The Baltic Course  

Russian issue within the present EU agenda

by Eugene Eteris

Previously hidden sentiments among Russian politicians for losing the most cherished, already disappearing Baltic part of the former Empire have come to the surface of the country's foreign policy. The EU Foreign Ministers' Summit in Brussels predicted in February that Russia's dissatisfaction and negligence could harm its trade and economic relationships with the EU. Moscow so far has showed no intention to apply the existing free-trade agreement with the EU toward the new members from the former Soviet block.   

 Russian-EU relationship became "geographically close" in 1995, when Russia's northern neighbour Finland joined the EU. That was the first moral blow, as Finland was the country which incidentally about hundred years ago had been the Russian Empire's "northern territory". Since 1995 Russia's common borders with the EU have stretched to almost 1.3 thousand kilometers. That had actually brought down another "moral curiosity", i.e. the "wall" which had kept the two largest economic blocks in Europe, i.e. that of the former Soviet Union's allies (Comecon) and of Western Europe (European Communities) completely indifferent to each other until 1988, the final days of the Communist block alliance on the continent.  

Cartoon: S. Tulenev, Chas

Recently, the Russian issue has become a cornerstone aspect in the EU development agenda. Some experts acknowledge that in the future the real division in the continent between the "old and new" Europe will be centred on Russia (Newsweek, Jan. 5, 2004, p.46). The recent election of President Vladimir Putin for the second term in office will surely add much to Russia' s extending influence both in Europe and in the world.     

From EU-Russia development file

Initial steps in the Russian-EU relationship can be dated back to June 25, 1988 Joint Declaration creating official ties between the two sides. At that time it was the USSR's initiative and that of the so-called Socialist camp of allies united in the Comecon; but in 1991 Comecon ceased to exist.

Another attempt, again within the framework of the then Soviet Union, was made in 1989 to organise co-operation with the Communities and Euratom, in particular. But it was short-lived too, as in 1991 the Soviet Union disintegrated.    

The first "partnership and co-operation" agreement between Russia and the EU was signed in 1994 in Greece and entered into force on December 1st, 1997. The main institutional bodies of this co-operation are: the Council and the Committee that governs both the main directions of such co-operation and its timetable. A special parliaments' liaison committee was created later on. At the same time "legal approximation" was envisaged as one of the main directions in EU-Russia co-operation. This agreement is valid until 2007.

An "indicative program" was adopted by the EU Council Resolution 99/2000 in December 1999, and it included the EU financial assistance for Russia during the 2000-2006 period.   

Several sectoral trade agreements between the EU and Russia have been signed during the last five years. The EU has rendered Russia technical and economic assistance in order to implement important reforms (legal system, nuclear security, financial sector, etc) with a total allocation of 3 billion euros during 1991-2003.    

From Russia "with higher duties"

The present EU-Russian agreement with the 15 EU member states is to be renewed in connection with the EU now taking on another 10 countries as members. Western politicians regard the renewing procedure as a pure legal formality, but the Russian side refuses any prolongation and is instead putting forward a list of 14 claims and requirements that cover, among other things, changes in trade quotas, lower taxation for Russian goods exported to the new EU member states, etc. The Russian side fears that the Baltic states' export will become much cheaper (due to EU export subsidies) while Russian export, correspondingly, will become more expensive due to EU common commercial policy and various restrictions, as it is with the steel export. For example, Russian aluminum export to Poland is not subject to any duties, but after May 1st the export duty will grow to 10 percent.

Fearing that the economic interests of the former Soviet block states might be hampered after the coming EU enlargement, Russia is most eager to get some "EU guarantees". An indication of the importance of this issue to Russia is seen in the fact that Russia has now nominated its EU representative in Brussels as the country's new prime minister.  

Most probably the EU-Russian negotiations will close with the EU making "symbolic concessions" and complete surrender on part of Russia.

Some stumbling blocks

Cold winds in the EU-Russian relationships started to blow in 2003 with visa problems for Russians travelling through Lithuania's territory (as a future EU member state) to the Russian enclave Kaliningrad which is surrounded by the EU states. Some solutions have been found but the tension has not completely disappeared.   

Certain fears on the Russian side have occurred with the NATO enlargement issues, which will bring the Western military alliance to Russia's doorstep already in the beginning of April. NATO decision to sell four Danish F-16 jet planes to the Baltics for surveillance flights was regarded as an additional step to "accelerate the conflict", and the Russian side in retaliation is going to pile up military strength in the Kaliningrad region.

Another example of tensions is Russia's effort to block the IMO (International Maritime Organisation, the UN special body) initiative which aims at providing the Baltic Sea area with the special environmental protection status. If the IMO move is approved, then Russia's single-hull oil tankers carrying crude oil from newly built Primorsk oil terminal near the Finnish border will be forbidden to cross the Baltic Sea, entailing great economic disadvantages to Russia. In case the IMO actions are approved by the international community, the ban on such old tankers is going to be enforced in the fall of 2005. Russia has argued for long that its unique geographical position merits exclusive economic considerations in its favour. Former Danish environmental minister, prominent Social Democrat and MP Svend Auken recently acknowledged that Primorsk oil terminal "represents an enormous ecological threat to the whole Baltic Sea region and, in particular, to Denmark. We have to work out effective international security measures to stop dangerous crude oil traffic". (Morgenavisen Jyllands-Posten, March 14, 2004, p. 9).   

And on top of all that, there's Russia's big concern over perspectives of unstable and collapsing trade with its former Baltic republics, now incoming members of the Union.

At the moment when EU newcomers are celebrating the historic event of officially joining "the family of European nations", Russian politicians are worried about the new economic situation in the region, feeling that the changes would put Russia into a series of very particular disadvantages. According to Russia's The Moscow Times newspaper, the main reason behind such feelings is Russia's unrealistic expectations about the EU intentions to accommodate Russia within these changes. Probably, as the paper has put it, both sides have equal misperceptions, e.g. EU about Russia's intentions, and Russia about political and legal culture in the European Union.

Generally speaking, Russia has a "double problem" in the European region, because with the coming enlargement both NATO and the EU are now moving right on to the country's doorstep. Thus from 2nd of April NATO forces will move to the Russian eastern boarders. At the same time, the EU officials claim that Russia's approaches to both issues should be clear and simple, meaning in fact that it has to accept them sooner or later. The ultimate requirement is that Russia has to enter into the same type of political and trade-economic ties with the new member states as it has already done so with the EU 15 old member states. Up to the end of February 2004 Russia has been refusing to sign the 1997 "partnership agreement" with seven former Comecon member states, newly accepted into the EU of 25. 


There is only one way out of the "mutual inadequate misunderstanding": that is, to get along the lines of further co-operation efforts on all possible political and economic directions between Russia and the EU. Of course, there might be difficulties in overcoming decades old Soviet Union's imperial heritage, but there is no other realistic way around to break the ice of negligence and hatred that still very often prevails in the latter's attitude towards EU. Recent EU foreign ministers' summit in Brussels (February 2004) concluded with the statement that if Russia comes up with any reservations in her attitude towards new member states, the EU would come up with certain retaliatory sanctions. Clearly, this is not in anyone's interests.

President Putin emphasised this year that Russia had no intention of joining the European Union: needless to say, Russia can't actually join, as it does not even come close to the EU criteria. Whatever Russia's cultural ties to Europe, its relations, he added, would be limited to the "historic horizon", meaning that the new generation of decision makers in Russia will decide what kind of EU-Russia relationship to develop (Russia turns away from the European idea. The International Herald Tribune, January 1st, 2004, pp. 1,4). The EU inward oriented policy with no clear strategy towards Russia and their neighbours to the East does not help much to ease the existing situation.

About 35% of Russia's present foreign trade turnover is EU-related; when it comes to energy resources, Russia is the second largest energy supplier to the EU. About a quarter of Russia's import comes from the EU member states, but only 2% of total EU export ends up in Russia and only 4% of EU import comes from Russia. In 2002 Russia's commercial export to EU reached about 51 billion euros; at the same time, Russia bought EU goods for 32.5 billion euros goods. After enlargement the EU will account for more than half of Russia's foreign trade.


Main EU-Russia problems:

•           EU accuses Russia of violating the freedom of the press.

•           EU against Russian approach to solving its Chechen republic issue. 

•           Russia wants visa-free entrance to the EU member states, which the EU denies; in response Russia prevented Western journalists writing critical reports about the Chechen war from entering the region.

•           Russia is still worried about visa-free entrance to Kaliningrad region for its citizens after the new EU enlargement. 

•           Russia argues against the growing disrespect for Russian minorities in the Baltic states. 

•           The EU, in return, claims that Russia has to ratify Kyoto treaty on climate change and air pollution.

•           Russia is not going to extend "partnership agreements" with the new EU member states.