RUSSIA AND EUROPE: PARADOXES OF MUTUAL MISUNDERSTANDING
At the beginning of the 21st century, Europe has become not simply a major but the main economic partner of Russia.
The economic history of post-perestroika Russia is divided sharply into two greatly differing periods, from 1992 to 1998 and from 1999 to 2004. One of the differences between them is that Russia"s foreign economic policy vector was directed at the United States during the former period and at the European Union during the latter period.
In the first half of the 1990s, the United States was regarded as the main political and economic partner of Russia. The results of that period of "strategic partnership" with the US were highly negative and included the failure of market reforms, plummeting living standards, and the 1998 financial crisis.
The situation has changed radically in the past six years, with the United States quickly losing its significance for Russia.
In 2004, the US accounted for 4.3% of accumulated foreign investment in the Russian economy, while eight EU countries - Germany, the United Kingdom, France, Cyprus, the Netherlands, Luxembourg, Sweden and Austria - accounted for 74%.
Russia"s economic revival in 1999-2004 rested on growing prices of energy resources and accompanying improvements in its foreign economic balance. Over that period, the total volume of the export of commodities and services from Russia has grown by 150%, from $71.3 billion in 1998 to nearly $172 billion by the 2004 yearend. Export to the EU countries was growing at a priority pace, partially due to the Union"s expansion. In 1998, fifteen EU countries imported $23.2 billion worth of Russian commodities, while in 2004 exports to 25 EU countries exceeded $104 billion (up by 330%). As a result, the 25 member states of the European Union account for 60% of Russian exports now.
The import of EU commodities to Russia more than doubled from $15.7 billion in 1998 to $32.6 billion in 2004 (49.5% of total imports into Russia).
The above facts and figures show that at the beginning of the 21st century Russia became economically dependent on Europe, serving as a major addition to the EU economies, if not their raw materials appendage.
Is this good or bad? I would say there are more advantages than disadvantages in this situation.
It is an accepted fact that, unlike political preferences, economic ties are mostly inseparable from social and cultural relations, as has been reliably proved by Russia"s relations with the EU countries. Unlike ties with the US or East Asian countries, Russia"s relations with Europe rest on a firm historical foundation of cultural cohesion.
As soon as Russians got a chance to travel abroad relatively freely, the EU countries became the top priority on the list of the most tourism-attractive countries in Russia. In 2003 (the data for later years is not available), the EU countries welcomed 6.6 million Russians or 56% of the total number of Russian tourists abroad. Less than 0.9 million Russians visited the US, and most of them (0.4 million) went to see their relatives, while 0.3 million went on business trips. In fact, barely 60,000 Russians went to the United States as tourists.
The statistics of visits by Europeans and Americans to Russia are indicative. Unfortunately, we have reliable data only for visits by citizens of 13 EU countries - Austria, Estonia, Finland, France, Germany, Italy, Latvia, Lithuania, the Netherlands, Poland, Spain, Sweden and the Untied Kingdom. In 2003, 5.3 million citizens of these countries (65% of all foreign tourists) visited Russia, while the number of American tourists was 280,000, or 3.5 times fewer than the number of Russians who visited the US that year.
Russian citizens have also voted for Europe economically. Despite the pro-dollar policy of the Central Bank of Russia, they bought more euros than US dollars from exchange bureaux in 2003 and 2004. Wealthy Russians opened bank accounts and bought expensive commodities and real estate in Europe, and successful Russian industrial companies invested their capital into European assets.
The EU is not only the biggest but also an irreplaceable economic partner of Russia. Russia-EU trade accounts for less than 1% of the EU"s GDP but is nearly 22% of Russia"s GDP (in market prices based on the exchange rate of national currencies). Russia has a greater stake in stable economic cooperation with Europe than vice versa. Europe can buy what it needs on alternative markets, but Russia cannot supply its oil and gas to other consumers.
Russia has been developing close social and cultural ties with Europe for many centuries. Several waves of Russian emigration went to Europe, not Asia. The architecture of Russian cities incorporated many European, not Asian, elements. Russian science embraced European, not Asian, influence.
Why then have Russia-EU relations been hovering at a freezing point?
The Russian political class regards united Europe with irritation and a lack of understanding.
The foreign policy of the Soviet Union, and subsequently of Russia, was focused on relations with individual West European countries rather than on cooperation with Europe as a single entity.
As to political interaction between modern Russia and the European Union as a member of global politics, it looks as a dialogue in which the Russian leadership is involved as a sad necessity rather than with a hope for serious future results.
In a way, this is due to specific features of the development of their interaction.
The Soviet Union did not have any relations with the uniting Europe. The USSR became the 39th country to recognise the European Economic Community (EEC) as a subject of international law. It established relations with the EEC only in February 1989, a few years before the country became a thing of the past. The Maastricht Treaty on European Union was signed and enforced at a time when few people in Russia were interested in foreign policy.
In the 1990s, Russian leaders focused their attention on relations with the US and partly on ties with other "great powers" and NATO. The EU expansion in 1995, the establishment of the Schengen Zone, the introduction of the euro and even the decision to admit some former Soviet bloc countries were as good as ignored by Russian politicians, primarily because the Soviet Union and Russia had not regarded Europe as a political force that could rival the United States and become a pole in the Russian politicians" vision of the "multipolar world."
The irritation of Russian politicians was probably rooted in the obvious fact that many of the goals proclaimed by their leaders turned out to be a utopia for the Soviet Union and Russia and a fact of life for Europe.
They are also annoyed by the positive results of interaction between individual European countries. The 50 years of integration, the successes of NATO as a military alliance, and the ability of Europeans to foster neighbourly relations with small nations that are not incorporated into the EU present a striking contrast to Soviet and Russian experience.
The advantages of the EU policy become apparent when compared to the efforts of Russia. The Kremlin"s recent achievements in the creation of a vertical structure of power show that the regime is not ready to tolerate genuine federalism in the country that is officially a federation. The process of the approval of the Common European Constitution, which began in Europe at the same time, cast a bright light on the scale of federative development in Europe, where federalism had not been regarded as a possibility before.
And lastly, the work of European institutions, above all the European judicial system and the economic structures of the EU, is another source of irritation in the Kremlin"s corridors of power. In the past few years, Russia has pledged to fulfil the decisions of the European Court of Human Rights, whose interpretation of these rights does not suit the Russian security-related structures, siloviki. And the common economic legislation of the EU has complicated preference relations with individual companies and invalidated Russia"s agreements with whole states (a relevant example is relations with East Europe during the EU expansion in May 2004).
The irritation of Russian politicians can be divided into elements, just as a ray of light passing through a prism is divided into individual colours. The most important of them is failure to understand processes underway in Europe, and a measure of fear.
The Russian political class is shocked by the Europeans" attitude to statehood and sovereignty, because the European Union in its present form is not an international organisation but a quasi-state.
Consequently, the member states are not sovereign entities in the traditional understanding of the notion, whereas Russia has always advocated a fundamentally different type of society spearheaded at preserving and strengthening state sovereignty as the ultimate value. Therefore, the current Russian politicians find it doubly difficult to deal with their European colleagues. On the one hand, the leaders of European states who were traditionally regarded as the main negotiating partners no longer have the powers to tackle many problems. On the other hand, Russian leaders cannot overcome their "historical" scepticism regarding the new bodies of power in the EU.
They are also irritated that, unlike the Soviet Union and modern Russia, the European officials are effectively promoting economic and social progress in all member states of the European Union.
Russian politicians are also irked by the visible resolve of Europe to gradually renounce the use of force for solving problems, to convert to pacifism, and to keep their military might within the limits of necessity.
And the last irritant is Europe"s commitment to democratic values, which has helped the EU to create a system that is widely different from the system of "managed democracy" nurtured in Russia.
But no matter what the Russian political class may think about Europe, the attitude to Europe of common people in Russia is becoming a crucial factor. Despite numerous facts testifying to the growth of the military might and geopolitical influence of the Untied States in the past years, experts and political scientists have started talking about the development of a "European ideal" that can overshadow the "American dream."
With the progress of integration, the European social model is becoming increasingly attractive to the world"s nations. Unlike Americans, Europeans do not enforce their principles on other countries. Instead, they clearly outline these principles and make strict compliance with them a precondition for the integration of new members into the European community of nations. At the same time, the admission of new countries to a "broader Europe" promises apparent benefits to their populations.
This model poses a threat to the traditional sovereignty of adjacent countries, which the Russian leadership considers, possibly not quite consciously so far, a serious political danger.
Russia has felt the full impact of the political might of united Europe in the past few years. It had to change many of its legislative norms to become accepted in European institutions (and not very important at that). The admission of former Soviet satellites into the EU has been a blow at Russia"s economic interests. The advance of ex-Soviet Baltic countries to the EU has effectively isolated the Kaliningrad region from "mainland" Russia. In view of possible admission of Turkey to the EU, the European part of Russia has become surrounded by the European Union, its key economic and political partner.
Moreover, the events of the late 2003 and the early 2004 showed that the strengthening of the EU"s political capacity largely depends on events in post-Soviet countries. Forces advancing under pro-European and partially anti-Russian slogans have won convincing victories in Georgia, Ukraine and Moldova. In my opinion, the possibilities of parallel implementation of two integration processes - European and Russian - on a territory "from the Atlantic to the Urals" have been exhausted. In the nearly complete absence of a clear foreign policy of the Russian leadership, the Europeans have launched an offensive in the Commonwealth of Independent States and will hardly stop now. Unlike Russians, they get the support of the local populations: revolutions in Georgia and Ukraine were truly popular movements and not "palace coups."
Here are my conclusions from the above facts. The Russian economy is dominated by the raw materials sector. With a population of 142 million and a modest GDP of #8364;400 billion, it is exerting minimal influence on global economic processes. Such a country simply cannot be an equal partner of the EU. This is why Russia"s priority task is to develop relations with the EU painstakingly and wisely, and it can choose from two paths in this undertaking.
One provides for pursuing a pro-European policy, which includes filing for admission to the EU and advancing several far-reaching, and possibly shocking, initiatives, up to and including the creation of a common visa-free space, harmonisation of the economic legislation, removal of customs barriers, and the creation of a common strategic nuclear command of the European nuclear powers and Russia. This policy should be based on understanding of the fact that the objectives of expanding the freedoms of Russian citizens, improving the quality of their life and ensuring proper social guarantees take precedence over the task of "strengthening the Russian state."
The other path entails the strengthening of Russia as a state that is not a member of any international alliances, and the creation of conditions for its revival as a centre of gravity for adjacent countries. But Russia can hardly restore the attractiveness of the Russian development model for the European republics of the former Soviet Union or, to a degree, for the South Caucasus states. Therefore, it can expand its zone of influence only in Central Asia, which does not promise economic benefits, but at the same time calls for promoting values in Russia that are in short supply in these countries - law and democracy.
Though the first path looks unquestionably better, the build-up of Russia"s integration potential in the post-Soviet space does not look unreasonable either. But the trouble is that such integration - and this is Europe"s main political lesson to Russia - can be only driven by Russia"s attractiveness in the eyes of neighbouring peoples, and not by attempts to win over their ruling elites, apply economic pressure or, worse still, use force.
Unfortunately, the EU will hardly become the main foreign policy partner of Russia soon. The fundamental reason for this is Russia"s stand that is developing under the influence of not so much objective factors as the psychological and ideological specifics of the Russian political class"s view of modern realities.
Firstly, the minds of Russian politicians, who have not overcome the Soviet ideological clichés and way of thinking, are darkened with a feeling of their country"s failure. This explains the utter irritation of the Russian political class at the achievements of other countries or international associations, especially in the spheres where Russia is suffering one failure after another.
Secondly, the Russian political class has not abandoned the view of the world as a combination of ethnic states and still thinks that the state is a strictly centralised hierarchy based on military and economic might. A vast majority of Russian politicians cannot grasp the essence of the EU, which is the renunciation of national sovereignty and balance of forces in global politics. They still try to promote ties with the leaders of individual EU countries. Objectively unsatisfying results of such relations leave a feeling of impossibility of constructive interaction between Russia and the European Union.
And thirdly, in modern conditions the EU is becoming a threat to a Russia that is governed by the standards of the first half of the 20th century. The threat that is coming from Europe, which Moscow feels, is a threat of accelerated European-style modernisation of countries from Russia"s former "zone of influence," and potentially of Russia itself. This is a palpable threat to the Russian political class, but it opens the door into a better life for common Russians. Therefore, the future belongs not to relations between the union of European countries and the Russian Federation, but to relations between the arising European and the reviving Russian nations. And this is a solid foundation for optimism.