Tuesday, April 29, 2008

Anniversary of Anguish over Bronze Battle

This weekend past saw the first anniversary of the Estonian Bronze Soldier crisis - over the removal of a soviet WW II monument from central Tallinn. As the crisis evolved it ignited a bilateral quarrel between Tallinn and Moscow, in the end setting Russia and the European Union at loggerheads. As the first anniversary of the Bronze battle drew close, a certain extent of anguish and apprehension arose among Estonian authorities. What was to happen this time over? The simple answer was - next to nothing.

On Saturday, some 100 demonstrators gathered in a park in central Tallinn to commemorate last year's events, and to call for the resignation of the Estonian government led by Andrus Ansip. The event was peaceful and heavily monitored by police and the Estonian secret service (KAPO).

That the demonstration actually rallied less of a crowd than the number of people merely injured last year must be considered a fundamental failure for Russian "minority" interests in Estonia. Not least so as, just a few weeks ago, an organization to unite Russians in Estonia held its first congress. That Saturday's demonstration had such a poor showing may thus point to a waning significance of the Russian issue in Estonia. Or should perhaps alternative explanations be sought?

What evolved over a few weeks last spring was that the same methods used during the coloured revolutions in Serbia, Georgia, and the Ukraine, were now applied by Russians themselves. As the protest was reaching its crescendo, actions and debate were coordinated by sms, e-mail, and blogs targeting largely unprepared Estonian political leaders and authorities. The subsequent cyber attacks on Estonian web-servers proved the peak in efforts to paralyze society. Someone had obviously done his homework.

In terms of the Russian-speaking population of the Baltic States, Russia has long propagated that these "minorities" are consistently discriminated against, and has even ventured so far as to compare the situation with Apartheid. Last year's events also gave Moscow an opportunity to highlight the issue on the international scene. Although much of recent bravado has mysteriously evaporated, Russia has e.g. demanded an addendum on the Russian minorities in Estonia and Latvia in ongoing negotiations on a new Partnership and Cooperation Agreement with the European Union.

Still, much indicates that Moscow came out of the 2007 conflict with the EU on the wrong end of the stick - besides the PR-fiasco for Moscow's international image - why such demands are most likely to be ignored. Also, Russian policy towards the Baltic States since 1991 has largely proven a failure. Already in 1997, Russia's Council for Foreign and Defence Policy - an influential think-tank - in a report characterised Moscow's policy as counterproductive, if it intended to safeguard the interests of Russian "minorities".

It is far too seldom argued that what is not said and done may be as interesting as what actually is. So may be the case also here, although reporting on something that did not happen - as the Bronze battle anniversary - would hardly qualify as breaking news or of interest to a larger audience.

Turning to the case in point, the Bronze Soldier crisis has fundamentally been interpreted as an ethnic conflict. In fact, few issues are as politically sensitive as ethnic tension. Recent history has witnessed oppression and even genocide on minorities to an extent that has shocked world opinion. However, this also has made us prone to see far too many societal conflicts with ethnic lenses.

So, why did the anniversary of the Bronze Soldier crisis pass by next to unnoticed? May it be that there are alternative or complementary explanations to last year's turmoil than the ethnic angle? Before trying some hypotheses, it should be clearly stated that the removal of the Bronze Soldier from central Tallinn unequivocally was the igniting factor of the 2007 crisis. It is quite obvious that the Estonian government acted in haste and with poor judgement. Thus, they partly brought the crisis upon themselves.

Still, that does not explain the absence of protests a year after the so far largest protests by ehtnic Russians in post-soviet Estonia. The situation has not altered and the reasons for, arguably, Russian discontent with conditions in the country has not changed for the better - rather the opposite as a fact. Political forces traditionally safeguarding interests of Russians have partly been rendered obsolete. In socioeconomic terms, nothing has really happened, as illustrated in a report by Marju Lauristin last autumn.

So, except for Estonia's monumental mistake and obvious Russia-related explanations of lacking protests this year - the upcoming presidential installation on 7 May and last year's domestic need in Russia to rally around a cause - what might serve as alternative or complementary hypotheses for the difference between last year and now?

One reason largely unexplored is the transit of Russian goods and products through Estonia. Russia has long wanted to divert this trade to Russian harbours instead of having to pay the costs of transit. Furthermore, Kremlin-sponsored Russian companies had long been eager to out-compete those companies that controlled and profited from the Estonian transit trade. The same applied for control over export-harbours in Estonia. For most observers, it serves as no surprise to state that the transit trade involves enormous sums of money. One can only imagine how much by pointing to the fact that Estonia lost some 6,3 billion Estonian Kroonas in transit revenues due to a few weeks of Russian blockade.

Consequently, just a week or so before the April 2007 events, Russian vice Premier, Sergei Ivanov, held a speech in Murmansk, in which he propagated curbing transit trade and diverting Russian exports to ports in the Petersburg region and Gulf of Finland.

Negotiations for transit quotas and pricing on Russian goods by Estonian railway were to be held in May 2007. In 2006, the Estonian state re-nationalized Estonian Railway (Eesti Raudtee), why preconditions for influencing the outcome of negotiations had been altered to the detriment of Moscow's interests.

As for harbour facilities, the ports of Tallinn and Muuga represented around one-quarter of Russia's total refined-product exports, thus by far outweighing any Russian harbour. Control over harbours in Tallinn, Muuga and Sillamäe had long been coveted by Russian business interests. As previously reported, last year's crisis also saw a transfer of trade between these ports to the benefit of Russian interests.

Then, there is also the question of shipping. The crisis and the subsequent Russian trade blockade is said to have favoured shipping operations, controlled by Swiss-based Gunvor Group. Gunvor is owned by Swedish oil trader Torbjörn Törnqvist, with interests in e.g. Surgutneftegaz. In November last year, Russian political scientist Stanislav Belkovsky made allegations in the German newspaper die Welt that Putin had amassed a personal fortune of some 40 billion USD, and that part of this was held by a 50% share of the Gunvor Group.

Although these rumours and allegations cannot be corroborated, and in fact have been denied by most concerned parties - among others Törnqvist himself - one cannot but stop to wonder what role business with a Russian stake had in the 2007 Russian-Estonian crisis. The example of controlling the transportation system - railways, harbours, and shipping - of Russian exports by way of Estonian transit might thus arguably be one alternative or complementary explanation to why last year's Russian-Estonian crisis was allowed to escalate to the level it did.

Russia's imposition of a trade blockade on Estonia for a few weeks last year was a hard hit on the transit trade. The transport of Russian goods by rail, road, and boat was halted. The companies involved in this line of trade, were among the all too evident losers, and many of them were more or less put out of business - both Russian companies and Estonian with often large Russian ownership interests. These companies were not sponsored by the Kremlin. Instead, it appears that the blockade wiped out annoying competition, and that mightier Russian business interests moved in to take over the transit trade, once the blockade was lifted. Such methods would not be a novelty in Russian business practices and thus serve to surprise nobody. Big business in Russia regularly gets Kremlin's blessing to move in and wipe out competition in order to monopolise a market. The difference in what would arguably be the Estonian case, is that these practices were now applied on another state not in the CIS, but on a member of the European Union.

So, apart from speculations and conspiracy-theories that normally surround events such as the Bronze Soldier crisis, it would seem worthwhile to test such alternative or complementary hypotheses as accounted for above. Who stood to gain from a blockade halting transit trade, and who has actually done so? However, if proven right, such an argument would not only expose that the Kremlin serves its own interests, but also a blatant disregard by Russia for the interests of the Russian "minorities" in the Baltic States, because the greatest losers of the conflict would turn out to be the very same Russian minorities that Moscow claims to defend.

Consequently, it may actually have been the Russians in Estonia who lost most out of the Russian-Estonian conflict over the removal of the Bronze Soldier. Russians were hit by losing the revenues from transit trade, both in terms of profits and employment. Furhtermore, Russians were the ones who were most exposed by raising the issue of disloyalty to Estonian society as a whole. For any minority in any country, such cross-pressure may prove highly detrimental to their future prospects of finding a place in society in social, economic and political terms, and still Moscow decided it was worth to run this risk.

Perhaps, in the end it is safest not to test such hypotheses as forwarded above, because - if validated - they would bring the perceived cynicism of Russian leaders to new and even higher levels. Moscow's indignation and heavy hand towards Estonia was officially motivated by the public outcry among Russians over the removal of the Bronze soldier. General opinion held that Moscow now finally had to step in to protect the Russian "minority" in Estonia. In stark contrast to this official policy, a proven transit trade hypothesis would - to the opposite - paint a picture of Russians abandoned by Russia and their cause sacrificed for the sake of petty business interests. One cannot help but wonder what the Russians who took to the streets in both Tallinn and Moscow in protest against "fascist Estonia" would think if confronted by proof to that effect. In the meantime, such hypotheses are, of course, just a fidget of one's imagination - or are they?