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Monday, 18 November 2013

The Ukrainian Soap Opera Continues « Wider Black Sea

The Ukrainian Soap Opera Continues « Wider Black Sea:

The Ukrainian Soap Opera Continues


Amanda Paul is a Policy Analyst at the
European Policy Centre in Brussels, where she
deals with the EU's Eastern Neighbourhood,
Russia, Turkey and Eurasia Region.
She is also a columnist for the Turkish Daily,
Today's Zaman.
Working on Ukraine is similar to watching a soap opera — a cast of colorful characters in dramatic story lines, with Kiev moving from one crisis-ridden moment to another. Indeed, Ukraine’s politicians are experts at keeping us on the edge of our seats. From an analyst’s point of view, this is fascinating. As for ordinary Ukrainians, they simply long for a boring, uneventful, stable state.
However, despite the endless political and economic turmoil, Ukraine remains an important country — Europe’s seventh most-populous country and a key gas transit state, it has wonderfully fertile soil and significant economic potential. It is a regional “backbone,” as the largest country between the EU and Russia, thus it is key for regional cohesion and stability. Ukraine’s strategic location and proximity to Russia’s breadbasket and economic heartland in the Volga region make the country key to Russia’s geopolitical strength. Russia allied with Ukraine gives Moscow confidence and strength, while a Russia without Ukraine is much weaker.
Ukraine is now in the midst of a particularly dramatic episode: whether or not to sign its Association Agreement, including a Deep and Comprehensive Free Trade Area (DCFTA), with the European Union at the forthcoming Vilnius Eastern Partnership (EaP) Summit on Nov. 28-29. Despite the fact that Ukraine’s political elites have consistently stated that European integration is their top foreign policy goal, the decision still hangs in the balance.
Ukraine has not fully met the EU’s criteria as spelled out in December 2012. Important reforms that could have been made earlier were not made because of a lack of political will, a failure of political parties to reach a consensus and the age-old problem of “vested interests.” Only since early summer has Ukraine accelerated its efforts, and this was principally a consequence of Russian attempts to derail the deal. Important legislation related to the prosecutor general, electoral law and the imprisoned former prime minister, Yulia Tymoshenko (which the EU has labeled selective justice), expected to pass through the Ukrainian parliament last week, did not. The process was postponed until Nov. 19. Because Ukraine is crucial to the success of the EaP, the EU has continued to move these deadlines. It now seems certain the decision will be last minute, possibly on the eve of the summit.
The EU — for right or wrong — has made Tymoshenko the make-or-break issue. However, the chances of Tymoshenko being out of prison by the time of Vilnius seem non-existent. The best we can hope for is that an agreement between Ukraine’s political elites and the EU will be reached in order to begin the process of a transfer to Germany for medical treatment, although again this hangs in the balance. The EU decision will be based on the recommendation of the European Parliament’s two special envoys on Ukraine, Aleksander Kwasniewski and Pat Cox.
The second problem is Russia. Ukraine needs and wants good relations with Russia, yet Moscow has been crystal clear that Ukraine will pay economically for going ahead with the EU deal. Moscow is using every type of carrot and stick, although so far not to a successful end.   Generally Russian carrots tend to have bitter centers. However, meetings (even secret ones) continue to take place between the two leaderships. Russia wants Ukraine to join its Eurasian Customs Union, but ultimately will settle for Ukraine ditching the DCFTA with the EU.  Yanukovych, in whose hands everything rests, is becoming increasingly unpredictable and at this point it is not clear which may he may ultimately jump. While this is far from the perfect situation for the EU, for Ukraine’s small neighbour Moldova, it also represents a considerable headache. Moldova needs a strong and stable Ukraine, closely engaged with the EU in order resist Russian pressure and pursue its own EU path most effectively. If Ukraine does not sign it puts Moldova into a very difficult situation included related to the Transnistria conflict where Russia has many levers to pull.
In the medium-to-long term there is no doubt the EU agreement will be beneficial for Ukraine, as its implementation will help modernize and democratize the country, including cleaning up the rampant corruption and making Ukraine a safer place to invest. Yet this won’t happen overnight, and in the short term the situation is going to be tough. Economically, Ukraine is in bad shape. The IMF recently refused Ukraine a much-needed loan again because of Kiev’s failure to meet certain criteria. Combine this with trade losses relating to Russia, which will increase after Ukraine’s signature, and we are looking at a very difficult short-term financial situation.
This situation has also fuelled a fight between Europe and Russia the likes of which has not been seen since the Cold War. The EU does not want such a confrontation with Moscow, but unfortunately Russia’s zero-sum imperialistic approach has put the two on such a collision course. How this story is going to turn out is still anybody’s guess, yet ultimately the road that Ukraine chooses to follow is going to have an impact far beyond its own borders.

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