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Alexei Leonidovich Kudrin

Alexei Leonidovich KudrinKudrin

First résumé of the Ukraine crisis

The overthrow of the Yanukovich government in Kiev, the Crimean crisis and the ongoing fights in Eastern Ukraine are likely to have profound changes in Europe. A background article by Stefan Bernhardt

Especially the human losses are high in the conflict in Ukraine. The situation is still not fully resolved: both EU and NATO appear to be the big losers politically so far while Ukraine, apart from the negative impact of the crisis, can also get something positive out of it. Russia's advantages, however, seem to outweigh the new issues in international politics.

Russia – more gained than lost

The Russian approach in Ukraine is cool, calculating, pragmatic and has proceeded thus far as planned. Crimea was practically given to Russia, with vigorous protest by Kiev and the West, but without any counter-offer in negotiations. With the redirection of Ukraine towards the EU and the loss of Crimea, Ukraine has no more leverage for cheap gas on the Kremlin. Moscow financed the government in Kiev with low price for long, but via the international credits for Ukraine, funding is be shifted to the West. Because of the already ambivalent Ukrainian foreign policy, this is a win for the Russian state budget.

The West, however, is startled and isolated Moscow at least in Europe. But it is questionable how hard this would hit the Kremlin. Even before Russia complained about the lack of cooperation of the West –negotiations over visa or cooperation agreements practically made no progress. The common structures with NATO, the NATO-Russia Council, were temporally suspended by NATO already in the Georgian War in 2008. The reduced investments due to the crisis will most likely recover again quickly, just like after the war with Georgia, since Russia is a very lucrative market.

Russia’s Poroshenko bonus


With the new President of Ukraine, Petro Poroshenko, the Kremlin seems to have an acceptable negotiation partner in Kiev. Poroschenko’s peace plan responds to Moscow's key demands: the protection of the Russian population, including the expanded rights for Eastern Ukraine as well as the enhanced protection of the Russian language. Also the constitutional amendment that Russia demanded was included as a project in the peace plan and is supposed to decentralize power in Ukraine. If political power is no longer concentrated in Kiev, takeovers by pro-Western or pro-Russian forces may have a lesser effect in the future.

Finally, Poroshenko also agreed to engage in dialogue with the separatists – demanded by Moscow as well but refused by the former Ukrainian transitional government. The – albeit skeptical – consent in principle of the Kremlin to the peace plan makes clear what Russia aims for with the crisis and now gets: a Ukrainian leadership that, like Poroshenko, is at least willing to negotiate rather than play off Moscow and Brussels or pursue a destructive, one-sided policy.

Ukraine – victim but also winner

At first glance, Ukraine seems to be the big loser of the conflict: It lost Crimea to Russia with the support of the Crimean citizens, Eastern Ukraine has completely lost confidence in Kiev and needs to face up to some kind of civil war. Internationally, Ukraine became the plaything of the two European powers: Russia and the EU. Economically, the extent of effects is difficult to assess, but with new gas prices at a European level, the state budget will be moved closer to bankruptcy. In addition, the industry has almost come to a standstill in Eastern Ukraine because of the conflict. However, Ukraine also gets something positive of the conflict.

Even before the conflict, the economic situation has long been on the verge of bankruptcy without interest of the West to help Ukraine. The Western impulse to drive back Russia made Ukraine’ collection of money easier. For the credits from the West and the IMF, the state budget restructuring needs to end the state subsidies for gas for the Ukrainian citizens and industry. With the increase of gas prices, the pressure for this financial recovery has continued to rise since the gas subsidies of the Ukrainian state are one of the reasons for its near bankruptcy. This could even lead to easing the permanent dispute over the price of gas between Gazprom and Ukraine in the future. If the subsidies are eliminated, it also eliminates the need for low gas prices. In exchange, Ukrainian citizens and businesses must bear the costs themselves.

The West – the true loser

Judging by the actions of the EU in the Ukraine crisis, the EU was uncoordinated, inconsistent and amateurish. The sanctions against Russia were symbolic and did not exert pressure; rather, they made a diplomatic solution more difficult. Likewise, the attempt to position itself as a mediator in the conflict when the Ukrainian transitional government decided the use of military force against the separatists was unsuccessful. At this time, the EU had already taken sides for Kiev and against the separatists and Russia although it needed to be neutral as a mediator in a conflict.

The statements of NATO to Ukraine are certainly debatable because they could have further escalated the conflict with their aggressive tone. Beside the EU, NATO is the biggest loser since it has so far been ignored by the Kremlin. No matter how many and aggressive accusations it directs to Moscow, Russia does not respond. Even in conflict resolution, NATO does not sit at the negotiating table. Its role in the conflict is by now completely marginalized. It is same for the United States.

What remains?

In the end, Russia seems to have prevailed. The entire EU has practically not been able to deal with the Kremlin, as the EU neither send out credible threats to Russia nor display diplomatic skills: a disaster of European instruments and foreign policy. NATO, like the USA, kept becoming a talking point again and again with the fuelling of war fears but disappeared into insignificance. Only the Ukrainian President Poroshenko has distinguished himself with a clever peace plan which even the Kremlin could agree to. Regardless of the peace plan’s success, he has proven to be able to deal more effectively with the crisis than all other participants.

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1st picture (source): Sasha Maksymenko / Creative Commons License

2nd picture (source): Олег Мосьондз / Creative Commons License