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Europe Daily Bulletin No. 11030
A LOOK BEHIND THE NEWS / A look behind the news, by ferdinando riccardi

A few clarifcations on situation in Ukraine and attitude of the EU

The reality is much more complex. Let's leave the announcements of war and other exaggerations to one side. In the face of the drama in Ukraine, the EU was obliged to adopt as clear an official position as possible - and it did so at the end of last week (see previous edition of EUROPE). But the reality is much more subtle and complex. The EU has recognised the new government in Kiev as the party with which it is ready to sign the envisaged association agreement (as we are well aware, the EU was ready and it was Ukraine that refused to accept to it), thus recognising the country's integrity and territorial unity.

This official position of Brussels is logical because the EU must remain faithful to its positions. However, the distance between the grand principles and the reality is plain. Today, the unity of Ukraine is theoretical. In fact, the division of the country into two parts is radical - one part, the majority, aspires to EU accession, feels European and has its own national language; the other part speaks the Russian language, its geographical separation is very visible and it does not have the objective of EU accession. In Kiev, the majority of the parliament even repealed the law that made Russian the second official language. Ukraine's integrity and territorial unity are an illusion. The head of government, Viktor Yanukovych, a Russian speaker, fled after the violent disruption in Kiev, where his life was in danger. He took refuge in Russia where he has announced that he will continue his battle, while Russia's Prime Minister Dmitry Medvedev has declared that “Yanukovych is still the legitimate head of Ukraine”.

Essential role of the energy dimension. At first sight, the geographical complications could be resolved through the partition of Ukraine - which theoretically seems possible because the territories of the two languages are, from a geographical point of view, distinctly separate. Each of the two parts could therefore follow its aspirations (including EU accession for one of them). Yet the political and economic reality is much more complex, due in particular to Ukraine's role in supplying Russian gas to the EU. It is hard to understand the situation if one doesn't reflect on it.

The trouble is therefore political and especially economic - with the stakes in the energy domain being huge and directly involving the EU and Russia.

For a long time, the totality of Russian gas destined for the European market transited through Ukraine - it crossed Austria and arrived in France and northern Italy with deviations towards part of Germany. The situation is currently less radical, in the sense that Russian gas can or will partly be able to follow other routes because alternative ways now exist or are being developed. However, transiting through Kiev still remains essential. This is the reason why Russia applies favourable customs duties and special prices to Ukraine, promising it large-scale financial support. Moscow has announced that $15 billion is available for Ukraine and that this has been put aside - but is currently blocked. At the same time, Moscow will not renounce its political weapon - Medvedev has said that the legitimacy of the new institutional bodies in Kiev raises very strong doubts and that the EU and US should not recognise authorities in Ukraine that walk about with weapons in their hands and masked faces.

The scourge of corruption. Another aspect must be taken into consideration - corruption. According to qualified observers, corruption is playing an impressive role on all sides, involving very well known personalities and sometimes ones that are popular even in the West. Ukraine's situation is disastrous - the new prime minister (and former finance minister), Arseniy Yatsenyuk, has called on the EU and the IMF for immediate aid of $35 billion and for the organisation of an international donors conference. An international study has established a corruption ranking that places Ukraine in 144th position out of the 177 countries studied.

Nevertheless, it has to be underlined that neither Russia, nor Ukraine, nor the EU itself has an interest in prolonging this crisis. The links that exist between all the parties in question are very close; between Russia and Ukraine real borders do not even exist. Russia needs to sell its gas and oil in Europe and Europe needs to have its energy as this is crucial for it. The collaboration and exchange projects between the EU and Russia in the energy domain are so enormous that the two parties can't afford to challenge them.

(FR)

 

Contents

A LOOK BEHIND THE NEWS
EXTERNAL ACTION
SECTORAL POLICIES
ECONOMY - FINANCE - BUSINESS
INSTITUTIONAL
WEEKLY SUPPLEMENT