Intelligence Brief - 23 October 2014
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Deep splits over how EU should respond to Russia

With Ukraine heading to the polls on Sunday, the international financier George Soros has created headlines with his comments on Russia.  What is interesting about Soros’s comments is less his assessment of Russia under Putin (few dispute that Putin espouses an unpleasant mix of authoritarianism and aggressive nationalism) but the way in which he seeks to portray Russia as a challenge to the European Union’s “very existence”.  Given that Soros admits that there is “a general dissatisfaction with the EU as a result of the euro crisis”, his playing up of the ‘Russia threat’ would appear to echo the long tradition followed by political elites in difficulty of playing up external threats to divert attention from internal difficulties.  However, behind the scenes in Brussels, influential voices are advocating a very different approach.

In an article published in the New York Review of Books, Soros warned: “Russia is presenting an alternative that poses a fundamental challenge to the values and principles on which the European Union was originally founded.  It is based on the use of force that manifests itself in repression at home and aggression abroad, as opposed to the rule of law.”  Soros argues that the admiration shown for Putin by the likes of UKIP leader Nigel Farage, the president of France’s National Front Marine Le Pen, and Hungary’s Prime Minister Victor Orban show that Putin’s style of nationalism is finding admirers within the European Union, and this is the source of the danger.

But as Soros also told the UK’s Guardian newspaper: “There is a general dissatisfaction with the EU as a result of the euro crisis which has perverted the initial impetus for forming a union of like-minded democratic states.  The euro crisis was mishandled and lasted a long time, and it turned a voluntary union of equals into something quite different.”  This would seem to be a more likely source for the growing popularity of Farage, Le Pen, et al than the aggressive policies of Putin in Ukraine.

To “save itself”, Soros wants the EU to radically boost support for Ukraine with an “immediate cash injection of at least $20bn with a promise of more when needed”.  By assisting Ukraine’s pro-Western politicians, Soros argues, the EU would be reverting to its founding principles and “would save itself by saving Ukraine”.

A thoughtful paper published on 17 October by the influential Centre for European Policy Studies (CEPS) provides a much more persuasive and thoughtful analysis of EU-Russia relations.  This paper – Towards a fragmented neighbourhood: Policies of the EU and Russia and their consequences for the area that lies in between – acknowledges that Russia-EU post-Cold War relations were relatively untroubled for as long as Russia perceived the EU “as being decoupled from other Western organizations widely viewed as hostile, such as Nato”.  As the paper notes, “while Russia fiercely opposed Nato’s enlargement towards its borders, it did not resist the expansion of the EU with the same degree of vehemence”.  Indeed, in the early 2000s Moscow showed “considerable interest in developing a strategic partnership with the EU”.

The problems came later when the EU’s Deep and Comprehensive Free Trade Agreements (DCFTAs) and Association Agreements (AAs) imposed on the countries signing them “a drastic shift towards the EU’s legal framework, and ultimately integration into the EU’s internal market”.  The CEPS points out that the EU’s Eastern Partnership programme, launched in 2008, also came in the context of Nato’s proposed expansion to Georgia and Ukraine, the independence of Kosovo, and the war in Georgia – and against this background the shift to “hard-law integration” under the Eastern Partnership led Russia to view the EU as “increasingly coupled with Nato”.

This is a persuasive observation.  The trouble between the EU and Russia (rather than between Nato and Russia, which is a different issue) stems from the EU overplaying its hand.  Soros argues that the EU would be reverting to its founding principles by being even more aggressive over Ukraine, but the CEPS suggests that the opposite is the case.

Our own view is that the West had the perfect formula for the development of post-Cold War Europe: Nato remained to provide deterrence against any Russian revanchism, while the European Union provided the magnetic soft power for the unthreatening eastward expansion of Western economic and political norms.  This perfect balance was upset, first, by Nato’s growing propensity for out-of-area military intervention and, secondly, by the EU’s employment of DCFTAs and AAs in the post-Soviet space that were seen to be too threatening by Moscow (and were, in any case, probably too demanding and ambitious for the backward economies they were intended to help).

So now Europe faces what is in effect a choice between the Soros proposition, which is unashamedly antagonistic towards Russia and may also be tainted by a desire to divert attention from the EU’s internal difficulties, or the CEPS’s much more careful approach.  In its 17 October paper, the CEPS says: “The EU should respond to Russia’s role as a spoiler through becoming both more self-critical…more ‘reflexive’ vis-à-vis its own policies…and more responsive vis-à-vis Russia’s initiatives.”

We have no doubt that the CEPS’s formula is the wiser one; we are less certain that it is the one that will prevail.

NOTE (1): An opinion poll published by the independent Levada Centre on 21 October found a record number of Russians now see the major Western powers as adversaries.  When asked “How do you see the major Western powers (the USA, Germany, Japan, UK, and others), as partners or adversaries of Russia?”, 79% replied as adversaries, with just 8% identifying them as partners.  When asked the same question in July 2010, 44% replied “adversaries” and 44% replied “partners”, with 12% saying they were unsure.

NOTE (2): Japan is to hold a joint naval exercise with Russia next week in the seas off Vladivostok, in Russia’s Far East.  The joint exercise has been held every year since 1998, but next week’s will be the first since the escalation of the Ukraine crisis.  On 21 October, Japanese media outlets reported Japan’s Chief of Staff Tomohisa Takei as saying that “contingencies with Russia must be avoided and maintaining constant contact is important”.

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