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Relation Between European Union and Russia

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Introduction

After the disintegration of the Soviet Union and the subsequent events in the early 1990s, the EU found it easy to agree with Russia on its agenda. The democratization calls were making some progress to the indebted and weak Russia.  But the strategy is in shambles now. The high energy prices ranging from oil to gas has enhanced and developed Russia’s position in the world making the country to adopt a strategy of defiance and has shown very little in nurturing a formidable relationship with the EU.  Russia has employed different strategies to demonstrate her defiance to EU rule of law in different countries from Georgia, Ukraine, South Ossetia and Abkhazia.  The game of energy supply and pricing continue to attract divisive arguments from either side. This paper analyses EU-Russia relationship from the pre-Soviet times to the moment and concludes with recommendation for the way forward (Entin, 2007).

Post-Soviet Relationship

After the split of Soviet Union and creation of Russia from the late 1980s to the greater part of 1990s, the EU-Russia relations were not as volatile as it is now. During this time, Russia and the EU were on consensus most of the time recalling that Russia was very much indebted and in financially incapable.  These times was characterized by Russia’s dependence on EU.

In 1989 the EU agreed on a trade partnership with USSR and in 1994 signed the Partnership and Cooperation Agreement (PCA). Because of the Chechen war, PCA only materialized in 1997. The PCA gave Russia a Most Favored Nation Status which typically meant that Russia could export to the EU market without any quantitative limitations on commodities except on steel products.  This pact laid the roadmap for a future free trade zone. Under the pact, a bi-annual Summit Meeting was to be held under the auspices of EU presidency. But these Summit meetings brought little in terms of cooperation since they were more inclined to the EU than Russia. These events have been followed by Russia’s call to withdraw from the agreement.  Besides these summit meetings, foreign ministers from the two blocks meets twice yearly under the Cooperation Council while their political directors meet four times every year (Sutela, 2005).

At the same time, the Political and Security Committee including the Russian ambassador based in Brussels meets on a monthly basis.  In addition, there are regular expert meetings on economic relations, political dialogue and legal affairs. These meetings have been characterized by Russia’s failure to attend.

The EU-Russia relationship has faced its share of hurdles with no clear commitment to a specific agenda. It is a history of sector cooperation bedeviled with issues of free trade, behavior rules and sometimes touching on the factors of production.  New sector interests have emerged within the partnership with the resultant effect of weakening the partnership, among the Finnish Northern Dimension (ND) of 1997. The ND stresses the importance of energy as a dominant issue in the EU-Russia energy co-operation.

This in a way brought a new thinking that will help shape future EU-Russia relations. It was postulated that this will work out since Finland and Russia had cooperated along that line from as early as 1990 to 2004.  Informed by this rationale, ND was adopted into the EU policy which has in turn popularized Finland in the EU-Russia agenda. Under the EU Eastern Enlargement, the border has expanded to twice as much.  Poland, Latvia, Estonia and Lithuania are party to this border (Sutela, 2005)

Several anti-dumping policies have been initiated by the EU against Russia and by 2004 Russia had been slapped by 11 of such policies. There have been mixed reactions on the question of Russia’s accession to WTO. The EU has refused to relent on her stance that doing so will affect other future membership to the trade organization though it’s expected to increase Russia’s trade by 50%. Russia has consistently applied for accession since 1993 but there seems to be no concession on the matter. The EU has disputed the low market price value for energy suggested by Vladimir Putin.  Russia produces its exports with low cost of production owing to her cheap gas used in most of these industries (Sutela, 2005).

The resulting effect of EU-Russia relations is uncertain. The oil rich and wealthy Russia has become more powerful than before making it to be less cooperative in talks and perhaps not interested in partnerships with the west. At the moment, EU is being overridden by Russia through signing of individual energy agreements with EU member states further weakening the EU community.

Moreover, Russia has stood in the way of Kosovo and shut out EU out of Central Asia and the Caucasus, areas which was targeted by the EU to forge new partnerships besides entrenching western democracy. As is that is not enough, Moscow has meddled in the EU efforts in Moldova and Ukraine (Leonard, 2007)

Russia is defying the EU legal system as mere plan to insert influence on Russia. What Russia portends by this is that when power shifts, then the law must necessarily change to reflect the new regime. Through this asymmetrical interdependence, Russia is making the EU more dependent on her especially on energy.

The EU is further divided than it was before. The Trojan horses which include Greece and Cyprus have been defending Russia but at the same time vetoing common positions in the EU. Strategic partners which include Spain, Italy, France and Germany have shown preference for Russia which in turn undermines consensus under the EU.  The Friendly Pragmatist who includes Malta, France, Slovakia, Finland, Luxemburg, Bulgaria, Slovenia, Belgium, Hungary and Portugal maintains intimate relations with Russia but have with business interest overriding their political goals (Leonard, 2007).

The Frosty Pragmatists which includes the likes Estonia, Romania, United Kingdom, Czech Republic, Latvia, Netherlands, Ireland and Sweden are less likely to speak on Russia in cases of human rights violations or other pertinent issues. The New Cold Warriors which include Poland and Lithuania are very hostile towards Russia and will do anything to block negotiations (Wilson, 2009).

But basically, countries within the EU more or less depict two stances: On one hand, there are those who are of the view that fostering relationship and building partnership with Russia is a key policy towards integration. On the other hand there are those who see Moscow as a threat because she has openly demonstrated her contemporary democracy and therefore must be excluded from the G8, NATO should take over Georgia, and Russia should be barred from investing in European energy sector (Leonard, 2007).

Lithuania sees Moscow rapid development as a threat to its political future besides degenerating into a cold war. The then US Secretary Condoleezza Rice assured President Valdas Admakus that was not to happen and termed such allegations as speculative and only heighten tensions between the two warring sides (Arunas, 2008).

Russia has recognized Abkhazia and South Ossetia as independent states which has completely violated sovereignty principles something the EU has not assented to. Furthermore there are allegations of Russia distributing passports to Ukrainians, South Ossetia and Abkhazia citizens. But Russia has been quick to defend this move that it’s her right to defend her citizens everywhere. Russia’s intervention in these regions is putting it on a parallel move with the EU (Arunas, 2008).

Energy Politics and EU dependency on Russia’s Energy

The question of energy plays a fundamental role in the relationship between Russia and the European Union. There exists a very strong relationship between the two which illustrate a double sided dependence where some states within the EU mostly dependent on Russian supplies while at the same time Russia banking on the EU market for its energy exports (EU Committee, 2009)

EU dependency on imported energy is by a factor of 50%, with a half of these originating from Russia. It therefore follows that if no major changes are made within the EU caucuses, this dependence is likely to rise to even 70%.  At the moment Russia has 47.55 trillion m3 of gas reserves and estimated oil reserves of 60 billion barrels making the world largest reserves.  Most of this energy is supplied to EU countries with oil being a major source of energy within the EU. Spain, Italy, Britain, Germany and France are the major importers.

EU Oil Imports for 2006

SOURCE % OF IMPORTS
Russia 33%
Norway 19%
Saudi Arabia 11%
Libya 9%
Iran 6%
Kazakhstan 5%
Algeria 4%
Nigeria 3%
Iraq 2%
Other 8%

Source: The European Commission.

When Russia cut her gas supplies in January 2009, it led to a crisis in the EU countries which are significantly dependent on her gas especially those that receive through Ukraine. As a result, the EU in conjunction with the Czech Republic issued a statement on January 6th 2009 requesting Russia to deal with her disputes with Ukraine and resume normal supply. The dispute arose when Russia deliberately raised the amount charged for gas transit by $ 179.50 to $ 360 per 1000 m3.

The EU delegation through the Czech Industry and Trade ministers was sent to arbitrate on the issue but unfortunately Russia failed to honor her promise to resume supply. This energy crisis from Russia made the EU ministers to converge and resolve that the only way out was to diversify energy sources, explore her European potential and foster solidarity between countries in the EU.  As a result the European Community is planning a 250 million pound investment in the Nabucco pipeline which will transport gas from Caspian region to Europe (EU Committee, 2009).

Russia supplies crude oil amounting 226 million tons per year to the EU alone. In 2006, 1.3 million bbl/d were transported through Druzhba pipeline alone making it the largest pipeline in the world.  Druzhba is approximately 4,000 kilometers in length (Borisocheva, 2007).

Table: Russian Oil Exports by Export Outlet, 2006.

Table adopted from

http://www.cere.gr/upload/Russia%20EU%20Oil%20and%20Gas%20Pipeline%20politics.pdf

The gas/energy tactic have had a profound effect on the EU-Russia relations, a situation which is making the EU to seek alternative sources to regain her position in the bilateral talks through the implementation of the Third Energy Liberalization Package. Earlier in 2006, Russia cut supplies to Europe, the EU intervened but it seems Moscow could not be deterred again in January 2009. So far the EU has not moved swiftly to counter this Russian move and safeguard her citizens. (Borisocheva, 2007)

Georgia 2008 War

The liability of the 2008 Georgia war is to be shared by all parties who were involved in the conflict. Georgian president is blamed for being responsible due to his recklessness. Georgians had mistreated the Abkhazia and the Ossetia for a period spanning over 20 years. At the same time Russia demonstrates utter misappropriate action when it went ahead to bomb towns in Georgia with her forces.

The role of Georgia in war had been clearly demonstrated earlier. President Saakashvili of Georgia had continually provoked the Russians into war highly encouraged by the ‚ÄėNeocon elements‚Äô from the US. Definitely the Bush administration played a critical role because he had the capacity to stop President Saakashvilli from entering into war. Washington massages to Georgia were very confusing and did not clearly indicate Bush‚Äôs desire to end the conflict.

On the other hand, Russians had prepared themselves in advances for the war. Three years prior to the 2008 Georgia war, Russia had unsuccessfully attempted to blockade Georgia. The outcome of the 2008 crisis was a culmination of the steps taken by Russia and President Saakashvili (EU Committee, 2009)

A number of issues that had build up over the past 20 years played a significant role in the crisis. From the time of the Soviet republic, a Georginaisation policy had been pursued which saw the transfer of Georgians into the Abkhazia regions.  Georgians were ethnically cleansed in Abkhazia resulting to loss of life and wrecked buildings. Georgians harassed the Abkhazians and the Russians retaliated by harassing Georgians degenerating into twenty years of horrible ethnic violence and turmoil.   Georgians who remained in Ossetia and Abkhazia resented amid accusations from Russia that they were allies of US.

Commercial interests in Abkhazia played a crucial role in precipitating the war. Russians who had commercial interests in Abkhazia were calling for the recognition of Abkhazia basically because of vested commercial interests. Russia employed force which was termed as disproportionate in 2008 Georgian war.

EU response to 2008 Georgian Crisis is laudable

One month to the crisis, President Sarkozy of France had taken over the EU leadership and immediately negotiated for a ceasefire between Georgia and Russia. As a result the EU formed an observation panel. Come September 1st of 2008, the EU Council suspended negotiations under Partnership and Co-operation Agreement with Russia and immediately launched a review commission to assess its relations with Russia.  After the review, the European Commission recommended the resumption of PCA negotiations which was accepted during the November 10th G.A and External Relations Council.  An independent inquiry was set up to investigate the causes of the conflict but the Russians never reciprocated these efforts from the EU (Bachkatov, 2007).

Under the ceasefire agreement, Russia had accepted to withdraw all her troops from Georgia but unfortunately this was not the case in South Ossetia, Kodori valley and Akhalgori. In fact Russian troops increased from 3,000 to 7,500 troops.  These troops even barred EU monitors from entering South Ossetia. The security situation continued to deteriorate especially among the ethnic Georgians in South Ossetia and Abkhazia where human rights violations were rampant especially in the Russian occupied areas.

Only Red Cross International Committee made to South Ossetia and UN Observer Mission in Georgia (UNOMIG).  The EU decided that the direction and the tone of the relations with Russia will be in line with the fulfillment of demands laid out under the ceasefire agreement. In a nutshell, the EU responded swiftly to the crisis bringing about the withdrawal of Russian troops from Georgia and initiated talks between the warring parties Geneva (Schuette, 2004)

As a result, the 2008 Georgian conflict has shaped the relations between Russia and the EU such that the EU has used the compliance to the ceasefire agreement as a precondition for future relations with Russia. This will in turn affect the Partnership and Cooperation Agreement between the two.

Presence of NATO on European soil

The encroachment of NATO on Georgia and Ukraine has had a remarkable effect on the EU-Russia Relations especially the location of Ballistic Missile Defense (BMD).  President Medvedev has threatened to retaliate by locating Iskander missiles further widening the rift within the EU-Russia relations. But that plan has temporarily suspended following President Obama request to address the BMD issue.

NATO BMD decision has put the relationship between the EU and Russia in tense mood which has made Russians very furious (EU Committee, 2009)

This defense system has been placed in Poland by the Americans and when asked about the issue, Russia responded that they always have trouble with Poland because it has been previously used by Germany and other countries within Europe. Moscow is worried that Americans are up to something and are using Poland to accomplish their mission and she is not willing to listen to those who assure her that there is no threat at all from NATO.  Russia has called upon America to allow it inspect the facility just to be sure and that it portends no alarm in future (Bachkatov, 2007)

NATO membership to Georgia and Ukraine is being contemplated within the EU caucuses which will further strain the EU-Russia relationship.  But many defended the idea that even if Georgia had not been a member of NATO that would not have averted the 2008 war. The question of membership to these two countries is being pursued and soon or latter Georgia and Ukraine will be incorporated.  The EU has sent a petition to the US to intervene on the NATO issue especially as it concerns Russia (Mandelson, 2007)

Conclusion

 It is evident that the relationship between Russia and the EU is not smooth. In view of these its imperative for the EU together with UN, OSCE and the US to sit down together and lay out a roadmap for a long-term partnership in the region. Russia must relinquish her quest to recognize Abkhazia and South Ossetia and the EU is not under obligation to assent to this. The decision by Russia to start distributing passports to residents of Ukraine, Abkhazia and South Ossetia in complete  violation of territorial integrity and will just fuel animosity between the EU and Russia. Russia must consider abandoning this move.  It is everyone’s interest to support efforts to have Russia join the World Trade Organization and engage proactively in global economy. On the energy issue Europe must move fast to support initiatives to harness other sources of energy which and reduce the dependency on Russian oil.  They also need to develop the Nabucco pipeline to increase gas supply and eliminate the shortages.

Bibliography:

Arunas, M 2008, Lithuanian Foreign Policy Review, Retrieved April 21, 2009 from http://www.lfpr.lt/index.php?id=114

Bachkatov, N 2007, EU-Russia Relations Worsen, Retrieved April 21, 2009 from http://mondediplo.com/2007/01/06russia

Borisocheva, K 2007, An analysis of the Oil and Gas Pipeline Links between EU and Russia, Retrieved April 21, 2009 from http://www.cere.gr/upload/Russia%20EU%20Oil%20and%20Gas%20Pipeline%20politics.pdf

Entin, M 2007, EU-Russia relations: Past, Present and Future. Retrieved April 21, 2009 from http://www.euractiv.com/en/enlargement/eu-russia-relations-past-present-future/article-167690

EU Committee, 2009, After Georgia the EU and Russia: Follow-Up Report. Retrieved April 21, 2009 from http://www.publications.parliament.uk/pa/ld200809/ldselect/ldeucom/26/26.pdf

Leonard, M. & Nicu P2007, A Power Audit of EU-Russia Relations. 2007. Retrieved April 21, 2009 from http://ecfr.3cdn.net/456050fa3e8ce10341_9zm6i2293.pdf

Mandelson, P. 2007, The EU and Russia: Our Joint Challenge. Retrieved April 21, 2009 from http://trade.ec.europa.eu/doclib/docs/2007/april/tradoc_134524.pdf

Schuette, R 2004, EU-Russia Relations: Interests and Values-A European Perspective, Retrieved April 21, 2009 from http://www.carnegieendowment.org/publications/index.cfm?fa=view&id=16269

Sutela, P 2005, EU, Russia, and Common Economic Space, Institute for Economies Transition: Finland. Retrieved April 21, 2009 from http://www.suomenpankki.fi/NR/rdonlyres/72D29959-BA8B-47D5-AA2B-DC4BA404E752/0/bon0305.pdf

Wilson, A 2009, The Future of EU-Russia Relations: A way Forward in Solidarity and the Rule of Law, Retrieved April 21, 2009 from http://www.europarl.europa.eu/meetdocs/2004_2009/documents/dv/pe407011en_wilsonpopes/pe407011en_wilsonpopescu.pdf

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