Peterson Institute publications
The Peterson Institute for International Economics is a private, nonprofit, nonpartisan
research institution devoted to the study of international economic policy. More › ›
RSS News Feed Search

Op-ed

Russia's Botched Policy in Its Own Backyard

by Anders Aslund, Peterson Institute for International Economics

Op-ed in the Financial Times
August 17, 2009

© Financial Times


Relations between Russia and Ukraine have always been difficult. Since Ukraine's Orange Revolution in late 2004 they have been dismal. Conflicts have involved gas, agricultural trade, the Russian naval base in the Crimea, the war in Georgia, and Ukraine's interest in NATO. Even so, politicians from the two countries rarely meet.

Last year Vladimir Putin, then Russia's president, escalated the conflict by publicly questioning Ukraine's sovereignty and territorial integrity. He has repeated his claims as prime minister. President Dmitri Medvedev's strident open letter to President Viktor Yushchenko amounted to a further escalation, with its declaration that Russia would not send a new ambassador to Kiev. Mr. Medvedev offered no constructive proposals but listed old Russian grudges, claiming that all faults lie with Ukraine.

The Kremlin's misunderstanding of Ukrainian politics is based on the fact that, unlike Russia, Ukraine is a democracy.

The language was reminiscent of Leonid Brezhnev in its detachment from reality. Mr. Medvedev claimed that no Russian threat against Ukraine exists, as if he were unaware of his prime minister's statements. He went on in Soviet vein: "Russia endeavors to be a predictable, strong, and accommodating partner" to its neighbors. Well, hardly, as Mr. Yushchenko noted in his response.

Mr. Medvedev's obvious aim was to influence the Ukrainian presidential elections scheduled for January, expressing hopes for improved relations with the "new Ukrainian leadership." Mr. Yushchenko is no longer a credible candidate, having proven himself an ineffective ruler. The two leading candidates are instead Yulia Tymoshenko, the current prime minister, and Viktor Yanukovich, the former prime minister, with Arseniy Yatseniuk, the former speaker, as the only other plausible contender.

But however much effort Moscow puts into the Ukrainian elections, it is not likely to achieve its aims, as the Orange Revolution illustrated. Contrary to common misconceptions, no real separatism exists in Ukraine. The Kremlin has given up on Mr. Yanukovich, the leader of largely Russian-speaking eastern Ukraine, realizing that no serious Ukrainian politician can be pro-Russian. Recently, the Kremlin has preferred Ms. Tymoshenko as somebody they can do business with, but there is no love lost.

The Kremlin's misunderstanding of Ukrainian politics is based on the fact that, unlike Russia, Ukraine is a democracy. The Russian leaders think they can "buy" Ukrainian politicians, but in the end they must listen to their voters, not Moscow, to gain office. This is an alien thought to the authoritarian Muscovites, who believe everything is manipulated from above and by Washington. Persistent anti-Ukrainian propaganda on Russian state television also turns eastern Ukrainians against the current Russian regime.

Mr. Medvedev's statements appear to be a reflection of the rivalry between the Putin and Medvedev camps, which confuses all central policymaking in Russia at present. Ominously, Mr. Putin has made Ukraine-bashing one of his trademarks and Medvedev needs to keep up. Russian economic policy is suffering as a result of this strife and Ukraine may do so too.

The broader problem for Russian foreign policy is that the country's rulers do not know how to deal with their post-Soviet neighbors. Their policy objectives are mixed. Gazprom wants to monopolize gas supply, transportation, and sales. Private businessmen aspire to expand their corporations. Agricultural interests block imports. Russian nationalists persist in neo-imperialism and populist politicians try to win domestic support by attacking their neighbors.

The result is that post-Soviet nations are trying to develop relations with anybody but Russia. Kazakhstan and Turkmenistan are opting for gas exports to China. Most starkly, Georgia and Ukraine are turning to the West, but even Belarus, the ultimate Russian loyalist, is fed up with the Kremlin and seeking other options.

For the West, the conclusion is that it needs to solidify its support for Ukraine regardless of who wins the elections. Fortunately, it is doing so. Joe Biden, the US vice president, made this point clearly during his recent trip to Kiev, while the European Union is pursuing efforts at integration, notably through a forthcoming European Association Agreement on trade.


RELATED LINKS

Op-ed: What Kiev's Democratic Turn Means for Moscow February 25, 2014

Op-ed: Russia Is Losing Sources of Economic Growth January 22, 2014

Op-ed: Putin Without Putinism February 8, 2012

Policy Brief 11-20: The United States Should Establish Permanent Normal Trade Relations with Russia November 2011

Book: Russia after the Global Economic Crisis May 2010

Book: The Russia Balance Sheet April 2009

Book: Russia's Capitalist Revolution: Why Market Reform Succeeded and Democracy Failed October 2007

Policy Brief 09-6: Pressing the "Reset Button" on US-Russia Relations March 2009

Paper: The Russian Economy: More than Just Energy? April 2009

Testimony: US-Russia Economic Relationship: Implications of the Yukos Affair October 17, 2007

Paper: Russia's WTO Accession November 21, 2006