Belarus: HR-Activists Get Swedish Awards

On Monday, the Anna Lindh Memorial Fund announced that this year's human rights' awards both go to Belarus. Thus, Tatiana Ravyaka receives the 2006 Anna Lindh Prize and Alyaksandr Byalyatski the Per Anger Prize. Both prize winners represent the Belarusian Human Rights Center Viasna.

Byalyatski, the leader of Viasna, has for a decade supported human rights in Belarus by offering legal aid to the thousands of people that have been repressed by Lukashenka's regime. He is awarded the Per Anger Prize for his "brave struggle for the rights of the individual in the fight against oppression of human rights."

Tatiana Revyaka, also of Viasna, receives the 2006 Anna Lindh Prize for her "committment, empathy and persistence in disclosing wrongs and supporting and advocating the oppressed. She courageously defies political oppression and spreads knowledge of an alternative society in which the rights of the individual are inviolable."

The Anna Lindh Memorial Prize was founded in honour of former Swedish minister of foreign Affairs, Mrs. Anna Lindh, who was murdered by a madman during a political campaign in 2003. The Per Anger Prize is in honour of ambassador Per Anger, Raoul Wallenberg's closest associate in salvaging jews in Hungary during WWII. The prizes will be presented to Revyaka and Byalyatski at a ceremony in Stockholm on 14 june.

Russia Warns Ukraine & Georgia of NATO

On Wednesday, Russian foreign minister Sergei Lavrov warned Ukraine and Georgia of joining Nato. During a speech in the Russian State Duma, Lavrov argued that such a "colossal geopolitical" change would threaten relations with the two countries. "We assess all possible consequences primarily from the point of view of Russia's national interests," Lavrov said.

According to Ukrainian foregn minister, Anton Buteiko, a majority of Ukrainians support that Ukraine would join Nato. If Buteiko would be right, this would constitute an enormous change in Ukrainian public opinion. As late as last year, only some 10% of public opinion supported Nato-membership. Why public opinion may have turned is unclear, but it might be as a consequence of the New Year's Russian-Ukrainian gas crisis. As for Georgia, Tbilisi has for long had the ambition to join Nato, but it has been regarded unrealistic as long as it is not accompanied by a Ukrainian application to enter the North Atlantic alliance.

That Russia, at this point, warns of the consequences primarily of Ukrainian Nato-membership, is due to regional political developments, not least with GUAM's recent formation of the Organization for Democratic and Economic Development, combined with increasing US openness to accepting the two countries as members of Nato. In Moscow eyes, such tendencies form part of a much greater geopolitical struggle between Russia and the US for influence over post-soviet space - Russia's traditional sphere of vital national interest.

Estonia: Gay Ambassador Flees Homophobia

The Dutch ambassador to Tallinn, Hans Glabitz, has decided to leave his mission to Estonia due to "persistent racist and homophobic abuse," BBC reports. Glaubitz is openly gay and lives with his coloured Cuban partner.

The problem has not been on an official level. The Estonian foreign ministry is, to the opposite, careful to point out that the couple has been well received at an official level. Instead, Glaubitz decision is due to widespread public homophobia in Estonia. According to Glaubitz, the couple has been constantly harassed in public by skinheads and drunkards with homophobic and racist remarks.

The Glaubitz case regrettably demonstrates the kind of homophbia still latent in many East European countries. That even a foreign ambassador finds his posting to a fellow European country unbearable, shows how profound a clash in cultures may be between the liberal Netherlands and relatively conservative Estonia.

Russia: Dollar vs Rouble

Last week, the Russian State Duma proposed a law prohibiting the use of prices in foreign currency. For all practical reasons, this would mean that price-setting in dollar and euro would be banned in Russia. The law proposal, which stands good chances of being passed, has been much ridiculed by domestic and international media alike. However, is there really reason for such ridicule if one would only closer consider the general idea?

Russians like to set their prices in dollar for the simple reason that any bigger business transaction in Russia is made in dollar. With inflation rates of up to 2,500% annually in the early 1990's, Russians have grown accustomed not to trust the country's own currency, viz. the rouble. Therefore, most Russians also keep their savings in US dollar. Despite a mere 11% inflation rate last year, people remember the latest great financial crisis in 1998, when the rouble dropped some 86% in the course of a year. Today's relative macroeconomic balance in the Russian economy, not least due to rising oil incomes, is therefore not reflected by greater trust in the rouble. Only this year, the rouble exchange rate has increased by 7% against the dollar. However, this does not seem to change how Russians value the rouble.

Nevertheless, sound scepticism is currently motivated to the dollar as store of value. Earlier this Spring, Russian Finance Minister, Aleksei Kudrin, questioned the US dollar as international reserve currency. In view of how volatile the dollar course has been in recent years, Kudrin's question has some rationale. People and national banks alike have, to an increasing extent, turned to the euro to hedge currency risks. Of course, this challenges the advantage of seigniorage for the US economy, allowing the country its current budget deficit due to the Iraq war. However, US deficit has now reached such levels that trust in the dollar is inevitably dropping. That oil producers are tending to turn to the euro for setting oil prices instead of the dollar, is a worrying tendency for the US. In view of increasingly diverging interests between Moscow and Washington, Russia's increasing scepticism towards the dollar comes at a time when the US economy is vulnerable to critique. Whether Russian initiatives to rid itself of dollar dependency also have a political motive sparked by deteriorating US-Russian relations is too early to say.

For now, the new legislation is interesting enough. So, will such a law actually work? No, of course not. Banning public use of dollar or euro denominations will have absurd consequences. Looking only at president Putin's recent annual address to the State Duma, it would have rendered him a considerable fine, judging from the number of times he used the "d" word. The new law may also create considerable confusion at the upcoming G8 Summit in Petersburg, as the Duma has recommended the Russian delegation only to use rouble denominations when presenting financial data. Former Finance Minister Boris Fedorov argues that the law will make Russia an international laughing-stock. His successor, Aleksei Kudrin, predicts that state officials will become totally confused by amounts "followed by an infinite number of zeros."

Still, is it not quite natural that a state uses its own currency denominations as a measurement of transactions? What would e.g. an American say if all US prices were in euro, despite the fact that payment would be made in dollar? That a reserve currency - such as the dollar or euro - is used in inflatory or crisis economies is quite natural, because people want to be sure of the value of their money. However, the rouble has preserved its value relatively well for such a long time now, that one should perhaps start reconsidering its value also in psychological terms. This will take time, but one has to start somewhere. It is quite evident that an economy the size of Russia cannot in the long-run go on using foreign currency as its financial gauge. The price of this is too great, not least in terms of transaction-costs and non-deposited money with no interest. So, despite the fact that the specific Duma bill and the debate surrounding it may be laughable, Russia has to start somewhere to normalise its economy. In light of this, the Duma may not be all wrong.

Ukraine: What Pascual Doesn't Tell

Chernobyl's lesson is that a state's lies threaten its people and its sovereignty. With this argument, former US ambassador to Kiev, Carlos Pascual, sets out on a frontal attack on Ukraine's leaders, in today's Washington Post. Using Chernobyl in a distasteful parallel, Pascual criticises Kiev for corrupting the security of Ukraine. However, what is not said is often more interesting than what is actually said. Thus, implicitly accusing Ukrainian leaders for lying, Pascual himself conceals crucial facts.

The immediate background to Pascual's vociferous accusations is the New Year's gas crisis between Russia and Ukraine. Kiev was put to the test, when Russian gas company Gazprom turned off gas supplies to Ukraine in mid winter. Racing against time and "popular" hypothermia, the Ukrainian government struck the deal they could get given the circumstances. With a 47 million hostage, there was little choice but to give way to Moscow's blackmail, using the brokers and dealers at hand. The result was a construct typical to the situation - with the much criticised RosUkrEnergo. It was a slave contract on unequal terms with murky Russian-Ukrainian business interests. So, where was Washington when Moscow chose to turn the tap? The truth is that Ukraine was left to the wolves, with support more in words than in deeds.

It is true, as Pascual argues, that Ukraine has enormous problems with corruption, especially within the energy sector, but he fails to see that steps are taken to combat this evil. Getting at grips with this is a condition for reform. Thus, Ukraine is intent on fighting corruption, because there is simply no other way to develop the country. The sickness is set deep in the system - from ministers to milkmen. Everyone knows this, and the Orange Revolution expressed that it was time for a change. Corruption causes lies, but what is a lie if nobody believes in it? People knew the truth, and believed they could change. However, transforming a society is like achieving transparency. It is not just getting there. It is starting somewhere. Corruption is endemic to Ukraine, and here no other sector is easier to pick on than energy. As with any monopoly, corruption will flourish as long as one supplier, namely Russia, dominates.

However, corruption and Kiev's energy problem do not justify implicit accusations that Ukrainian politics is based on lies, by equating Soviet falsehood with current democratic rule. Nor does it warrant unjust parallels between the national trauma of Chernobyl and today's complex energy policies. Pascual claims that:

Unlike in 1986 when Soviet leaders tried to cover up Chernobyl's threat, Ukraine's leaders now have the opportunity to respond to alarm bells in the gas sector and forestall an impending danger to its own sovereignty and European energy security.

What Pascual does not tell, is that Ukraine's leaders seize any opportunity they can to safeguard energy supplies - for themselves and Europe. In doing so, Kiev is walking a thin line along the domestic-foreign frontier. Relations with Russia are tense, but there is little other alternative for now, than to rely on Moscow for energy supplies. That Ukraine is dependent "on imported gas and shady contracts" is simply an effect of this.

Still, Kiev is actively trying to find alternative solutions that could also benefit other nations. Against Russia's expressive will, Ukraine is turning the flow of oil in the Odessa-Brody pipeline towards Europe. Gas supplies from Turkmenistan are sought, admittedly though in cooperation with the infamous RosUkrEnergo. Last year, plans were announced to build a pipeline from the Caspian to Poland. Another scheme is a pipeline from Iran - and then also a pipeline to the Baltic. Finally, only last week, Georgia Ukraine, Armenia and Moldova formed a regional "Organization for Democracy and Economic Development," where one of the main purposes is to: "activize efforts to ensure energy security, including by means of diversifying routes of transportation of energy resources from Central Asia and Caspian regions to the European market."

Are these actions of a country that does not try to assume its responsibility? Obviously, Kiev is trying to find alternatives to dependence on Russian energy, and by doing so attempts to rid itself of the full-fledged corruption within the Russia-Ukraine gas trade. Therefore, seeking alternatives is breaking with the past - as much in terms of dependence as corruption. This is a fact that Pascual should acknowledge, not least because Ukraine - and not the US - is running the risk of failure.

So, are the leaders of Ukraine lying, and thereby threatening their people and the sovereignty of the nation? Judging from the actions that Pascual proposes in comparison to what Kiev actually does, such a presumption is mere nonsense. There is little doubt that the government and a majority of Ukrainians would wholeheartedly subscribe to most of the measures Pascual proposes, if they only had the power to do so. Furthermore, Kiev is already working in this direction. Pascual simply cannot be ignorant of this. The question is how great a responsibility Ukraine should assume. Kiev is already out on a limb in trying to please US and EU interests in confrontation with Russia.

Bismarck said that "Politics is the art of the possible." Galbraith begged to differ by arguing that "Politics is not the art of the possible. It consists in choosing between the disastrous and the unpalatable." It is the latter type of choices Ukraine's leaders have been facing ever since the Orange Revolution. To belittle the difficulties of these choices is outright impudent. The West rightly assumes that democracies are stable. Seldom do we realise that democratisation is volatile. In the last two years, Ukraine has made giant leaps in democratisation. Its leaders must, however, be given the benefit of the doubt that they are able to avoid the pitfalls on the road to democracy. They are little served by being stabbed in the back for not reaching perfection at once. Instead of a reward for trying, Pascual scolds them.

Furthermore, when Pascual implies that the Ukrainian leadership is lying to the people, he is in blatant disrespect of the sovereign choice of the Ukrainian people. A majority has repeatedly voted for change. On March 26, the road to reform was reconfirmed in defiance of all the hardships it involves. The people steered off from an impending backlash, not necessarily because they believed in their leaders, but because they trusted this was the right way forward.

Politics in Ukraine is a sham since the elections, and the people is witnessing the daily charade of coalition negotiations to form a new government. Still, if the politicians fail, the people will hold them accountable for erring. It is a mutual relationship with few parallels in post-soviet space. The people has, once and for all, empowered itself, and will not accept that politicians make a mockery of its sacrifices for reform and democracy. Still, few believe in miracles and the understanding is growing that progress will take time. People are no fools. Their trust will be proportionate to the achievements. The people has had its choice, and has opted for further reforms with open eyes. This is a question of political direction - not political directors. To assume that the people is not competent to judge its leaders and to see through lies, when it has done so less than three months ago is a grave misperception.

Today, what people and politicians alike realise, is the basic political and economic paradigm of diversifying risks. This is not the time for pigheadedness in going full-out either way. There is a need for moderation, even if it may involve suboptimal solutions, for the simple reason that there is no power to reach the optimal. The alternatve for the people is failure, and nobody will be there to catch them if they fall, as demonstrated by the gas crisis.

Furthermore, when Pascual calls for state intervention in the energy sector, he ignores the importance of separating state from business - the lack of which has casused many of the problems from the outset. He thus disregards the delicate balance needed for gradually introducing necessary state regulation. On a wider European scale, Kiev needs all the backing it can get for the policy it is already pursuing. Substantially greater support is needed if anything more is to be done. Such support will most likely be lacking. Pascual himself states the obvious reason for this:

The United States hardly needs another crisis in the Russia relationship as we seek Russia's help in preventing a nuclear Iran. Russia needs neither an irate European customer nor a fight with diplomatic partners seeking to prevent an Iranian nuclear bomb.

Thereby, Pascual also fails to recognise the connection between Ukraine's domestic and foreign policy. For all the domestic measures that he proposes are in direct contradiction with Russia's core interests in using energy to exert influence over its "near abroad." A situation where Moscow directly or indirectly controls Ukraine's energy sector is decidedly in the best interest of the Kremlin. The greater extent of corruption, the less degree of cohesion will Ukraine's energy policy have. As long as such a situation is maintained, Russia gets both the power and the profits from Ukraine's gas dependence. Therefore, Moscow will most likely oppose any reforms or clensing of this sector. Taking heed to Russia's interests is simply incompatible with ensuring Ukraine's and Europe's gas supplies by supporting Ukraine. This should not conceal the fact that "the EU and the US should engage Ukraine and Russia before the crisis erupts and offer to facilitate negotitation of normal commercial arrangements." Here, Pascual is completely right.

All the same, it appears that the US cannot have it both ways: Urging Ukraine forward and at the same time serving Russian interests. If the Bush administration would seriously consider Pascuals proposals, Washington may have to "walk the walk and talk the talk," and that means directly confronting Russian interests. The other way around would, to the contrary, satisfy Moscow in the short run, but also potentially paralyze progress in safeguarding Ukraine's and Europe's gas supplies in the long run. There is, however, a middle way: Trusting the sound judgement of Ukraine's leaders, that they are competent to handle the issue themselves on a regional level, and with due support from the West. This would mean the continued long-term diversification of energy supplies that Ukraine and neighbouring countries have initiated, in combination with short-term EU and US arbitration between Kiev and Moscow. By lengthy engagement, US and EU companies may also get a stake in the profits by construction of pipelines and energy production. However, trusting Ukraine's leaders is obviously the last thing Pascual would do. What he does is to urge them to pull forward in response to the dangers to their own "sovereignty and European energy security." At the same time, he apparently refers to Ukraine when stating that "Russia needs neither an irate customer nor a fight with diplomatic partners seeking to prevent an Iranian nuclear bomb." By urging Kiev forward, Pascual however creates the latter - an irate customer in the guise of Ukraine.

One cannot but agree that most of Pascual's proposals would be desirable both for Ukraine and Europe at large - including Russia. The contradiction they carry in incompatible positions for, on the one hand Russia, and on the other hand Ukraine, Europe and the US, makes them an impossible road to tread. After three years in Kiev, one would expect Pascual to understand these basic complexities when Ukrainian domestic and foreign policies converge. This is though the most important factor that Pascual doesn't tell. By concealing complex but crucial factors, he would appear to badly serve the interests of both Ukraine and US foreign policy.

To be quite blunt, Pascual needs to cut the crap. He does not tell a lie, but he is surely twisting the facts, although he should know better. What is the real political motive for this? Does he have an issue with the leaders of Ukraine, the Bush administration, or the fact that Kiev does not wholly comply with any brainchild that Bush & consortes may conjure up? Prescribing a policy in two seemingly incompatible directions is not an answer. So, what is his motive. This, only Pascual can tell.

Ukraine: Football to the People

On Monday, Ukrainian Prime Minister Yuri Yekhanurov appealed to the country's business leaders to let employees watch World Cup football matches, Ukrayinska Pravda reports. After two near misses since independence, this is the first time Ukraine's national team has qualified for the World Cup.

Football fever has struck Ukraine with full force. To avoid a full-out epidemic, Yekhanurov now pleads with the country's chief industrialists, to let people watch the matches. Otherwise, he fears a considerable decrease in production. His recipe is to adjust working hours to avoid collisions with matches. Another viable alternative would be to put TV-sets at workplaces. Why? Yekhanurov explains: "We can expect an epidemic of various diseases. People will simply report sick in multitudes." Is the similarity between "support" and be "ill" in Russian a mere coincidence, one wonders.

Yekhanurov's appeal may seem peculiar. However, there is some precedence. When the American soap opera "Santa Barbara" hit Russia in the early 1990's, production is said to have halted in factories throughout the country. Being the first American TV-show broadcast after soviet demise, many Russians were spellbound by the wealth and careless life of a family presenting a would-be version of the American dream. However, Russians were far from the only Santa Barbara addicts. US president Ronald Reagan and his wife Nancy is said to have been next-to fanatic viewers. So, Yekhanurov might not be so wrong after all. World Cup wins or visions of wealth - one has to let the people nurture some dreams.

Note: In Russian, support is болеть whereas ill is болен. However, in Ukrainian, supporter is прибічник, and ill is хворий.

Belarus: The Galina Rodionovna Mystery

On account of a recent dicussion at Tobias Ljungvall on Belarus, more questions must obviously be raised about Galina Rodionovna - wife of Belarus president Lukashenka. Who is she - this first lady of Belarus? Few seem to know, why the question all the more deserves an answer. Who can solve the mystery of Galina Rodionovna - Belarus' secretive presidential wife?

As previously discussed, Lukashenka's wife, Galina Rodionovna, has for long been out of public view in Belarus. She still lives in the rural town of Shklov, where Lukashenka once led a collective farm. Officially, she is regularly commuting to her husband in Minsk, but among others the BBC claims that the couple is separated. They have two sons together - Viktor and Dmitry.

On the few occasions, when Lukashenka has commented on Mrs. Rodionovna, he has been saying things like: "Wives have no business in the affairs of state officials." Lukashenka has also reportedly been negative to examples where wives and children of state leaders are put in the limelight. This would seem one of the few positive traits of Lukashenka. However, keeping his family out of power seems to be an ambition that he nowadays is not fulfilling, as his sons appear to exercise an increasing influence in state affairs.

The picture above, courteously provided by Tobias Ljungvall, depicts the couple's wedding. However, it is one of only two available photos of Mrs. Rodionovna. The other one depicts her milking a cow, which does not appear a common chore for a presidential wife. Ljungvall claims that "she is said to be a decent woman." Then, what more is to be said? Questions abound, but little is disclosed. For the time being, it seems that Galina Rodionovna will continue to be a mystery to the world.

Russia Opposes Rivals in Central Asia

Russia opposes the emergence of new organisations in Central Asia that could rival Russian influence in the region, Interfax reported on Tuesday. Instead, Moscow refers to the Shanghai Cooperation Organization (SCO) as the sole instrument to combat terrorism in Central Asia.

This statement by Boris Gryzlov, speaker of the Russian Duma, indicates Moscow's fears that the US might have a card up its sleeve for a new design to Central Asia. At an SCO parliamentary meeting on Tuesday, Gryzlov reportedly said:

We can tackle the tasks of resisting and fighting terrorism together in the framework of SCO and Russia does not support the establishment of organizations comparable to the SCO in Central Asia. --- The establishment of a parallel entity would be a barrier to cooperation. We don't need pressure or compulsion wherever they may come from.

When asked about the meaning of this, Gryzlov pointed at the US, which he accused of having plans to set up a parallel organisation to the SCO in Central Asia. Apparently, Moscow fears increased US interest in the region, whereas perhaps Washington would not see anything wrong in a little bit of sound competition. However, it is becoming painstakingly clear that the two old partners in the fight against terrorism are rapidly drifting apart in what is becoming a new Great Game in Central Asia.

Russian-Georgian Links Back on Track?

This is not exactly the news one might expect coming out of Moscow these days, but it is the impression that one may get by a passing glance at a recent Interfax telegramme. The story is that the railway link between Moscow and Tbilisi has been restored after a 13-year long disruption. However, with a little fantasy, it may also give a certain twist to current political relations between Russia and Georgia.

Evidently, trains will leave Tbilisi for Moscow three times a week, starting last Saturday, and passengers will have to go through the discomfort of a detour via Azerbaijan. This is so, because the direct line to Moscow has been out of service since the start of the Abkhaz conflict in 1992.

Even though the newly reopened Tbilisi-Moscow connection is not via Abkhazia, negotiations are underway between Russia, Georgia, Armenia and Abkhazia, to reopen also the line running through Abkhazia from Yerevan via Tbilisi to Moscow, possibly as soon as within two years time.

That the link between Moscow and Tbilisi now has to go by detour and not directly may be a mere coincidence, but can also serve to signify the general character of current political relations between Russia and Georgia.

Estonia: Stalemate in Russian Relations

In August 1991, Estonia regained its lost independence after nearly 50 years of soviet occupation. Some 15 years later, Estonia and Russia still lack regulated borders. Last year a border agreement was finally signed, but it did not take long before Russia withdrew from the treaty - something next to unprecedented in international relations. Since then, a stalemate persists between the two countries as relations thus reached a dead end. What will it take for Estonia and Russia to sort out their differences?

In May last year, everything seemed set for a go-ahead on a final Russian-Estonian border treaty. The last hurdles had been cleared, as the two foreign ministers decided to sign the treaty in Moscow on May 18, instead of the infamous 9 May Soviet victory day. The latter was not possible, while 9 May 1945 signified the seal of Estonia's soviet occupation. The treaty was signed and the only thing that remained was to have it ratified by parliaments in the two countries. Both were eager to remove the matter from the agenda once and for all, and hastened to have ratification bills passed by parliaments. Just weeks earlier, president Putin had declared that:

Russia is ready to sign formal border treaties with Estonia, Latvia and Lithuania. I hope this will not be accompanied by some idiotic territorial demands. In today’s Europe, in the 21st century, one country making territorial demands against another, at the same time wanting to ratify a border treaty - this is complete nonsense.

However, this is more or less what happened, at least according to Moscow's version of events. Whereas the Russian parliament - the State Duma - was hesitant to ratify the border treaty, anticipating trouble, Tallinn moved on. Eager to get the question off the agenda before vacations, the Estonian government also put the treaty before parliament - the Riigkogu. Reactions to this were negative from the very outset, as many parliamentarians held that the government thereby tried to force through the treaty without proper discussion and debate. To be passed, the bill had to get a 2/3 majority. Such majority suddenly seemed unable to reach, why the government preferred to enter negotiations instead of facing certain defeat. These negotiations resulted in a separate preamble or declaration to the border treaty, referring to the Tartu Peace Treaty of 1920, by which Soviet Russia recognised Estonia's independence within the pre-WWII borders. However, current borders have been revised during soviet reign, which makes Tartu references unacceptable for Russia. With this preamble, the Estonian parliament passed the ratification.

Moscow's reaction
Moscow's reaction was predictable to say the least. On June 21, Russia's Ministry of Foreign Affairs stated that it would not put the treaty before the Duma for ratification. Then, during a visit to Helsinki at the end of June, foreign minister Lavrov declared that Russia had decided to revoke its signature from the border treaty. This is also what happened, and on 1 September president Putin formally withdrew Russia from the treaty. The move to withdraw from an already ratified treaty is next to unprecedented in international relations, and must be considered a very stern reaction. The scandal, a few years back, when president Bush revoked the US signature from the treaty on the International War Crimes Tribunal has reverberated in the international community ever since. Examples are scarce, because the international outcry for doing so is expected too great, and one has to pay too high a price for it to be worthwhile. Still, this was exactly what Moscow chose to do.

Estonian explanations
Why did the Estonians act in this way, if they clearly understood what the reactions from Moscow were to become? What were they to gain from this? Some suggestions have been made, although they fail to explain for - even in combination - Tallinn's action.

One factor is that Estonia in April 2005 went through a government crisis and that the sacked prime minister and leader of the Res Publica party, Juhan Parts, quickly needed to profile himself with some cause, not least after a failed unification of Estonia's two right-wing parties - Res Publica and the Reform Party. Thus, demands connected to the border treaty seemed as a convenient opportunity for Res Publica.

Another reason is that the foreign minister of Ansip's new Reform Party government - 31-year-old Urmas Paet, simply was too new and unexperienced on his post, why he could not manage to deal with Moscow and domestic political intrigues at once.

A third explanation, is that government coalition partners - not least the Social Democrats with their grey eminence Thomas Hendrik Ilves at a safe distance in Bruxelles - stood to gain from a squabble between the two right-wing parties.

Then, there is Estonian politics' black horse of Edgar Savisaar and his Centre Party. Being the new minister of finance, Savisaar was arguably the one pulling the real strings in cabinet affairs. Savisaar is a political survivor with a murky soviet past, who has been constantly scandalised over the years but always gets away without a stain on his popularity, especially among poor and rural population, including the Russians. Also, Estonian conservatives are usually quick to point out that the Centre Party is in union with president Putin's United Russia, thereby casting suspicion on him for being on Kremlin's leash or even - at times - payroll.

Finally, it must have been hard to put off Russian interests, though not necessarily Russia itself, from the temptation of exploiting Estonia's domestic difficulties in this situation. Whether the Russian factor could hold on to itself in not giving in to such an urge will however remain unclear. The effect was though in Russia's interest. Thus, Estonia stood to gain nothing, but to once again be portrayed by Russia to the great powers of Europe as an amateur in international relations in disrupting the treaty. Still, blaming Moscow is simply too much of going through the motions to be taken seriously. Perhaps, Russia in reality simply had to stand idly by while the Estonians themselves fumbled about in torpedoing the treaty.

So, is there any way out of this mess for Estonia? At an OSCE-meeting earlier this spring, foreign ministers Lavrov and Paet discussed the need for resumed negotiations to settle the border issue once and for all. Some discussions have also been held since, but both parties seem to agree that a ratified treaty will not come into force in the foreseeable future. The issue is simply politically dead at the moment, while so much prestige was put in on both sides to finalise the border settlement. Once this was lost, little room was left for future talks. Estonia thus seems to have little choice but to let the issue at rest for the time being.

Dealing with Russia
In view of the current situation, how should Estonia handle its relations with Russia? Professor Andres Kasekamp, director of the Estonian Foreign Policy Institute, believes that Estonia now will opt for an EU-solution. According to Kasekamp, Estonia should take the CFSP/ESDP more seriously. This is also currently the sentiment among many politicians in Estonia. The country seems intent on playing out the EU-card, despite the Union's demonstrated inability to stand firm on Russia. Such a policy thus seems to have a weak foundation in current realities. That Sweden and Finland were the only other EU-states in support of the Estonian position concerning the border treaty, is a telling example of how little the EU cares about Estonia's relations with Russia. EU politicians are simply fed up with the whole affair of Estonia not being able to conclude a border treaty with Russia for the last 15 years. EU-support thus seems destined to fail, and EU's European Neighbourhood Policy appears to offer little use to Estonia, as it does not comprise relations with Russia.

The alternative of handling relations with Russia through Nato should, in this perspective, seem all the more tempting to Tallinn. Such a method would, in reality, mean using the US and the Transatlantic link to influence NATO-policy. In May 2005, president Bush visited Riga, and among other things discussed subjects such as democracy and freedom in Eastern Europe. This kind of US high-level discussions is in the best interest of Estonia, while statements to this fact facilitate setting the Nato-agenda in Tallinn's favour. US vice president Cheney's speech at the May 2006 Vilnius Conference also signalled a change towards a more critical stance in US policy towards Russia. In November this year, Riga will host the annual Nato Summit, offering an opportunity to further Estonian interests in relations to Russia by proxy of Nato. Estonian chances to bandwagon with the US to deal with Russia through Nato are therefore greater than ever. Still, Tallinn strangely enough seems to prefer the EU option - perhaps reflecting the post 2001 change in Nato's geographical focus. What Estonia fails to recognise is the fact that also within Nato, the tide is changing in relations with Russia. Tallinn should clearly not miss out on this opportunity to use a change in US and Nato policy towards Moscow in its own favour.

Finally, a joint approach in coordinating Estonian interests on Russia to concurrently influence both Nato and the EU in the same direction might be a recipe for success, but this is simply too complex a task for a small country to pull off.

Domestic difficulties
In the meantime, the Russian question in Estonia continues to drag on as an annually recurrent tradition. The drama has been played out by more or less the same actors over the last 15 years with little variation. This year's incident was the 20 May desecration of the Bronze Soldier Monument (Pronkssõdur) by Estonian nationalists. For Russians, it is a memorial to Soviet soldiers who died fighting in World War II. For Estonians, it is a symbol of the Soviet occupation.

Therefore, in connection to Russia's victory day each year, soviet veteran ceremonies at the monument are ritually followed by protests from Estonian nationalists. This year, events have been especially serious with a string of demonstrations. Among Estonian nationalist demonstrators were crackpot professional dissidents such as Holocaust-denier Tiit Madisson, but also more respected people such as former commander-in-chief Aleksander Einseln. Their objective is the removal of the Bronze Soldier from central Tallinn, and little consideration is taken to reasoning in view of their unwavering demands.

The situation has been exploited by extremists on both sides. Last week, the headline of the leading Russian newspaper in Estonia, Vesti Dnia (fmr. Sovetskaya Estonia), read: "On the Brink of Civil War." Also, rumours about Russian vandalisation of Estonian monuments, e.g. in Tartu, are spreading, and the resurfacing of old Interfront activists has been quite unexpected. Probably, protests will peter out in a few weeks, but it is worrisome that extremists repeatedly are allowed to set the political agenda for almost a month each year. This is simply not a sound political tradition for a small country like Estonia. Protests and demonstrations may well be overlooked by the majority of Estonians as an annual freak event, but each year extremists are allowed to set the public agenda through media.

Narva and the Russian-speaking population
When one refers to the situation of Russians in Estonia or Latvia, one should be aware of the fact that this does not necessarily mean Russians as such. Migration to Estonia in the post-war era came from all over the Soviet Union, why it might be as natural to come across a Tajik, a Ukrainian or a Lithuanian in Tallinn as it is with a Russian. Today, they all meet the same conditions and requirements for residence permit and citizenship no matter what their place of origin might once have been. That Russians are in a majority should not serve to hide this fact.

Estonia's Russian-speaking population is concentrated partly to Tallinn and neighbouring cities, and partly to Eastern Estonia. However, it is in the East that the Russian dominance is especially compact - in cities like Narva and Kohtlajärvi. For long, crisis has coincided with ethnicity in this part of the country, which incidentally also neighbours on the disputed border areas with Russia. Unemployment and social malaise have been a constant feature in Eastern Estonia during the last 15 years. A destitute population with little hope for the future has presented a great problem for Estonian authorities. The city of Narva, right on the border to Russia, facing Russian Ivangorod on the other side of the river, is a telling example.

In reality, the few Estonians living in Narva are state representatives in some capacity, and they associate little with the local Russian-speaking population. In Narva, it is perhaps no coincidence that the well-held offices of the Russian Consulate are located only a few hundred metres from the headquarters of KaPo - the Estonian security service.

However, things are now looking brighter for Narva. The situation is still such that everyone who knows how to, tries to move away from the city. Many of the top students at Estonian universities originate from Eastern Estonia, strongly motivated from knowing that the alternative is poverty. This may not be the case in the future though. In recent years, things have begun to turn around for Narva. Unemployment has decreased and many industries are moving production to this area due to dramatically rising costs and a deficit of qualified labour in Tallinn and the densely populated areas of Western Estonia. The opposite to high costs and unskilled labour is exactly what Narva has to offer. Adding to this, the lower wages in this region attract a rising number of investors. Whereas activities still are far from bustling, the tendency towards a rather rapid development within the next decade is clear.

Until now, Narva's economy has largely depended on border trade with Russia. With much lower prices on petrol, alcohol, and tobacco in Russia, shuttle traders cross the border back and forth on a daily basis, bringing merchandise for illegal distribution and sale on Estonian and Western markets. There are few figures on the full extent of this trade, but Russian customs' estimates say, that it accounts to some 20-30% of Northwestern Russia's foreign trade. There is no wonder then that transit-trade is Estonia's most profitable business, the proceeds of which have made great fortunes for the people who control it. Today, a majority of Estonia's richest businessmen are ethnic Russians. The paradox is that the population of Narva and Eastern Estonia has had little to gain from the shuttle-trade. Most of the money has ended up in the pockets of a few fellow compatriots that could not care less about the situation of their Russian kin. Therefore, the future of Narva rests on the opportunities to enter other economic areas.

That a rising number of businesses in Estonia are now moving production to Narva is thus very promising. Too long, the level of costs has not been sufficiently geographically diversified to make it profitable moving industry to the East. Now, this has changed, why companies will seek to increase their dividends by lowering costs by relocation. In the meantime, however, a generation of workers has been lost to Eastern Estonia due to unemployment destitution. The old generation may be lost, but the new generation faces a much more promising future, which might allow them to stay on in their hometowns in the East.

The Choice of a New Generation
Things are changing in Estonia with 15 years passed since regained independence. A second new generation is entering the public and business spheres. This generation has little to remember from soviet times. The situation applies to Estonians and Russians alike. The arguments from nationalists and pro-Russia groups are increasingly perceived as artificial constructs with little relation to everyday reality. Both groups are themselves becoming as antiquated as oblivious. With economic development, also social and economic differences between Estonians and Russians will narrow, and so will consequently also the potential for extremists to exploit such friction. The focus of a new generation in Estonia is set on Europe and not on Russia. Relations with Russia are increasingly becoming irrelevant for most people in Estonia. Once this is realised, Moscow will have difficulties to exploit the situation of the "Russian minority" in Estonia in relations with Tallinn. It will also become harder for Russia to raise support in Estonia per se by appealing to fellow Russians. Perhaps then, Moscow will definitely let go of its lost empire and plainly put borders and other issues at rest with Tallinn without further ado. However, also in Estonia it will take a new generation to sort out the country's differences with Russia, but in the end, Tallinn and Moscow will budge to the new realities.