at best mixed results”.

 

But just as Russia has a number of gripes about the EU, so has the EU about Russia.  These range from single issues – Kyoto, charges for EU airlines overflying Siberia, veterinary procedures covering trade, and certification of exports, lack of ratification of border treaties with Estonia and Latvia, for example – to the broader matters of laggardly implementation of the PCA by Russia and, of course, the concerns about democracy, human rights and the rule of law, referred to in the Communication.  The EU does not mind having difficulties with Russia – it has difficulties with just about everybody else too in one sphere or another, not least with the United States.  What is especially frustrating is the difficulty with which any progress can be achieved.  And here we enter the realm of culture and mindsets.

 

The Communication notes acerbically that “Experience has shown that when difficult matters arise, Russia often seeks to treat questions by setting up new negotiating mechanisms. The EU should make clear its willingness to engage with Russia on all complex issues of mutual interest but continue to give priority to substance over form, with a view to obtaining concrete results.”  Anyone who has worked and lived in Russia will recognize this complaint.  Bureaucracy, in all its worst aspects of rules, procedures and forms – often incomprehensible and frequently seemingly pointless, except to make things difficult – dominate every aspect of working life.  Incompetence, obstruction and downright corruption are everyday features in Russia.  But beneath this surface layer of apparent self-defeating stupidity lies something more profound and deeply rooted in Russian culture and history.  Unlike the experiences of the EU member states, Russian history teaches that life is a zero-sum game (if not negative-sum) – for every winner there must be a loser.  Making concessions is a sign of weakness and, in earlier times, could be punished by the authorities with extreme penalties.  Thus, when the EU says what it thinks is patently self-evident – that Russia will benefit from enlargement – the natural, initial reaction on the Russian side is to look for the hidden catch.

 

The problems caused by this mutual misunderstanding are compounded by two further aspects of Russian behaviour – the habitual adoption of confrontation as the preferred negotiating style, rather than cooperation, and a tendency to put off addressing issues that are complex until the last moment.  These approaches are in fundamental contrast to the negotiating behaviours used within the EU by the existing member states and – as part of the accession process – learned by the new members: take long-term perspectives on complex issues and negotiate in the spirit of give-and-take.  Of course, the picture is not nearly so clear-cut in reality, but there is a great deal more substance than caricature in this depiction.

 

A final contributing factor of significance is the totally different way that the Russian civil service operates, compared with the civil services of the EU.  In the EU, in some countries more than others, it is not untypical for civil servants actually to propose new initiatives to their political masters and certainly to apprise their masters regularly of the implications of alternative policy choices.  By and large, in Russian ministries civil servants undertake no activities of significance unless explicitly ordered to do so by the minister or one of his/her, typically numerous, deputy ministers.  In this, it has faithfully adhered to both the Tsarist and Soviet traditions.  Thus, the administrative capacity of the Russian civil service is far below that of its western counterparts.  Indeed, Martin Gilman, the International Monetary Fund's Senior Resident Adviser in Moscow from 1997 to 2002, stated in an interview with the Washington Profile News Agency (12th March 2002 – see www.washprofile.org) that this lack of administrative capacity was perhaps the biggest obstacle confronting the path to successful economic development.  It is worth quoting him on this: “[T]he [Communist Party of the Soviet Union]was the central authority, and when it disappeared there was nothing else, there was just a skeleton, so it looked like a government structure, but the real power of decision-making, for resolving disputes and reaching compromises and making decisions, was not there. There was a formal government structure that had no way of making decisions.”  (Emphasis added).  There has not been much progress on this front since Gilman’s time.

 

It is hardly surprising, therefore, that EU-Russia negotiations are frustrating.

 

Disappointed expectations

A further cause of EU displeasure with Mr Putin’s Russia is that, ironically, it has been reasonably successful.  Boris Yeltsin’s Russia of 1991 to 1999 was a total shambles, to put it kindly – the financial devastation of the emerging middle-class (not once, but twice); the first of the current Chechen wars; the infamous loans-for-shares looting of national resources; the encouragement of virtual autonomy on the part of the 89 federal subjects (the regions that make up the Russian Federation); the collapse of the economy; the victorious emergence of criminal, crony capitalism; the entrenchment of corruption as the basis of state-citizen relations; more prime ministers than many Russians have had hot dinners; and much, much more.  Yet, the West, including the EU, put up with all this, turning a blind eye to the worst excesses as the assumed necessary price of transition to a free-market economy and a pluralistic democracy based on the rule of law and respect for human rights.

 

Putin has not overcome most of these problems, but he has at least tried to tackle quite a lot of them.  His greatest achievement – from the perspective of most Russians – is that he has restored a degree of stability and predictability to the country.  Opinion poll after opinion poll show that the overwhelming majority of Russians value such stability more than just about anything else, including western notions of democracy, independent media and the like (let alone the inviolability of oligarchs and the privatization scams).  Opinion polls are not elections, but they do enable us to record people’s priorities and concerns.  In this they perform a valuable democratic function.  Why, then, should the EU express disapproval of what Mr Putin is doing when his actions are supported by the vast majority of Russian citizens?  There is an unpleasant whiff of paternalism and superiority here.

 

But it is precisely because Putin has achieved so much that there is irritation that he has not done more.  With Yeltsin, one never knew what would happen next, so expectations, while optimistic for the longer term – however long that might turn out to be, were modest in the short-term.  By contrast, Putin has shown himself to be somebody the West can “do business with”, so more is expected of him and is expected now.  This does not mean that his record is an unblemished success, far from it, and the EU along with Colin Powell, Joachim Fischer and others, are perfectly entitled to go public with their concerns.  But it seems a little unfair to be tough on Putin after the extraordinary indulgence of Yeltsin.

 

New thinking

And this brings us to the role of the new member states, especially the eight who were once part of the Soviet Union (the Baltics) or its satellites (the rest).  Each previous enlargement of the EU has brought new perspectives to how the EU has thought about itself and its relations with the rest of the world.  It has been blindingly obvious that the accession of new members, who had previously been part of the Soviet hegemony, would be no exception, especially with regard to developing new policies towards, and relationships with, Russia.  In this respect, one can unequivocally accuse Russia of making a big strategic mistake.  Instead of cultivating friendly relations with these countries as equal sovereign partners, Russia has adopted a predominantly bullying and blustering tone that has confirmed these countries’ historic mistrust of Russia as a dangerously imperialistic country and alienated the existing members of the EU.  Truly, in this case Russia has nobody to blame but herself.  The new members, especially the Baltic States and Poland, should have been wooed as potential “friends at court” in the enlarged EU.  But the opportunity was squandered by Homo sovieticus thinking in key Russian power structures.

 

Whether or not President Putin could have made any difference is hard to say.  Part of his popular mandate rests on the belief among Russians that he can restore his humiliated country’s greatness.  In the absence of real global power, one way of asserting this is to be very loud.  “Speak softly, but carry a big stick” only works if you have a big stick.  But, arguably, the bad-tempered rants that have emerged from Moscow in recent times probably do not reflect Putin’s personal vision of how to conduct business with the West in general, and the accession states in particular.  It may not be a scientific assessment, but one has only to look at how confident, relaxed and pleased Putin looks when he is at G8 meetings or EU-Russia summits – pictured alongside his good chums George W., Tony, Gerhard, Jacques and co. - compared with how uncomfortable he looks at NIS meetings with the likes of Lukashenko, Kuchma and the Central Asian despots.  Unnecessarily upsetting the EU’s new members does not seem to fit with Putin’s personal views, though this – perhaps overly-charitable – interpretation probably does not get much consideration in the chancelleries of, say, Riga or Tallinn, who clearly want Russia to shut up and stay out of what they define as their internal affairs.

 

So, to ask an old Russian question, what is to be done?

 

It takes two to tango

On Russia’s side, Putin must order various things to happen.  (Without his personal direction they will not happen).  A ‘charm offensive’ should be launched at the governments of the more important EU accession states, coupled with a strict injunction to involved officials to cut out offensive and counter-productive rhetoric.  (This does not mean dropping reference to issues of genuine and legitimate concern to Russia – trade tariffs, the plight of ethnic Russian minorities, and so forth – but couching these concerns in constructive ways, not in the habitual bullying and confrontational manner).

 

A major reform of Russia’s Foreign Ministry needs to be carried out.  Old Guard apparatchiki should be replaced with multi-lingual, young diplomats and negotiators, who are familiar with western mindsets.  One has only to look at similar reforms in the foreign ministries of the CEE accession states to see how impressive and beneficial the results can be.

 

Putin himself needs to explain more clearly and convincingly what his vision for the future of Russia is – especially regarding the key issues of democracy, the rule of law, media freedom, Chechnya and the other concerns of the West.

 

Most important, Putin should heed the exasperation of the EU and others over the lack of substantial progress in areas that Russia has committed itself to work on.  He should define precise goals and priorities for Russia-EU cooperation and empower trusted and competent officials to draw up mutually agreed ‘road-maps’ for their achievement. (This almost certainly means bypassing the civil service).

 

On the EU’s side there should also be action.  First, the EU should try to understand and be patient with Russia’s very different mindset over negotiations, and provide all support it can to Russian initiatives that attempt to overcome this psychological hurdle (training, secondments of bright Russian diplomats to EU counterparts, study tours, an effective information campaign in Russia that explains what the EU stands for and how it operates, etc).

 

Second, while listening carefully to what the new member states have to say about Russia – their knowledge and experience are invaluable, after all – the existing members should ensure that the tail does not wag the dog.

 

Third, just as Russia needs to tone down its rhetoric, so should the EU stop retreating behind baffling jargon and start being clear and precise.  For example, will there be a free trade agreement between the EU and Russia?  If so, what are the precise terms and conditions?  Stop talking about ‘common spaces’, which mean nothing to anybody.  This is simply waffle at its worst.

 

Fourth, back up intentions – and reward good behaviour – in a meaningful and tangible way.  The EU keeps asking – often demanding – that Russia should ‘harmonise’ and ‘approximate’ its legislation and regulations with those adopted by the EU, especially with regard to Single Market matters.  While nobody disputes that Russia’s legislative base needs radical reform to enable it to participate effectively in the global community, not least in the areas of trade and investment, the EU has never explained why Russia needs to adopt EU legislation whereas the United States, Japan, Australia and so on, have escaped this somewhat draconian requirement.  If this is of such enormous mutually beneficial importance, let the EU pay for it – it will be an investment that is handsomely repaid over time, if what the EU claims is true.  At present, the EU, through its Tacis program, has been spending on average around €200 million a year on Russian projects.  This amount should be raised to €3 billion a year and should cover capital expenditures as well as the current, primarily technical assistance projects that Tacis funds (consultants, training, etc).  If this seems a lot – and it is – it is only roughly proportional, in terms of population, to what the new member states have been getting since 2000.  Poland, for example, with a population of 40 million – less than a third of Russia’s – has been getting around €1 billion a year.  With this kind of financial support, there is a much stronger likelihood that Russia will listen and undertake necessary reforms.

 

If the EU balks at such a huge commitment – as it undoubtedly would – then let it try a smaller-scale version of such support, by providing large funds for the infrastructural development of Kaliningrad, officially designated by Russia as a pilot region for EU-Russian cooperation and accepted by the EU as a special case, given its exclave status.  A fund of around €250 million over five years could achieve a great deal.  If successful it could be extended to Russia as a whole, or at least those parts that will border on the enlarged EU.  If not, well, maybe it would then be legitimate to start voicing complaints about Russian backsliding. 

 

In the meantime, the EU’s obloquy of Mr Putin’s Russia is ill-informed, inappropriate and premature.  Yes, the siloviki are increasingly dominating public affairs (as opposed to oligarchs and criminal gangs); yes, elections are blatantly unfair (as always); yes, there are fewer independent national media outlets, especially in television (but there were never truly ‘impartial’ outlets – only those owned by oligarchs; there is no Russian BBC and never was); yes, there are appalling human rights abuses in Chechnya (and have been at least since Stalin deported most of the population against their will 60 years ago, quite apart from colonial wars of conquest earlier); yes, in general Russia is a pain in the neck for the West (nothing new). 

 

E-Day – the date of formal EU enlargement – has catalysed this outbreak of EU anger (fuelled by Italian Prime Minister Berlusconi’s extraordinary behaviour at the November 2003 EU-Russia summit, where he publicly contradicted EU policy by supporting Putin’s behaviour over Chechnya and the arrest of Khordokovsky, which infuriated just about everybody else in the EU and which has led to the recognition that the EU needs to speak with “one voice” on Russian issues).  But, the root causes go back to the frustrations and cultural misunderstandings that have dogged relationships for centuries between Russia and the West, not just in the last decade or so.  E-Day has provided the proximate cause of the current slanging match, but it is not the real reason.  Both sides need to reflect on their approaches to each other and try to start again.  The stakes are too high to allow emotion to prevail, especially as, in Vladimir Putin, the EU and the West have a Russian leader who seems genuinely committed to reform of the economy and, perhaps, to democracy as well – once stability has been firmly established, as the Russian people desperately hope.

 

 

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