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Blowback Diplomacy: How the US was Locked Out of the Caspian

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It has been almost one year since the IV Caspian Summit in Astrakhan, Russia, where the presidents of the five Caspian states signed a political declaration that denied any foreign military presence in the Caspian Sea.

This means that possible future deployment of NATO forces in the area will not be allowed. According to Russian President Vladimir Putin, this declaration “sets out a fundamental principle for guaranteeing stability and security, namely, that only the Caspian littoral states have the right to have their armed forces present on the Caspian.” While this is a threat to the United States, the decision may not have been as much of a shock. It may have been US policies that pushed this decision to the forefront.

Looking back to the collapse of the Soviet Union, the United States was careful not to make it seem as though it was siding with the new states in their efforts to achieve independence from Russia. This was important because the United States did not want to give the impression that a “cordon sanitaire” was being created around Russia in order to isolate it from Europe. The new states and Russia were given the opportunity to create arrangements amongst themselves that were acceptable to both sides. The United States was to basically stay out of it. This policy was a way to allow the United States to slowly and strategically become involved in these new states in the years following the collapse of the Soviet Union without bothering or irritating or worrying Russia.

After giving the newly independent states some time, the United States became increasingly active in its diplomatic efforts in the region. It started out with official visits, first by the leaders of the region to the United States: President Islam Karimov of Uzbekistan visited the White House in 1996; President Eduard Shevardnadze of Georgia, President Heidar Aliyev of Azerbaijan, President Nursultan Nazarbayev of Kazakhstan in 1997; and President Saparmurat Niyazov of Turkmenistan in 1998.   These visits were then followed by US Secretary of State Madeleine Albright touring the region in 2000.

To add to this, possibly one of the most significant US policy decisions in the Caspian region, the Clinton Administration appointed a “special envoy”, or a special inter-agency working group, which focused on Caspian policy. This was interesting because so much focus was placed on this remote region, even though there was no significant trade relationship between the Caspian littorals and the United States, no real threat of major war, and no immediate threat to regional or international peace and stability. The United States military also began to pay attention to the region. Many training sessions and programs were conducted in the area and between 1992 and 1999. The United States also provided the Caspian area with nearly $1.9 billion under the Freedom Support Act to promote democratization, market reforms, health care, and housing.

However, not all good deeds go unpunished. While supporting the region, the United States also addressed the importance of Central Asia and the Caucasus. A mistake the United States may have made in addressing the importance of this region was emphasizing the region’s oil and gas wealth. In an address before the Senate Appropriations Committee’s Foreign Operations Subcommittee, Secretary of State Madeleine Albright noted that it was of national interest to support states in the Caspian Basin because they were strategically located and energy-rich. This may have planted a seed of suspicion in Russia toward US motives in the area, which could have led long-term to the decision to lock them out of the region militarily in last year’s summit.

Thus, the very policy that was meant to help the United States gain the littoral states’ trust and future access to the Caspian’s resources and strategic location may have backfired. The US invested so much time, money, and energy working to build the navies and strengthen the military in Turkmenistan, Azerbaijan, and Kazakhstan. However, all of that training and arms supplied were ultimately manipulated by Russia and Iran, cajoling the states that they could protect their interests themselves without more direct foreign military aid and involvement. The littoral states bought into the idea that their bolstered militaries, along with Russia and Iran’s supplementally pledged military support, would be enough to protect themselves. It seems apparent that the idea of needing protection from Russia and Iran in the future was not considered a relevant threat. This concept is something loudly crowed about in the West but these decisions show it is not shared by the ‘lesser’ Caspian littorals.

Another policy of the United States that may have contributed to this lockout decision was the imposition of sanctions on Russia and Iran. Russia not only has soft power influence throughout the region, many of the littoral states are fearful of a belligerent Iran. The United States imposed sanctions on Russia in response to the annexation of Crimea and subsequent involvement in the war in Ukraine. The sanctions have caused severe economic harm to Russia causing food prices to soar, the exchange rate to weaken, inflation to increase, and incomes to decrease. The United States also imposed further sanctions on Iran due to its illicit nuclear activities. Like in Russia, the sanctions severely affected Iran’s economy, causing incredibly high inflation, unemployment, and food prices. Thus, Russia and Iran’s distrust and anger toward the United States, along with their own national security interests, fueled their actions to push the littoral states to agree with the lockout.

The decision to block foreign militaries from the Caspian Sea is a threat to the strategic interests of America and, to a lesser extent, the EU. Potentially, it could have negative repercussions on energy security. By removing any Western military influence in the region, Russia will be able to maintain the regional hegemony it considers its natural birthright. In addition to that, Iran will be able to ensure greater strategic flexibility moving forward with the JCPOA nuclear accord. It is now clear that there were policy decisions made by the US that negatively affected its relationship with Russia and Iran and fueled the push for the military lockout. Additionally, the United States’ discussion of the strategic location and energy wealth of the Caspian Basin undoubtedly caused an air of doubt by the ‘greater’ Caspian littorals and clearly motivated them to improve their relations with Kazakhstan, Azerbaijan, and Turkmenistan enough so that those three could legitimately believe in the wisdom and efficacy of relying on their own regional securitization. In short, the biggest decision that came from the IV Caspian Summit was the product of a long and gradual process of ‘blowback diplomacy,’ where the United States was forced to reap a bitter harvest from its earlier sowing season.

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Eastern Europe

Latvia developed new tasks for NATO soldiers

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Member of the Latvian Saemas’ national association “Everything for Latvia!” and Freedom”/LNNK Jānis Dombrava stated the need to attract NATO troops to resolve the migration crisis. This is reported by la.lv.  In his opinion, illegal migration from the Middle East to Europe may acquire the feature of an invasion. He believes that under the guise of refugees, foreign military and intelligence officers can enter the country. To his mind, in this case, the involvement of the alliance forces is more reasonable and effective than the actions of the European border agencies. Dombrava also noted that in the face of an increase in the flow of refugees, the government may even neglect the observance of human rights.

The Canadian-led battlegroup in Latvia at Camp Ādaži consists of approximately 1512 soldiers, as well as military equipment, including tanks and armoured fighting vehicles.

Though the main task of the battlegroup in Latvia is country’s defence in case of military aggression, Latvian officials unilaterally invented new tasks for NATO soldiers So, it is absolutely clear, that Latvian politicians are ready to allow NATO troops to resolve any problem even without legal basis. Such deification and complete trust could lead to the full substitution of NATO’s real tasks in Latvia.

It should be noted that NATO troops are very far from being ideal soldiers. Their inappropriate behaviour is very often in a centre of scandals. The recent incidents prove the existing problems within NATO contingents in the Baltic States.

They are not always ready to fulfill their tasks during military exercises and training. And in this situation Latvian politicians call to use them as border guards! It is nonsense! It seems as if it is time to narrow their tasks rather than to widen them. They are just guests for some time in the territory of the Baltic States. It could happen that they would decide who will enter Latvia and who will be forbidden to cross the border!

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Eastern Europe

Changes are Possible: Which Reforms does Ukraine Need Now?

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Photo: Robert Anasch/Unsplash

The past 16 months have tested our resilience to sudden, unexpected, and prolonged shocks. As for an individual, resilience for a country or economy is reflected in how well it has prepared for an uncertain future.

A look around the globe reveals how resilient countries have been to the COVID-19 pandemic. Some have done well, others less so. The costs of having done less well are almost always borne by the poor. It is for this reason the World Bank and the international community more broadly urge—and provide support to—countries to undertake economic and structural reforms, not just for today’s challenges but tomorrow’s.

One country where the dialogue on reform has been longstanding and intense is Ukraine. This is particularly true since the economic crisis of 2014-2015 in the wake of the Maidan Revolution, when the economy collapsed, and poverty skyrocketed. Many feared the COVID pandemic would have similar effects on the country.

The good news is that thanks to a sustained, even if often difficult, movement on reforms, Ukraine is better positioned to emerge from the pandemic than many expected. Our initial projection in the World Bank, for example, was that the economy would contract by nearly 8 percent in 2020; the actual decline was half that. Gross international reserves at end-2020 were US$10 billion higher than projected. Most important, there are far fewer poor than anticipated.

Let’s consider three reform areas which have contributed to these outcomes.

First, no area of the economy contributed more to the economic crisis of 2014-2015 than the banking sector. Powerful interests captured the largest banks, distorted the flow of capital, and strangled economic activity. Fortunately, Ukraine developed a framework to resolve and recapitalize banks and strengthen supervision. Privatbank was nationalized and is now earning profits. It is now being prepared for privatization.

Second, COVID halted and threatened to reverse a five-year trend in poverty reduction. Thanks to reforms of the social safety net, Ukraine is avoiding this reversal. A few years back, the government was spending some 4.7 percent of GDP on social programs with limited poverty impact. Nearly half these resources went to an energy subsidy that expanded to cover one-in-two of the country’s households.

Since 2018, the Government has been restructuring the system by reducing broad subsidies and targeting resources to the poor. This is working. Transfers going to the poorest one-fifth of the population are rising significantly—from just 37 percent in 2019 to 50 percent this year and are projected to reach 55 percent in 2023.

Third, the health system itself. Ukrainians live a decade less than their EU neighbors. Basic epidemiological vulnerabilities are exacerbated by a health delivery system centered around outdated hospitals and an excessive reliance on out-of-pocket spending. In 2017, Ukraine passed a landmark health financing law defining a package of primary care for all Ukrainians, free-of-charge. The law is transforming Ukraine’s constitutional commitment to free health care from an aspiration into specific critical services that are actually being delivered.

The performance of these sectors, which were on the “front line” during COVID, demonstrate the payoff of reforms. The job now is to tackle the outstanding challenges.

The first is to reduce the reach of the public sector in the economy. Ukraine has some 3,500 companies owned by the state—most of them loss-making—in sectors from machine building to hotels. Ukraine needs far fewer SOEs. Those that remain must be better managed.

Ukraine has demonstrated that progress can be made in this area. The first round of corporate governance reforms has been successfully implemented at state-owned banks. Naftogaz was unbundled in 2020. The electricity sector too is being gradually liberalized. Tariffs have increased and reforms are expected to support investment in aging electricity-producing and transmitting infrastructure. Investments in renewable energy are also surging.

But there are developments of concern, including a recent removal of the CEO of an SOE which raised concerns among Ukraine’s friends eager to see management independence of these enterprises. Management functions of SOE supervisory boards and their members need to remain free of interference.

The second challenge is to strengthen the rule of law. Over recent years, the country has established—and has committed to protect—new institutions to combat corruption. These need to be allowed to function professionally and independently. And they need to be supported by a judicial system defined by integrity and transparency. The move to re-establish an independent High Qualification Council is a welcome step in this direction.

Finally, we know change is possible because after nearly twenty years, Ukraine on July first opened its agricultural land market. Farmers are now free to sell their land which will help unleash the country’s greatest potential source of economic growth and employment.

Ukraine has demonstrated its ability to undertake tough reforms and, thanks to the COVID-19 pandemic, has seen the real-life benefits of these reforms. The World Bank looks forward to providing continued assistance as the country takes on new challenges on the way to closer European integration.

This article was first published in European Pravda via World Bank

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Eastern Europe

Liberal Development at Stake as LGBT+ Flags Burn in Georgia

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Photo: Protesters hold a banner depicting U.S. Ambassador to Georgia Kelly Degnan during a rally against Pride Week in Tbilisi, Georgia July 1, 2021. Credit: REUTERS/Irakli Gedenidze

Protests against Georgia’s LGBT+ Pride parade turned ugly in Tbilisi on July 5 when members of the community were hunted down and attacked, around 50 journalists beaten up and the offices of various organizations vandalized. Tensions continued the following day, despite a heavy police presence.

On the face of it, the Georgian state condemned the violence. President Salome Zourabichvili was among the first with a clear statement supporting freedom of expression, members of parliament did likewise and the Ministry of Internal Affairs condemned any form of violence.

But behind the scenes, another less tolerant message had been spread before the attacks. Anxiety about this year’s events had been rising as a result of statements by the government and clergy. Prime Minister Irakli Garibashvili suggested the march “poses a threat of civil strife.” The Georgian Orthodox Church meanwhile condemned the event, saying it, “contains signs of provocation, conflicts with socially recognized moral norms and aims to legalize grave sin.”

For many, these statements signified tacit approval for the abuse of peaceful demonstrators. Meanwhile, the near-complete absence of security at the outset of the five-day event was all too obvious in Tbilisi’s streets and caused a public outcry. Many alleged the government was less focused on public safety than on upcoming elections where will need support from socially conservative voters and the powerful clergy, in a country where more than 80% of the population is tied to the Georgian Orthodox Church.

The violence brought a joint statement of condemnation from Western embassies. “Violence is simply unacceptable and cannot be excused,” it said. The Pride event was not the first and had previously been used by anti-gay groups. Violence was widespread in 2013 — and the reality of attacks against sexual minorities in Georgia remains ever-present.

In a socially conservative country such as Georgia, antagonism to all things liberal can run deep. Resistance to non-traditional sexual and religious mores divides society. This in turn causes political tension and polarization and can drown out discussion of other problems the country is marred in. It very obviously damages the country’s reputation abroad, where the treatment of minorities is considered a key marker of democratic progress and readiness for further involvement in European institutions.

That is why this violence should also be seen from a broader perspective. It is a challenge to liberal ideas and ultimately to the liberal world order.

A country can be democratic, have a multiplicity of parties, active election campaigns, and other features characteristic of rule by popular consent. But democracies can also be ruled by illiberal methods, used for the preservation of political power, the denigration of opposing political forces, and most of all the use of religious and nationalist sentiments to raise or lower tensions.

It happens across Eurasia, and Georgia is no exception. These are hybrid democracies with nominally democratic rule. Armenia, Georgia, Kyrgyzstan, and others have increasingly more in common, despite geographic distance and cultural differences.

Hungary too has been treading this path. Its recent law banning the supposed propagation of LGBT+ materials in schools must be repealed, European Commission President Ursula von der Leyen said on July 7. “This legislation uses the protection of children . . . to discriminate against people because of their sexual orientation . . . It is a disgrace,” she said.

One of the defining features of illiberalism is agility in appropriating ideas on state governance and molding them to the illiberal agenda.

It is true that a mere 30 years since the collapse of the Soviet Union is not enough to have built a truly liberal democratic state. Generations born and raised in the Soviet period or in the troubled 1990s still dominate the political landscape. This means that a different worldview still prevails. It favors democratic development but is also violently nationalistic in opposing liberal state-building.

Georgia’s growing illiberalism has to be understood in the context of the Russian gravitational pull. Blaming all the internal problems of Russia’s neighbors has become mainstream thinking among opposition politicians, NGOs, and sometimes even government figures. Exaggeration is commonplace, but when looking at the illiberal challenge from a long-term perspective, it becomes clear where Russia has succeeded in its illiberal goals. It is determined to stop Georgia from joining NATO and the EU. Partly as a result, the process drags on and this causes friction across society. Belief in the ultimate success of the liberal agenda is meanwhile undermined and alternatives are sought. Hybrid illiberal governments are the most plausible development. The next stage could well be a total abandonment of Euro-Atlantic aspirations.

Indeed what seemed irrevocable now seems probable, if not real. Pushback against Georgia’s Euro-Atlantic choice is growing stronger. Protesters in front of the parliament in central Tbilisi violently brought tore the EU flag. Twice.

The message of anti-liberal groups has also been evolving. There has been significant growth in their messaging. The anti-pride sentiment is evolving into a wider resistance to the Western way of life and Georgia’s Western foreign policy path, perhaps because it is easily attacked and misrepresented.

To deal with this, Western support is important, but much depends on Georgian governments and the population at large. A pushback against radicalism and anti-liberalism should come in the guise of time and resources for the development of stronger and currently faltering institutions. Urgency in addressing these problems has never been higher — internal and foreign challenges converge and present a fundamental challenge to what Georgia has been pursuing since the days of Eduard Shevardnadze – the Western path to development.

Author’s note: first published at cepa

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