The latest Russia-EU summit in Brussels took place in unusual circumstances. President Dmitry Medvedev was in attendance as the outgoing head of state and the whole world was talking about how Russia has changed in the wake of the recent parliamentary elections and how the usual political stability has given way to uncharted territory.
It is even harder to understand what is going on in Europe. It would have been considered alarmist to talk about the collapse of the euro and even the EU itself not long ago, whereas now even this could happen. In fact, it’s now used to scare European leaders into taking aggressive measures and adopting a more responsible attitude.
The EU summit in Brussels took place a week before the Russia-EU meeting. It was described as an historic victory. Although the United Kingdom opposed the Franco-German proposals on a budgetary and fiscal union, other EU members seemed to accept them. Measures to unify economic policy and impose strict budget and fiscal discipline are essential, but isn’t it too late to take them?
In effect, such measures amount to federalization and seriously limit sovereignty in favor of supra-national bodies. Perhaps such a project could have succeeded in the second half of the 1990s, when European integration and ambition were at their peak. Now the tune has changed. The project is expected to collapse, and tensions between the EU countries are mounting. Ordinary people in these countries do not understand what’s going on or what the proposed measures will do. Distrust of elites is rampant and leadership has been unconvincing.
Under such circumstances, the EU countries will have to take steps to boost accountability and deepen integration. Coordinating these measures is an agonizing process but they still will have to be ratified by all member states. Problems will arise practically everywhere and in countries where a referendum will be required the situation may be hopeless. Even the heads of state and government that supported the new document last week are not necessarily ready to live by such rigid rules. President Nicolas Sarkozy said a couple of days later that Paris is not prepared to forgo its sovereignty.
London’s refusal to join the next stage of integration (the Czech Republic, Hungary and Sweden also remain hesitant) marks the beginning of the EU’s inevitable stratification. The talk about multi-speed Europe has been going on for a long time but each time this idea was refuted as contradicting the union’s original commitment to equality. Now it will become reality by itself.
Russia is a major EU trade and economic partner and the EU is Russia’s biggest partner. Russia is now thinking about how it may be impacted by the integration crisis. Obviously, the sudden collapse of the entire structure, the euro and the EU itself in the worst case, would hurl the world into recession. This will affect everything, including hydrocarbon prices, which are critical for Russia.
If we assume that the worst-case scenario will be averted, and this is in the vital interests of major EU countries, Russia may stand to gain from the transformation of the EU. In any case, greater sovereignty will lead member states to independently build their relations with major states, such as Russia, once they are no longer able to rely on the EU as their foreign agent. The EU will not disappear as an instrument of pursuing coordinated interests. Gazprom, which recently has been an object of coordinated pressure under the pretext of anti-monopoly measures, has no cause to hope for a better position. When interests coincide, different countries will willingly utilize centralized institutions. However, there are spheres in which different countries have different ideas about their interests in Russia, which creates more freedom to maneuver.
Any economic problems that may arise in the EU as a result of the integration crisis will compel individual countries and the EU as a whole to take a greater interest in major or promising markets. Russia’s serious financial reserves may be very helpful for Europe. Strange as it may seem, the aggravation of the crisis in the EU may even help promote a long-standing priority of Russian diplomacy, visa-free travel, simply because the Europeans may wish to remove any extra barriers to expanding economic cooperation. The document on moving closer to visa-free travel is a positive development because it maps out some practical steps. However, subsequent steps are not even mentioned. Implementation of the terms does not automatically lift the requirement for short-term visas. The sides must make a political decision based on factors that have nothing to do with the heart of the matter.
The context of Russia-EU relations is changing. Before Russia was seen as the unpredictable party but now the Europeans are catching up in this respect. The intrigue continues to grow.