June 7, 2012

Grandeur, Russian Style


by Mauro De Bonis
Vladimir Putin says he won't rebuild the USSR. In fact, such a task looks impossible. But through business and economic ties, Russia can regain control of large tracts of the former Soviet space. That's why a new custom union is coming to light. 
Vladimir Vladimirovic Putin has often reassured the West that he has no intention whatsoever to recreate the Soviet Union. He's content with being the President – a role that's more to do with his destiny than his job, as he explained – of a Russian Federation that in order to be regarded as a global power, has to come to terms with huge domestic problems, as well as find a way to rein in the former Soviet space (an beyond).

To breathe new life in the glorious Bolshevik empire is in fact no easier than resurrecting a dead. Other, more urgent priorities await Russia. First of all, what Moscow needs today is a reliable, united and efficient Federation. Secondly, it needs to free itself from the gas & oil marriage, in order to diversify its economy and attract foreign capital. But to do this, it needs to build infrastructures tailored to a XXI century economy and a huge territory, reverse a worrying demographic trend, streamline its Soviet-style bureaucracy, fight (for real) corruption and organized crime, and put an end to the low-intensity conflict that's been dragging on for years in the Russian Caucasus.

Looking beyond the Federation's borders, it's quite clear that some parts of the former Soviet empire are forever gone. It's the case of the Baltics (now fully Euro-Atlantic) and of Georgia, that sidelines America and was deeply scarred by the 2008 Blitzkrieg against Moscow and the ensuing loss, at least de facto, of its two disputed regions, Abkhazia and South Ossetia. The remaining former Soviet republics, with different degrees of closeness to Russia, don't look (only) to Moscow anymore. And rightly so: those nations are provided with their own national interests and with different options – i.e. different trading and strategic partners – to satisfy them. Furthermore, Moscow is gradually loosing those cultural and linguistic ties with its neighbors that used to play such a big role in keeping the latter steadily oriented towards the Kremlin.

For all these reasons, Moscow has not in mind a new USSR. Rather, it aims at putting itself up as an Eurasian reference power for the former Soviet republics (and not only them). Such a design involves forced choices, namely filling the geopolitical vacuum that will open up in Central Asia once the US finally withdraws its troops from Afghanistan. It's no easy task, but it is an essential one if Moscow wants to count again in the region, while checking China's rapid and sharp expansion and countering Europe's and America's advance towards its western borders, mostly in southern Caucasus and Ukraine.

In its efforts, Russia can count on a Ukrainian government that looks with renewed interest to the Kremlin, and on an armed garrison in the mentioned Abkhazia and South Ossetia, that unilaterally declared their independence from Tbilisi. The latter element is of great importance to Russia, since keeping the pro-European, pro-Nato Georgia divided will considerably delay Tbilisi's entrance in the Western camp.

In order to display a newfound international stature and to become a hinge of East-West relations, Moscow is determined to carry out the project of an Eurasian Union launched by its Strategist in Chief on October 4 from the pages of Izvestija daily newspaper. The project amounts to assembling a huge common economic area, quite similar to the European Union, that one day could even adopt a common currency. “For the first time since the collapse of the Soviet Union, the first step has been made to restore natural economic and trade relations in the former Soviet space”, claimed Putin. Thus is business, not ideology, that Moscow looks at in order to re-establish its imperial courtyard.

Putin's triumphant statement referred to a custom union between Russia, Belorussia and Kazakhstan, that came into effect on January 1st and is seen by the Kremlin as just the first of many steps to come. This common economic space will soon welcome in its ranks Kirghistan, Tajikistan and, in September, a country seldom paired with the former USSR – New Zealand. It was Russian Foreign minister Sergej Lavrov who proudly disclosed the imminent accession – a very important one for Russia. Though peripheral, Wellington is actually fully Western, thus its membership will enhance the international stature of the Eurasian club. Lavrov announced that New Zealand will officially join the custom union during APEC's next summit in Vladivostok and that in a few years EFTA countries (Norway, Sweden, Island and Lichtenstein) could follow. In fact, those countries are already negotiating their accession: the talks began in 2010, after a Joint Study Group put together by Russia and EFTA in December 2007 gave green light to the initiative.

If New Zealand's entry fully represents Russia's interests in the Asia Pacific, that of the four European countries confirms Moscow's interest in the Old Continent, all in the large framework of Putin's Eurasian Union project

The Russian-Kazakh-Belorussian attention to the EFTA countries, and vice versa, is measured primarily on the relationship that Moscow intends to nurture with Norway and Switzerland, two strategic countries for its economic interests. The first lays on the cold Arctic waters, an Eldorado for energy yet to be discovered and exploited; the second is a rich partner of many Russian oligarchs, and a shrine to their fortunes.

After years of fierce battles and disagreements, Russia and Norway now have a fruitful cooperation. Ties were mended two years ago with the agreement for the division of the maritime border area in the Barents Sea. A 40-year-old territorial dispute for the exploitation of about 175 thousand square kilometers of waters rich in hydrocarbons and fish was put to an end. Moscow and Oslo outlined the boundary that divides it into two approximately equal parts and decided to jointly explore the oil and gas fields at the (new) border. Russia and Norway also decided in March to strengthen their political and military cooperation: for them, security and the control of a region of growing strategic importance is crucial.

The political and economic relationship between Russia and Switzerland has never been so prosperous. The Helvetic Confederation is among the major investors in infrastructure- (especially energy-infrastructure-)-poor Russian Federation. Moscow needs the know-how, the experience and the resources of the Swiss enterprises.

President Medvedev was the first Russian head of state to visit Switzerland, back in 2009. The Helvetic officials and entrepreneurs liked his plans to modernize the country, as this time it's Russia that looks like a paradise. Bern follows a precise strategy put forward in 2006: focus on economic agreements with the Brics, the emerging powers group that includes Moscow. In August 2010 an action plan for economic cooperation between the two countries for the 2011-2013 period was signed, followed by the July 2011 joint statement for economic modernization. The goal of the plan was the promotion, among other things, of investment and economic contacts between Russia and Switzerland; the presidents of the two countries attended the signing ceremony, underlining its importance.

The Swiss government and companies will be able to assist efforts aimed at developing the Russian energy and transportation sectors. They may participate in the construction of Skolkovo, Russia's Silicon Valley; Skolkovo Foundation's president is Viktor Vekselberg - the Russian tycoon living in Switzerland and share-owner of Swiss companies like Oerlikon, Sulzer and Züblin. Small and medium-sized Swiss enterprises will participate in building the infrastructure for the 2014 Winter Olympics in Sochi, the World Cup in Russia in 2018 and the 2016 Ice Hockey World Championship, also hosted by Moscow. Bern will provide its expertise in mechanical engineering, nanotechnology and other fields where Moscow know-how is poor.

To facilitate the penetration of Swiss companies in the boundless Russian Federation, Switzerland lobbied harder than any other country for Moscow's admission to the WTO. Thanks to Bern, in fact, the last hurdle in this ten-year process, Georgia's veto, was overcome. Swiss diplomacy has succeeded in bringing together two countries that less than four years ago had fought a brief and bloody war.

Moscow's presence into the WTO will benefit Swiss companies operating in the Russian market and will boost the negotiations for the EFTA countries' accession to the Eurasian Economic Area. In exchange for its diplomatic effort, Bern wants Russian support in order to avoid being ousted by the Executive Committee of the International Monetary Fund; Switzerland also wants to have a productive role in the G20, chaired by Russia in 2013.

The Russian Federation apparently chose the economy, development and its commercial interests as weapons to gain ground against other planetary powers and increase its influence in the area of its former empire. It has decided to act as the main reliable Eurasian reference point. It has no plans for creating another Soviet Union, because if its dissolution was the biggest catastrophe of the XX century according to Putin, rebuilding it would be the greatest strategic disaster of the XXI. Russia's new president is totally aware of that: otherwise, why, in August 2008, would he have stopped his soldiers on the outskirts of Tbilisi?
(9 Maggio 2012)
http://temi.repubblica.it/limes-heartland/grandeur-russian-style/1922

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