Russia-Ukraine: business is business, and what this actually means

Wednesday, 26. May 2010     0 comment(s)
Arkady Moshes
Programme Director - The EU's Eastern Neighbourhood and Russia research programme

In the end of April European media rushed to cover what looked like a sensation – the decision of the new Ukraine’s government to trade the extension of the lease of the naval base in Sevastopol to Russia for 25 years for the discount in gas prices. A lot less attention was paid to the official visit of Russia’s president Dmitry Medvedev to Kiev last week.

This is a mistake. The results of this trip, or rather their failure to meet the expectations of those who thought that Ukraine’s drift closer to the Russian orbit would continue, are no less significant. These results indicate that the curve of Kiev’s foreign policy may have already changed its direction.

Did Kiev agree to allow the merger of two national gas companies which had been proposed by Prime Minister Vladimir Putin – essentially a takeover of Ukraine’s “Naftogaz” by the Russian monopoly “Gazprom”, which would give Moscow control over transit pipelines and potentially the access to retail gas trade? No.

Did Moscow give Ukraine any guarantees to continue the gas transit? No. On the contrary, Dmitry Medvedev reaffirmed that the decision to build by-pass pipelines would not be revised. Did we hear about the transfer of assets in the aircraft industry or port and railway infrastructure to Russian companies that had been speculated about? No.

Was Ukraine willing to consider joining Russia-led Customs Union – let alone the Collective Security Treaty Organization? No. It is a WTO member, and this fact expresses the preferences of where Ukraine would like to integrate and where no very clearly. Was the dispute concerning the line of the maritime border in the strait of Kerch settled? No. Kiev sticks to the previous position that gives it control over the navigable part of the strait and shows no indication to revise it in Russia’s favour.

Were major concessions made in the joint statements on security in the Black Sea region and the conflict in Transnistria which would reveal that Kiev now welcomes the increase of Russia’s influence? No. Even the opposition-minded Ukrainian commentators emphasize this in their analysis.

And the list of bilateral controversies can be extended.

The thing is that Ukraine is continuing its balancing act which it has never abandoned. True, after Kiev has not played its Sevastopol card the best it could, its bargaining position weakened and the act will be more difficult to perform. But the name of the game has not changed. Eastern Ukrainian oligarchs, staying behind the administration of Viktor Yanukovich, may not care about national values as such, but they do know how to use the instruments of political sovereignty to protect their property and economic interests. The majority of the country’s population, which did not vote for Yanukovich in the elections, will watch his actions carefully and, if necessary, be ready to express discontent at the next parliamentary elections. Those come very soon, just in two years, and the next parliament and the next cabinet, which it will form, will hold the president to account.

Normality, “business as usual” in the Russian-Ukrainian relations is controversy, not accord and mutual satisfaction. This is how it has been since the disintegration of the USSR. Now the two sides disagree in a friendly climate, they agree to disagree, yet they disagree.

Those decision-makers in the West who, with frustration or relief – it is not a secret that not everybody here wants to work hard for the successful transition in the Common Neighbourhood, there are those who would welcome the return of Russian control because that would mean less responsibility for the EU, - now repeat the conclusion about Ukraine going back to Russia, may already have a reason to revise their views.

Texts reflect the opinions of the individual authors

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