Political crisis in Ukraine

Crimea has been a part of Russia for over two centuries and to many Russians it is a strange switch in the Soviet history that Crimea is not part of Russia today. It was a present of Nikita Chrushev to celebrate the 300^th anniversary of Ukraine’s merger with tsarist Russia.  In recent decades it has been a source of tension between Ukraine and Russia. 

One of the most recent disputes has been in May 1992, shortly after the collapse of the Soviet Union, when the Crimean Parliament declared independence from Ukraine. The dispute was resolved with an agreement known as the Act on Division of Power Between Authorities of Ukraine and Republic of Crimea, which granted Crimea autonomous status within Ukraine.

The Crimea is the only region in Ukraine where Russians are in the majority, constituting about 60 percent of Crimea’s population.  Apart from the Russians and Ukrainians, there live 12 percent Crimean Tatar (a Muslim population which has been deported en masse in 1942 by Stalin to Central Asia and have since returned to their homeland), who have little affection for Russia. There is also an important naval base at Sevastopol that the Russians lease from Ukraine (until 1942 in exchange for discounts on Russian gas). Sevastopol is the home of Russia's Black Sea Fleet, and it gives the Russian Navy direct access to the Mediterranean Sea.

Last November started unrest in Kiev when President Yanukovich backed away from political and free trade agreements with the European Union. On 22 February he was impeached by the Ukrainian parliament and temporally – until the elections of May 2014 – replaced by Oleksandr Turchynov, an ally of Tymoshenko. This caused tensions between supporters of the new Kiev administration with pro-Russian protesters at the Crimean area. On 1 March the Russian parliament approved to send troops to Crimea in order to protect their military bases.

A full invasion of Ukraine could risk interrupting deliveries of Russian gas to European countries and further destabilizing a country that’s already on the brink of default. Opinion makers think that Putin’s goal rather may be to ensure Russia’s military dominance of the region survives through its hold on the Black Sea port Sevastopol.  The threat of military force may set the stage for a referendum scheduled for 30 March in Crimea over whether the region should have more independence from Kiev (and become de facto Russia’s unofficial protectorate).

Reporters of the Bloombergs Bussiness Week ask themselves why Ukraine matters to so many nations. “Ukraine doesn’t seem like the kind of place that world powers would want to tussle over. It’s as poor as Paraguay and as corrupt as Iran. During the 20th century it was home to a deadly famine under Stalin (the Holomodor, 1933), a historic massacre of Jews (Babi Yar, 1941), and one of the world’s worst nuclear disasters (Chernobyl, 1986).”

According to them China looks to Ukraine as a secure source to supply food and energy. It’s lending the country billions of dollars to upgrade farm irrigation and develop coal gasification; and Russian President Vladimir Putin wants Ukraine to join his Eurasian Union trade bloc, not the European Union. Half of the gas sold by Russian state controlled Gazprom to Europe, traveled through a maze of Ukrainian pipelines.  [Read more at: The New Great Game: Why Ukraine Matters to So Many Other Nations.]

Peter Coy sums up the seven main reasons why Putin won’t give up Ukraine:

Pride: Putin said in 2005 that the fall of the Soviet Union was “the greatest geopolitical catastrophe” of the 20th century. From that perspective, to allow Ukraine to slip out of Russia’s orbit would make Putin no better than Mikhail Gorbachev, who presided over the Soviet empire’s dissolution in 1991.

Trade: Putin wants Ukraine to join Russia’s fledgling customs union with Belarus, Kazakhstan, and soon, Armenia. The customs union is his answer to the European Union’s much larger trading bloc. Indeed, the current protests broke out after Ukrainian President Viktor Yanukovych, a Putin ally, pivoted away from a European Union integration accord last November and chose Russia instead.

History: Russia and Ukraine have deep historical links dating back to the Kievan Rus, whose glory days were the 11th and 12th centuries. Kievan Rus “is traditionally seen as the beginning of Russia and the ancestor of Belarus and Ukraine.”

Statehood: In 2008, the Russian business daily Kommersant cited a source in a NATO country’s delegation who quoted Putin as telling President George W. Bush: “You understand, George, that Ukraine isn’t even a state.” For most of the 900 years preceding independence in 1991, it wasn’t. Parts of what’s now Ukraine were controlled by Poland, Lithuania, the Khanate of Crimea, Austria Hungary, Germany, and of course Russia. In 2009 Putin approvingly quoted a description of Ukraine as “little Russia.” If Putin doesn’t perceive Ukraine as a real state, he’s less likely to respect its independence.

Crimea: Crimea, the southern part of Ukraine on the Black Sea, was part of Russia until 1954, when it was given to the Ukrainian Soviet Socialist Republic by the Presidium of the Supreme Soviet, supposedly to strengthen brotherly ties, even though it had a majority-Russian population. Historians still aren’t sure why Russia gave away Crimea, but Putin isn’t likely to let that gift get too far away.

The Navy: Russia’s Black Sea Fleet is headquartered in the Crimean city of Sevastopol (which is less than 200 miles northwest of Sochi). If an unfriendly Ukrainian government ended the lease, Russia would be forced to move its headquarters east to Novorossiysk. In December, Russia dangled an offer of cheaper natural gas to Ukraine in exchange for better terms on its lease in Sevastopol.

Energy: Natural gas sales to Europe are a key source of foreign exchange for Russia, and a big share of that gas passes through Ukraine. It wants to keep those pipelines in friendly hands. But Russia’s Gazprom is also hedging its bets by building a new South Stream pipeline that crosses the Black Sea on the seabed from Russia to Bulgaria, bypassing Ukraine.

Source: New York Times, Bloomberg Businessweek

Presidential elections Russia 2012

With less than a month remaining until the Kremlin vote, the presidential campaign is picking up steam nationwide.

Following a brief look at the five candidates who made it on the ballot, detailing how they got there, who they are and which part of the increasingly politicized Russian populace might tick their name on March 4.

Vladimir Vladimirovich Putin (Влади́мир Влади́мирович Пу́тин) - Еди́ная Росси́я, Yedínaya Rossíya centre-right; conservative

Gennady Andreyevich Zyuganov (Генна́дий Андре́евич Зюга́нов) - Коммунистическая партия Российской Федерации; КПРФ; Kommunisticheskaya Partiya Rossiyskoy Federatsii

Vladimir Volfovich Zhirinovsky (Влади́мир Во́льфович Жирино́вский) - Либерально-Демократическая Партия России (ЛДПР), Liberal'no-Demokraticheskaya Partiya Rossii (LDPR): liberal-democratic
Zhirinovsky was and still remains the nation’s top populist. With slogans such as “a bloke for every broad, a bottle of vodka for every bloke,” his Liberal Democratic Party led the 1993 parliamentary vote with 22 percent, essentially kickstarting Zhirinovsky’s career that has since encompassed many a brawl with opponents on camera and flaming speeches that laughed in the face of all that is politically correct.

Sergey Mikhailovich Mironov (Сергéй Михáйлович Мирóнов) - Справедливая Россия, СР, Spravedlivaya Rossiya: social-democratic. Have a look at his blog. At RIA Novosti Mironov is discribed as 'the undecided one' as he's not really anti-Kremlin as other SR-members.

source: RIA novosti

Mikhail Dmitrievitch Prokhorov (Михаил Дмитриевич Прóхоров) - Правое дело, Pravoye delo: centre right; liberal - democratic - conservative  
Prokhorov, one of Russia’s richest businessmen and owner of the American basketball team the New Jersey Nets, is the only independent candidate to run in the March 4 presidential election. He would like to form his own political party that would be larger than the ruling United Russia.
While he was running Norilsk Nickel, the company became the world's largest producer of nickel and palladium. He is the former chairman of Polyus Gold, Russia's largest gold producer, and former President of ONEXIM Group. He resigned both positions when he entered politics in June, 2011.
According RIA novosti most voters are convinced Prokhorov is a Kremlin project, but for many, it would not matter: a large part of the populace just wants to vote against Putin, and in this situation, any candidate would do. Though the old and the poor would prefer Communist Gennady Zyuganov, many in the middle class are likely to opt for Prokhorov, who braved the street protests this winter (getting pelted once by snowballs from the anarchists) and who made the right political noises, putting forth an admittedly populist program of reforms that targets the “creative class,” promising political freedoms, improving the economic climate and reining in the bureaucracy – in essence, dismantling the legacy of Putin, who is the main target of protesters. But Prokhorov also flirted with the ruling establishment, saying he would not mind being a prime minister under a victorious Putin, or even keep him as the head of the government if Prokhorov himself ascends to the Kremlin, hardly a popular idea with the “creative class,” which is united in its dislike of Putin.
Check also his blog.

More info: RIA Novosti, Vesti.ru

WK 2018 in Rusland

Rusland, dat nooit eerder een WK organiseerde, mag het WK van 2018 organiseren maar heeft volgens De Morgen nog veel werk voor de boeg om het WK binnen acht jaar georganiseerd te krijgen, maar in een land waar de gas- en petroleumroebels de laatste jaren de plak zwaaien, moet ook de organisatie van een WK mogelijk zijn. Een politieke keuze zo wordt in de wandelgangen van de FIFA gefluisterd.

Het dossier dat de Russen indienden was immers niet echt waterdicht. Op het vlak van infrastructuur kon het land nauwelijks garanties voorleggen. De meeste stadions moeten nog gebouwd worden en het land kampt met grote problemen op het vlak van transport en accommodaties. De luchthavens zijn verouderd en dat kan in het uitgestrekte land voor logistieke problemen zorgen. Rusland speelde daar echter handig op in door alle kandidaatspeelsteden uit het 'Europese' gedeelte van het land te kiezen. Enkel Ekaterinburg ligt ten oosten van de Oeral en ietwat afgescheiden van de rest van de speelsteden.

Maar de Russische autoriteiten en vooral eerste minister Vladimir Poetin schaarden zich achter de Russische kandidatuur en de bonzen van de Russische politieke wereld konden de FIFA dan toch overtuigen zodat Rusland voor het eerst in de geschiedenis het WK mag organiseren.

"Jullie hebben ons het WK 2018 toevertrouwd en jullie zullen daar geen spijt van krijgen", klonk het meteen na de bekendmaking vanuit de Russische clan. "Laat ons samen geschiedenis schrijven." Premier Poetin: "Dit is een teken van vertrouwen. We zullen al onze mogelijkheden aanwenden om een sterk toernooi te organiseren." Het WK van 2014 wordt in Brazilië afgewerkt.

Bron: De Morgen

Poetin opent Wereld Economisch Forum

De Russische premier Vladimir Poetin heeft in het Zwitserse Davos het Wereld Economisch Forum geopend. Hij sloeg daarbij een verzoenende toon aan tegenover het Westen. Volgens Poetin vraagt de economische crisis om wederzijds vertrouwen en zeker niet om meer militaire uitgaven. Poetin waarschuwde verder nog tegen te veel staatsingrijpen in de economie.

De volledige speech: Выступление Председателя Правительства Российской Федерации В.В.Путина на открытии Всемирного экономического форума в Давосе.
Update: The Philosophy of Davosism

Russia as an island of stability

It is now official – the Russian economy is in recession. Have Vladimir Putin and Dmitry Medvedev mishandled the crisis? Have they responded inadequately to the challenges facing the country? What could the Russian government have done differently? What impact will the deteriorating economic situation have on Russian politics? How will the crisis affect Russia’s foreign policy and its relations with major powers and neighbors? Will the West be able and willing to help Russia, or will Russia seek help from OPEC and China?
It now appears that the Russian leadership has been slow to understand the true impact of the international financial crisis on the Russian economy. All the way through November it had tried to portray the crisis as a U.S.-manufactured phenomenon that had nothing to do with Russia, and that the country would remain “an island of stability.” The government is now at a crossroads – having privatized the political dividends from the rising oil prices in 2000-2008, it is now forced to admit that the rising living standards of the past eight years have more to do with high oil prices than with the able management of Russia’s economy, which remained commodities-driven.

Vlad Ivanenko comments that Russia is likely to use the crisis to expand its sphere of influence in the near abroad. [...] Using the ruble as the price unit in state-sponsored trade credit lines will increase its role as regional reserve currency. Moreover, the crisis can push previously reluctant neighbors to form a regional trade union with Russia at the helm.
Secondly, a better delineation of state and private sector responsibilities will emerge. [...] I treat this development as a correction of excesses associated with the wild privatization of the 1990s. Using public funds, the state reaffirms its role in defining strategic national objectives, but leaves the day-to-day operations in the hands of private managers.
Finally, potential development of a brand-new economic system – prompted by the crisis – in this country cannot be excluded.

Ethan S. Burger adds that economic crime should be dealt with in the same way violent crime is. [...] Credible efforts to combat corruption and effective regulatory and law enforcement are needed to restore the businesses' and the citizens' faith in government. The criminal justice system and judiciary must inspire confidence in the population.

Andrei P. Tsygankov questions the economic model developed under Vladimir Putin. This model assumed stability of high oil prices, which allowed the state and private energy corporations to be more assertive abroad, including by borrowing from foreign banks. Rather than becoming an opportunity to diversify the economy, expansion of energy production and contracts slowed down such diversification. Although at the time it made sense to exploit energy as a comparative advantage, the sharp decline of oil prices requires a principally different course. Given the continued uncertainty in the global markets, the Russian government faces difficult choices ahead.

It is important to keep things in perspective. Russia’s fundamentals are not ideal, but they are not bad either, and can still serve as a basis for economic recovery. If the oil prices do not fall below $30 a barrel and the United States begins to recover within the next year, Russia is likely to feel the difference and will get back on its feet within a few years following the United States. Russia’s recession is very serious, but in relative terms, it is still possible not to make it much worse than that experienced by Western economies.

Professor Stephen Blank ends the discussion with a political note. To a large degree, this crisis validates many of the Western (and domestic) criticisms of Putin's economic and political policies that were built on a castle of oil, which is no more substantial than sand. Reforms and a much lower profile in world politics while Russia recovered and developed meaningful economic capabilities, not unlike China, was and remains the way to go. But that means decisively breaking with the neo-Muscovite and patrimonial model and moving toward a genuine market economy and pluralism, if not democracy in politics. The response to date has been the wrong one, pointing toward more state control and monitoring from above, as Frolov points out. Not only does this bring the country closer to fascism, without losing its neo-Tsarist and neo-Soviet attributes, but it also ensures that the country will pursue a great power status that is unattainable, and will crash at some future date in a major international crisis that will be of its making to a considerable degree.