Think tank projects Ukraine at equal distance from Russia and EU

  
Ukraine on the way to reform
Ukraine on the way to reform

As Russia, the USA, Ukraine and the EU are expected to hold talks next Thursday in Geneva to try to negotiate an end to the Ukraine crisis, a Brussels think tank published today (10 April) advice on how this “exceptionally important opportunity” should be used.

The foreign ministers of Russia, the USA, Ukraine and the EU will hold talks next Thursday in Geneva, Reuters has revealed, citing two diplomatic sources. The office of Catherine Ashton, the EU foreign affairs chief who is due to take part to the meeting, has not confirmed the information.

Tensions have risen in the mainly Russian-speaking east since the overthrow of Ukraine's Moscow-backed president and the installation of a new pro-European government, which says the occupations are part of a Russian-led plan to dismember the country [read more].

A storming of the two buildings could provoke a strong response from Moscow, which has reserved the right to send troops in to protect Russian speakers.

Against this background, Michael Emerson, Associate Senior Research Fellow at the Centre for European Policy Studies (CEPS), writes that to stabilise the political situation in Ukraine and set the country on a fresh path of national recovery, the four parties meeting in Geneva should agree as follows:

  1. There should be no further attempts to promote separatism, such as unauthorised referendums.
  2. All illegal occupation of public buildings should be stopped immediately.
  3. All barricades should be dismantled.
  4. All unofficial militias and so-called self-defence groups should be disarmed immediately.
  5. Preparations should continue to assure free and fair presidential elections on 25 May 2014.
  6. The next government of Ukraine should undertake a thorough constitutional review process, assuring inter alia language laws that fully respect both majority and minority languages, and assure a sound distribution of competences between national and sub-national authorities.
  7. Ukraine will join no military alliance.
  8. Ukraine should have high-quality free trade with both the EU and the Russia-Belarus-Kazakhstan customs union.
  9. The EU and the Russian-Belarus-Kazakhstan customs union should expedite negotiations over a common European economic space to which Ukraine should be eligible to become a full party.
  10. A trilateral Ukrainian-Russian-European consortium should take in hand rehabilitation of the Ukrainian trunk gas pipeline network.
  11. The price for the import of Russian gas into Ukraine should be pegged on the average German import price, less an amount reflecting shorter transit costs.

This idea of a free trade area from Lisbon to Vladivostok was first described by Russian President Vladimir Putin back in 2010.

At the last EU-Russia summit on 28 January, European Commission President José Manuel Barroso said that an important way to foster trust was to work on the “most important strategic and shared objectives,” namely to create a common economic space from Lisbon to Vladivostok [read more].

EurActiv asked Emerson if his proposal to reconcile the projects of the EU, to have association pacts with its neighbours, and the Russia-promoted Customs Union, could fly. He said that the Deep and Comprehensive Free Trade Agreement (DCFTA) which accompanies the Association Agreement doesn’t require Ukraine to join the EU’s customs union.

“You can have two free trade areas, as long as you don’t draw either in a customs union. There is no antagonism. This is why this whole conflict around the DCFTA is in economic terms so ridiculous,” Emerson said.

Emerson is not the first in the Brussels community to advocate that the Union’s neighbourhood policy should be based on a plan integrating Russia, instead of antagonising it.

Speaking at a public event in Brussels recently, Pierre Vimont, a French diplomat who heads the bloc's foreign policy department, the EU External Action Service (EEAS), said Ukraine's choice between EU association and the Customs Union wasn’t as “inescapable” as initially thought [read more].

But Emerson also breaks new ground regarding the future of the gas transmission system of Ukraine (GTS), which needs important funding for its rehabilitation, and a consortium to manage it.

Moscow has so far sought a bilateral Russia-Ukraine consortium, which would not only operate, but own the gas transportation system [GTS]. Ukraine’s position has been that there should be a trilateral EU-Ukraine-Russia consortium to operate GTS. The position of the EU has been that the Union cannot participate in a commercial project, that European companies should be involved instead, and that funding should be sought through an international financial institution.

The failure to agree on GTS has largely contributed to the present state of affairs, where gas to Europe could stop flowing through Ukrainian territory any time soon [read more].

Asked by EurActiv how he saw the EU contribution to the consortium, Emerson said it would be in the form of “a portfolio of some energy companies and the European Investment bank, and maybe the EBRD as well”.

Russian President Vladimir Putin informed several European leaders today about the "critical situation" over Ukraine's natural gas debt, and about a possible impact on the transit of gas to Europe.

According to the letter obtained by EurActiv, Putin calls on the economy, finance and energy ministers of EU countries to meet with their Russian counterparts and "work out concerted actions to stabilize Ukraine’s economy and to ensure delivery and transit of Russian natural gas in accordance with the terms and conditions set down in the contract". 

Gazprom says Ukraine owes $2.2 billion for gas supplies, and missed the deadline for paying for its March supplies.

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