Connect with us

Russia

Why Economic Sanctions Mean Little to Moscow

Emil Avdaliani

Published

on

Realpolitik, a German term for politics based on day-to-day calculations regarding the military and economic balance of power among major states, should be used and discussed more often in the modern world, though we often discuss Russia and the ways to influence its actions over the long-term especially in its immediate neighborhood.

Economic sanctions are a common tool for the West, and many, particularly in the former Soviet space, believed that western measures would cripple Russia and make Moscow change its foreign policy with regards to Ukraine and perhaps Georgia. Others thought the economic sanctions would do no more than influence some aspects of Russian policies, though in such a way as to limit to a certain degree Russia’s projection of power.

But Russian politicians giving in to European pressure would be humiliating from a nationalistic point of view.

Instead of (or on top of) those sanctions, what the West lacks is a quiet military and economic build up along the Russian borders so that Moscow starts seeing the changing geopolitical landscape. Again, those western actions would not be based on loud bombastic statements such as “we’ll change if you do,” but on a real shift in the balance of power. This is what is happening now when Europe demands Russian concessions on Ukraine in exchange for lifting financial restrictions. But for the Russian leadership, it will be self-destructive to radically abandon its current policy on Ukraine and Georgia.

That there is a larger western economic and military presence in the Russian neighborhood is what matters to the Russians. For Vladimir Putin, a master practitioner of realpolitik, western notions of the democratic development of Ukraine, Moldova and Georgia, and thus Russia’s non-interference, is a flagrant misconception. The leadership in Moscow does not genuinely believe that the West is so interested in Ukraine and Georgia. From the Russian perspective, the spread of democracy cannot be a viable explanation and the West’s purely geopolitical calculations should be considered.

Putin, like his predecessors from the Soviet era or even the Romanov dynasty, believes that any Western moves in the Russian neighborhood are anti-Russian per se. He is not to blame; there is simply a different civilizational approach to foreign relations in Moscow compared to Western countries. In studies on geopolitics, this factor is often missed, but it is deeply important.

There is also a distinct way in which the Russian leadership responds to foreign threats. In Europe, governments of countries facing problems can easily resign, while in Russia, bending to foreign pressure is tantamount to an unravelling of the state apparatus, leading to elite infighting and even possibly something close to troubles on the periphery of the state. This is a product of Russian geography, ethnic composition and culture.

On the contrary, faced with direct pressure, the Russians usually make moves which better show off their military strength. Consider what happened in Ukraine. Facing a total loss of Ukrainian territory in 2014, a distinctively Russian reaction to this coming disaster was taking the pieces which Moscow could still take.

To counter Russian moves, a larger US and European presence in Ukraine, Moldova and Georgia could arguably be the only viable solution to the problems with Russia in the former Soviet space. Moscow will have to consider more acutely the changing geopolitical landscape, while it will serve as a good further pointer to various Russian elites that the state’s foreign policy for the past 20 years has been counterproductive.

This will be a good representation of realpolitik towards Russia. In a way, the time is ripe for reinvigoration of this 19th century German foreign policy concept. The US recently reformulated its foreign policy, while its latest national strategy document clearly outlined the rise of power competition in Eurasia. To strengthen its positions across the continent, Washington ideally would need to work in Japan, South Korea and other traditional US allies. In this atmosphere, direct US support for Georgia and Ukraine might be logical and could be more practical than time-consuming NATO procedures.

It will be costly, but still not as much as the US is spending on its larger allies. In the era of the Cold War and later in the 1990s, when notions of world democratic world order were a driving motor of the US foreign policy, in a world based on realpolitik there will more avenues for direct, bolder and balance-changing moves.

This brings us back to Russia and how the economic sanctions have had only a limited impact on Moscow. Imposition of sanctions alone failed to produce viable results: instead, they should have been propped up by other actions, such as changing the economic and military landscape of Georgia and Ukraine.

Author’s note: first published in Georgia Today

Emil Avdaliani specializes on former Soviet space and wider Eurasia with particular focus on Russia's internal and foreign policy, relations with Iran, China, the EU and the US. He teaches history and international relations at Tbilisi State University and Ilia State University (Georgia).

Continue Reading
Comments

Russia

Forgiving Old Debts: Russia’s Diplomatic Maneuver

Published

on

With economies experiencing contractions across the globe and with governments in the third world most vulnerable, discussions of debt relief have been revived. Yet, forgiving old debts is nothing new to the Kremlin. For the Russian government, it has been just one part of a wider diplomatic toolkit to rekindle ties that have faltered since the end of the Cold War.

Once the primary backer of numerous states over large swathes of the globe, Moscow largely retreated from the non-Soviet space during the presidency of Boris Yeltsin and it continued to not be a primary concern during Vladimir Putin’s first two terms as head of state. However, Russia’s resurgence on the international arena over the past few years has not only made the country more willing to re-engage with the region but also more capable.

International media has primarily viewed this through the lens of military strength. Whether it is sending trainers and advisors to the Central African Republic, allegedly supporting rebels in Libya, or deploying Wagner Group forces to fight an Islamic State-offshoot in Mozambique, the focus has primarily been conflict-oriented. However, less explored is the quieter and more economic measures that the Russian government has taken in order to win hearts and minds outside of the West.

As part of a debt-for-development programme, Russia has forgiven approximately $20 billion worth of debt to various African governments that was accrued during the Soviet period. Beneficiaries include the Commonwealth nation of Tanzania and Francophonie member Madagascar, along with others. In forgiving these loans, the Kremlin has acknowledged a reality that many countries continue to deny: such debts are unpayable. At the first ever Russia-Africa Summit, Putin stated explicitly that “It was not only an act of generosity, but also a manifestation of pragmatism, because many of the African states were not able to pay interest on these loans.”

These measures have yielded concrete benefits for the previously indebted countries. For example, the decision to forgive Mozambique’s $40 million debt was done in conjunction with the United Nations World Food Programme, with the money that was intended for debt repayment instead being used to provide free school meals for 150,000 children over the course of five years.

While Russia will potentially be losing some money in the short term, debt forgiveness is likely to open new doors moving forward. Many of the countries that have seen their debts written off have significant economic and geopolitical potential. With improved political relations as a consequence, it is hoped that Russian companies will get preferential treatment should contracts be offered to international firms. This could help explain the Kremlin’s decision to forgive 90% of North Korea’s $11 billion debt despite the latter’s weak position. Russia has been eager to develop a trans-Korean gas pipeline that would transport fuel to South Korea. While the likelihood of this being realised remains slim, in the context of Pyongyang’s inability to repay the debt in any case, it is a reasonable gamble to make on the part of the Russian government.

This is somewhat similar to China’s efforts over the past few years, albeit in an inverse form. With Beijing less cash-strapped than Moscow, it is able to invest directly whereas Russia is using debt forgiveness to redirect cash payments away from servicing old debts and instead towards domestic reinvestments. Free projects, such as the Chinese-funded and constructed headquarters of the African Union, have been followed by ever-growing economic and political relations.

Russia’s debt policy has been used to strengthen existing alliances and partnerships. While not all Soviet-era allies have retained close ties to Moscow, many have done so continuously since the Cold War. One of the biggest beneficiaries of Russian debt forgiveness has been Cuba. In July 2014, ahead of a visit to the island nation by Putin, the Russian government wrote off 90% of Cuban debt. Though Russia was not only the country that showed willingness to restructure Cuba’s debt obligations at the time, it was by far the most generous. China restructured approximately $6 billion while Japan and Mexico forgave $1.4 billion and $478 million, respectively; Russia forgave $32 billion.

The decision did reaffirm the close relations between Moscow and Havana. Cuba has repeatedly voted in support of the Russian Federation at the United Nations on sensitive topics, such as Crimea, and Russian firms have received multiple drilling and mining contracts from the Caribbean country.

However, this strategy has its limitations. The overwhelming majority of these debts date back to the Soviet era and are therefore limited in scope. Some countries, such as Angola and Ethiopia (which saw most of their debts forgiven in the 1990’s), were primarily recipients of military support during civil wars so their debts were not as vast as other heavily indebted countries with other creditors. Since then, despite respite from Moscow, such countries have continued to become increasingly burdened by growing debts. While Ethiopia is often heralded as an example of rapid economic growth, its debt, both in total but also has a percentage of GDP, has grown considerably during the post-Soviet era.

While debt relief is undeniably beneficial to the third world, the fact that Russian-owned debts constitute a mere fraction of all foreign-owned debts in most cases means that the act of writing debts off cannot achieve much in of themselves. Consequently, in several countries, the gesture is mostly a PR move. In the case of Afghanistan, where Russia was the largest creditor due to loans handed out during the 1980’s, Kabul had for decades refused to recognise the debt. The decision to forgive the debt was therefore more of a signal of a desire to improve relations than any hope to achieve instantaneously tangible rewards.

The largest stumbling block for the Kremlin’s efforts remain structural issues afflicting the indebted nations, the nature of which vary considerably from country to country. For example, while Russia has forgiven a majority of Iraq’s debt to the country, which in turn helped revive talks over potential oil contracts, the continued instability in the Middle Eastern nation makes it difficult to reap many benefits. Though it is true that Baghdad has continued to purchase Russian T-90 tanks and attack helicopters, this is more of a sign that Russia has partially managed to pivot Iraq away from the United States’ sphere of influence as opposed to gaining economically.

With the onset of coronavirus, however, Russia might not be the leading debt forgiver for very long. In places such as sub-Saharan Africa, where economies are expected to continue shrinking while deficits are set to grow, other creditors could potentially step in and likewise forgive debts. In April of this year, G20 leaders agreed to extend debt relief in the form of a moratorium on debt repayment yet this can only serve as a short term solution. With many governments already increasing their borrowing, creditor nations are well positioned to leverage their position in order to improve geopolitical relationships as well as set the stage for favourable contracts for their firms. If more countries follow Moscow’s path, then the significance of what the Kremlin has done will only recede and lose much of its relevance.

Debt forgiveness can win friends but can only go so far. For Russia’s diplomatic maneuvers to stick, they will need to continue complementing it with other efforts, such as improving trade and boosting security partnerships, in order to truly make the most of its financial generosity.

Continue Reading

Russia

The Case of Belarus: Russia’s Fear of Popular Revolutions

Emil Avdaliani

Published

on

For Russia, the crisis in Belarus caused by the August presidential election result is of a geopolitical nature. Moscow might not be openly stating its geopolitical calculus, but in its eyes, the Belarus problem resembles the uprisings in Ukraine, Moldova, Georgia, and Kyrgyzstan and represents a similar problem in the long run.

Whatever the arguments propounded by world analysts that protests in Belarus are not about geopolitics and more about popular grievances against President Alexander Lukashenko, the issue will ultimately transform into serious geopolitical game.

For Moscow, the Belarus problem has been about geopolitics from the very beginning, though it was only on August 27 of this year that Vladimir Putin announced the creation of a special “law enforcement reserve” for use in Belarus should the situation get “out of control.”

The Russians understand that an “Armenia-style” revolution in Belarus could theoretically take place, but it would open the country more to Europe and thereby create geopolitical dilemmas similar to those created in Ukraine before 2014. The Russians further grasp that in Ukraine, the situation was out of control even before the Maidan Revolution. Moscow’s influence was not sufficient to stop Ukraine’s gradual shift toward closer ties with the collective West.

For the Russian leadership, events in Belarus are a continuation of the “revolutionary” fervor that has been spreading across the former Soviet space since the early 2000s. What is troubling is whether or not the Russians see this process as an expression of the popular will that is largely independent of the West. Several indicators point to an ingrained belief within the Russian political elite that in fact the West has orchestrated the popular upheaval in Belarus.

Russian history might be of help here. Throughout the nineteenth century, the Russian Empire fought the spread of European revolutionary thought along and inside its borders. It built alliances to confront it and fought wars to forestall its progress. But in the end, the Bolshevik Revolution and the subsequent policies of the Communist Party were largely based on European thought, though many western ideas were changed or entirely refashioned.

Similar developments took place during the late Soviet period. By the 1980s, popular disapproval of the Soviet system had grown exponentially. A revolutionary fervor for independence ran amok in the Baltic states, Ukraine, and elsewhere. True reforms would have served as a cure, but half-hearted economic and social measures only deepened the crisis. Military power was used in a number of capitals of Soviet republics, but again only half-heartedly. Thus was the entire Soviet edifice brought down.

Modern Russian leadership should see that there is essentially no cure for popular grievances and mass movements along its borders. Russian history gives multiple examples of how military intervention against revolutionary fervor can bring immediate results but leave long-term prospects bleak. The defeat of revolutionary passions can only take place by minimizing those economic, social, and state-system problems that usually generate popular upheaval. This is the dilemma now facing modern Russia. The revolutions that occurred over the past 20 years, and the situation today in Belarus, all fit into this pattern.

For the moment, Lukashenko has won this round of strife with the protesters, and his rule is highly likely to continue. But what is equally certain is that the protests gave birth to a massive popular movement in a country that was once famous for the quiescence of its population.

Russia fears that eventually, this revolutionary tide will close in on Russian society. Lukashenko has stressed this idea, saying in an interview that mass disturbances will one day reach Moscow. Many rightly believed this was a ploy by Lukashenko to scare the Russians into supporting him—after all, Belarus is far smaller than Russia and much less important than Ukraine. Still, Lukashenko was right insofar as he pinpointed possible long-term problems Russia could face as it moves closer to 2036.

Much depends on the West as well. It faces a dilemma in which it ought to pursue a policy of vocal condemnation and perhaps even impose heavy sanctions—but from a balance of power perspective, moves like those would distance Minsk and push it closer to the Russian orbit. This dilemma of morality versus geopolitical calculus will haunt the West in the years to come.

Belarus exports 10.5 million tons of oil products per year, including about six million tons through the ports of the Baltic states to world markets and another 3–3.5 million tons to Ukraine. Redirecting flows from the Baltic ports to Russian ones has been discussed, but this option is less attractive to Minsk because of the longer distances involved. This comes at a time when the Baltic states imposed sanctions on high-ranking Belarussian officials and the EU is pondering serious measures.

With each such move from the West, Russia gets another opportunity. Russia has professed interest in encouraging Belarus to redirect its oil exports to Russian ports and has agreed to refinance a $1 billion debt to Russia.

A broader picture might help put the events in Belarus in context. In the South Caucasus, the Russians appear to have reached the limit of their influence. They more or less firmly control the overall geopolitical picture, but have nevertheless failed to derail Western resolve to compete in this region. In Central Asia, Russia has more secure positions, but the region in general is less important to the Kremlin than the western borderlands.

It is thus the western front—Belarus and Ukraine—that is a major theater for Moscow. Since 2015, many have believed that Syria is Russia’s top geopolitical theater, but this assumption is based simply on the intensity of the immediate processes that are transpiring in the Middle East. With or without Syria, Moscow’s global standing will not be fundamentally damaged. Belarus is a different matter entirely. Changes there, and by extension a potentially anti-Russian state, would constitute a direct threat to Moscow.

For Russia, Belarus is the last safe buffer zone on its western border. Ukraine is lost, as is Moldova, and the Baltic states have long been under NATO protection. Only Belarus serves as a bridge for Russia to move militarily into the heart of Europe. To lose it would be tantamount to a complete “encirclement” of Russia by the West, as argued by Russian politicians.

This geopolitical reality also means that Belarus is the country that will remain most susceptible to Russian geopolitical influence. No wonder Russia is pushing to station its air base on Belarussian soil, reinvigorate the Union state, and intensify Minsk’s economic dependence on Moscow. As was the case with Ukraine, the upheaval in Belarus is about regional geopolitics.

Author’s note: first published in besacenter.org

Continue Reading

Russia

The Navalny case: Violent maintenance of the Cold War

Slavisha Batko Milacic

Published

on

We are currently witnessing the rise of the Cold War, through the media, after the case “poisoning” of Alexei Navalny. The case was used to raise tensions between Moscow and the European Union to the maximum.

Apparently, Alexei Navalny became a victim of poisoning. Yet none of this we can know for sure. However, after the mentioned event, an avalanche of statements “about the orderers of poisoning” was initiated by prominent European and American representatives. Without any critical review, avalanches began to fall in the direction of Moscow and President Vladimir Putin as the main culprit.

One of the first countries from which the avalanche of accusations started was France. Francois Croquet, France’s ambassador for human rights, said: “We know who is to blame.” A very undiplomatic statement for a diplomat, which went beyond the official framework of communication. Francois Crockett joined the wave of accusations against Russia with his statements before any investigation.

French Foreign Minister Jean-Yves Le Drian said that in his opinion, “she (Russia) should have conducted an investigation, and when the culprits are found, they should be tried, to learn a lesson, because this is not the first case of poisoning.” ». The statement, very fierce, but outside the position held by the person in question. The statements of prominent diplomats call into question the international authority of France’s voice in the world.

These statements are aggressively joined by many politicians in Eastern Europe, especially those who feel revanchism towards Russia because of the Eastern Bloc, and further project of Russophobia, which are in line with the great energy battle over the construction of Nord Stream 2, which involved the case of Alexei Navalny.

What do we know so far about Navalny and his treatment. Navalny was initially treated in Russian hospitals, by doctors who did not detect any presence of poison, and then he was transferred to Germany, where it was determined that he was intentionally poisoned. His transport was organized by the “Cinema in the Name of Peace” organization, which was responsible for “rescuing” the group “PussyRiot”, which considered the act of imitation of abortion in the church to be an expression of artistic performance.

In the light of the situation with Russian opposition member Alexey Navalny admitted to the “Charite” hospital in Berlin with the symptoms of poisoning European and particularly German politicians and journalists opened yet another page of blatant Russophobia. Many of them push forward the theory of poisoning creating a classic image of the bloody Russian state trying to get rid of another enemy as in their vision it happened with Sergey Skripal. Even though no proofs are available and the statements of German doctors are scarce of details, this case is claimed to deepen the crisis in German-Russian relations. Some Bundestag members even call to cancel Nord Stream-2 as a punishment for the Russian government.

Despite the media hysteria encouraged by many politicians from the West, there are those who did not succumb to the first wave of Russophobia, and looked more soberly at the event related to Alexei Navalny and asked for additional evidence. For example the Vice President of the Flemish Parliament Filip Dewinter:

“Until now there is no real proof that Navalny was poisoned. I have the impression that countries like Germany are building up the pressure against Russia. The Navalny-issue is once again a perfect excuse to compromise the Russian authorities with violence and oppression against the ‘opposition’ … An objective and neutral investigation will tell“ stated Mr. Filip Dewinter.

His statements are not alone

Chairman of the “Prussian Society Berlin-Brandenburg” Volker Tschapke stated:

“Facing constant anti-Russian propaganda on different levels, I am not surprised with such an attitude, yet I can’t accept it. One of the key principles of any democratic society is the benefit of the doubt: nobody can be declared guilty until the proper investigation is conducted. Too bad, looks like this principle doesn’t work in Europe anymore. I’d like to wish Mr. Navalny to recover very soon and to call German politicians to stick to democratic values and stop pointing fingers at the Russian government without any substantial evidence base.“ said Mr. Tschapke.

Doubts about the case are also expressed by Member of the Parliament of Italy Paolo Grimoldi:

“I don’t trust the “institutional attack” to Navalny in Russia. He has many enemies, especially outside politics, in his life. In my opinion, it doesn’t look like an attempt to eliminate a political opponent. If any Russian top institutional level ever wanted to strike Navalny they would act more efficiently so let’s be serious and stop attacking Russia for nothing, stated Mr. Grimoldi.  

Divided statements regarding Navalny’s case tell us that, unlike in 2014, American power is declining and that European politicians do not make synergistic statements against Russia, but many of them view things with common sense and seek additional evidence for accusations against Russia. More and more Europeans are asking the questions: How is Russia threatening us? What will happen terribly for Europe if Nord Stream 2 is built? Most understand that the conflict in which America is pushing Europe with Russia has nothing to do with European interests, but with American ones.

Continue Reading

Publications

Latest

Trending