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The strategic consequences of Brexit

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Though with a knife-edge majority, Great Britain has relinquished its economic and political relationship with the EU. Obviously account shall be taken of the many people who voted in favour of Bremain, since they will not disappear all of a sudden, but also the strategic, military and geopolitical effects of this new UK position shall be assessed.

A position which today seems to be mainly economic and commercial, but which will soon herald wider choices than the mere give-and-take between Great Britain and the European Union.

For sure the British people have never liked the European Union.

In 1975 Margaret Thatcher put strong pressures for the United Kingdom to adhere to the European Union, but the idea of the Iron Lady was to become member with a view to controlling a powerful entity, such as the EU, thus avoiding the creation of an axis between France and Germany to isolate Great Britain – as, indeed, later happened. Also from the commercial viewpoint.

Prime Minister Thatcher decided to adhere to the EU as some businessmen do with potentially dangerous companies of which they buy a significant shareholding so as to better manage them from inside.

It is worth recalling that there was still the Cold War that Great Britain was fighting with great care and intelligence wisdom.

At the time, both Prime Minister Thatcher and the other EU statesmen viewed the European bloc as an economic agreement preventing the USSR from extending its economic, if not military, influence over what the French philosopher, Raymond Aron, called “the great Central European plain.”

The plain that the Warsaw Pact planned to quickly conquer so as to reach the Atlantic and seal the UK into its North Sea.

Without Great Britain, there would be no European nuclear arsenal and the French one would fall immediately into Russian hands.

Furthermore, in her book of 2003, Statecraft: Strategies for a Changing World, Margaret Thatcher did not dismiss the possibility of Brexit as “unthinkable”, but thought that the issue had to be analyzed very carefully.

It had to be assessed in terms of strategic and commercial routes and in terms of UK influence over the EU decision- making process, as well as for assessing the balance between the euro and the pound sterling.

These are the decisive factors of the EU-UK matrix, not others.

Currently the European framework is obviously much more complex than in the 1970s.

It is not true, however, that the Union rescued Europe from the fratricidal wars which scarred it as from Napoleon I onwards. The European Civil War, as the German historian and philosopher Ernst Nolte called it.

Conversely peace in Europe was preserved by the military balance between NATO and the Warsaw Pact.

The “economic basis of the war” between Germany and France, from Alsace-Lorraine to the Ruhr region, was an old strategic concept which had already been solved with the European Coal and Steel Community (ECSC) in 1951.

Nevertheless, as from 1980 onwards, it was precisely Margaret Thatcher who put pressures on the EU to “get her money back,” by considering the agreements between the EU and the UK unnecessarily too burdensome for her country.

In her speech delivered in Bruges in 1988, the Conservative Prime Minister spoke clearly against “a European super-State exercising a new dominance from Brussels”.

This is the core of the issue: the British people have never wished to turn the economic “contract” among the European Member States into a specifically political contract. They wanted and still want to have a free hand in the global financial framework. Finally they intend to avoid the geopolitical effects of the economic and trade ties established in Brussels.

Great Britain is a State, a great nation, which needs overall global autonomy which, on the contrary, the EU manages according to covertly Franco-German interests that are potentially opposite to the UK ones.

It is not the British leaders’ perception, it is the truth and, however, in politics, perception counts as reality, if not even more.

As is in A Midsummer Night’s Dream by William Shakespeare.

With this choice, Great Britain, which still has the “imperial dominance spirit of Lawrence of Arabia” – as the former Italian President Francesco Cossiga who, however, was a close friend of Margaret Thatcher, called it – is trying to play some cards which, despite the “mists of tomorrow”, are potentially valid.

Firstly, the relationship with the United States, also at economic level, comes back to the fore.

When in 1976 the United States celebrated the bicentennial of their independence (from Great Britain, by the way), a British sailor arrived in the New York port holding a banner with the inscription: “Come back home, guys, we have forgiven you.”

Hence Great Britain still considers itself an empire – currently a British empire of finance and technology, but anyway still an empire.

With a view to becoming again “what it is” – along the lines of Friedrich Nietzsche’s journey of becoming a free spirit – Great Britain just needs to revive and revitalize its special relationship with the United States.

As early as 1958, a Mutual Defense Agreement was signed between the United States and Great Britain regarding the two nuclear arsenals while in 2010, thanks to a subsequent bilateral treaty with the United States, Great Britain had the opportunity of overcoming many of the controls and limits imposed by the Americans on its advanced defense technologies – limits imposed also on NATO members.

Great Britain is the second largest economy of the English-speaking world and the sixth largest world economy. It is the largest US trading partner and a member of the UN Security Council. It hosts the highest number of US military bases abroad and, above all, it is the global financial hub which periodically rescues US banks from their insolvency crises.

Hence it is clear that Brexit can be seen as a major US strategic success and outlines the end of the “third pole” between East and West which sometimes the EU has dreamt of being.

The dollar zone has never liked the euro. Quite the reverse, it has fought it harshly.

For the United States, the European single currency was and still is a strong competitor, as well as a threat to their role as hegemonic global financial power – an insane “Napoleon’s dream”.

Moreover, the idea of bringing the euro to an often forced parity with the US dollar has undermined EU exports, by compelling them to be carried out with a currency having a too “high” value which has restricted the end-markets.

Not to mention the many temptations generated by the euro on world commodity markets: it is true that – among many other assessments and considerations – the United States attacked Saddam Hussein for his still secret choice of trading most of his oil and petroleum products in euros.

It is also true that, in the phases characterized by great international tensions, Iran traded part of its oil and petroleum products in euros, especially on the “stock exchanges” in Kish and in the other islands of the Persian Gulf.

The Brexit effects, however, increase the volatility of the pound sterling against the dollar, with a spread of approximately 15% compared to the pre-referendum values.

Financial analysts’ imbalances which, by now, are mainly trolls, namely IT automatisms.

Certainly Great Britain will not be granted a preferential treatment by the United States in the framework of the TTIP negotiations.

US President Obama has explicitly warned that the UK would be at the “back of the queue” in any trade deal with his country if it chose to leave the EU and would have the same treatment and the same barriers to entry as countries like China, Brazil or India.

Nevertheless Barack Obama is about to leave the US Presidency and, if Donald Trump were to be the next President, he will have every interest in dividing the European competitors and favoring them against the aggressive practices of countries like China and, in the future, India.

Also Hillary Clinton cannot avoid using this leverage offered by Great Britain for the TTIP negotiations.

The British TTIP is a bet on the future which, however, the UK could win by relying on its great financial strength.

Bilateral trade between the United States and the UK is very significant: America is the first destination of UK exports and the United States are the third generator of imports for the UK, after Germany and China.

North America and Great Britain are the largest mutual foreign investors.

A situation which cannot change all of a sudden, in spite of the US discontent and dissatisfaction with Brexit.

Furthermore the British government stated that TTIP could provide to the British economy a surplus of approximately 10 billion pounds a year.

There is the need to recover much of the Brexit cost and rebuild a strategic and military relationship with the United States which the UK sees as the only bulwark against two EU and NATO structural dangers: the EU decision-making weakness in the Middle East and the explicit German polemic against the Atlantic Alliance’s anti-Russian posture, which has been mounting in recent months.

Two dangers that the UK wants to avert: the recovery of German geopolitical autonomy tending to Eurasia and the EU structural weakness faced with Middle East tensions.

In Great Britain’s mind, Germany is always the country of the old definition by Lord Ismay, who was NATO Secretary General from 1952 to 1957: “The Atlantic Alliance’s purpose is to keep the Americans in, the Russians out and the Germans down”.

Great Britain does not want the strategic and economic exchange between France and Germany, in which Germans buy French government bonds massively and, in return, are entitled to the “enhanced and extended protection” of the French military nuclear power.

Great Britain does not even want a euro which, as “a German mark in disguise”, penetrates the major British export expansion areas.

Moreover, considering the EU strategic inanity, Great Britain fears for its corridors to and fro its Asian Commonwealth.

With its operations in Crimea and Ukraine, the Russian Federation blocks and distorts the direct line between Great Britain and India, besides changing the balance of power in Central Asia, where the UK has still strong interests.

Since 2001 to date, Great Britain has deployed its military units in Afghanistan, in the framework of the US Enduring Freedom operation, not only for mere “Atlantic loyalty” as other countries (including Italy) have done, but to still afford the regional strategic viability and role which are essential for it to keep Northern India, the central Asian countries and the routes from Southern China.

Those who think globally, as the decision makers of what was once a great Empire, do not stop doing so all of a sudden.

Unfortunately the EU’s mistakes are known to everybody: an artificially overvalued currency – maybe to compete with the dollar; an insane disconnection between EU foreign and economic policy; the idea of simultaneously controlling 29 countries which are all competing one another, with different tax systems and public spending mechanisms, not to mention the autonomous and conflicting public debt securities markets.

The EU could certainly reform itself by establishing, within the ECB, a single market of government bonds, possibly managed (and not tiered and capped) with the issuance of “European debt securities”.

That Germany does not want, and with good reason.

Moreover the Union could also make the various Member States develop an export plan, with a view to analytically protecting one commodity or the other, without dangerous generalizations (even for us).

From chocolate to wine, up to the hilarious theory of the ”Polish plumber” – popularized by Philippe de Villiers as a symbol of cheap labor coming from Central Europe as a result of the Directive on Services in the Internal Market during the EU Constitution referendum in France in 2005 – in the field of exports, so far Italy has lost and has hence paid for its mistakes related to its “scarce incisiveness” in Europe.

It is worth recalling that the Polish plumber. was supposed to come and work in the EU at the same rates he charged in Krakow. However, the cost of living in this Polish town is very different from the cost of living in the center of Munich.

Abstract free-trade and liberal theories, typical of a bad macroeconomics handbook, mixed with archaic protectionism – this is exactly what the EU has often been.

Hence, following the ideas of General de Gaulle, another great “Eurosceptic”, the issue lies in returning to a Europe of Nations and States where only what is already in common is decided jointly – and it could not be otherwise…

This means European protection from asymmetric shocks, selective penetration of new foreign markets and domestic liberalization of goods and services.

The idea of making the EU be the comptroller of the Member States’ public budgets, with abstract and binding rules, paves the way for a number of exceptions which inhibit the rule, or for a covert economic struggle between EU rich and poor countries.

We have already experienced it in Greece and this could also happen in Italy and Spain.

Furthermore, the EU has insisted on implementing a common “foreign, security and defense policy”, with the obligation to “make the Member States’ civilian and military capacities available to the EU”.

Shall this be done in agreement with NATO? Where is the chain of command of this 29-Member State army? Who develops its plans and sets its goals?

All this is for stabilization, humanitarian and conflict prevention missions, disarmament or military assistance and advice.

And what is the role played by the United Nations, despite all its limits?

In short, as from a certain phase onwards, which we could identify with the 2001 crisis, the European Union has believed to be what it was not and had not been conceived and meant to be.

After all, even the old anti-Soviet dissident Vladimir Bukovsky, was not entirely wrong when, from his new English homeland, equated the European Union with his old USSR.

Hence if the EU is able to reform itself not only at organizational, but also at domestic financial level, it will be in a position to keep on selling its merchandise: protection against asymmetric shocks, a strong currency widespread in the world, as well as a free internal market.

Conversely, if it continues to pursue its Napoleon’s dream of “uniting Europe”, it will have to face “one, a hundred, a thousand Brexit” – just to paraphrase Che Guevara’s words.

Furthermore, the issue does not lie in asking – as the Italian politicians do – for “greater budget flexibility” in exchange for abstract reforms which may be suitable for the Finnish people, but not for the Flemish population.

The problem is completely different: to have the possibility of drafting autonomous budgets so as to subsequently check their effects over a period of two years, without prior diktats.

Briefly, a more modest EU will survive very well – even after Brexit.

Advisory Board Co-chair Honoris Causa Professor Giancarlo Elia Valori is an eminent Italian economist and businessman. He holds prestigious academic distinctions and national orders. Mr. Valori has lectured on international affairs and economics at the world’s leading universities such as Peking University, the Hebrew University of Jerusalem and the Yeshiva University in New York. He currently chairs “International World Group”, he is also the honorary president of Huawei Italy, economic adviser to the Chinese giant HNA Group. In 1992 he was appointed Officier de la Légion d’Honneur de la République Francaise, with this motivation: “A man who can see across borders to understand the world” and in 2002 he received the title “Honorable” of the Académie des Sciences de l’Institut de France. “

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Digital COVID-19 vaccine passports have arrived- why they are a bad idea

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With the arrival of the first batches ofCOVID-19 vaccines at various countries, there have been a number of statements by public officials and corporate executives who are calling for a global “vaccine passport” which will offer those who get vaccinated freedom to travel and the ability to enter venues, restaurants, sport events and even schools.

The framework for the implementation of a global vaccine passport has already been established by the Commons Project, a non-profit organization backed by the World Economic Forum and the Rockefeller Foundation. Some of its key people are former Bill Clinton aide Paul Meyer, former Engineering VP of Google Alan Warren and Hong-Kong based investor Jennifer Zhu Scott.

The Commons Project has created the Common Pass, a mobile application in which people will register when they get the vaccine from certain vaccination sites. In order to board a flight or enter a restaurant a person will have to scan a QR code provided by the Common Pass that will contain their vaccination status. If they are not vaccinated they will be denied entry.

The Common Pass is already active; it was recently tried on flights of United Airlines & Cathay Pacific, where it was used as a platform to register traveler’s Covid-19 test results. Four more companies (JetBlue, Lufthansa, Swiss International Airlines and Virgin Atlantic) have decided to use it.

In the future, the Commons Project aspires to extend the use of the Common Pass to venues, stadiums, public transport and even schools, while there is also a strong possibility that it may be applied to other industries such as hospitality and entertainment. UK’s vaccination minister Nadhim Zahawi, recently said that restaurants, cinemas and bars might effectively ban those who are not vaccinated.

If the Common Pass is established as a global vaccine passport, millions of people from different countries will be forced to give their personal health and travel information to a private entity in order to have the ability to travel, go to school, attend a concert or go to a club. Through the use of the Common Pass people will basically be coerced into getting vaccinated, while there are also serious privacy concerns.

But even though there has been a campaign by the media to portray those who are skeptical of COVID-19 vaccines as a minority of “crazy anti-vaxxers” that reject any kind of vaccination, this is simply not true.

In fact a large part of the global population hesitates to get vaccines that have been developed within 10 months when it normally takes 10 years. Especially younger people without health issues who face minimal risk of getting seriously sick from COVID-19 feel that a potentially unsafe vaccine poses a bigger risk to them than the virus itself.

After all, no one can deny that, because of the pandemic, compromises on safety were made during the development of the vaccines. The clinical trials for most of the vaccines were completed after the mass production had already started and they lasted few months instead of the standard 5-9 years, while pharmaceutical companies have been given immunity by western governments from liabilities regarding potential unknown serious side effects of their vaccines.

In this uncertain environment, corporations and governments trying to vaccinate the whole population by imposing coercive measures such as digital vaccine passports will only add to the skepticism against the COVID-19 vaccines. Moreover new issues of privacy and the handling of personal health data from private entities will arise and will complicate even more the discussion around the pandemic, while also undermining further the confidence of the people in existing institutions.

Besides, what exactly is the point of such draconian measures when, as the England’s deputy chief medical officer Prof Jonathan Van-Tam has said, the vaccination of just the high risk groups is enough to eradicate the 99% of hospitalizations and deaths from COVID-19?

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Greece and UAE’s Strategic Cooperation: A New Regional Equilibrium in the Making

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UAE Minister receives Minister of Foreign Affairs of Greece (Photo: WAM)

The agreement on Joint Cooperation in Foreign Policy and Defence between Greece and the United Arab Emirates (UAE) is a milestone for bilateral relations and for the wider region. It was signed during the official visit of the Greek prime minister to the UAE on 18th November 2020. The agreement seals the determination of both countries to enhance their strategic partnership in the domain of defence with the aim to foster cooperation and jointly address common challenges and threats.

It is in this context that the agreement contains a mutual defence clause or else a mutual military assistance clause that equals to a common defence doctrine as it foresees that in case either country is threatened or attacked, both are committed to contributing to the defence of the other to ensure their sovereignty and territorial independence.

The clause contained in the agreement on Joint Cooperation in Foreign Policy and Defence has a purely defensive character and is the maximum that can be achieved between two countries that do not share common borders. For the implementation of the agreement, a regular consultation mechanism has been instituted at the level of Foreign Ministers, while a Supreme Joint Committee between Greece and the UAE is to be established.

The agreement also foresees the stationing of military forces of one country in the territory of the other, and the exchange of classified intelligence information. This provision comes to institutionalize the stationing of military forces of Greece, a member state of NATO and the EU, and of the UAE, a member country of the Gulf Cooperation Council to each other’s territory. It is noteworthy that at the height of the Greek-Turkish crisis in August 2020 when seismic vessel Oruc Reis conducted surveys in maritime areas that partly fall within the Greek continental shelf, the United Arab Emirates relocated four F-16s to the Greek island of Crete, where they were stationed for two weeks and participated in joint air exercises with the Hellenic Air Force.

The value of joint military exercises between Greece and the UAE is significant especially when taking into consideration that the Emirati armed forces are one of the most modern in the region that are technologically equipped with state-of-the-art weapons systems. The UAE’s Air Force has 68 Mirage 2000 French fighter jets and 78F-16 American fighter jets; its Navy has 11 corvettes, and the government of Abu Dhabi is the first in the world that has acquired the Terminal High Altitude Area Defence (THAAD) anti-aircraft system of Lockheed Martin. The system is designed to shoot down short-, medium-, and intermediate-range ballistic missiles in their terminal phase by intercepting with a hit-to-kill approach. In total, 100,000 people serve in the UAE Army, Navy and Air Force.

An additional agreement for the training of technicians from the UAE in the Greek Aviation Industry is to be finalized soon. The Armor Training Centerin Avlona is scheduled to host Emirati technicians, due to its proximity to the technical base of the Greek Aviation Industry in an area of ​​about 90 acres within which all necessary infrastructure and facilities will be constructed.

The Greece-UAE agreement on Joint Cooperation in Foreign Policy and Defence has been concluded in view of broader regional security arrangements and intends to counter Turkey’s assertive behaviour and expansionism that extends from the Arab (Persian) Gulf and Syria to Libya and the East Mediterranean Sea. Already, the UAE participates in the 3+1 formula consisted of Egypt, Cyprus, and Greece along with France and regularly discusses regional crises that threaten peace and stability including developments in the East Mediterranean.

The Joint Declaration adopted by the Ministers of Foreign Affairs of Cyprus, Egypt, France, Greece, and the United Arab Emirates in May 2020clearly criticized Turkey for its pirate behaviour and gunboat diplomacy that aim to advance Neo-Ottomanism. As known, Neo-Ottomanism  is the vision of contemporary Turkish foreign policy whose scope is to restore Ankara’s influence in the areas of the former Ottoman Empire and thus turn Turkey into a leading power in the East Mediterranean, the Middle East, and the Balkans.

Acknowledging Turkey’s expansionist strategy in the broader region, the UAE, Greece, Egypt, France and Cyprus denounced Turkish illegal activities in the Cypriot Exclusive Economic Zone and territorial waters, that plainly violate the United Nations Convention on the Law of the Sea (UNCLOS). They also condemned Turkey’s continuing violations of Greece’s territorial waters and airspace as well as Ankara’s military interference in Libya urging Turkey to fully respect the UN arms embargo, and to stop the influx of foreign fighters from Syria to Libya.

These developments that constitute a threat to the stability of the broader region and of Europe accelerated the cementing of regional defence and diplomatic arrangements.  The normalization of relations between the UAE and Israel constitutes a cornerstone of peace-making and regional partnerships. So does the UAE-Greece agreement on Joint Cooperation in Foreign Policy and Defence. The joint agreement and the mutual defence clause ensures the ability of both countries to exercise self-defence in accordance with article 51 of the UN Charter that explicitly recognizes that a UN member state has the right to legitimate defence not only in the event of an armed attack against it, but also in the event of a “threat of use of force”.

Especially when it comes to Greece, Athens is entitled to defend itself especially when taking into consideration Turkey’s timeless provocations and military escalations that are evidenced by: (a) the establishment of the Aegean Army in the ‘70s with an offensive posture, (b) the invasion and occupation of part of Cyprus, (c) Turkey’s repeated violations of Greece’s territorial waters and airspace that are estimated at around 7,000 only for 2019, and (d) the casus belli proclaimed by the Turkish Parliament in case Greece extends her territorial waters up to 12 nautical miles.

The multiple crises triggered by Turkey across the broader region haven given the opportunity to Greece and the UAE to display their large regional alliance network. Greece and the UAE along with like-minded and western-oriented regional countries coordinate policies; The ultimate goal lies in stopping Turkey from acting like a neo-ottoman pirate state in the East Mediterranean.

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Great Powers Competition in Moldova

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Image source: Wikipedia

Moldova is the forgotten epicenter of tensions between the West and Russia, located between Romania and Ukraine, with no direct access to the sea since the territorial changes of the Soviet era. This country of 3.3 million inhabitants for 33,846 square km is plagued by ethnic divisions with Gagauzia and Transnistria, two territories diplomatically close to Moscow. Both the Kremlin and Brussels are reluctant to integrate Moldova into their respective zones of influence due to several elements detailed in this article, which has led to a political situation that has alternated pro-European and pro-Russian governments since the end of the Cold War.

Confirming this unstable political context, Maia Sandu, a pro-European Moldovan stateswoman, was elected president of the country on November 15, 2020, succeeding pro-Russian Igor Dodon. However, this election should not lead to a rapprochement between the West and Moldova, as the major powers are accustomed to considering the country as a political no man’s land, in contrast to the other members of the Eastern Partnership.

The Kremlin’s Reluctance to Take a Proactive Approach in Moldova

For Moscow, the lack of access to the Black Sea makes Moldova less strategically important than other countries in the region. As such, the Kremlin was more active in Crimea and Georgia with the diplomatic recognition of Abkhazia and South Ossetia, in contrast to Moldova, where no noticeable change has taken place in Transnistria since 1992.

This situation is paradoxical because a rapprochement between Moscow and Chisinau could confer many strategic advantages on the Kremlin. In this respect, better Russian-Moldovan relations would thus hinder any possible advance of the European Union and NATO in Molodva, and could also force Ukraine to reconsider its diplomatic approach vis-à-vis the Eurasian Economic Union (EEU). Moreover, the strengthening of military cooperation between Moscow and Chisinau would increase pressure on Romania, which is favourable to Moldova’s integration into Euro-Atlantic institutions.

Moscow’s cautious approach is all the more paradoxical given that Russia has sympathisers in Moldova with the two territories of Transdniestria and Gagauzia, Tiraspol and Comrat, wishing for rapprochement and even integration within Russia.

For Transnistria, which has been de facto independent of Moldova since the end of the Cold War and whose desire for integration into the Russian Federation was demonstrated by the 2006 referendum with 97.5% of the votes in favour, a diplomatic rapprochement between Moldova and Russia could improve relations between Tiraspol and Chisinau.

On an economic level, if Moldova joins the EEU, Transdniestria could be taken into account, with Chisinau considering it as part of its territory and Tiraspol having an economic interest in aligning its standards with those of Russia.

On the military level, an increased influence of the Kremlin in Moldova would make it possible to negotiate the integration of Chisinau into the Collective Security Treaty Organisation (CSTO). If this were to happen, the Kremlin could reduce the presence of Russian peacekeeping troops in Transdniestria. In effect, if Moldova joins the CSTO, Moscow would become the protector of Moldova and de jure of Transdniestria, as this territory is a part of Moldova in accordance with Russian, Moldovan and international law.

The withdrawal of Russian soldiers from Transnistria, who are monitoring the contents of Soviet military equipment warehouses, is a source of tension between the West and Russia. In November 2008, the NATO Parliamentary Assembly adopted a resolution calling on Russia to withdraw its forces in accordance with the commitments made at the 1999 OSCE summit in Istanbul. The UN General Assembly adopted a similar resolution (document A/72/L.58) calling on the Russian Federation to pull out of Moldovan territory in June 2018.

With Moldova close to Russia, Russian peacekeeping troops would be given the opportunity to withdraw or reduce their numbers, thus easing tensions between the international community and Russia. For the Kremlin, this would also allow it to optimise operating costs and allocate this budget to other peacekeeping operations, including the Nagorno-Karabakh troops, which have been operating since November 10, 2020.

The second pro-Russian territory of Moldova is Gagauzia, which extends over 1,830 square kilometres divided into four non-contiguous zones, grouping around fifteen communes into three districts. Unlike Transnistria, which is de facto independent of Chisinau, Gagauzia is incorporated into Moldova. The inhabitants are initially Turkish-speaking, largely Russified during the 19th and 20th centuries, and now culturally distinct from the Turks.

The Russian-speaking Gagauzs wish to move closer to Russia because they have little advantage in learning Moldavian (Romanian language). Historically, Russia appears to be a country that protects Gagauz interests, a fact that still permeates relations between Moscow and Comrat (the capital of Gagauzia) and bears witness to Moscow’s soft power in this territory.

Comrat is in favour of strengthening the influence of the Kremlin in Moldova in order to promote the Russian language against Romanian, but also to restrict the influence of Bucharest, the fear of the Gagauz being integrated into a “Greater Romania” which would not defend their interests.

Given these elements, and despite the strategic advantages that a rapprochement between Moscow and Chisinau could bring, Moldova remains a political no man’s land for Russia. Moscow’s reluctance to become more involved stems from several factors, the main one being the economic health of the country, the poorest on the European continent with a nominal GDP of $4,498, which means that integration into the EEU would not strengthen the latter’s economic power, making Moldova dependent on other members.

Enlargement of the CSTO into Moldova would lead to a deterioration in Moscow’s relations with the western world, particularly with Romania, and would have repercussions for all the countries of the Black Sea, which could encourage certain states such as Georgia to speed up their rapprochement with NATO and the EU.

An Expensive Investment That Diminishes Interest in the Western World

Moldova is of little economic interest to the EU, with the only competitive sector being agricultural products due to the abundance of rare earth. In addition, the corruption of elites and the departure of young graduates hampers the emergence of new services and active civil society.

Chisinau invests a mere 0.4% of its GDP in its armed forces, with fewer than 6,000 soldiers relying on Soviet equipment, and therefore of little interest to NATO. Apart from the lack of military means, Moldova is a neutral state that does not wish to join an alliance (NATO or CSTO). A poll carried out in 2018 shows that 22% of Moldovans are in favour of a project to join NATO and 43% against it.

While Moldova’s integration into the EU would be a strong symbol and testify to the resilience of Brussels’ soft power in a post-BREXIT context, it would be expensive and the EU would have to invest considerable sums within the framework of the Eastern Partnership to enable Chisinau to meet the accession criteria.

Integration into the Schengen area would trigger a demographic crisis, with young Moldovan citizens having few opportunities at home. Consequently, the European Union prefers to adopt an attitude similar to that of Russia and consider Moldova as a political no man’s land.

In this regard, the result of the elections of November 15, 2020, with Maia Sandu attests to the influence of western influence in the country, but also highlights the lack of confidence in Dodon’s leadership, who has not managed to achieve a rapprochement with Russia during his term as President.

The EU-Moldova cooperation sought by Maia Sandu will struggle to emerge due to the lack of human resources in the country and the absence of infrastructure to export and import goods. Moldova has not had the financial means to modernise its road and rail networks since the fall of communism.

Romanian Ambitions in Moldova

Because of its cultural and linguistic proximity to Moldova, Bucharest would like Chisinau to move closer to the Euro-Atlantic structures of which Romania is a member, even considering going as far as full integration with the rebirth of a “Greater Romania,” which brought the two states together from 1918 to 1940. This prospect is not acceptable to the Gagauz and Transnistrians, but also to many citizens and Moldovan elites, as the country would become an impoverished region of Romania with no control over its future.

Romania’s proactive approach is a source of apprehension for Russian speakers and an argument in favour of Transnistrian and Gagauz separatism. Bucharest is especially influential because the administration has adopted a policy of “passportisation” in Moldova. Romanian citizenship is granted to Moldovans who apply for it and can prove that they have a Romanian ancestor, thus granting European citizenship with its benefits. In total, more than 726,100 Moldovan citizens have thus become Romanians since the end of the Soviet Union.

A facetious remark circulating in Moldova mentions that the country is going to join the European Union, with or without the agreement of Brussels, since there will soon be no Moldovans and only Romanian citizens.

Beijing’s Soft Power in the Black Sea

As in the rest of the Black Sea, the Chinese influence in Moldova has increased in recent years. Beijing is interested in this territory because of the lack of infrastructure and the prevailing corruption, which allows Chinese companies to offer all types of partnerships in exchange for various counterparts.

In 2015, the Chinese company SOE China Shipping Container Lines launched container transport services in the Moldovan port of Giurgiulesti — the country’s only harbour accessible to Black Sea vessels — via the Danube, after signing a terminal services agreement with the national operator. This investment enabled Chisinau to export its products abroad, especially as its economy was suffering from the Russian embargo on Moldovan wine imports. According to local companies, the international free port of Giurgiulesti should continue its development and become a logistics platform with a business park enabling Chinese companies to access the European and Eurasian markets.

Moldova has started negotiations on a free trade agreement (FTA) with Beijing in 2017, removing barriers to the import of certain products and strengthening business exchanges. According to forecasts published by the Moldovan authorities, Moldova’s exports to China could increase by 39.85% and its GDP by 0.42% as a result of the FTA.

The most significant development took place in 2019, when Moldova concluded an infrastructure agreement with two Chinese contractors for the construction of nearly 300 kilometres of roads, at an estimated cost of $400 million. One road will surround the capital Chisinau and the other will link Ukraine to the north. Two Chinese companies — the China Highway Group and the China Railway Group Limited — will participate in this project, marking the first Chinese-led infrastructure project in Moldova. According to Chisinau, the projects will significantly improve traffic and contribute to overall economic growth. A total of 12 major Chinese companies also participated in the Chisinau Business Forum in April 2019, underlining their commitment to increase investment in the country. In the context of the Covid-19 crisis, the Chinese authorities announced that the debt of 77 countries, including Moldova, had been temporarily suspended.

Beijing’s choice to focus its attention on Moldova is explained by the country’s non-alignment, but also by the reluctance of Moscow and the European Union to become more involved. China is, therefore, meeting no resistance from the Russians or westerners.

For the Kremlin, Chinese investments in the region could harm the ambitions of Brussels and Washington in Moldova, China being an ally of Russia. While for westerners, China was providing considerable aid to the EU by modernising infrastructure, which could bring Chisinau closer to Romania and the EU because of the weakness of Chinese soft power, cooperation between Beijing and Chisinau is confined to the economic sector.

No Man’s Land or Chinese Gateway to the Black Sea?

In conclusion, Moldova is one of the epicentres of the tensions between the West and Russia, but the latter are reluctant to increase their involvement because of the unfavourable economic context, as well as the lack of direct access to the Black Sea.

For the EU and NATO, the results of the recent elections should, in theory, lead to a rapprochement, but in practice Transnistria and Gagauzia will hinder the most ambitious projects. Romania is called upon to play a leading role in this rapprochement, but the divisions between Bucharest and Chisinau are a reality to be taken into account and the rebirth of a Greater Romania seems unlikely.

Russia has a strategic interest in increasing its influence in Moldova by integrating Chisinau into the EEU and the CSTO, but this would encourage other Black Sea countries such as Georgia to draw even closer to the western world. Moreover, the presence of Russian troops in Transdniestria and the pro-Russian position of Comrat allow the Kremlin to remain present in the region, independently of Chisinau’s diplomacy, which does not encourage Moscow to develop a pro-active policy.

Beijing’s economic diplomacy seems to be producing results and bringing the two states closer together. In this respect, China has succeeded in modernising the Moldovan infrastructure despite obstacles rooted in corruption. This makes Moldova a potential laboratory for Chinese soft power and indirectly benefits both westerners and Russians.

In view of the results of the November 2020 elections, it seems appropriate to pay attention to the rapprochement between Russia and Transnistria, a process that could be accentuated if Maia Sandu confirms her pro-western policy. Gaguzia could gain in importance, as a move towards the EU and NATO could lead to the resurgence of separatism in this region.

Resources

CENTRAL INTELLIGENCE AGENCY (CIA), «The European Borders of the USSR», Office of research and Reports, 1955

CENTRAL INTELLIGENCE AGENCY (CIA), «The Challenge of Ethnic Conflict to National and International Order in the 1990s: Geographic Perspectives», Rapport de conférence, 1995

LAMBERT Michael, Stratégies de mise en place des Soft Power européen et russe en Moldavie après la guerre froide, Études de l’IRSEM n° 40, 2015, 94 pages (www.defense.gouv.fr/content/download/393969/5890290/file/Etude_IRSEM_n40.pdf)

LAMBERT Michael, Comprendre la présence militaire russe en Transnistrie, Revue Défense Nationale 2019/3 (N° 818), pages 107 à 112.

KLEIN Margarete, Russlands Militärpolitik im postsowjetischen Raum. SWP-Studie, 2018

BABAN Inessa, «The Transnistrian Conflict in the Context of the Ukrainian Crisis», Collège de défense de l’Otan 2015, Research Paper n° 122, 12 pages (www.ndc.nato.int/download/downloads.php?icode=468).

KLIMENKO Ekaterina, «Protected Armed Conflicts in the Post-Soviet Space and their Impact on Black Sea Security», SIPRI Insights on Peace and Security n° 2018/8, décembre 2018, 28 pages (www.sipri.org/sites/default/files/2018-12/sipriinsight1808_0.pdf)

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