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Friday 26 September 2014

Does Putin's latest threat hide his fears?

It has now emerged that Putin has demanded from the EU a re-opening of the, "... recently-ratified trade pact with Ukraine and has threatened “immediate and appropriate retaliatory measures" if Kyiv moves to implement any parts of the deal ...", as reported yesterday (24th September 2014) by Peter Spiegel in Brussels. (cf. also Russia demands changes to Ukraine-EU trade deal).  

With a copy of the Putin demands sent to the EU and also sent to Ukrainian Foreign Minister Pavlo Klimkin, Ulyukayev said Russia could treat even a partial implementation of the treaty as a trigger to react. In a recent letter to the EU trade commissioner, seen by Reuters on Thursday, Economy Minister Alexei Ulyukayev said Moscow wanted three-way negotiations to amend the EU's treaty with Kiev, which Russia says will hurt its own economy.
  
"We reiterate our intention to adjust, if necessary, the preferential regime between Russia and Ukraine in order to minimise negative problems related to the change in the trading regime between Ukraine and the EU, not excluding other ways to protect the Russian economy." (my emphasis)
Russia unhappy with the EU-Ukraine trade pact. 
Even more interesting, José Manuel Barroso, current President of the European Commission, won't rule out changes to the EU-Ukraine Pact if Kiev makes such a request.

José Manuel Barroso
This threat of Putin, besides his 'nuclear' threat, his threat about being able to invade Kiev in 2 weeks, pricking at the air space of Canada, the US, and Sweden with his jet fighters and nuclear bombers, and pointing out to all and sundry that he also has his sights on certain former Eastern European countries who are now a part of the EU; is this merely the bullying display of a 'paper tiger', to use a phrase coined by Mao Tse Tung?

Furthermore, what is rather significant about this latest threat is that Moscow is worried that the EU-Ukraine economic pact will mean that Ukraine will [have to] bar imports from Russia that fail to meet EU quality standards. This specific condition will also block any attempt by Russian businessmen to circumvent EU quality control by trying to export to the EU via dummy companies that they may set up in Ukraine, since Ukraine itself will also have to conform to EU quality standards.

Putin's threat against Ukraine's current trade with Russia rings rather hollow since Ukraine now has the whole of the EU to trade with at a preferrential level. It is this which rather sticks in the craw of both Putin and Medvedev. After all, Medvedev is now checking Russian supermarket prices to ensure that they are not overcharging Russian consumers in the face of the current sanctions, as reported in the Moscow Times on September 1st.

Medvedev checking supermarket prices
Furthermore, his threat about ending overflight rights of Western airlines means that Russia will lose $500 million in overflight rights payments, as pointed out by Tim Worstall on 9th September. As he says, ".... it’s not entirely obvious that Russia has a proper grasp on who gets harmed by trade sanctions."

Even more bizarre is Putin's total misunderstanding that "Reopening the legal texts [of the EU-Ukraine Trade Pact] would pose problems for the EU's multinational procedures and pose serious diplomatic obstacles". Yet some " ... EU officials say that there is room for compromise with Moscow on Ukrainian trade; Russian exporters could have a soft route to compliance with EU quality and other standards in Ukraine so that they only need meet the requirements for selling goods into the EU-Ukraine free-trade area over a very long time." This suggestion has not gone down well with some EU members, notably Poland.

"Diplomats from one eastern EU member said they were angry that De Gucht (European Commissioner for Trade)  had agreed to the delay without consulting them and felt that Germany and other major powers had given in to pressure from Russia.

Jacek Saryusz-Wolski, a Polish member of the European Parliament which ratified the accord simultaneously with Kiev, voiced a similar view.
"Putting the EU-Ukraine trade deal on ice is the wrong decision," he said. "It would delay the necessary reforms and set a bad precedent."

Once again Germany, amongst others, (Is that the voice of Matteo Renzi that I hear?) is vacillating even though, as Steven Hill so correctly pointed out on ," Chancellor Angela Merkel’s foreign policy of engagement towards Russia, and her personal relationship with President Vladimir Putin, [now] lie in tatters.".
Angela Merkel and Putin
Furthermore, " ... [H]er approach toward Russia appears to indicate a doctrinaire mindset that sees doubling down on failed policies as a sign of strength and resoluteness. While all is quiet at the moment on the Eastern front, Chancellor Merkel does not appear to have a Plan B." Nor, it would seem, does she have the stomach to simply confront her businessmen who are still sucking at the teats of the corrupt Russian cow.

De Gucht
Controversially, the Flemish De Gucht has been accused of Insider Trading (2008) when he was a minister in the federal government of Belgium, anti-Semitism for his remarks about Jews in relation to the Israeli-Palestinian peace process and the September 2010 Washington talks, and racism by the Congolese Information Minister, Henri Mova Sakanyi, for his remarks about the government of the Demcratic Republic of Congo. And as recently as April 2012, he attracted criticism for a groundless statement as EU Trade Commissioner that Ireland was "already out of recession". He somewhat reminds me of the many European right-wing organizations, individuals, and political parties who are fervently and quietly in support of Putin.

Taking all of this into account, can we say that Putin and his current 'economic' threat against Ukraine is merely those of a "paper tiger"? Will the EU buckle under this threat and give in to Moscow, who now wants three-way negotiations between the Ukraine, Russia, and the EU, to amend the EU's treaty with Kiev simply because it will hurt Russia's economy? Is Tim Worstall correct in saying that, ".... it’s not entirely obvious that Russia has a proper grasp on who gets harmed by trade sanctions," or the Ukraine-EU Trade Treaty for that matter? Or is the Putin mafiosi clan beginning to fray at the edges.

Consider the rather childish and undiplomatic response of the Russia’s ambassador to the UN, Vitaly Churkin, towards the speech given by Arseny Yatsenyuk, the Ukrainian Prime Minister, to the General Assembly at the UN yesterday, 24th September,  viz. 
  • Mr. Putin, you can win a battle against the troops, but you will never defeat the people – united Ukrainian nation,” the PM said. Churkin was puzzled by that. “It’s strange that his speech ended up in a melodramatic call to the Russian president,” or
  •  “It’s strange that Ukraine’s PM, instead of solving the multiple problems of his country, which is nearing economic collapse, has come to New York to speak in front of a half-empty General Assembly room,” How many half-empty General Assembly's has Churkin spoken to? 
Vitaly Churkin in the UN General Assembly
Is this an indicator that the weight of the bald-faced lies that Putin and his propaganda machine has had to invent regarding the direct Russian invasion of eastern Ukraine has become too much to bear, even for Vitaly Churkin? And what does Sergey Lavrov, that dyed-in-the-wool Soviet-educated Foreign Minister of Russia, that stickler for diplomatic language and protocol, have to say about his colleague's childish remarks? His silence is positively deafening.

Sergey Lavrov
Maybe because Churkin had to listen to what Obama, in his speech, had to say about Putin and Ukraine  prior to the address of Arseny Yatsenyuk viz.

"If we lift our eyes beyond our borders - if we think globally and act co-operatively - we can shape the course of this century as our predecessors shaped the post-World War Two age."
Sharply critical of Russian actions in Ukraine (my emphasis), Mr Obama said it was an example of what happens when countries do not respect international laws and norms. (my emphasis)
He called on Russian President Vladimir Putin to follow "the path of diplomacy and peace and the ideals this institution is designed to uphold"

that Churkin had to respond to Yatsenyuk's speech as he did. Thus, in light of his respone to the speech of Yatsenyuk, one could almost say to Churkin in relation to the speech of Obama ,"Cat caught your tongue?"

And yet .... and yet .... "...many [EU] governments are wary of antagonizing Russia, the bloc's leading energy supplier, and fear more Russian trade retaliation. Russia has already responded to EU and U.S. sanctions by banning imports of most food from the West", as reported by Adrian Croft and Robin Emmot. (Thu Sep 25, 2014 ) In fact, as they point out, "...Slovak Prime Minister Robert Fico and Hungarian Prime Minister Viktor Orban, have been openly scornful of sanctions and these countries are likely to push for an easing of sanctions next week." How ironic! Has the Hungarian Prime Minister forgotten about 1956, when Russian troops and tanks poured into Budapest to put down a revolt by the Hungarian people? Or has the Slovak Prime Minister forgotten about 1968
 
Viktor Orban                                    Robert Fico

Or does it all boil down to gas and oil, now that winter is but 2 months away.


(to be continued)







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