Monday, September 30, 2013

European integration, but not as we know it

As recently as a few months ago, the prospects for Ukraine’s European ambitions looked unpromising to say the least, but it seems a few months is a long time in geopolitics, and Russian pressure has decisively shifted the landscape, seemingly providing an engine and impetus on the EU and Ukrainian side to get the deal done. In attempting to satisfy the EU’s requirements for signing the Association Agreement, slated for November’s Eastern Partnership Summit, Ukraine’s parliament has been pushing through relevant legislation with impressive speed. The laws however are not short on Party of Regions-friendly appendages to keep the troops happy. The authorities are also employing the security service, the SBU, to harass the communists for their anti-EU advertisements. Ukraine’s brand of European integration is not exactly out of the textbook of Schuman or Adenauer.

Internal sabotage by pro-Moscow figures in Ukraine’s government has long been cited as one of the biggest single risks to Ukraine signing the agreement, so pushing through the necessary laws has required a high level of party discipline in the Party of Regions, exemplified in the recent defrocking of deputy Igor Markov, an individual with pro-Moscow sympathies who has even been described as a Ukrainophobe politician, after being found guilty of election irregularities. The removal of his mandate will have sent a very clear message to any other would be dissenters in the party, the point being that a) being out of the Verkhovna Rada deprives individuals of abundant opportunities for personal enrichment and a degree of personal protection b) voting irregularities of one sort or another could most likely be dredged up in a great many voting precincts in the country, giving the party considerable available leverage if needed.

It is this culture of rank and file discipline that has been key in allowing the Donbas clan to establish their power base in Ukraine thus far, so it shouldn’t be a surprise that they are able to turn the screw in this way, albeit in the name of an unlikely cause. Such methods understandably have their detractors, but one such detractor has been none other than the supposed red line in the EU-Ukraine deal, imprisoned former PM Yulia Tymoshenko, who went as far as to describe Markov glowingly as “a new young, energetic, charismatic, ideological leader of the pro-Russian citizens of Ukraine”. If Brussels truly has decided to realpolitik with Ukraine, surely such a statement is somewhat unhelpful.

Tymoshenko’s and her party’s statements in support of Markov may actually reflect a fear that Tymoshenko’s makeweight status may be put aside in the context of the wider geopolitical interest (although Tymoshenko has previously urged the EU not to withhold signing the agreement on her account). Already, EU figures are talking of demanding ‘progress’ with the Tymoshenko situation, which may be Brussels giving itself some elbow room come November, and to paraphrase European Parliament member Hannes Swoboda, if Ukraine returns to the Russian sphere what leverage will the EU have to resolve Tymoshenko’s situation then?  About as much as it has on Khodorkovsky, Magnitsky or Pussy Riot, to be frank. It also reminds us that parochialism is never far from the minds of Ukraine’s politicians, the whole reason Tymoshenko is behind bars in the first place.

As for Russia, the Association Agreement would be an unusual setback for a country currently emboldened on the world stage. Russia’s sway on Syria, the arrest of Greenpeace activists for ‘piracy’, persistence with homophobic laws against boycott threats for Sochi 2014, and military aggravation of the Baltic States, Finland and Sweden could all be seen as manifestations of Russian confidence. However, at the same time, Russia may overreach itself, and is prone to mistakes.

Medvedev stated Russia’s ‘all or nothing’ position on Ukraine’s integration with east and west (although Yanukovych’s suggested ‘3+1’ co-operation with the Customs Union always sounded like a ‘thanks but no thanks’). Perhaps Russia would have been better biding its time and letting Ukraine drift a little longer. Instead, Russia’s concerted pressure has very rapidly created an imperative for the EU and Ukraine to sign. In its customs blockades, it also managed to step on the toes of every major player in the Ukrainian oligarchy, uniting them like never before, and even the natural sympathy for Russia of the population in Eastern and Southern Ukraine has been significantly eroded. One leading commentator has gone as far was to describe their actions as ‘nation building’ for Ukraine. And Russia ought to be careful not to make things even worse for itself; threats last week to dismember Ukraine could conceivably reverse Ukraine’s decision to no longer pursue NATO membership.

Russia’s information war also looks increasingly ham-fisted. Russian presidential advisor Sergei Glazyev is clutching at non-existent straws by suggesting Ukrainian officials ‘don’t know what they’re signing because they can’t speak English’ and talking generally of Ukraine’s actions as ‘suicidal’. One should not underestimate Russia’s leverage however, even within the EU itself. The apparent reluctance of Slovakia to export gas to Ukraine to neuter the tried and tested gas cut off threat* may be such an example, and the Kremlin may still have other cards to play. One can’t rule at a last minute wet fish capitulation by the Ukrainians, but again Russia’s potential to offer any carrot is limited. When Yanukovych extended the Black Sea Fleet lease in early 2010 he was promised cheaper gas, but more than three years on it is clear to see that the Black Sea Fleet concession yielded nothing, and Russia in fact looks with disdain on such bargains with its near neighbours. Against such a background, why would Ukraine make a similar deal?

If the Association Agreement is signed and eventually takes Ukraine on a path to free trade and democracy, Yanukovych’s methods seem an odd way to get there, but a look at history shows that the EU is no stranger to pragmatism. Italy was included in the original 6 amid fears of the strength of the communists there, Spain and Portugal against a fear of democratic backsliding, Greece to prevent either the return of military rule or absorption into the Soviet bloc (and going on to effectively waste over 3 decades of membership), and the Baltic States despite reluctance in the early ‘90s in some quarters. If Ukraine not only signs the agreements, but is able to comply with its conditions, the ends may have more than justified the means.

* - it would be interesting to know whether Russia diversifying gas transit away from Ukraine and via the Nord Stream pipeline and Belarus (whose gas transit system was finally surrendered to Moscow) and lower transit volumes through Ukraine has inadvertently given Ukraine a freer hand in the technicalities of reversing the gas flow etc. Quite possibly it has.

Saturday, May 04, 2013

The neurotic side of Ukrainian patriotism

This is probably hardly worth commenting on, but I nonetheless felt that I had to get it off my chest, and after all what are blogs for?

On 26th April the world, or part of it anyway, rightly chose to remember the Chernobyl catastrophe which, whilst on the territory of what is now Ukraine, contaminated a swathe of Belarus, parts of Russia and places as far away as Anglesey, North Wales.  It is in Ukraine that the catastrophe is most poignantly remembered. It doesn't help that in Belarus President Lukashenka has taken a policy of ambivalence towards the disaster. It must be remembered, along with other pivotal catastrophes that have shaped Ukraine as it is today.

However, one Ukrainian language page took its tribute to the absurd extent of claiming that Chernobyl was 'another stage of ethnic genocide against the Ukrainian people'. I considered letting this go, but clearly to claim any such thing is a travesty and grossly insulting to all those who've suffered, as the radioactive cloud knew no borders. Power stations of the very same type existed throughout the USSR, and one still operates close to Moscow itself. I've written on this blog before about the importance of remembering both the Holodomor and the 'shot renaissance' and the strong case for considering these genocidal acts, but to see a seamless link between this and Chernobyl invites that dreaded word pathological. It's actually a hideous comparison if you think about it, to somehow compare the engineers whose mistake lead to atomic meltdown to Stalin. How will Ukrainians be taken seriously if those that claim to represent Ukrainian patriotism come out with such careless and neurotic nonsense, well meaning or otherwise. It also doesn't help if, when pointing this out, one is simply dismissed as 'idiotic'. These things matter. Just witness what happens when the next western media outlet calls Auschwitz a 'Polish death camp'.

That same page a few weeks earlier carried a picture of one of the signs at Palats Sportu metro station which, as a complete anomaly on the Kiev metro which now exclusively uses Ukrainian, retains a single sign using the Russian name Dvarets Sporta. The fact is that, when the station was built, the policy of the Kiev metro was bilingualism, so signs in the same style can be found also in Ukrainian, and this is little more than a quirky survivor of its age and an attempt at something like art deco style. The said page seemed to be calling for its destruction irrespective of all other considerations, and most of the comments were vitriolic in condemning this poor little sign. Of course most Kievans aren't too bothered about it. What about all the Soviet symbols still to be found on numerous metro stations there? Isn't removing those a more noble cause than picking on a single sign in Russian?

Ukrainian is and should be Ukraine's national language, and with at least, for argument's sake, 25m odd first language speakers, more than many other national languages in Europe, it is not small beer. I personally prefer to use Ukrainian in the shops and cafes in Kiev and normally encounter no prejudice doing so.

What worries me is that if the Ukrainian language cause is dominated by nutjobs like this, the real cause of the Ukrainian language won't be taken seriously. Rather like those Kyiv campaigners who think that the best way to protect a language is to preach to the mother tongue speakers of another language about what words they should use. Some Ukrainian patriots clearly desire an eradication of other languages from Ukraine which is no better than the desire of others to marginalise Ukrainian. At this rate you have to wonder if the careless 'genocide' label might be applied in the other direction. Good intentions, but careless words.

Wednesday, March 20, 2013

Cyprus and the UK - time to collect foreign rents?

Parochialism in the public debates in both and the risks letting rich foreigners off the hook

What do Cyprus's apparently defeated bank levy proposal and the UK opposition's also defeated proposal for a 'mansion tax' have in common? Although on markedly different levels, both proposals very quickly met opposition on the grounds of hardship. In the Cypriot case that is perhaps more obvious or direct, but the mansion tax too it is claimed could lead to personal hardship for some individuals. Whilst Cypriots threatened to bulldoze their banks over the bank levy, a Radio 5 live phone in a couple of weeks ago was dominated by the hardship theme. What the two proposals also have in common is the dilemna now facing governments who, in different respects, have become attractive havens for money and investments from wealthy individuals in foreign climbs.

40% is the key figure. It is the percentage both of Cyprus bank deposits held by Russians and, coincidentally, of new properties built in London which are snapped up by foreign investors, often with no intention of living in them, so actually further exacerbating the UK housing shortage. Wealthy individuals from countries where investments are less straightforward have chosen both of these countries in their different ways for essentially similar reasons of security and future stability for their gains. This has enormous benefit if you are a Cypriot bank or a UK construction firm, but it has issues too; in Cyprus we end up with a top heavy banking sector in a tiny country, and in the UK we could say that these property investors are not paying their way for the privilege of buying the nation's leaseholds and freeholds.

The common denominator in both cases is that attempts to get these sometimes shady investors to pay into the countries from which they benefit get muffled in debates which focus on the hardships of the locals. We shouldn't belittle that. In both cases a suggested solution has been a higher threshold. Not many with savings of 100 000 or higher or with a house worth, say, £5 million or more, are going to be worrying about where their next meal is coming from (some of thee properties invested in are worth more than fifty times the 2 million threshold!). There is a reality that a pensioner who's saved all their life to have a few thousand in the bank, or a homeowner who is (only in a sense) a victim of rocketing property prices and the considerable expense and taxation associated with running a large home would suffer personal trauma under the original proposals, but the other reality, of wealthy foreign citizens who take advantage without taking responsibility, must not be ignored.

Of course there is a problem. As the Cyprus proposal shows, a more obviously targeted proposal risks making relations problematic with the governments of countries where politics, business and goodness knows what else are seamlessly intertwined, and there is no taboo about making such issues political. However, there is a deep need to reframe the debate, to educate people about the perhaps uncomfortable truth about the ways in which their countries have changed, and why it is only fair and reasonable that these people be taxed. Otherwise, we really are hurting the little guy, our ordinary citizens, whilst the big guy (crooked businessmen, even criminals) continues to fatten himself abroad unimpeded, much as he has quite likely already done back home. 

Of course the governments of free democracies, in states with free media, must listen to their citizens, but it would be a pity if, whilst having those values, we decide simply to give a free ride to dodgy individuals from the countries to our east where the media is muzzled and national parliaments are little more than corrupt dysfunctional rubber stamp institutions devoid of such social conscience. Not to mention the real little guys, millions living in poverty because of corruption, criminality and stolen state assets that have enriched many of these individuals. Surely its only right that these investors pay their way somewhere along the line.

Friday, February 08, 2013

EU-Ukraine: He who has ears, let him hear.

Yanukovych's conduct may actually be making it easier for the EU to talk of eventual membership

The word füle translates into Hungarian as 'ears', and EU Commissioner on Enlargement and the Eastern Partnership Štefan Füle is clearly hoping that someone on Bankova is finally going to start listening. In his speech to the Verkhovna Rada, Füle pulled few punches (metaphorically speaking it must be said) as to the EU's misgivings with the current goings on in Ukraine, now laying into the regime publicly over unconstitutional proxy voting ('piano playing'), procurement law and other areas, rather than allowing the selective justice issue to be the sole broken record.

If his words to parliament were scathing, those to staff and students on a visit to Kyiv-Mohyla Academy, Kiev's fiercely independent liberal university (on whose European Studies course I had the good fortune to be a lecturer) seem to have been rather more encouraging. There is now a clearer acknowledgement of the status of the Eastern Partnership countries as potential applicants under Article 49 of the Lisbon Treaty, that any European country can apply for membership, if it meets the criteria, and a clear differentiation now being made between the eastern and southern neighbourhoods in this respect.

The pressure on Ukraine to 'make a choice' between Russia's Customs Union and the EU's free trade deal is mounting from both sides. Having gone as far as concluding the agreement, one senses the EU would like to close the deal. Ukraine's civil servants are resigned to the prospect of intense trade pressure from Russia if progress with this continues, most likely across many areas. Arguably, with the $7bn gas bill, it has already started. What doesn't help Russia's case is that you can never be sure that it won't behave in such ways even if Ukraine were to enter the CU. A track record of such behaviour hardly builds trust. Ukrainian officials hope that Russia's excesses might be limited by it having joined the WTO.

Another theme running heavily through this process now is conditionality. Indeed, Füle has now given Ukraine 19 key indicators that it needs to work on. The chances of Ukraine satisfying 19 separate concerns looks pretty low. That's a lot more than satisfying the vague 'back of an envelope' Copenhagen Criteria that the 2004 and 2007 entrants needed to meet, and which Yushchenko and Tymoshenko at least had half-convincing pretences of attaining. The everyday  reality of Ukrainian political life is clearly a million miles away from any such criteria. Yanukovych's primary policy seems to be keeping Tymoshenko behind bars, and there is no sign whatsoever of this abating. Recent news continues the trend, with concerns now spreading, for example, over internet freedom. If Ukraine's governance, rule of law, and overall behaviour are more akin to those in the CU, reason follows that they will find it very difficult not to end up there. With that in mind, it is paradoxically easier for the EU to talk about eventual membership. For years the EU entertained the idea of Turkey joining simply on the assumption that Greece would always obstruct it, hence the awkward situation since Greece changed its mind.

In a sense, the EU can almost rely on Ukraine to fail for now, but in the long term the suggestion is that successful implementation of the DCFTA might yield a membership perspective. For those that joined during the previous decade the Association Agreements already contained this membership perspective, and successful fulfilment brought candidate status, so this mechanism basically builds in an extra stage, a longer road which is perhaps in everybody's best interests. As long as the door can be opened for trade, and for Ukrainians to travel, other matters are less imperative. The EU needs to itself recover, and for the Polands and Spains of this world to develop to potentially join the net contributors that would help to pay for further enlargement; clearly a long way off. However, it would be in the interests of all the stakeholders in Ukraine's future to finally start listening.

Wednesday, January 23, 2013

Is there a European alternative to the Brussels project?

An 'outer ring' of European states could pursue looser integration and have collective clout

If the UK is truly heading towards an 'in or out' referendum on EU membership, thoughts must be turning quickly towards what alternative model the UK-Europe relationship might follow. The options are not straightforward.

One common retort from British Eurosceptics is 'look at Norway', but that option is not as great as it may look at first glance. A Norwegian local politician I met a couple of years back lamented her country's unwillingness to join the EU, saying that Norway has to implement 95% of EU legislation, with a 0% say about what goes into it. They do have control over their fishing industry, but many aspects of their lives come under the remit of EU directives that no Norwegian had a hand in drafting. Iceland also has this deal but has now decided to seek full EU membership instead.

Very few who truly understand the issues think that Britain can simply have no form of economic integration with the EU, and even Nigel Farage's language has become more nuanced during his time in Brussels. If Britain, for example, was to leave the EU, but desire to continue to participate in the single market, it would have to accept something similar to the EEA deal. Switzerland, on the other hand, has a series of bilateral opt-ins and opt-outs of EU policies, but on many issues it is captive to the regime that surrounds it.

'Tory Euroscepticism' may be the driving force behind Cameron's decision, but British Eurosceptics are not a homogeneous group. There are the rabid 'bent banana' Eurosceptics who ignore the geographical reality of where our island sits, and for whom there is no distinction between EU migrant workers and illegal immigrants from elsewhere in the world, and who conveniently ignore the hundreds of thousands of Brits residing in other EU states. There are still some with delusions about the UK's potential global role, or farcical ideas that Americans, Australians or Indians would be 'delighted' to open up to preferential economic agreements with the UK. There is the frequently-coined argument that when Britain voted in the 1970's it voted to join an economic union, not a political one, but a look at the founding treaties of the EU makes clear that it was all along a politically-coloured project. 

Then there are quite reasonable arguments made about the democratic deficit in the EU's institutions. There is also the technical constitutional argument, which relatively few mention but which holds some water, about the incompatibility of the EU's system with the British system, that the British constitutional principle that 'no parliament can bind its successor' is broken by the signing of European treaties. That explains how figures on the left such as Tony Benn came to be part of British Euroscepticism.

So Britain, Norway, and Switzerland might all have reasons to be less than satisfied with their position, but they are not alone in feeling that their deals with Brussels are in some way unsatisfactory. Across Europe, on the eastern frontier, we have Turkey, the candidate country which may never join, which so far has only a customs agreement with the EU which is of limited value. Then there is Ukraine, which may or may not one day get round to signing a Deep and Comprehensive Free Trade agreement with the EU, but whose problems with democracy and the rule of law may leave it self-excluded. Georgia, Moldova and Armenia are all in the process of agreeing similar free trade deals with Europe, and the DCFTA model may be what Turkey eventually has to settle for, if it doesn't decide that a sub-optimal relationship with Europe does not outweigh the benefits of a multi-vector trade policy, given its geographical position and robust pre-crisis economic growth. 
During European debates in the UK, going back to the 1990's, the phrase 'two-speed Europe' frequently came up, implying that France, Germany, Benelux, Spain, Italy etc. could push ahead with closer integration whilst, for example, Britain and the Nordic countries could take a slower approach. Only in one sense has this clearly manifested itself, but notably, in the EU states that did not choose to adopt the Euro. One might also sense that one or two newer EU members, longer term, might not desire the closest level of integration with other member states. Would Poland, for example, ever really want to end up in political union with Germany?

So, if Britain is twitchy, Norway disadvantaged, Turkey rejected and Ukraine self-excluded, not to mention Switzerland and Iceland in Europe but not the EU, should these countries think about getting together in some kind of trade organisation, which could collectively lobby Brussels? If the EU had a rival club of 8-10 countries with which it had to agree single market conditions, might those countries together have real influence? In the longer term, such a consortium might be able to get Israel or Russia/Belarus/Kazakhstan on board (in a post-Putin epoch) and then you are talking about a rival group with tremendous clout. After all, if all these countries are either unhappy being under the EU's thumb, or given the cold shoulder by it, doesn't it make sense to look at other options? A looser organisation might also be able to more effectively involve Europe's southern neighbourhood.

There would be nothing to stop the group of non-EU members here (to list, Iceland, Norway, Switzerland, Liechtenstein, Turkey, Ukraine, Georgia, Moldova, Serbia, Macedonia, Montenegro) to sit down and discuss common interests and possible future co-operation. This is admittedly just an idea and hasn't been fully thought through, but perhaps not all roads in Europe lead to Brussels (?). 

I'll freely admit that this is a rehash of a 2011 article on the same blog. The relevance of the issue persists.

Ukraine's ideology problem

The rise of Svoboda, though regrettable, can't be viewed out of context

At the start of the year, probably in a slow week for news, the BBC finally got wind of the right wing phenomenon that is Svoboda. Its report was not very different to similar previous reports on other right wing groups, such as Hungary’s Jobbik. After all, in 2012 the BBC had already put lots of effort into telling us about the kinds of attitudes that apparently only exist in Eastern Europe. Ritualistic activities make the best footage, and it’s not difficult to get some quotes from a party member sounding forth reprehensible views, most worryingly the abhorrent and baffling anti-semitism that pre-occupies right wing groups across Central and Eastern Europe, long after the Jewish communities in these countries were savagely almost completely extinguished. There are certainly things to worry about, not least the unchecked veneration of the controversial Stepan Bandera, but reports about the right wing resurgence ignore the wider context of Ukraine’s political landscape at their peril.

Take history, for example. It was the Party of Regions, not Svoboda, which closed access to the SBU archives that had been open during the Yushchenko era. At that time the authorities also handed control of the country’s National Institute of Memory to the Communist Party. Since then it has aggressively pushed the Soviet-era narrative of World War II in schools and in the gaudy Victory Day celebrations. Against this background of limiting rational and impartial historical research and promoting national myths, it is not difficult to see how Svoboda now has fertile ground to promote the Bandera narrative. Contrast this with the breakthrough over the past few years in Holodomor remembrance which means that even pro-Russian politicians are seen at the memorials on remembrance day. The airing of historical evidence has doubtless helped enormously in making this possible, and superseded the heated debate over whether it should be classed as genocide.

The authorities and those that came before them have also laid fertile ground in a host of other ways. A push for what might be termed as ‘Galician nationalism’ epitomised by the vindictive Education Minister, was soundly rejected by Ukrainians at the polls. Svoboda’s strong showing in Kiev oblast shows that any kind of Galician nationalism, or an attempt to put a wedge between Western and Central Ukraine, is a non-starter, and doesn’t even depend on voters being Russian or Ukrainian-speaking. Don’t forget that Galicia (Halychyna) in fact also extends into Poland (Galicja) and the concept is of little relevance to modern Ukrainians, many of whom clearly value national unity.

Svoboda was heavily implicated in the recent fighting in the Verkhovna Rada, and Udar rightly praised for standing back, but let us not forget that it is not Svoboda that created Ukraine’s parliamentary thugocracy, as some nasty beatings in the previous parliament illustrate. Ukraine’s lack of proper parliamentarianism goes back a long time. Support for banning multiple-voting (‘piano playing’) by MPs is an easy gold sticker for Svoboda. The European Parliament’s plea to the other opposition parties not to co-operate with Svoboda seems like a non-starter when crucial votes on such issues could make all the difference, and with such disregard across the board for constitutional principles. It is also inconsistent with previous cases within the EU, such as in Slovakia when Robert Fico’s Smer party went into coalition with the anti-Hungarian Slovak National Party (whose leader proclaimed his wish to roll tanks into Budapest). Shouldn’t the European Parliament have taken a similar stance then?

The success of Svoboda, and the Communists, also point to a need in Ukrainian politics to return to ideology. The personality parties of the last 20 years have done little to enable debate about the best course the country should take, and the affinities the major parties have claimed along ideological lines with the groupings of the European Parliament have ranged from tenuous to bogus. The re-emergence of the left and the right ought to concentrate the minds of those in the centre, particularly if ideology now counts for at least 1 in 4 of the country’s voters. Ukraine must take more steps towards functioning parliamentarianism rather than strong presidentialism, as studies have proved that the former model is more effective at enabling reform than the latter, much as this is counter-intuitive to many in the former USSR.

Svoboda may also be addressing another major gap in the country’s political life, that of civic activism, appearing keen to get involved in issues ranging from shale gas to industrial relations. This is a glaring gap that the major parties have left to be exploited. A Kiev friend tells of how, shortly after the Orange Revolution, her mother, a private medical practitioner and educated woman, called in at the offices of the Tymoshenko bloc asking how she could meaningfully contribute to the party’s work; the answer was that she could if she wished distribute leaflets and that no other service was required as the aim was simply to gain and retain power. It’s not difficult to see how Svoboda’s involvement in issues that matter to people, even if opportunistic, would resonate. Ukrainians occasionally show a penchant for direct action, blocking a railway line at Kharkiv or breaking down fences around beaches in Crimea. If Svoboda can tap into those grievances, they’ll be onto a winner.

However, a note of caution against becoming a Svoboda apologist. A student of mine here in Warsaw puts it in succinct terms; “my grandfather’s family was killed by Bandera”. The black marks against Svoboda are black indeed.