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Moscow Times
December 5, 2002
Russia and Europe: The Limits of Integration
By Rene Nyberg
Rene Nyberg, the Finnish ambassador to Russia, contributed this comment toThe
Moscow Times. It is based on a lecture he delivered in Helsinki on Nov. 28.
In the continuum of history, Europe stands for modernization, and for the new Russia there are few alternatives to that. Territorially the largest nation on earth, Russia must either modernize or face marginalization.
Power in Russia is very firmly in the hands of a reformist president and a reformist-led government, but one consequence of the bloodless revolution in 1991 is that the mighty Soviet bureaucracy is still in place, underpaid, overstaffed and wallowing in corruption. Economic power is in the hands of the export industries, and these are demanding reforms. The exhausted reformers and impatient industrialists are calling more vociferously than ever for administrative change. Meanwhile, the privatized economy, in which ownership rights are gradually stabilizing, needs the rule of law to protect those ownership rights.
The integration of Russia into European and global structures is one part of the determined process of reform. Russia's relationship with the World Trade Organization is a very good example of this: President Vladimir Putin and his government have been able to make use of WTO negotiations as a tool in their own legislative reforms.
In Russia, by far the most dynamic factor is privatized industry, which has succeeded in breaking away from Soviet traditions more quickly than any other sector. It has also been the most effective factor in integrating Russia with the West. By promoting administrative and judicial reform and supporting the development of a civil society, industry is in fact creating an operating environment for itself. A listing on the New York or London stock exchanges is a step toward insuring one's rights of ownership within Russia itself. A similar effect could be achieved by attracting foreign investments.
However, the scarcity of foreign investments in democratic Russia, compared with Communist China or the Central and East European countries applying for EU membership, highlights the inflexibility afflicting the whole process of reform. An example of this rigidity is that Finland has spent more than three years trying to negotiate with Russia an agreement on protection of investments, and we have twice initialed a draft -- to no avail, unfortunately. We are still no nearer to an actual agreement.
Although the issue of an agreement on protection of investments is not directly connected with Russian membership of the WTO, it is an illustrative example of the difficulties experienced by the Russian administrative machinery in adapting to the world economy. Another topical example is the constant interference with traffic on Russia's only border with the EU. If Finnish exporters and importers suffer from the erratic practices of Russian customs or the overt extortion schemes of the Russian road authorities, one can only guess at the problems this must create for the country's own industries. I would venture to suggest that one of the Russia's main barriers to international trade is the corrupt administrative machinery, which forces companies to evade the payment of VAT and customs duties.
The improvement of border procedures will require a radical re-thinking of the relationship between the authorities and the needs of commercial interaction. Smoothly functioning border formalities would be in the interests of Russia, Finland and Europe as a whole. So, it can only be hoped that Russian industry will put pressure on its own authorities to mend their ways.
The burden of an unreformed administration can be felt everywhere. Recently Izvestia reported on the current "transportation war" between Finland and Russia. According to the paper, this confrontation, instead of reflecting the possibilities presented by Russia's integration with Europe, underlines its strict limitations. This can be seen every day of the year on Russia's border with Finland. And this border, despite the problems, actually functions better than any other section of Russia's frontiers.
Limits to Russian integration with Europe of a more emotional nature came to the surface in the course of the dispute over Kaliningrad. This was the first time that the EU and Russia were engaged in negotiations over a concrete question that went to the heart of EU doctrine, the Schengen agreement and the EU's external boundary. It also encroached on the sovereignty of a future EU member state, Lithuania. The dispute brought Russia face to face with reality. It had been ignoring Kaliningrad for years and had simply been putting off negotiations over a re-admission agreement with the EU. Similarly, the Russian passport system is outdated and unreliable. Discussion of the dispute in the State Duma stirred up a great deal of submerged mud and even unleashed extreme elements prepared to invoke the terms of the secret appendix to the Molotov-Ribbentrop agreement.
With all its exaggerations, the dispute gives us some cause for reflection. Kaliningrad dominated relations between the EU and Russia to such an extent that it prevented any dialogue from taking place at a practical level on many other issues. Nearly all the meetings of subcommittees, which were to have been convened this autumn under the Partnership and Cooperation Agreement, were postponed. The EU as an institution remains averse to the Russian way of thinking, but Moscow knows very well how to exploit the EU's weaknesses.
Moving on to the situation in Chechnya and Moscow's relations with its southern neighbors: The hostage drama in the center of Moscow threw Russia off balance for a moment. However, the successful use of force, even though it entailed casualties, testified to the government's resolve. But this alone will not remove the problem, for the threat from the south is more concrete than ever. The big issues here are how the whole Caucasus region and Central Asia will evolve, and how Russia's relations with its southern neighbors will develop.
To quote Alexei Malashenko and Dmitry Trenin in their recent book, Russia is a European country located in Asia. Eurasia as a concept no longer exists. That was the Soviet Union.
Russia's long border to the south means that it remains close to Afghanistan, the flow of drugs from that quarter, the threats posed by the new nuclear powers and the general instability that afflicts the Middle East.
The war in Chechnya has led to a radicalization of Islam throughout the North Caucasus, and as the dispute between Russia and Georgia indicates, the repercussions are also being felt south of the main mountain range. Abkhazia is part of the same conundrum, as is the conflict in South Ossetia.
The escalation of the situation in Chechnya into a clash of civilizations would pose a threat to the existence of the Russian Federation as a whole. As the then Prime Minister, Vladimir Putin, admitted at the EU-Russian summit in Helsinki in October 1999, Russia has neglected the task of supporting moderate Islamic elements in Russia.
The real challenge for Russia will be to re-integrate the North Caucasus and normalize relations with Georgia, or one might sum up the challenge as being one of re-modernizing the "southern" societies that border on or lie within Russia. Looked at in this way, the task is not unlike that facing Russia's ally in the war on terrorism, the United States, of extending democracy and human rights to the Middle East.
To conclude, Russia is once more going through a historic period of reform, and more crucial than changes taking place in its external operating environment is the country's own capacity for social renewal.
It is this that will set the limits of Russian integration.
The EU is Russia's most important partner in cooperation, and its border with the EU is brimming with opportunities. This western border is the most secure one that Russia has. At the same time, Russia's greatest challenges are situated in the east, and the gravest threats to its security are located in the south.
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