The empire strikes back! Russia and the East-West dynamic.

Rooney, John Jack

When Russian tanks rolled into South Ossetia's capital of Tskhinvali in August of last year, a bitter reality dawned on Georgian President Mikheil Saakashvili as he realized there would be no Western military intervention and there would be no stopping the Russian army running roughshod over his country's key infrastructure and military installations.

Western media carried interview after interview of Saakashvili recounting how Georgia had taken all the right steps in transforming itself from a repressed socialist republic into a beacon of democracy in the region, i.e., building partnerships with the UN and the WTO, stamping out corruption, and converting to a free market economy. And yet, the West extended no security, at least until the drafting of a quasi-effective 6-point peace plan ala Nicholas Sarkozy which ended Russian operations only after extensive destruction and loss of life had already occurred.

Saakashvili has been taught a lesson about the limits of Western partnerships, but was this message meant exclusively for him and his small republic, or was it a broader statement for the entire post-Soviet region about the Kremlin's newly assertive foreign policy? One country, in particular, which was certain to pay close attention to this military action, as well as a Western lack thereof, was Ukraine.

THE REASSERTION OF RUSSIAN INFLUENCE

It's no secret that Russia has felt increasingly threatened by Western institutions cutting into its sphere of influence in Central and Eastern Europe. No doubt the Kremlin has taken measures to push back and counter this steady progression, leaving fledgling democracies like Georgia and Ukraine caught in a constant struggle between competing influences, both internal and external. Ever since the collapse of the Soviet Union, the advance of the Western agenda and the expansion of Western institutions has been steadfast, and yet the 2008 South Ossetia war, incidentally coinciding with the global economic crisis, may have marked a turning point where faith in Western institutions has begun to wane and post-Soviet fledgling democracies have begun to turn back to their roots in the east.

As for Ukraine, starkly contrasting viewpoints on the South Ossetia War were voiced from the country's two leading politicians, reflecting two distinct mentalities driving the internal debate. On the one hand, President Viktor Yushchenko strongly condemned Russia's actions as imperialistic: he refused to recognize the independence of the two breakaway regions, canceled the visit of a Ukrainian delegation to Moscow, and even went as far as to threaten a blockade of Russia's Black Sea Fleet upon their return to the ports in Crimea shared between the two nations.

On the other hand, ex-Prime Minister and opposition leader Viktor Yanukovych remained loyal to Moscow by defying his president with a public recognition of the independence of South Ossetia and Abkhazia--a bold move considering that the only other nations besides Russia to do so were Venezuela, Nicaragua, and the de facto independent Republic of Transnistria. More importantly, with three months until Ukraine's crucial 2010 presidential elections, pro-Russian Yanukovych is comfortably the frontrunner in all the polls, while Yushchenko, the incumbent, enjoys a pitiful four percent approval rating these days and has been written off as having virtually no chance for reelection.

One way or another, it seems Russia has been able to reassert itself as a major influence on Ukraine's domestic and foreign policy. If so, what are the implications for today's East-West dynamic? One must consider Ukraine's position as the largest country in Europe with vast economic potential, not to mention its vital strategic position as the primary energy supplier to Europe with some 80 percent of Russian gas pumped through Ukraine's pipelines. To put it bluntly, with Ukraine serving Russia's geopolitical interests, without a doubt a Russian empire will emerge once again.

EAST-WEST DEMOGRAPHICS OF UKRAINE

It's important to understand the deep divisions that run through the country and how they have been successfully exploited. More accurately separated in terms of South/East from Central/West, the fissures in Ukraine's demographic makeup run along historical, religious, cultural, and linguistic lines; the footprint of imperial Russia and the Slavic Christian Orthodox state is still visible on its right flank, while ties to Poland, Lithuania, and Austria-Hungary resonate a stronger European-Ukraine orientation on its left. These distinct histories, while no means comprehensive, do provide a framework with which to examine the present-day political climate of the country.

In light of the upcoming presidential elections in January, the leading candidate Viktor Yanukovych has been able to draw substantial grassroots support from the Russian-speaking industrial southeast by advocating such policies as: increasing social spending, adding Russian as a second national language, reorienting strategic alliances by pursuing closer cooperation with a CIS security arrangement rather than pushing for NATO membership, favoring full membership in the Common Economic Space (economic union dominated by Russia) and even going as far as to call for a renewal of "the traditional strategic brotherhood with Russia," a loaded term which harkens back to the days of the USSR.

Yanukovych's national policy agenda would mark a stark change to the pro-Western policies of President Yushchenko, who has promoted free market reforms and European integration through NATO and EU membership, as well as the use of the Ukrainian language over Russian in media, public life, and schools in order to develop a specific Ukrainian national identity.

A DYSFUNCTIONAL DEMOCRACY

However, significant missteps throughout Yushchenko's presidency led to mounting criticisms by a population growing disillusioned by its short experiment in democracy. To begin with, President Yushchenko and Prime Minister Yulia Tymoshenko struggled with overlapping authority resulting from a hastily written constitution, which lacked a clear division of power and encouraged a political rivalry between the two. This rivalry quickly resulted in the firing of his closest ally from her top cabinet post.

In fact, over the course of Viktor Yushchenko's tenure as president, Ukraine has had four prime ministers, and at the moment, lacks a foreign minister, a finance minister, and a defense minister, encouraging short-term thinking and political maneuvering rather than efforts at real reform. As a member of the opposition, it was not difficult for Yanukovych's popularity to rise as Yushchenko's government became gridlocked with one crisis after another.

To make matters worse, serious mismanagement of economic reform led to severe inflation, which was followed by revaluation of the currency. This ultimately caused a savings loss of about a billion dollars as well as disincentive for investment. Since efforts at privatization were bogged down by strict tax avoidance regulation and the cancellation of special economic zones, large companies and banks inside Ukraine suddenly needed to search for foreign buyers; meanwhile, powerful Russian investors were eager to satisfy the demand and regain influence, this time through economic means rather than authoritarian.

GAS, MONEY, AND CORRUPTION

Nonetheless, perhaps Yushchenko's biggest blunder over the course of his presidential term was allowing corruption to continue and further take root in the Russia-Ukraine gas business, thus undermining the very democracy and transparency he was supposed to be ushering in.

Upon price negotiations for the 2005 gas and transit fees with then Russian President Vladimir Putin, a shadowy intermediary company RosUkrEnergo was created as a vehicle through which Russia could use profits from the transaction to fill the pockets of wealthy Ukranian oligarchs, presumably in exchange for political influence and leverage of some form or another within the country's political machinery.

This was a tremendous blow to Ukraine's independence. As the Ukrainian free press exposed these shady dealings, the hopeful Ukrainian population began to doubt whether democratic rule would ever change the corruption they were trying to purge by electing Yushchenko in the first place.

To make matters worse, Yushchenko agreed to fix prices for transit fees ($1.60/mcm/100 km for 5 years) and storage fees ($2.25/mcm for 30 years--40-50 times lower than the European average), thus greatly damaging Ukraine's position to negotiate in subsequent price disputes. In this sense, Yushchenko had not only opened the door to greater strategic vulnerability and increased Russian leverage over Ukraine's most important economic sector, but he also was undermining the very democratic principals that he was suppose to be protecting and fostering.

Since 2005, gas price disputes between the two neighboring countries have become a yearly ritual with last winter's standoff the worst yet, as Russia's state-owned oil giant Gazprom shut off supplies for 13 days, leaving much of Central and Southeastern Europe vulnerable to energy shortages in the dead of winter.

Russia's rigid persistence during the standoff led some to speculate that ulterior motives for the shutoff were at play, especially in retrospect, given that the ultimate resolution rendered prices almost unchanged from the initial negotiating positions prior to talks breaking down. Even though it has been estimated that Gazprom lost as much as $1.5 billion in revenue as a result of the shutoff, the whole fiasco was nonetheless effective in exposing Ukraine's internal disorder and instability as a partner, giving Western Europe reason to pause with their efforts in extending EU membership and a NATO membership action plan.

Russia's propensity to use their gas levers as a geopolitical weapon is not entirely new. In fact, when the Czech Republic signed on to host the radar installation of the United States missile defense plan, it was no coincidence that oil flowing in from Russia dropped some 40 percent. Meanwhile, repeated pricing disputes with Ukraine have been effective in marginalizing the country from deeper European integration. In a matter of six months, two different methods were used in Georgia and Ukraine for achieving the same goal.

ANOTHER SOUTH OSSETIA?

And yet a situation similar to what unfolded in Georgia just a year ago is not entirely unimaginable in Ukraine either. While using these gas disputes to drive a wedge between Ukraine and its European allies has proven successful in disrupting the relationship, recent progress has been made in smoothing over these difficulties and putting the country on a steady path to EU and ultimately NATO membership. In fact, an agreement between Ukraine and the EU to overhaul Ukraine's gas transit system was signed just this past March in Brussels, and further negotiations have begun with the EU to include Ukraine as a member of the Energy Community--bold moves which Moscow regards as provocative in terms of weakening the leverage they exercise over their neighbor, not to mention their unstated desire to establish control over this transit system themselves.

Agreement or not, Russia has already established a foothold inside of Ukraine's energy infrastructure with Russian firms controlling four of six oil refineries; however, other methods of keeping Ukraine in check remain on the table as well. Like Georgia, Ukraine has its own separatist tensions with an ethnic Russian majority in Crimea alongside a number of pro-Russian organizations such as the Russian Community of Crimea, the People's Front Sevastopol-Crimea-Russia, and the Crimea office of the Institute of CIS States which all have strong political and financial links to Russia.

More alarming, however, has been the issuance of Russian passports in the region, providing the same basis for military intervention that Moscow used when invading South Ossetia--the defense of its countrymen and citizens abroad. In fact, just this past August in the Black Sea resort of Sochi, Medvedev met with Duma leaders to revise the legal basis for "the use of the armed forces of the Russian Federation," a move which some saw as a veiled threat of possible intervention in Crimea. As the deadline for Russia's naval presence in critical ports in Sevastopol approaches, some suspect that Russia may be setting the stage for possible military action, especially given the bitter disagreement the two governments have over Russia's continued use of Ukrainian ports for its Black Sea Fleet. While this scenario seems unlikely, European countries considering extending NATO membership will certainly be given pause over these tensions in the Black Sea.

As Ukraine prepares to elect its next president in January, a more Russian friendly administration is almost certain to take root. Regardless of whether the pro-Russian Yanukovych or more moderate Tymoschenko take office, Ukraine's stability is of utmost importance if closer ties to the West will continue to be forged.

Many have viewed US President Barack Obama's decision to cancel the land-based missile defense installations in Poland and the Czech Republic as a slight to Central and Eastern European security. This view may, however, prove shortsighted soon enough. If Obama is able to alleviate tensions with Russia and create a more positive context with which Ukraine can pursue Western partnerships, then scraping the missile defense installation could pave the way for a new more productive partnership between Russia and the West, and ultimately Russia and Ukraine.

The staunchly pro-Western reform agenda of Yushchenko simply intensified the internal polarization of Ukraine's East-West divide, leading to political infighting and gridlock, rather than producing real meaningful reform. Given the tools Russia has employed to maintain geopolitical influence over its neighbor, a more measured approach that recognizes Russia's legitimate role as a partner with Ukraine as well as the rest of Europe will lead to a more stable Ukraine, making it a much stronger candidate for Western integration with EU and NATO membership.

Suggested Reading

Aalto, Pami. The EU-Russian Energy Dialogue: Europe's Future Energy Security. Ashgate, 2008.

D'Anieri, Paul J. Understanding Ukrainian Politics: Power, Politics, and Institutional Design. M.E. Sharpe, 2006.

Mankoff, Jeffrey. Russian Foreign Policy: The Return of Great Power Politics. Rowman & Littlefield, 2009

Szporluk, Roman. Russia, Ukraine, and the Breakup of the Soviet Union. Hoover Press, 2000.

John Jack Rooney is a freelance writer based in Prague, the Czech Republic.