Tag Archives: economy

Russia – EU relation and strategic nature of hypocrisy

Speaking into an interview given to the Serbian newspaper ”Politics”, Russian Minister of FR, Sergey Lavrov noticed: ”Many questions have accumulated in the relations between Russia and the EU, including those related to the implementation of the Eastern Partnership policy. We note that there is no adequate reaction by the EU to Ukrainian events, primarily the occupation of local administrations by opposition groups in several regions of Ukraine. There was a comprehensive and fair talk on a broad spectrum of topics at the EU-Russia summit on the 28 January. It is important that it has confirmed the strategic nature of the Russian-European Union partnership.”

About what kind of ”comprehensive and fair talk” we are speaking ? Remember that the long-planned and publicized summit – planned to take place over two days (27-28 January) was meant to a few hours restricted meeting among principles and key advisors (mainly Vladimir Putin, Catherine Ashton, José Manuel Barroso, the president of the European Commission, Herman Van Rompuy, the president of the European Council, and Sergei Lavrov, Russia’s foreign minister), decision that would have been taken “in light of the recent developments”.

29putin_cnd-superJumboVladimir Putin’s meeting with European leadership was dominated by Ukraine’s political crisis and if Russian leader said Russia will honour loan to Ukraine (after a new government will get in power, course ?!), we can observe that in the EU vision there is nothing remarkable. It seems that it is the duty Russia to help Ukraine. Rompuy said it ”between the lines” when he is speaking in his press release following the 32nd EU-Russia Summit about ”a concrete and telling example of the huge potential for all – I will repeat what I said last Saturday in Warsaw. In 1990 the prosperity levels were the same in Poland and Ukraine. Today, Poland is three times more prosperous than Ukraine. And here I am only talking of the economic dimension”. More specifically, it leads to the idea that Poland (under the influence of the West) has prospered and Ukraine (the sphere of influence of Russia) reached poverty. So, Russia must to pay for… ? Literally. And figuratively speaking. EU reluctant to remember the brilliant “achievements” on the road of prosperity of countries in its sphere of influence. Such as Romania and Bulgaria, in the East and around Ukraine and Poland. How about Greece ? Or Spain ? Who must to pay for? Just ask… 🙂

Oh, Mr. Rompuy, you are right ! when we are speaking about Eastern Partnership, is clear like the light of day that each understood what was required of their own interests… Mr. Rompuy admits that ”there can be different interpretations and misunderstandings on the association agreements and that is why we both agreed to pursue bilateral consultations at experts level on the Eastern Partnership Association Agreement and the economic consequences on both sides”. But if that there is just an propagandistic and unfortunate way to hide the lack of well-defined economic opportunities that the EU should offer Ukraine ?

Assault of China to the gates of Europe – ideological fears and pragmatic options

For several days mass-media‘s attention in Bucharest turned massively to something else than to the usual bickering between “coabitants” of convenience sheltered in various palaces in the capital of Romania. It is true that so many senior foreign officials together were not there from the NATO Summit in Romania in 2008. And if in 2008 the official who has won the most important success was Russian President Vladimir Putin, now “the man of the day” was Chinese Premier Li Keqiang.

Annual meeting of the Heads of Government of China, Central and Eastern Europe and the third edition of the Economic and Trade Forum China-Central and Eastern Europe held this year in Bucharest, after the first edition held in Budapest in 2011 and the second in Warsaw in 2012. An excellent opportunity not only to remember the good relations of friendship that connected Romania and China over time but also an important opportunity for the government of PM Ponta to do another concrete step from an agenda of good intentions (about which I wrote here after the visit of Prime Minister Ponta in Beijing/July 2013) to a truly viable partnership.

Although managed questionable in terms of communication (the event was in the media agenda only in the 11th hour before the start), the organizers were able to bring in Bucharest not only one of the political leaders of the planet (which came with a lot of dignitaries and no less than 300 business representatives), but more than 1,000 representatives of private and state companies from the 16 countries of Central and Eastern Europe: Romania, Bulgaria, Poland, Hungary, Slovakia, Czech Republic, Slovenia, Serbia, Montenegro, Croatia, Bosnia and Herzegovina, Estonia, Albania, Latvia, Lithuania and the Republic of Macedonia. Trade and Economic Forum held on the sidelines of government leaders meeting focused on five major themes: energy, agriculture, tourism, IT and infrastructure, without omitting in the informal discussions also other topics of relevance to those involved.

The concerns of EU about “new Russia” – China

Throughout the three days, during which Chinese Premier visited Bucharest, I was witness an interesting array of reactions, from the emotional to the more or less justified ideologically, from fears tributary bygone era to the euphoria of daydreaming. Needless to mention that those who matter the most are the ones strictly pragmatic.

Simultaneously with the lavish receiving of Chinese premier in Romanian lands, the European Commission released a statement requesting the EU countries to remain united in negotiations with China, a signal that the media portrayed as a direct warning to the Romanian Prime Minister Ponta. An intentional (or not) misunderstanding. I think rather we are dealing with an attempt (is right a little too spontaneous and having a serious dose of hypocrisy) of leaders in Brussels to avoid the emergence a “new Russia” in the bilateral relations arena of EU members, knowing that Russia preferred all the time to deal directly with countries leaders when its interests were not able to overcome the opposition of leadership of the European Union. China also might apply this old but effective tactic of “Divide et impera” in relations with EU and the leaders in Brussels are aware that it could bury their last shred of authority. Moreover, commenting on the Summit in Bucharest, Thomas König, coordinator of program for relations with China at the European Council on Foreign Relations (ECFR), notice that lately “China has become very opportunistic.” “While Western Europe still faces with economic crisis, without being able to offer new opportunities for Eastern Europe, China has rapidly increased its presence in the region without us knowing exactly what are its the final objectives” he says. As such, it seems that the target of reminder wasn’t Romanian Prime Minister Ponta, but all 16 heads of government present in Bucharest. But I emphasize again that I find hypocritical and unjust attitude of the leaders of the EU leadership. Because among the top countries that have treated and treat with Russia over the head of the European Union (and probably will do the same with China – Germany has already demonstrated “that it can”!) are not newcomers to the community, but just “heavyweights” players from West of Europe. Those should be some kind of “model” for Easterners, less experienced and less connected to European standards.

     China's Premier Li Keqiang arrived Bucharest What may surprise is that this time China’s approach to fellowship with much noise and fanfare brass, which is somewhat unusual for Chinese diplomacy that is most often associated with the phrase “Keep quiet and do it”. Sure, we can noted that some of the noise associated with the Bucharest meeting was due to the organizers who wanted to adjudicate (perhaps too strongly, and even to the detriment of a pragmatic approach) great gain of rating. Thus beyond the euphoric and fraternal statements made in the numerous meetings with the press (that’s too much creates the impression of cheap and I do not remember any other top international meeting where the key figures to have double / triple exit to the ramp’s lights) nobody really understood: what strategy China is planning for the frontiers of Europe? What role could play in this strategy the countries of Central and Eastern Europe, or in other words, EU provincial relatives, poorer and less pretentious than Western counterparts? If we look at the current volume of trade between the EU and China, which reaches 500 billion, with the ambition to reach 1,000 billion in seven years, and then compare it with the statistics which show that Poland, the Czech Republic, Hungary and Romania together imported from China totaling 31 billion euros ($ 42 billion) in 2012, while exports to China last year reached only 4.5 billion euros ($ 6 billion), we quickly finds that the Eastern market occupies only a small part of the commercial potential offered by the European economic bloc and offers a vast space for growth in the medium and long term.

Why has changed China “Dragon” with Tiger ?

China’s relations with the countries of Eastern Europe were generally strong, sustained during the communist and the sharing the same type of political ideology. And apart from some occasional meetings with the Dalai Lama and settle accounts among Chinese immigrants, news and discussions about China mainly aimed its economic success. More specifically, the Eastern European countries are less critical of the Chinese dictatorship, human rights violations, censorship of the press and the internet, etc. Both sides tend to give priority to the economic pragmatism, especially in the context of the economic crisis which has shown that globalism has its unattractive parts, in which each is on its own. Chinese Prime Minister loves … tigers. Certainly. Even if the usual symbol of China is the Dragon. “Romania can become a tiger of Europe” said in Bucharest the Chinese premier, one of the most powerful people on the planet (which prestigious Forbes magazine grants a worthy third place among the most influential people in the world). “I heard the Prime Minister Ponta presentation about the Romanian economy. I believe that Romania can and will become a tiger of Europe and, if all tigers will come together and collaborate, we will develop a huge market” said Premier of China to the opening of works of Economic and Trade Forum China -Central and Eastern Europe. Romania and China are as two tigers that if join their forces would modernize Europe” said Li Keqiang, changing known Chinese dragon with the economic tiger at the European border, trying to persuade and ensure equality of strategic partnership. Impeccable level of discourse would say. (Maybe Romanian should use the high Chinese official discourse as national autosuggestion formula!) And for implementing of modernization which seems to give some chills to the European leaders, Chinese Premier and the Government of Beijing offers a significant credit line of 10 billion euros in addition to the investments already announced and accomplished in this part of the world. “Also, we must into account the financing channels. Together with the member states of the European Union will make sure that, in lines drawn by EU regulations, we can successfully exploit the special credit line of 10 billion U.S. dollars” Li Keqiang said. Recall that during his visit in Poland in April this year, Wen Jiabao, China’s former prime minister, announced the establishment of a credit line of $ 10 billion to support Chinese investment in Central and Eastern Europe. At the same time, he announced plans to set up a secretariat for cooperation between China and countries in the region, highlighting an ambitious target of $ 100 billion in trade between China and Central and Eastern Europe by 2015.

At the meeting in Bucharest, Li Keqiang expressed the confidence for theChina's Premier Li Keqiang visit to Romania potential economic relations between China and those 16 countries of Central and Eastern Europe after the prime ministers of these countries have shown some excellent economic prospects of the region and the areas where they are interested in foreign investment. He concluded at the end of the Forum that Europe, and particularly the European Union is the largest trading partner of China in the moment, but  the trade with the countries of Central and Eastern Europe are only 10%, and the volume of foreign investment is lower, which means a great potential hence the interest of China to invest huge resources in the region. Of course, as has happened in other parts of the world where China has imposed its diplomacy & the most powerful argument – finances, also its presence in Europe has its critics. In an article published by Deutsche Welle are reminded that “China’s critics from the West or from Africa often argued that Chinese ample investments and loans have an important political stake, and the China’s interference in African politics would sometimes be very visible, as would have happened in Zambia in 2006, when Ambassador Li Baodong threatened that would be suspended all Chinese investment in copper mines if the opposition leader Michael Sata wins the elections”. Most likely it is a true. However looking the things pragmatically, Chinese companies do not differ from Western transnationals, whose policies are already well known Romanians and others countries from neighborhood. Most likely there is also some political and diplomatic pressure. Interests of Chinese investors (like all big investors of the world) is to make profit, the bigger using lower resources, in some cases to offset losses and modest gains from home, gains limited by the certain government policies of Beijing. Depends only on European business partners to show they are able to use their strengths to achieve the expected benefits in turn.

Cinderella and Prince of the East

Although far from having a coherent foreign policy strategy, the Romanian diplomacy being rather chaotic, reactive and speedy willing to unnecessary compromise and unjustified arrogance, depending from which of the West chancellors blows the wind, this time the government in Bucharest was unexpectedly very well oriented regarding the geo-economic space. Cinderella of Europe succeeded in obtaining the attention of the Prince of the East. A second economic power in the world has come to Bucharest with the “sweet promises” that it will provide the latest technology, including nuclear energy. If decades ago the Chinese were selling in Romania plush toys, porcelain items and cheap sneakers, now they would be craftsmen of a supersonic train, on hovercraft, and a superimposed highways, bunk beds or ultra-fast communication systems. At least it was clear from the statements of Prime Minister Ponta and the government ministers who have already proceeded to the signing of memorandum aimed at cooperation in the energy sector, including the expansion and nuclear power complex from Cernavoda. Things look not too bad. At least in theory. Even if some voices immediately found to minimize the amount of investments made ​​- 5 billion euro. True, some of the same voices who in summer cataloged the presence of Prime Ponta in Beijing as completely unnecessary. When China gives 10 billion for the entire region is already too little if Romania only get half? And if there is a fierce competition with Hungary, the Czech Republic or Poland ? Yes, it is very important that these projects do not remain some goals on paper, but that become the basis for a strategic partnership in the long term. Yes, it is very important to have a serious dose of determination and pragmatism, and a lower dose of corruption, otherwise the 5 billion will go down the drain like the European funds that Romania has not been able to access. Yes, attention of the Prince can be lost on the way to the altar! Also, yes, it is possible that the government in Bucharest to push to reduce relations with China, or more precisely rules it in terms dictated by Brussels, but I think it would be helpful if Romanian makers will show courage, will treat eternal “problem of the spine” and pursue national interests. The government in Bucharest cannot “betray” the interests of Europe if Romanian citizens will live better, or if Romania will have a modern infrastructure, or if will increase its energy independence. All this, of course, if logic of “old” Europe is not somehow affected by sclerosis

Instead of an epilogue

During the Bucharest Summit he did everything possible to be present daily on the television screens, he warned the Prime Minister on the issue of the next year’s budget, publicly challenged the government decision, he called an unexpected meeting of Supreme Defence Council of the Country (CSAT) which lasted just 15 minutes and has made a serious competition for Russian Deputy PM Rogozin regarding the rebellious and ”crazy” statements about Moldova Republic … in other words, he gave a successful demonstration of infantilism. But finally, the “problem child” of the Romanian policy, aka Traian Basescu was able to rejoin into the role of the President, has overcome his adversity against the Prime Minister Ponta and showed wise and objectivity: Summit with China is a chance for Romania and if the Government and technicians are well prepared and the projects that will be presented will be realistic and convincing, Romania could only win”.

Published by Cadran Politic, dec. 2013

Overview of Russia’s Recent Foreign Policy, India Important for both US and Russia

Interview accorded The World Reporter journal.

As soon as Vladimir Putin assumed power in Kremlin last year, we have seen immense involvement of Russia in the international affairs. From Cyprus to Iran and Syria, the amount of aggressiveness Russia showed to maintain its interests was comparable to Soviet times. After a big gap of 20 years, when this huge nation was keeping a low profile since the collapse of Soviet Union, Russia’s recent active role in the world politics has given hopes that soon we are going to see a multipolar world ending US dominance. To discuss the mood in the Kremlin we interviewed Gabriela Ionita, Editor in chief of Power&Politics World who is also an expert in Russia’s international affairs.

TWR: After the collapse of Soviet Union, we saw Russia had gone under a cold state. There was almost negligible response from Russia on Iraq and Afghanistan war. But we could see some response from Russia on Libya, and now Russia has come out fully aggressively in Syria’s case. Do you think all these years, when Russia re-established itself on the global platform, it has prepared itself to take on western world again on global geopolitics issues? Are we going to see a bipolar or a multi polar world soon?

 G.I.: We are already part of a world with multiple power centers. President Obama’s speech, at the recent meeting of the UN, certifies such a perception of political analysts. To reduce the geopolitical equation only highly questionable relationship between U.S. and Russia is meaningless. There are numerous emerging economies from which even Russia and U.S. could learn some useful lessons. Also, there are many cooperation organizations to which the two are not only States, but also leaders and the need to find consensus solutions to highlight leadership. And last but not least, we see that today almost all the countries of the world – from the European Union, the Middle Orient, the Chinese and American societies – are faced, in one form or another, with the need to find new strategies and preserve their identity in the radically changing world, and Russia – a huge melting pot of ethnic groups and cultures – cannot make an exception from it.
putin_lodkaIn the last two decades, Russia has changed its political and ideological concepts as far as was possible with the legacy of the former USSR, legacy assumed open by the new leaders in Moscow. As you were saying, there was almost a negligible response from Russia on Iraq and Afghanistan war. But we must remember that Russia had its own catastrophic experience in Afghanistan, whose consequences are still felt in the minds of the Russian society. So it’s good to notice that after the disintegration of the USSR Russia has really felt what a collapsed state means. Its first and foremost priority was the domestic situation. It is known that the economic growth, prosperity and geopolitical influence are derivatives from the total condition of a settled society. After overcoming the urgent impediments of internal order, it was logical for Russia to wonder itself: ”who is ?” and where should it be looking on foreign policy for supporting its own interests. The first step, of course, was trying to gain the regional influence and, subsequent, the global influence and its returning to the table of the world’s great leaders.
Regarding the reaction to the conflict in Libya, I do not think that Russia had a clear strategy. This was more an attempt of the ex-president – the current prime minister Medvedev – to improve his personal political rating, which proved to be a rather unsuccessful attempt. Instead, Russia’s intention to protect its interests in the Middle East were seen in the intervention in Syria. Russia wants to be a major decider and even a major opponent when its interest dictates. And if you take a peek at the commercial agreements between Russia and Syria or Iran, it is easy to see that here the interests dictate.
 Contrary to controversial statements regarding Russia’s imperial obsessions, restoring the USSR and other such foolishness that the russophobias propaganda sites are full of, there is nothing unusual in Russia’s intentions. Looking closely and judging right, we can see that all the great and small powers of the world are doing everything they can to promote their economic interests and preserve their own sphere of influence. What differs are only the methods and strategies used. Some prefer to invoke the principles of democracy and human rights, other – the rule of law and veiled threats, other – economic pressures and direct threats, others – just shut up and do – the last statistically having the best results.
TWR: – But what do you think about the relations between Russia and the U.S. at the moment?
G.I.:  On one hand, it would be childish of us to believe that between two states that claim to be a global power pole there could be a relationship like ”milk with honey”. On the other hand, in spite of the officials declarations, the restart of Russian and American relations continued all along (sometimes even for reasons of internal propaganda of the two states) to be hunted by the ghosts of the Cold War. Nowadays, at the level of perception of public opinion I will quote Olga Kamenciuk, communications director of the Russian Center for the Study of Public Opinion. “Lately, between Russia and the U.S. there are many differences. Mainly, this is on the cases such as Snowden and about Syria. Regarding Snowden, for example, most Russians thought that Russia’s position will worsen relations with the U.S., but only 15% are saying he does not have to be granted political asylum”. The same is the public opinion in the case of Syria. Russians understand that this situation will worsen relations with America, but prefer an independent position of their country on this issue. In the U.S., the situation is somewhat similar. According to Gallup (agency for marketing and social studies) for the first time since 2000, the number of those who consider Russia an enemy exceeded the number of those who see Russia as an ally.Shoigu_Rasmussen
But it’s good to remember that not always the public perception also means the reality behind the closed doors. U.S. and Russia worked together and effectively collaborate on the levels where the interests of the two coincide. The fight against terrorism, drug trafficking, aviation security, cyber-crime are some aspects of this collaboration. Then, behold, recently a NATO ship arrived in port at St. Petersburg as part of continued NATO-Russia Council military cooperation, and provided an opportunity for naval counterparts to meet and exchange experiences. And even when we are tempted to believe that relations between the U.S. and Russia are at their lowest level in a few days will take place in Brussels the first over two years meeting of the NATO-Russia Council (NRC) at the level of Defense Ministers with the participation of Russian Defense Minister Sergey Shoigu. The NATO headquarters considers Shoigu’s involvement in the meeting the unique opportunity to give an impetus to military relations between Russia and NATO in the field of security. So here, the reality is much more complex and cannot be reduced to categorical labels.
TWR: In spring, Cyprus approached Russia under financial crisis to seek potential bailout plan which Russia refused. Why do you think that Russia let go such a big opportunity of earning a partner in Mediterranean Sea, who was ready to offer its gas fields and warm water port at a strategically important place just under the nose of EU? 

G.I.: In reality, things are not so simple. Many people said they were surprised and wondered at the time why the Prime Minister Medvedev stepped out in the case the Cyprus crisis. […]

(Full text can be read here)

interview made by Sanskar Shrivastava, editor in chief of TWR