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A NEW LEASE ON A FLEET, A NEW LEASE OF LIFE

Yevgeny Kiselyov

THE MOSCOW TIMES

with Ukrainian president Viktor Yanukovych on April 21 in Kharkiv, which pro- vides a significant discount on the price of Russian gas in exchange for extending the lease for the Black Sea Fleet in Sevastopol until 2042. The opposition has already labelled the agreement the “Medvedev-Yanukovych Pact” in an attempt to create a negative association in peo- ple’s minds with the infa- mous Molotov-Ribbentrop Pact between the Soviet Union and Nazi Germany. Critics of the new Ukraini- an president, who assumed office in February, have in- creased their vitriol against Yanukovych, resorting to a host of ideological cliches and unconvincing argu- ments. For their part, foreign jour- nalists have also been guilty of using cliches in reporting the story. For example, they often refer to Yanukovych as a pro-Russian politician. They never tire of reminding readers that Moscow had supported Yanukovych in his failed run in the presidential election of 2004, and that the support of the Kremlin played a key role in his de- feat. They speak as if Kiev has definitively returned to Moscow’s orbit.

P

THE POLLS

Most Russians satisfied with state

QUESTION: OVERALL, DO YOU APPROVE OR DISAPPROVE OF THE WORK CONDUCTED BY RUSSIA’S GOVERNMENT?

assions are raging in Kiev over the agree- ment president Dmit- ry Medvedev signed

I have written more than once that it is highly doubt- ful that Yanukovych has a pro-Russia bias – if for no other reason than the polit- ical party he heads, the Party of the Regions, is run by the owners of major Ukrainian coal, metallurgical, mining and chemical companies that have more ties with Europe and Asia than they do with Russia. At the same time, however, these enterprises cannot exist without Russian gas. The original price for that gas, which prime ministers Vladimir Putin and Yulia Ty- moshenko agreed to in Jan- uary 2009, was exorbitantly high for them. Tymoshenko was never able to explain clearly why Rus- sian gas paradoxically cost Ukraine about $50 more per 1,000 cubic metres than, for example, Germany, which is much farther from Russia’s borders. Now that Tymoshenko is part of the opposition, she accus- es Yanukovych of putting the business interests of Ukraine’s oligarchs above the country’s national interests. But there is another side to the story, about which the op- position remains silent. The enterprises owned by those oligarchs employ millions of people who will be deprived of a means of survival should those firms halt production or go bankrupt. What’s more, some of those plants are the sole source of income for entire towns. If they fail, those company towns will die with them. The Ukrainian economy is

DRAWING BY DMITRY DIVIN

Yanukovych had few other options available to him other than to sign the deal

teetering on the verge of col- lapse. The country is suffer- ing from a serious decline in production and a sharp drop in tax revenues. It has a huge budget deficit, enormous public debt, an empty treas- ury and a high poverty rate. The gas-for-fleet agreement that enables the Ukrainian government to save up to

$4bn per year is like a new lease of life for Ukraine’s dying economy. Without that cut in gas prices, Ukraine could not have shown an acceptable national budget plan to the International Monetary Fund and resumed co-operation with that organisation. Now it is eligible to receive

another $6bn or $7bn this year and up to $20bn over the long term. It is clear that Yanukovych had few other options avail- able to him other than to sign the deal. But the question most peo- ple are asking is: Why did the Russian side suddenly agree to concessions that will

cost it $40bn over the next 10 years in gas discounts in return for extending the lease of the Black Sea Fleet in Sev- astopol, particularly when the fleet has lost almost all of its military and strategic importance? With that money, Russia could build a new base for the fleet on the Russian Black Sea coast, modernise the ships and make all of the of- ficers rich to boot. There are several reasons for Russia’s generous terms. The Kremlin probably real- ised that the previous prices for Russian gas were too steep. This would inevitably lead to a payment default and a new “gas war” between Rus- sia and Ukraine that would cause billions of dollars of lost revenue for Russia and lead to angry accusations from European gas custom- ers of “Russian energy black- mail”. There were political factors as well: Russia’s presidential election is only two years away, and regardless of whether the ruling party chooses to run Mr Medvedev or Mr Putin for president, ei- ther one could bolster his campaign by boasting that Russia’s flag, as well as the Navy’s St Andrew’s flag, will flutter over Sevastopol’s bay for at least another quarter of a century. What’s more, judging from statements Mr Putin made at a news conference on Monday, he is playing a com- plicated and tricky political game. In one sense, he is present-

ing himself as the guardian of the European Union’s en- ergy interests by suggesting that, thanks to him, an agree- ment has been reached en- suring the stable transit of Russian gas over Ukrainian territory for the next dec- ade. At the same time, however, he uses scare tactics against the Europeans by suggesting that with the Ukrainian op- position ready for a no-holds- barred political fight and threatening to annul the gas agreement if they come to power, now is the time to build the South Stream pipe- line bypassing Ukrainian ter- ritory and declare a fait ac-

compli.

According to polls, Ukrain- ian society is divided over the gas-for-fleet deal between Moscow and Kiev. According to a survey con- ducted by Research & Brand- ing Group, 53pc of those whe responded hold a generally positive view of the agree- ment, while 32pc hold a neg- ative view. But there is an enormous dis- tance between simply being opposed to the deal and ac- tually taking part in massive protests, as the opposition has urged. When Tymoshenko and other opposition leaders were in power, their reputation wors- ened to such an extent that it would seem highly unlike- ly that they can inspire the people to stage another Or- ange Revolution. It would be especially diffi- cult now, when most people are willing to give Yanuko- vych a fair chance – maybe he can end the crisis and set the country on the right path toward economic growth and political reform. But if nothing has changed six to 12 months from now and if people don’t see an im- provement in their standards of living, Yanukovych can ex- pect serious problems.

First published in

The Moscow Times

RUSSO-BRITISH RELATIONS: FROM PREJUDICE TO PRAGMATISM

Dmitry Babich

SPECIAL TO RN

A

Russian president Dmitry Medvedev and prime minister Vladimir Putin remain popular, the Levada Centre told Inter- fax following a recent nation- wide poll. Seventy-three pc of Rus- sians approved of president Medvedev in April (75pc in March), while Putin retained his 78pc score. Some 53pc of the respondents approved of the job the government is do- ing, and 66pc said that the government might change things for the better in the near future. Twenty-seven pc said the opposite.

Confidence in Putin scored 50pc, followed by Medvedev (42pc), emergency situations minister Sergei Shoigu (18pc), Liberal Democratic party lead- er Vladimir Zhirinovsky (13pc), and Communist party leader Gennady Zyuganov (9pc). Deputy prime minister Ser- gei Ivanov and Moscow mayor Yuri Luzhkov received an ap- proval rating of 5pc each, while foreign minister Sergei Lavrov Federation council chairman Sergei Mironov and Kemerovo governor Aman Tuleyev got 4pc. Fifteen pc did not trust any Russian politicians.

re Russo-British re- lations going to im- prove under the new coalition of Con-

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PREDATOR PUTIN

I

Alexei Pankin

THE MOSCOW TIMES

n honour of World Press Freedom Day on May 3, Reporters Without Bor- ders released a list of the

top 40 “Predators of Press Freedom” that includes prime minister Vladimir Putin. It sounds as if Putin was nom- inated for an honourable award. “Strong leadership from the top has been his guiding principle in the reconstruc- tion of a strong state after the years of confusion under Boris Yeltsin,” the report said. “The press has not been

spared. The national televi- sion stations now speak with a single voice.” I am certain the people who wrote those lines read a re- cently released book by Yevg- eny Adamov, former head of the nuclear power ministry (now Rosatom). Adamov is famous for having been jailed in Switzerland on charges filed by the US, then extradited to Russia where he was convicted but given a suspended sentence. In his book, Adamov relates an incident that occurred after the August 1998 default in which he refused to use the resources of the coun- try’s nuclear industry to help

banker and NTV founder Vladimir Gusinsky resolve debt problems he was hav- ing with Most-Bank, which Gusinsky headed.

Putin’s harsh measures were not so much aimed at the press as against TV station owners

Gusinsky told Adamov: “You think you’ll be here long? The FSB will take you away by evening. I’ll teach you a les- son on what the media is ca-

pable of doing!” Adamov claims the sum involved was $100m. “The experience gave me a first-hand understanding of how the so-called oligarchs viewed their own influence and importance at that time,” Adamov wrote. This episode describes a business model of informa- tion blackmail and extortion that was typical of the coun- try’s mass media – particu- larly television – during the Yeltsin presidency that is so disparagingly described by Reporters Without Borders. But I think Putin’s harsh measures against NTV and Channel One were not so

much aimed against freedom of the press or journalists, per se, as they were against sta- tion owners Gusinsky and Boris Berezovsky, respective- ly. The measures were an at- tempt to make the state at least a little more manage- able after the chaotic Yeltsin years. In this respect, I agree fully with the authors of the media predators list. I also agree that the period during which all national television sta- tions have been “speaking with a single voice” has dragged on a bit too long now. Having broken the con- trol that oligarchs exercised over television, Putin either failed or, more likely, was afraid to replace it with a genuinely independent media. Adamov writes that although the media is subordinated

more to the Kremlin than to private business interests, the situation now is essentially no better than it was in the mid-1990s. But apparently, every leader has his own mis- sion and his own resources. If president Dmitry Medvedev wants to create the condi- tions for an independent media to emerge, he might get a boost from one exter- nal source: the sharp rise in Russian internet users. Main- taining tight control over the traditional television media is less important than it was before. Next May, we will be able to judge Medvedev’s progress by looking at Russia’s rank- ing in the yearly press free- dom index. It would be nice if they treat Medvedev with the same respect and under- standing that they have shown toward Putin.

servatives and Liberal Dem- ocrats? There’s no lack of op- timists in Russia on the matter. There are some tra- ditional stakeholders in the often uneasy Bear and Lion romance (such as the wealthy Russian business elite who are so attached to London they even preferred it to St Petersburg as the venue for the annual Russian Econom- ic Forum). In the recent years, one could add to them a group of “Tory-philes” from the Russian foreign policy expert community. What exactly is Toryphilia in Russia? Toryphilia is not ex- actly a theory, but a mindset among Russian foreign pol- icy experts which favours conservatives in both the United States and the UK for being more “pragmatic” and “predictable”. That, the Toryphiles say, makes con- servatives better partners for negotiations than liberals or

leftists. This mindset (never proven by any serious re- search) was best summed up by Vyacheslav Nikonov, the president of Unity in the Name of Russia foundation, a semi-official think tank of the United Russia party: “They (conservatives) don’t have to prove their patriot- ism to anyone.” Citing such achievements of American conservative Republicans as the Soviet-American détente under Richard Nixon or the Reagan-Gorbachev dialogue, Nikonov expected the trend to work also with British conservatives and even with the Polish radical tradition- alists centred around the party of the Kaczynski broth- ers. The recent developments in Russian-American and Rus- sian-Polish relations seem to dash Nikonov’s theory, putting it under the same question mark with numer- ous theories on sports statis- tics. “Patterns” of victories and defeats of some football team may explain just about everything to believers in sports statistics, especially to the inventors of this or that pattern. To non-believers,

these patterns may not mean anything. The ongoing im- provement of relations be- tween Moscow and Washing- ton under the Democratic administration of Barack Obama and a new start of Russo-Polish dialogue under the new centre-right parlia-

Conspiracy theories are the byproduct of ignorance. The treatment for this is in classrooms

mentary majority in Poland seem to signal some prob- lems with “Tory-phile” the- ory. Even if there is some truth to it, this truth is by no means universal. But can Britain be a pleasant sur- prise, with the Toryphile the- ory avenging itself? For a believer in sports sta- tistics, there is no shortage of encouraging data. In the 1920s, our relations reached a low point in 1924 under the Labour government of Ramsay MacDonald, when the forged letter by Grigory

Zinoviev, head of Commu- nist International, was pub- lished by the Daily Mail. In the letter, Zinovyev called on prominent Labour party members to “apply pressure on the government” to make it ratify the already agreed treaties between Great Brit- ain and Soviet Russia. The treaties were supposed to lift the ban on British loans to Russia, where Lenin’s gov- ernment had refused to hon- our debt obligations to Brit- ish bondholders. The result was the cancellation of So- viet-British negotiations. Two decades later, in the late 1940s, it was under the La- bour government of Clement Attlee that Britain became a founding member of the anti-Soviet Nato alliance. However, a small change in perspective provides a total- ly different picture. In 1924, MacDonald’s government was replaced by a Conserv- ative cabinet which broke all diplomatic relations with the USSR in 1927, leading to ru- mours about a possible war with Britain among ill-in- formed Soviet citizens. These rumours were one of the rea- sons for the crisis in grain

deliveries from Soviet peas- ants in 1927, which in its turn led to Stalin’s collectivisation with subsequent famines in Ukraine, Russia and Kaza- khstan. As for the start of the Cold War in 1940s, its first shot was fired not by Attlee, but by Conservative Winston Churchill in his famous 1946 speech on the “Iron Curtain”. Margaret Thatcher, another Conservative prime minister, may have been the first West- ern leader to believe in the seriousness of Mikhail Gor- bachev’s reformist intentions, but her initial meeting with him in 1984 was preceded by negative rhetoric between Moscow and London in the early years of her premier- ship. As usual, sports statis- tics work both ways. So, what is the key to im- proved relations? If one could reduce it to one word, that word would be “real- ism”. Relations between Rus- sia and Britain improved or soured not because of a vic- tory of this or that party at the elections, but because of the presence (or absence) of realists in this or that cabi- net. In 1941, facing an threat of Hitler’s invasion, Conserv-

ative Churchill stretched his hand to Russia. In 2001, after 9/11 when the threat of ter- rorism appeared to be al- most as deadly as the Nazi threat, Labour prime min- ister Tony Blair and the then Russian president Vladimir Putin promised their peo- ples a new relationship. The promise never materialised as a number of new “Zi- noviev letters” were poured on the public by controver- sial figures from both coun- tries. This failure should re- mind us of one more recurrent pattern: strength- ened by realists in times of trouble, Russo-British rela- tions are often ruined in times of peace by provoca- teurs capitalising on con- spiracy theories. As is often the case elsewhere, conspir- acy theories in Russo-Brit- ish relations are a byprod- uct of ignorance. Treatment against this disease is to be found not in party headquar- ters, but rather in classrooms and newsrooms. Learn more and get real – such is the call of the day.

Dmitry Babich is a political analyst at RIA Novosti. Page 1  |  Page 2  |  Page 3  |  Page 4  |  Page 5  |  Page 6  |  Page 7  |  Page 8