Reede, 29 November 2013 13:19
Laas Leivat - Estonian Life No. 48 2013
The pro-Moscow Ukrainian president Victor Yanukovych, abruptly pulled out of the special EU-Ukraine pact. The Kremlin threatened the country with trade losses worth billions and costing hundreds of thousands of jobs if it signed a strategic pact with the EU.
"Ukraine could not withstand the economic pressure and blackmail. It was threatened with restricted imports of its goods to Russia, particularly from companies in Eastern Ukraine, which accommodates the greater share of its industry and employee hundreds o thousand of people. Calculations would suggest this would lead to billions in losses. These were specified by President Yanukovych in a telephone conversation with the president (Lithuania's president Dalia Grybauskite who also holds the rotating presidency of the EU) earlier this week," explained Jovita Neliupsiene, advisor to Grybauskaite.
With the Ukrainian economy in critical condition, rejection of the EU could cost Ukraine a critical amount in terms of EU support and possible loans from the IMF.
In a rare joint reaction from the EU leadership, European Council president Herman Van Rompuy and European Commission president Jose Manuel Barroso sharply condemned Russia for putting pressure on Ukraine to drop plans to sign a trade and co-operation agreement with the EU. They said: "It is up to Ukraine to freely decide what kind of engagement they seek with the EU. We therefore strongly disapprove of the Russian position and actions."
The rivalry between Russia and the EU started in 2009 when the EU proposed an eastern partnership with Ukraine, Azerbaijan, Georgia, Moldova and Belarus. The EU offered free trade, cooperation, financial support in exchange for democratic reforms.
The EU's other goal not openly expressed, was to limit Russia' influence and define how far Europe extends to the east. For Russia, the struggle to dominate Ukraine, is not only about keeping political shackles over the country, but controlling a region that was the centre of the Russian empire a millennium ago. This helped generate a Cold War style fight between Moscow and Brussels.
Russia's determined efforts to keep Ukraine within its control originate from deep seated emotional, cultural and strategic issues. Most of modern Ukraine became under the control of Russian czars in the 1700s after being part of Lithuanian-Polish Commonwealth. Except for small territorial brief declarations of independence, the situation remained unchanged till the USSR's collapse in 1991. Surveys have shown that one third of the population speaks Russian exclusively which helps maintain Russian influence. In fact when Mykola Azarov became the prime minister in 2010, one of his promises was to learn Ukrainian.
Kievan Rus, a loose federation of Slavic tribes centred in Kiev, was the regional power
in the 9th to the 12th centuries. Moscow was a mere settlement at that time. Its ruler Prince Vladimir brought Christianity to the region, laying the foundation for the Russian Orthodox Church. Some of the most prominent figures in Russian literature, including Mikhail Bulgakov and Nikolai Gogol are Ukrainian born.
As part of the Soviet Union, Ukraine was home to some of the leading industrial establishments producing metals, cars, maritime technology, aviation and missiles. Russia has continued to depend on Ukraine to supply most of the same product as the pre-collapse period of the USSR. As part of the threat aimed at Kiev, warning Ukrainians not to sign the agreement with the EU, Russia, after a signed Ukraine-EU deal, would pull out of any Ukraine-Russia industrial co-operation, move that could crucially affect Ukraine's industrial base
The Russian Black Sea Fleet base is in the Ukrainian Crimean port of Sevastopol. While this particularly fleet is comparatively small, it has still played a vital role in Russia's projection of worldwide power . Some of its ships have recently been deployed to Syria. It's a symbol of Russian pride. The lease to Russia extends to 2042. With Ukraine possibly signing the EU agreement, this would leave the Russian fleet stranded.
There are several other compelling reasons for the Kremlin to fear a Ukrainian-EU relationship. They include Trans-Ukraine gas pipeline, the loss for Russia of a important strategic region, fear of increased influence for Western powers, etc.
Ukraine has already felt the severity of Russian sanctions. As punishment for intensified talks between Kiev and Brussels prior to Ukraine pulling out of a possible agreement, Russia restricted the import of Ukrainian steel and chocolates. This has reduced Ukrainian exports this year by $6.5 billion. This would be followed a by higher tariffs on all Ukrainian imports. And Russian threats are not to be dismissed. For 'bad behavior' Kiev has been punished three times in the past by Russia shutting its gas supplies.
What are the long term consequences of Moscow once again using its influence abusively? Michal Baranowski, The Warsaw director of the Geman Marshall Fund think-tank said: "Geopolitically competition in the region is back. The EU should be ready for a long game."