The label ‘strategic partnership’ has been extensively used in EU-Russia relations since the second half of the 1990s. However, the viability of such a strategic partnership is being questioned nowadays by policymakers and observers on both sides, and the development of the relationship is stalled. Hiski Haukkala in an article “The Tomorrow Is Now” (Russia in Global Affairs, No. 4/2007) argues that Russia and the EU face an existential choice of making their partnership a success. In the light of this argument it would be worth exploring options for cooperation which have not been sufficiently used over the last couple of years. In the first place, one should analyze “hard security issues” which are at the core of the disagreements between the EU and Russia – multilateral cooperation and arms control, security cooperation in the CIS, and energy.

In the global dimension, the UN Security Council (UNSC) is by far the most important among the few institutions in which Russia, EU members and the U.S. are on an equal footing. In recent years, Russia has increasingly used its permanent membership in the UNSC to block mainly U.S. initiatives perceived as running counter to Russian interests. On the other hand, there have been signs of Russia’s growing interest in a stronger involvement in UN activities.

The UN Security Council seems to offer little room for manoeuver in multilateral cooperation, since Russia’s approach is focused mainly on strengthening its national interests and position as a global player and its preparedness to participate in (and indeed its commitment to) multilateral decision-making is rather limited. However, the EU/EU members should highlight common positions (which regularly occur on a variety of problems, such as Iran, North Korea and the Israeli-Palestinian conflict) and in so doing keep Russia involved in multilateral debates in the framework of the UN.

The EU/EU members should take up Russia’s verbal commitments concerning its involvement in UN peacekeeping activities and humanitarian aid, which could become another field of intensified interaction and cooperation. However, the EU will have to face the fact that the Russian approach is diverging significantly from its own in many aspects. Moscow is campaigning for the recognition of organizations like the CIS, the Organization of the Collective Security Treaty or the Shanghai Cooperation Organization as regional peacekeeping bodies by the UN – which would certainly create controversies among EU members. Russian technical support for developing countries is not tied to political issues, while the EU claims that good governance and democracy are cornerstones of its concept of development aid. Thus, attempts to coordinate activities in these fields should be accompanied by an open dialog about the underlying principles and goals.

Multilateral arms control and nonproliferation regimes are in a deep crisis. The existing tensions between the U.S. and Russia have culminated in fierce debates about American plans to deploy parts of a global Ballistic Missile Defense System in Poland and the Czech Republic. Back in 2002, Moscow did not show strong resistance against U.S. withdrawal from the Anti-Ballistic Missile Treaty, now Russia shows increasing readiness to confront Washington. High-ranking members of the Russian military even called for Russia’s withdrawal from the Intermediate Range Nuclear Forces Treaty (INF), while Moscow officials announced that Russian nuclear weapons might be retargeted at Europe should the U.S., Poland and the Czech Republic implement their plans. Ultimately, the Russian reaction was twofold: in July 2007, Moscow announced its withdrawal from the stalled Treaty on Conventional Forces in Europe (CFE) and suggested that Washington jointly use the Russian Gabala radar station in Azerbaijan as a substitute for deployments in Poland and the Czech Republic. The American reaction to this suggestion has been cautious, emphasizing that joint use of the infrastructure in Gabala would not be excluded, but could only serve as an addition to the deployments in Poland and the Czech Republic.

As a party to the negotiations about the Iranian (and North Korean) nuclear programs Russia has often pursued ambivalent policies. Moscow has sided with the West in its desire to prevent Teheran from acquiring nuclear weapons, while at the same time trying to avoid strict economic sanctions in order to protect arms trade with Iran and the Russian-Iranian contract on the construction of the nuclear power plant in Bushehr. Furthermore, Russia put forward the suggestion to create an international consortium for the enrichment of uranium on Russian soil, which would provide Iran with the possibility for civilian use of nuclear power, but prevent it from running a military nuclear program.

The EU’s room for manoeuver in addressing the crisis of multilateral arms control and nonproliferation regimes is very limited, since further developments largely depend on the attitudes of the U.S. and Russia. The EU lacks a common position regarding American ABM plans, as well as Russian reactions to it. The only sphere where Russia and the EU currently share interests is the prevention of the Iranian nuclear program. Therefore the EU should consider the Russian suggestion on the international consortium for uranium enrichment and try to convince all parties concerned to enter into serious negotiations about it. The same holds true for Russia’s offer regarding the radar station in Gabala. There is little hope that either Russia or the U.S. will accept the other side’s conditions as they have been formulated during the first half of 2007 – but negotiations would keep multilateral processes going and increase the chance that compromise solutions can be found. By all means the EU should emphasize the importance of multilateral arms control and nonproliferation vis-à-vis both Russia and the U.S.

In the regional dimension, tensions between Russia and the EU have been on the rise in recent years. While the EU has increased in stature, Russia is struggling to maintain economic and political control over the former USSR. Thus, the “common neighborhood” has become the subject of a competition for influence between Russia and the EU. Again, the underlying principles and strategies, as well as goals, differ. At the same time, Russia and the EU face common security threats that emanate from political and economic instabilities in the “common neighborhood.”

The resolution of the protracted conflicts in Moldova, Georgia and Azerbaijan is perhaps the only challenge as regards relations in the former Soviet Union that has been oriented toward maintaining the status quo situation, because it provides Moscow with a strong political, economic and military leverage over the states affected by these conflicts. At the same time, Moscow would not dispose of the forward-looking vision of how to treat the breakaway regions, which increases its reluctance to see any changes in the status quo.

The EU has a vital interest in the resolution of the protracted conflicts because they are a major impediment to the development and stability in the region. However, EU member states are deeply split over the issue, which weakens the position of the EU in the region. Brussels has tried to gain a higher profile by appointing two EUSRs for, respectively, the South Caucasus and Moldova, and has deployed the EUBAM mission on the Ukrainian-Moldovan border, as well as a small rule-of-law mission in Georgia, EUJUST Themis. It also strives at shaping the domestic environment in the affected states through its ‘European Neighborhood Policy.’ However, such measures have so far been solitary instances resulting not from the EU’s forward-looking approach, but from pressure from regional actors.

The EU should claim a bigger role in conflict resolution, not only in the Transdnestr region, but also in the other conflicts. The fact that Moscow, after initial reluctance, ultimately accepted EUBAM, should encourage the EU to engage more deeply on different levels – confidence building, border monitoring, and mediation.

It seems that the greatest potential for cooperation regarding the protracted conflicts lies in Russia-EU peacekeeping activities. Russia has always displayed a great interest in closer security cooperation with the EU in the framework of ESDP. Here, the EU could offer Moscow cooperation, which could possibly lead to joint peacekeeping. This would contribute to the development of the Common Space on External Security and the stabilization of this fragmented and crisis-prone region.

The main stumbling block here is the discrepancy between the sides’ approaches to the build-up and command structures of joint peacekeeping forces. Russia demands cooperation “on an equal footing,” i.e. its equal participation in the command of joint ESDP and Russian forces. The EU, on the other hand, insists on decision-making autonomy, which precludes equal participation of the Russian side. To resolve the contradiction, both sides should be prepared to enter an open dialog about these opposing positions.

In the energy sphere the former Soviet republics remain entangled in a complex network of energy interdependence. Russia holds a monopoly of pipeline routes for Central Asian gas to Western Europe. The former Soviet republics are almost 100-percent dependent on Russian energy deliveries. On the other hand, they control the transport routes for Russian exports to the EU, while Russia is becoming increasingly dependent on Central Asian gas to supply its own domestic market.

Given technological backwardness and ever-increasing internal consumption, Russia will face serious problems in supplying its domestic market and fulfilling export commitments in the medium term. The Russian Energy Strategy until 2020 outlines measures to meet these challenges. Among other things it envisages increased use of fossil energy sources other than gas. It remains questionable, however, whether such steps can ensure the sustainability of both domestic supply and exports. Considering the political implications of a sharp increase in domestic prices, urgently needed reforms in the gas sector are not very likely under the current domestic conditions.

The EU’s dependence on gas imports from Russia has been on the rise ever since the beginning of the 1990s. At the same time, both sides have found themselves increasingly at odds regarding the conditions of energy trade. The EU expects a liberalization of the Russian energy (essentially gas) market so that EU companies can enter it. Moscow’s refusal to ratify the transport protocol to the European Energy Charter in order to protect its transport monopoly over energy deliveries has been a major point of contention for over 10 years now. The Russian side has produced a number of arguments against the ratification of the Charter and the transport protocol, which have not been considered on the European side. Russia also responds to the EU’s accusations by pointing out that the EU tries to limit the activities of Russian companies in its own markets, thus denying equal conditions for all sides.

The EU and Russia are both dependent on mutual energy trade relations. The EU will not be able to quickly diversify its gas imports (which would also mean switching to potentially less stable trade partners). The fast diversification of exports to other world regions requires huge investments, which Russia will not be able to make in the foreseeable future. Russia cannot abandon the EU as its main energy customer any time soon. Thus, functioning and stable energy relations are at the core of both sides’ interests.

The crucial precondition for more cooperation in the field of energy is liberalization on both sides, based on reciprocity. Russia has to modernize its energy market if it wants to remain capable of guaranteeing domestic as well as export supply. Considering its relative backwardness in technological development, Moscow should be highly interested in a controlled opening of the Russian energy market and closer cooperation with energy companies from the EU and other industrialized countries. This concerns not only production and transportation, but also – and in particular – energy efficiency, which must become a crucial issue on the Russian agenda.

If the EU wants Russia to soften its stance on energy market liberalization, it has to demonstrate that Moscow’s accusation of protectionism is invalid. The Commission’s recent initiative aiming at unbundling energy production and distribution might be a useful step toward the liberalization of the European energy market. It remains questionable, however, whether it makes sense to one-sidedly hinder foreign companies’ access to European networks (the ‘Gazprom Clause’) without flanking such measures with more constructive moves toward mutual understanding. The European Energy Charter still seems to be the best available instrument to defuse tensions in EU-Russia energy relations. It entails rules for investment and non-discriminatory trade as well as a mediation mechanism. Therefore it provides important tools for the regulation not only of bilateral energy relations between the EU and Russia, but also of relations with the transit countries. In order to restart the Energy Charter process, the EU should seriously consider Russian concerns with respect to the transport protocol, open up negotiations on them and be prepared to partially adapt the Charter in order to get Russia on board.

To conclude, it is difficult to call Russia and the EU strategic partners. However, due to the many interdependencies the EU and Russia have considerable potential for fruitful cooperation on all levels of their relationship. If both sides make use of this potential, there is a realistic chance that a substantial strategic partnership might develop in the future.